Investors may want to think twice before investing their money in China, says DoubleLine founder Jeffrey Gundlach.
“China is not achievable, in my opinion, at this point,” the bond king told Yahoo Finance in an interview at his California home. “I have never invested in China for long or short. Why? I don’t trust the data. I don’t trust the US-China relationship anymore. I think investments in China can be confiscated. I think there is a risk of that.”
Gundlach’s comments came ahead of the third annual DoubleLine Round Table event on Tuesday, Prime Investor.
Some of Gundlach’s concerns about China came to prominence last year.
The ongoing crackdown on the operations of major Chinese internet companies such as Didi by the government has rattled investors in the space. The crackdown on the country’s biggest tech names has now led to tighter listing requirements by the Chinese government.
To that end, Didi plans to delist from the New York Stock Exchange later this year not long after a disastrous IPO (in large part due to Chinese authorities).
Meanwhile, the Chinese government has also affected after-school tutoring companies such as TAL Education Group – shares of the name dropping about 95% in 2021.
All this in addition to China’s ongoing war against the rise of cryptocurrencies.
The country’s investment headwinds are shown in how the country’s key indicators will perform in 2021.
For example, the Golden Dragon Index – which tracks the performance of medium- and large-cap Chinese stocks – fell by about 49% in 2021. The Wall Street Journal reports that the total value of internal stocks in China rose by 20% in 2021, lower of the performance of Chinese stocks. S&P 500 offers.
Gundlach is increasingly optimistic about emerging markets with the exception of China (which he no longer thinks is an emerging market).
“I kind of think the next step, the big step is to get into emerging markets,” Gundlach added. “We’ve been in EM equity this whole time. And we’ve been underweight until very recently with EM debt as well.” .
Brian Suzy It is a comprehensive editor and Announcer at Yahoo Finance. Follow Suzy on Twitter Tweet embed and on LinkedIn.
Follow Yahoo Finance on TwitterAnd Facebook social networking siteAnd InstagramAnd FlipboardAnd LinkedInAnd Youtube, And reddit