Recruiting in China

Tuesday March 21, 8:00 am ET

DENVER, March 21 /PRNewswire/ -- China's economic growth has stabilized and offers exceptional investment opportunities over the long term, according to research published by economist Burton Malkiel and others in the most recent issue of the Journal of Investment Consulting, the formal publication of the Investment Management Consultants Association (IMCA®).
In their paper, "Investment Strategies to Exploit Economic Growth in China," Malkiel and co-authors Jianping Mei and Rui Yang show why they expect China to enjoy economic growth rates well above those of the developed world.

They acknowledge, "returns from investments in Chinese equities have been unattractive for the past decade, and corruption and corporate governance issues, as well as a variety of restrictions, make direct investment in Chinese opportunities difficult."

However, the Chinese economy has turned a corner, they write, and China is becoming more appealing and less risky for investors. "Chinese equities are now attractively priced relative to their earnings, their historical valuations, and their growth rates, and ... some risks have been attenuated over time."

The authors say that they believe there is an excellent probability that the growth of the Chinese economy will continue to be "exceptionally rapid" over the decades to come. They back up their optimism with the following three observations:

1) The market economic institutions necessary for growth in China are
established and the country already has enjoyed years of success;
2) China's government is pragmatic and will continue to guide the
economic transformation of the economy; and
3) China is home to an abundance of underutilized human capital and
considerable savings, both of which are necessary to fuel growth.

Finally, the authors outline the potentials and risks of the various ways that investors can directly and indirectly take advantage of this promising forecast.

Malkiel, a long-time professor of economics at Princeton, is best known for his book, A Random Walk Down Wall Street. Mei, an expert in international asset pricing and real-asset finance, is a professor at New York University. Yang is deputy director of research for Boshi Fund Management in Shenzen, China.

The Journal of Investment Consulting is the formal publication of the Investment Management Consultants Association, the premier professional and accreditation organization of the investment consulting industry. For more information about IMCA and this issue of the Journal, visit www.imca.org.

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