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In this video, I cover why Ray Dalio, the founder and CIO of the largest hedge fund in the world, is bullish on Chinese stocks.
Ray Dalio's article on Chinese assets and policies: https://www.linkedin.com/pulse/understanding-chinas-recent-moves-its-capital-markets-ray-dalio/
Casgains's Recommended Investing/Business Books: https://docs.google.com/spreadsheets/d/1DI8ca5GLEfQXU34uplO3E3w6YHXbvMbK1JR-GxXBeUc/edit?usp=sharing
My Second Channel:
https://www.youtube.com/channel/UCPkDot_lMk7HB_c68HubbUg
Twitter: https://twitter.com/casgains
Instagram: https://www.instagram.com/casgainsacademy/
Contact for business inquiries only: casgainsacademy @gmail.com
Over the past few months, China’s crackdowns on its tech giants have led many investors to doubt the future of Chinese stocks. Cathie Wood recently sold almost all of Ark’s Chinese holdings and many others have done the same too. Amidst the negative sentiment, Ray Dalio believes that everyone is making a huge mistake. Dalio is the founder and CIO of the largest hedge fund in the world, Bridgewater Associates. He believes that almost all Westerners have completely misunderstood China’s recent moves. This video will go in-depth on why Dalio is betting big on China’s future and why he thinks everyone is entirely wrong on China’s latest policies. Welcome to Casgains Academy. If you’re new to the channel, please consider subscribing for more content like this, and let’s get right into it.
Ray Dalio is not like a typical fund manager in the way he manages money. Everyone knows about the idea of high-risk and high-reward. In the stock market, if you take on more risk, then your potential reward increases. While that sounds logical, Dalio doesn’t see it that way. Unlike other fund managers, he focuses on low-risk and high-reward. This is called the pure alpha strategy. Simply looking at a fund manager’s portfolio returns would be short-sighted, because returns don’t include risk. Investing in more volatile assets can lead to extreme upwards and downwards swings. The typical retail investor might be fine with that, but Dalio focuses on high net worth clients that are often risk-averse. One statistic named alpha takes risk into consideration. Alpha is a number that represents someone’s risk-adjusted return, which is calculated by taking an investor’s return and subtracting it by their portfolio’s volatility. Dalio focuses purely on alpha by generating the highest return with the lowest volatility. To do this, he uses investments that counteract each other to lower overall volatility while still keeping high expected returns (do a scale with Stocks on one side, and Bonds on the other side). One of Dalio’s most famous funds is the all-weather portfolio, which has consistently generated high returns with low volatility.
Some of you may know about how China recently took down Didi from Chinese app stores. The Cyberspace Administration of China accused Didi of illegally collecting user data. We literally saw China take down the largest ridesharing app in the country in a blink of an eye. This led Didi stock to fall by 35% since Didi’s IPO in July. The other event that shocked many investors was when China announced that the education sector would become non-profit. This instantly tanked the shares of many Chinese education companies. TAL Education, New Oriental, and Gaotu Techedu stock are all down over 85-95% in the past six months. These two events among others have led investors to be fearful of China’s future policies. Nonetheless, Ray Dalio sees the situation completely differently. In Dalio’s perspective, he thinks that China has been increasingly capitalistic over the past few decades. The Chinese government’s recent policies are just a small part of a long-term trend to maximize the well-being of its citizens. In a recent article, Dalio said, “[Most Western observers] interpret moves like those two recent ones as the Communist Party leaders showing their true anti-capitalist stripes even though the trend over the last 40 years has clearly been so strongly toward developing a market economy with capital markets, with entrepreneurs and capitalists becoming rich. As a result, they’ve missed out on what’s going on in China and probably will continue to miss out.” Dalio’s statement can be directly contrasted with Cathie Wood, who recently stated that she was concerned about China’s latest moves. In Ark’s monthly market webinar, Cathie mentioned how she thinks the incentive for Chinese citizens to work has diminished. In essence, Cathie thinks China is moving closer to communism, whereas Dalio believes that China is moving closer to capitalism. So how is it possible that Dalio thinks China is still capitalistic despite the government’s recent moves?
In this video, I cover why Ray Dalio, the founder and CIO of the largest hedge fund in the world, is bullish on Chinese stocks.
