Anybody Wanna Start A Vulture Fund? Buy Bank Shares on Taobao

FT: Investors rush online to ditch stakes in China rural lenders
Shareholders in China’s rural commercial banks have been offloading their stakes on Taobao, the biggest online Chinese auction site, in a sign of the increasingly desperate steps being taken by cash-strapped investors.

...The backdoor methods for cashing out of the banks reflects a new urgency among shareholders to leave the sector amid dwindling returns and mounting bad debt.

...Investors snatched up about Rmb42m in shares in four small lenders from public auctions on Alibaba’s Taobao site in December and January. Since April, investors in more than 11 banks have cashed out via such auctions on the shopping platform better known for Korean cosmetics than financial holdings.
More at the link.

Related: China GDP scepticism upends trading strategies
However, Nevsky might be the first to say out loud that China, in large part, has made the whole business model unmanageable. Nevsky wrote a letter to clients explaining itself, beginning with a recap of the investment process it has used throughout the fund’s 15-year life: top-down forecasting of macroeconomic variables combined with bottom-up forecasts of company earnings. It is a process that has required, among other things, transparent "and truthfully compiled" data at a macro and company level, and logical decision-making by policymakers.
The best markets are those with the least information, that's where the largest profits are to be made.
Nevsky says data releases have become less transparent and truthful, and that as China and India have grown in importance, the problem has been exacerbated. Nevsky doesn’t believe either country’s stated real GDP growth. "This obfuscation and distortion of data … makes it increasingly difficult to forecast macro and hence micro as well," it states.
You might notice there hasn't been a lot of discussion about Chinese equities here. I actually lean towards fundamental analysis when buying stocks. There's a reason I've focused on macro and my biggest trade on China for several years was to be short industrial metals.

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