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0912 2022


How the turmoil in China is shaking the financial world

DHF Capital S.A.

As the rest of the planet says goodbye to nearly all COVID-19 measures and treats the virus for now on as a ‘winter come along’, China persists its zero tolerance policy. The zero tolerance policy is the result of rising infections and the first fatal cases in months. As the Chinse economy suffers severe from the measures, civilian protests against the policy causing investors to be even more hesitant. The results: stock market drops and a lot of insecurity. How this influences your assets?

The path to where we are now

First the continuous drop of the stock market in China needs a deeper clarification. It is namely not a result from the unrest of past month only. The economy of China from the past decades is known as a climber. However the COVID-19 measures of the last three years caused the economic growth in China to inhibit, as journalistic platform CNBC recently reported . The six months of lockdown policy from this year, together with rising infections on top of that, are troubling the economic recovery and supply chains even further. The tension with the United States furthermore ensures that investors mainly stay away from China.

Things are shaping up well in the global financial market

CNBC states that China will probably stay in this ‘covid-coma’ till the second quarter of 2023. Looking only at the Chinese situation may result in general pessimism. The key to minimizing risk is to focus on the global financial markets where things are shaping up well. That means: long term goals as a kingpin in fertile markets and avoid the short term investments.

“Investors should choose blue chip and other stable companies with a long term view as the market is vulnerable and can go any side from here. Short term goals should be avoided as much as possible.” Anupam Kumar, Wealth Manager at DHF Capital

With over a $20 trillion market value, the Chinese stock market is hard to ignore completely. The growth and innovation from the past decades stays enormous. The world depends basically on the Chinese factories that have been put to hold, or farmers that can no longer sell and ship their crops. The long term avoidance that applies to the market, is not a matter of decades, but some years. It provides time to let the pressure cooker cool off to financial stability nationwide.

DHF takes away the risk

Retail investors, generally, do not have that much dedicated time to track and manage their investments. However, at DHF Capital only seasoned trained professionals with the experience and skills in trading are moving in the market. For all clients DHF minimizes risk by consistent positive results and guaranteed returns as risk management is our core business. If you would have any questions regarding the situation in China, please reach out to us. Well gladly give you more information.

DHF Capital S.A.

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