Ray Dalio's article on Chinese assets and policies: https://www.linkedin.com/pulse/understanding-chinas-recent-moves-its-capital-markets-ray-dalio/
Casgains's Recommended Investing/Business Books: https://docs.google.com/spreadsheets/d/1DI8ca5GLEfQXU34uplO3E3w6YHXbvMbK1JR-GxXBeUc/edit?usp=sharing
My Second Channel:
https://www.youtube.com/channel/UCPkDot_lMk7HB_c68HubbUg
Twitter: https://twitter.com/casgains
Instagram: https://www.instagram.com/casgainsacademy/
Contact for business inquiries only: casgainsacademy @gmail.com
Over the past few months, China’s crackdowns on its tech giants have led many investors to doubt the future of Chinese stocks. Cathie Wood recently sold almost all of Ark’s Chinese holdings and many others have done the same too. Amidst the negative sentiment, Ray Dalio believes that everyone is making a huge mistake. Dalio is the founder and CIO of the largest hedge fund in the world, Bridgewater Associates. He believes that almost all Westerners have completely misunderstood China’s recent moves. This video will go in-depth on why Dalio is betting big on China’s future and why he thinks everyone is entirely wrong on China’s latest policies. Welcome to Casgains Academy. If you’re new to the channel, please consider subscribing for more content like this, and let’s get right into it.
Ray Dalio is not like a typical fund manager in the way he manages money. Everyone knows about the idea of high-risk and high-reward. In the stock market, if you take on more risk, then your potential reward increases. While that sounds logical, Dalio doesn’t see it that way. Unlike other fund managers, he focuses on low-risk and high-reward. This is called the pure alpha strategy. Simply looking at a fund manager’s portfolio returns would be short-sighted, because returns don’t include risk. Investing in more volatile assets can lead to extreme upwards and downwards swings. The typical retail investor might be fine with that, but Dalio focuses on high net worth clients that are often risk-averse. One statistic named alpha takes risk into consideration. Alpha is a number that represents someone’s risk-adjusted return, which is calculated by taking an investor’s return and subtracting it by their portfolio’s volatility. Dalio focuses purely on alpha by generating the highest return with the lowest volatility. To do this, he uses investments that counteract each other to lower overall volatility while still keeping high expected returns (do a scale with Stocks on one side, and Bonds on the other side). One of Dalio’s most famous funds is the all-weather portfolio, which has consistently generated high returns with low volatility.
Some of you may know about how China recently took down Didi from Chinese app stores. The Cyberspace Administration of China accused Didi of illegally collecting user data. We literally saw China take down the largest ridesharing app in the country in a blink of an eye. This led Didi stock to fall by 35% since Didi’s IPO in July. The other event that shocked many investors was when China announced that the education sector would become non-profit. This instantly tanked the shares of many Chinese education companies. TAL Education, New Oriental, and Gaotu Techedu stock are all down over 85-95% in the past six months. These two events among others have led investors to be fearful of China’s future policies. Nonetheless, Ray Dalio sees the situation completely differently. In Dalio’s perspective, he thinks that China has been increasingly capitalistic over the past few decades. The Chinese government’s recent policies are just a small part of a long-term trend to maximize the well-being of its citizens. In a recent article, Dalio said, “[Most Western observers] interpret moves like those two recent ones as the Communist Party leaders showing their true anti-capitalist stripes even though the trend over the last 40 years has clearly been so strongly toward developing a market economy with capital markets, with entrepreneurs and capitalists becoming rich. As a result, they’ve missed out on what’s going on in China and probably will continue to miss out.” Dalio’s statement can be directly contrasted with Cathie Wood, who recently stated that she was concerned about China’s latest moves. In Ark’s monthly market webinar, Cathie mentioned how she thinks the incentive for Chinese citizens to work has diminished. In essence, Cathie thinks China is moving closer to communism, whereas Dalio believes that China is moving closer to capitalism. So how is it possible that Dalio thinks China is still capitalistic despite the government’s recent moves?
Over the past few months, china's crackdowns on his tech giants have led many investors to doubt the future of chinese stocks, kathy wood recently sold almost all of ark's chinese holdings, and many have done the same too. Amidst a negative sentiment, ray dalio believes that everyone is making a huge mistake. Dalio is the founder and cio of the largest hedge fund in the world bridgewater associates. He believes that almost all westerners have completely misunderstood.
China's recent moves. This video will go in depth on why dalio is betting big on china's future and why he thinks everyone is entirely wrong on china's latest policies. Welcome to caskians academy, if you're new to the channel, please consider subscribing for more content like this and let's get right into it. Ray dalio is not like a typical fund manager in the way he manages money.
Everyone knows about the idea of high risk and high reward in the stock market. If you take on more perceived risk, then your potential reward increases. While that sounds logical, dalio doesn't see it that way. Unlike other fund managers, he focuses on low risk and high reward.
This is called the peer alpha strategy. Investing in more volatile assets can lead to extreme upwards and downward swings. The typical retail investor might be fine with that, but dalio focuses on high net worth clients that are often risk averse. One statistic named alpha takes risk into consideration.
