{"id":28562,"date":"2026-09-25T07:30:00","date_gmt":"2026-09-25T11:30:00","guid":{"rendered":"https:\/\/jeffclarktrader.com\/market-minute\/?p=28562"},"modified":"2026-09-24T10:52:55","modified_gmt":"2026-09-24T14:52:55","slug":"time-to-trade-chinese-stocks","status":"publish","type":"post","link":"https:\/\/jeffclarktrader.com\/market-minute\/time-to-trade-chinese-stocks\/","title":{"rendered":"Time to Trade Chinese Stocks"},"content":{"rendered":"

China is waking up.<\/p>\n

The Shanghai Stock Exchange Composite Index (SSEC) is up nearly 5% over the past two months. Of course, most folks haven’t noticed because most folks abhor the idea of investing in Chinese stocks – with good reasons…<\/p>\n

Chinese stocks are risky. There are lots of fraudulent companies listed on the Chinese stock exchanges. Even the legitimate companies are prone to posting sketchy financial reports.<\/p>\n

The United States and Chinese governments are rivals.<\/p>\n

China’s government is known for manipulating its financial markets.<\/p>\n

And the list goes on… There are plenty of reasons NOT to buy Chinese stocks as investments.<\/p>\n

But, every now and then, a low-risk\/high-reward setup appears – where it can be quite rewarding to TRADE Chinese stocks.<\/p>\n

Today is one of those times.<\/p>\n

Prior to its recent rally, the Shanghai Stock Exchange Composite Index (SSEC) was trading near its lowest relative valuation to the S&P 500 in 20 years. Look at this long-term chart comparing the SSEC to the S&P 500…<\/p>\n\n

\"\"<\/figure>\n\n

When the chart is rising, SSEC is performing better than the S&P. When the chart is falling, SSEC is performing worse.<\/p>\n

For the most part, over the past 20 years, your money has been treated better in the U.S. than in China.<\/p>\n

There are times, however, where the valuation difference is so extreme it has paid well to own Chinese stocks.<\/p>\n

In late 2008, for example, as the U.S. markets were still dealing with the Great Financial Crisis, SSEC bottomed. It then rallied about 80% over the next three months.<\/p>\n

In February 2022, this ratio chart hit another extreme low. SSEC rallied 20% in about four weeks, while the S&P 500 dropped 7%.<\/p>\n

In September 2024 – the last time this chart was at such a depressed level – SSEC rallied 25% in two months.<\/p>\n

Today, the ratio chart is back down near its lowest point ever. Chinese stocks have been uninspiring so far in 2026. The SSEC is down 1% year-to-date. Meanwhile, the S&P 500 is up more than 12%.<\/p>\n

But, it looks like that trend may be about to change. The ratio chart is starting to turn higher from deeply oversold conditions.<\/p>\n

This doesn’t guarantee a rally in Chinese stocks, of course. Nothing is ever guaranteed in the financial markets.<\/p>\n

This historically low valuation does suggest, however, that the risk to owning Chinese stocks right here is limited.<\/p>\n

And, the potential reward could be substantial – especially if the recent rally in the S&P cools off a bit and money starts to rotate into underperforming markets.<\/p>\n

Best regards and good trading,<\/p>\n

\"Signature\"<\/p>\n

Jeff Clark
\nEditor, Market Minute<\/em><\/p>\n","protected":false},"excerpt":{"rendered":"

For the most part, over the past 20 years, your money has been treated better in the U.S. than in China.<\/p>\n","protected":false},"author":2759,"featured_media":0,"comment_status":"closed","ping_status":"0","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"ep_exclude_from_search":false,"service":"","footnotes":""},"categories":[1],"tags":[],"publication":[10],"person":[7],"newsletter-type":[],"ticker":[],"class_list":["post-28562","post","type-post","status-publish","format-standard","hentry","category-market-minute","publication-market-minute","person-jeff-clark"],"acf":[],"ai_tts_audio_outdated":false,"ai_tts_content_changed_at":"","ai_tts_content_changed_during_generation":false,"ai_tts_legacy_post":false,"_links":{"self":[{"href":"https:\/\/jeffclarktrader.com\/market-minute\/wp-json\/wp\/v2\/posts\/28562","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/jeffclarktrader.com\/market-minute\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/jeffclarktrader.com\/market-minute\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/jeffclarktrader.com\/market-minute\/wp-json\/wp\/v2\/users\/2759"}],"replies":[{"embeddable":true,"href":"https:\/\/jeffclarktrader.com\/market-minute\/wp-json\/wp\/v2\/comments?post=28562"}],"version-history":[{"count":1,"href":"https:\/\/jeffclarktrader.com\/market-minute\/wp-json\/wp\/v2\/posts\/28562\/revisions"}],"predecessor-version":[{"id":28568,"href":"https:\/\/jeffclarktrader.com\/market-minute\/wp-json\/wp\/v2\/posts\/28562\/revisions\/28568"}],"wp:attachment":[{"href":"https:\/\/jeffclarktrader.com\/market-minute\/wp-json\/wp\/v2\/media?parent=28562"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/jeffclarktrader.com\/market-minute\/wp-json\/wp\/v2\/categories?post=28562"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/jeffclarktrader.com\/market-minute\/wp-json\/wp\/v2\/tags?post=28562"},{"taxonomy":"publication","embeddable":true,"href":"https:\/\/jeffclarktrader.com\/market-minute\/wp-json\/wp\/v2\/publication?post=28562"},{"taxonomy":"person","embeddable":true,"href":"https:\/\/jeffclarktrader.com\/market-minute\/wp-json\/wp\/v2\/person?post=28562"},{"taxonomy":"newsletter-type","embeddable":true,"href":"https:\/\/jeffclarktrader.com\/market-minute\/wp-json\/wp\/v2\/newsletter-type?post=28562"},{"taxonomy":"ticker","embeddable":true,"href":"https:\/\/jeffclarktrader.com\/market-minute\/wp-json\/wp\/v2\/ticker?post=28562"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}