ARE ALIBABA, JD.COM, TENCENT, NIO STOCK DONE?

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Well today we need to have a serious discussion about the chinese stocks these stocks have been an absolute disaster mode and it seems to just be getting worse and so we got to ask ourselves is this the end is things gonna get better from here is this a buying opportunity of a lifetime for chinese stocks or is this going to just keep getting worse and worse okay

I want to go through five different points with you here today that will kind of discuss into detail about these chinese stocks and kind of my viewpoints on this as you know i’m an alibaba shareholder okay that’s the only chinese stock i hold as of right now and so after we get done answering these five questions i’m gonna share with you my views on alibaba if

They have changed if that’s a stock i plan on selling and have already sold or maybe we’ll buy more or anything like that or maybe not even just touching it right now okay so we’ll discuss all this so the first question of the five we got to ask ourselves is are they still really crashing well let’s go ahead and look at some stock prices here today what we will

See here is that so many of the big chinese names are down massively again today okay we got baba down another 3.6 percent today we have $0.10 down over 2% today by the way those are the two big chinese stocks are eight out there the biggest of the bigs we have baidu down a percent today we had jd which is has been absolutely destroyed like 40 50 percent over the

Past few months down another five plus percent today we got vipshop down over three and a half percent today we have iq down over 6% today and then the new hut stock on the block neo is down over 14% today guys so obviously by looking at that yes the correction is still going on with chinese stocks it has not ended these that have absolutely got nailed and keep

In mind these stocks many of these stocks i just mentioned are down 30 plus percent in the past 3 to 4 months ok have have an absolute disastrous last 3 to 4 months many of these stocks down 30 plus percent okay some of them down 40 50 percent if we go into some of the smaller chinese stocks a lot of them are down over 50 percent okay so it’s been an absolute

Disaster so if you’re asking yourself are they still really crashing absolutely these stocks have been absolutely nailed and they have continued to get nailed over and over and over again okay so yes absolutely with that question it’s still going on all right no are they crashing for one of two reasons okay usually stocks go down usually a sector goes down our

Stocks in general because of two reasons one could be because of fundamentals all right the fundamentals of that company have gotten worse or the fundamentals of all the companies have gotten massively worse or is it a valuation concern where maybe stocks get too overpriced right and they need to just come down to a lower number all right so let’s let’s discuss

Both of these is it fundamentals are these stocks going down based upon the fundamentals of their companies changing for the worse in the answer to me at least in my respect is no absolutely not many of these stocks still have phenomenal growth have still reported phenomenal earnings the last time they reported earnings and yet their stocks are a lot of them are

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Down 30 plus percent over the last three to six months the fundamentals of alibaba and $0.10 and so many of these companies have not really changed much okay over the past you know let’s say three to six months a lot of them are still have just as strong growth as they had before a lot of them are doing great things all of they’re building out their businesses so

You can’t really say these stocks are going down because of fundamentals it’s just not factual okay so the other question is are they going down based upon valuation are these stocks going down based upon valuation maybe some of them got too high the answer is yes and no in some of these stocks respect it could be valuation alright some of them may be just did go

Over price you need to have a correction however a lot of the chinese stocks are actually massively undervalued if you compare them against their american peers especially if you can pair off a p/e ratio a revenue ratio a price to sales ratio on ton of the chinese stocks are actually way undervalued compared to a lot of american counterpart companies okay so you

Can’t really say it’s really valuation so it’s like okay if it’s not valuation and it’s not really fundamentals and why are these stocks trading down and it’s a hundred percent based on fear right now and the fact that people feel like these stocks are gonna get worse and worse and worse okay the fact that people feel like they’re they’re scared for the chinese

Economy and why is this that gets into point number three and that is the tariff situation okay the tariff situation just in the past 24 hours has gotten worse all right and what else got worse so the stock prices of the chinese companies all right came out and said he’s brought to get new tariffs out there he’s looking more and more things the chinese a cut you

Know his president says he’s gonna fight back by any means necessary you know he’s going to do what it takes for the chinese economy to succeed so we have an ugly tariff situation ok this started about six months ago and it’s getting worse and worse you just have both sides battle and now you know and it just creates a lot of fear out there and the fear ends up

Breeding into the stock market for pretty much most stocks out there not just chinese companies but a lot of the chinese companies you have you have a double bat situation here you have the chinese president who’s used to pretty much getting his way who all said now is like in a situation where he’s like i’m not getting my way what do i do okay and some people look

At it the way he’s viewing it as he’s trying to get his way and they say i mean this chinese president he’s just on a kamikaze mission okay he’s on a kamikaze mission he just has to win this and if he doesn’t win this he could jeopardize his entire economy over there and you have the united states who’s really in a position of power because united states buy so

Much more from china than china buys from the united states okay go ahead go to china and try to find out by a made in usa product okay it’s gonna be very hard to find good luck trying to find something like that overcome the united states and go to your local walmart and you’ll see i’ve practically every other thing there says made in china on our okay so the

