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David White on SA has an article that shows how selling of Chinese stock adrs could drag down the US market. Article is titled: Why Does Trouble In China Have Such A Big Effect On The US? Excerpt: " The ADRs on this list have a total market cap of about $3.27T as of August 27, 2015. There are over 300 of them; and a guesstimate would put their total market capitalization at roughly $4.0T. The iShares China Large-Cap ETF (NYSEARCA:FXI) has lost about -35% of its value from its April 27, 2015 close of $52.71 to its August 24, 2015 close of $34.18. If one extrapolated that loss across the roughly $4T in market cap of Chinese stocks that trade as ADRs in the US, one would get a loss of about -$1.4T in just those four months for US stock markets from the Chinese ADRs alone." Article also includes a chart showing margin debt. Link to article: http://seekingalpha.com/article/3470486-why-does-trouble-in-china-have-such-a-big-effect-on-the-us?isDirectRoadblock=false&uprof=11 |
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