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United states is definitely in a position of power but you have the chinese president in china the government over there who’s kind of viewing this in the like wait a minute we get our way with everything also we’re not going to get our way what do we do in this situation so it creates a really ugly situation that china doesn’t want to back down and the united

States doesn’t want to back down because they’re really in a position of power so it’s a bad bad situation and it’s just kind of an ugly ugly situation right now guys so the tariff situation is not cleared up if from right now it might be getting worse and it’s probably not gonna clear up anytime soon that’s the issue guys the question is when will it end okay

That gets into point number four when will this end win will chinese stocks start bouncing back when will this tariff situation ends and the answer is no one knows no one knows when this will end okay this could go for many more months this could maybe end in a few months this could go for another year this could maybe end any okay this could go for the rest of

Trump’s presidency and imagine if trump gets reelected and it’s still a battle you know for another four years past that we could be looking at six years plus until maybe there’s a truce here or maybe there’s not okay this is just a flat-out war going on and it’s a it is really kind of branching out into a trade war at this point okay and the answer is honestly

No one knows when this is gonna end no one knows we can guess but that is a hundred percent what it is if you have a prediction oh this is going to end next month all this is going to get end in six months one year from now two years from now if you were trying to guess at that that’s all it is it’s a guess there’s no there’s no way you can possibly predict when

President xi and president trump are gonna say okay let’s just come to a truce here because we have not seen it yet okay so the answer is we don’t know when this is gonna end okay and that’s a hard thing to understand when you are a holder of stocks in general especially chinese stocks it definitely is scary when you say man i don’t know when the heck this is

Gonna end where’s the bottom at in this situation okay so there’s one big question you have to ask yourself okay and after we get done this i’ll go into my opinion on one of my holdings alibaba and in kind of my views there the one big question you have to ask yourself right now is are you bullish on the chinese economy over the next decade if you were bullish on

The chinese economy over the next decade i’m telling you there are a lot of good values out there in the chinese stock world right now okay there’s still some companies that you can make an argument that are maybe overvalued or a little scary and whatnot but there are a lot of chinese stocks that are really good values if you were bullish on the chinese economy

Over the next decade however if you were bearish on the chinese economy you don’t believe in their their economy over there you think it’s just gonna crumble you think these tariffs are gonna massively hurt their economy they’re gonna kind of go into a lost decade if you feel like that you are bearish on chinese stocks and the chinese economy as a whole then then

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You know it’s not even worth touching any of these stocks if you have that type of mindset it’s not worth it why would you want to get involved with it if their economy’s gonna go into a lost decade it’s just not worth touching any of the stocks okay so it really comes to your frame of mind or you bullish on the economy in china for the next decade or are you bearish

If and if you don’t really have an opinion either way then even then it’s probably makes sense not touch chinese stocks in general alright no in in terms of my alibaba position you guys have known starting about a month ago maybe a month and a half ago or so i started buying alibaba shares okay and i have said i can plan to continue to by alibaba throughout 2018

Especially if it drops more i still stick with that i do plan on that the problem is i’m buying a lot of stocks okay so there’s only so much money to go around i’m also buying facebook stock aggressively right now i think it’s a ridiculous value when you’re looking at it from a long-term perspective skyworks solutions cirrus logic i’m gonna start buying once again so

Those are three other companies that i’m all want to actively buy over the coming months that creates a situation where there’s only so much money to go around so when i look at alibaba shares i say that’s definitely a stock that is very attractive to me as far as my view on the chinese economy i think it will be fine over the next decade could they have a recession

Yes they could have a recession but it is still a massive economy that is growing okay is it growing as strong as it once was no but it is still growing very strong so when i look at it from that perspective look at all the things alibaba is doing all the unbelievable businesses they’re building out i look at that business i say even if the chinese economy is just

Okay for the next decade let’s say it doesn’t it doesn’t grow like crazy let’s say the chinese economy is just okay even if the chinese kind of economy is just okay alibaba should still massively grow okay this company should have unbelievable numbers over the next decade and should become a very very profitable company so when i look at it in that context i say

You know what you know it makes more sense to buy alibaba shares if they continue to fall my only issue is there’s only so much money to go around in their other stocks i also want to actively buy and there also other call options i’m looking at for 2021 in some stocks out there so for that reason i am continuing to buy alibaba you know for probably the remainder

Of 2018 but there’s only so much of money that’s gonna go in there because there are other deals out there as well of stocks i absolutely love so that’s my view on the chinese economy chinese stocks i want to hear your view on alibaba tenzen jd neo any of these stocks out there you want to talk about i want to hear your opinion you’re bullish or bearish on the

Chinese economy who’s gonna win this trade war i want to hear from you guys down there in that comment section if you love to keep up with stock market news and make sure you follow me on instagram thank you for watching have a great day

Transcribed from video
ARE ALIBABA, JD.COM, TENCENT, NIO STOCK DONE? By Financial Education

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