Alpha is a number that represents someone's risk-adjusted return, which is calculated by taking an investor's return and subtracting it by the portfolio's volatility. Dalio focuses purely on alpha by generating the highest return with the lowest volatility. To do this, he uses investments that counteract each other to lower overall volatility, while still keeping high expected returns. One of dalia's, most famous funds, is the all-weather portfolio which has consistently generated high returns with low volatility.
His pure alpha plan has also generated impressive returns. Despite having little to no significant downturns, the primary reason why dalio has been able to do this is because of his expertise in macroeconomics, ray dalio can see and prepare for economic cycles, and he now believes that he is seeing something that many westerners don't see. Some of you may know about how china recently took down dd from chinese app stores the cyberspace administration of china accused the deity of illegally collecting user data. We literally saw china take down the largest ride-sharing app in the country in a blink of an eye.
This has led dd's talk to fall by 35 since dd's ipo in july. The other event that shocked many investors was when china announced that the education sector would become non-profit this instantly tanked. The shares of many chinese education companies, tal education, new oriental and galatu chadadu stock are all down over 85 to 95 percent in the past six months. These two events, among others, have led investors to be fearful of china's future policies. Nonetheless, ray dallow sees the situation completely differently in dalio's perspective. He thinks that china has been increasingly capitalistic over the past few decades. The chinese government's recent policies are just a small part of a long-term trend to maximize the well-being of its citizens. In a recent article, dalio said most western observers interpret moves like those two recent ones as a communist party leader showing their true anti-capitalist stripes, even though the trend over the last 40 years has clearly been so strongly toward developing a market economy with capital markets with Entrepreneurs and capitalists becoming rich as a result, they've missed out on what's going on in china and probably will continue to miss out dalio's statement can be directly contrasted with kathy wood, who recently stated that she was concerned about china's latest moves in ark's monthly market webinar.
Kathy mentioned how she thinks the incentive for chinese citizens to work has diminished. In essence, kathy thinks china is moving closer to communism, whereas dalio believes that china has and is still moving closer to capitalism. So how is it possible that dalio thinks that china is still capitalistic despite the government's recent moves? In short, dalio thinks that china is simply making moves to benefit the well-being of its country. Dalio stated that in this case, the policy maker signaled to deity that it might not be best to go ahead with the listing, and they understandably want to deal with the data privacy issue.
In the case of educational tutoring companies. They want to reduce the educational inequality and the financial burden on those who are desperate to have their children, have these services, but can't afford them by making them broadly available. They believe that these things are better for the country, even if the shareholders don't like it. Dalio is clearly taking a totally different stance on the situation than most investors, but his reasoning definitely makes sense.
In fact, china's latest move to alleviate gaming addictions amongst children was also done for the well-being of chinese citizens. After all, why would the chinese government destroy the future of their economy and discourage innovation? Despite our speculation, the reasoning behind china's new policies is unclear. Chinese policymakers aren't sharing why they're doing what they're doing. Nevertheless, dalio knows that this isn't the first time that our current situation has changed.
In fact, you remember several situations where the reactions to china's moves are misinterpreted. For example, in 2015 retail investors flooded into the chinese market, with more than 30 million new accounts opened in the first five months of 2015.. When this chinese retail investing bubble popped, the chinese government had to buy stocks and manipulate the market. In hindsight, dalio knows that this was done in order to save the capital markets. Dalio also recalls when the chinese run plunge in 2016 and the people's bank of china had to widen the currency ban for the chinese one. A currency ban is when a country sets price limits for how much a currency can fluctuate. In 2016, china widened its currency ban to help its capital markets. During this time, investors pointed to this as evidence of policymakers.
Turning away from capitalism, however, dallow thinks that was actually a move showing more confidence in a capitalistic system. Dalio said that through it all chinese policymakers successfully managed to fall out and pursued their goals, i.e the direction of their actions never changed. It has been in support of a fast and steady development of capital markets, entrepreneurship and openness to investment to foreign investors. So i encourage you to look at the trends and not misunderstand and over focus on the wiggles in order for investors to see.
What's going on, dalio thinks that we must understand that chinese policymakers have a goal of acting in the interests of chinese citizens. Capitalists and investors in china's capital markets are subordinate to this goal, as we saw in china's latest moves. Dalio then went on to say that those in capital markets and capitalists need to not mistake their having riches for having power for determining how things will go. Dalio was clearly taking a stab at jack ma, who mistakenly thought that his ridges would bring in power.
If you haven't heard of what happened shortly, after speaking against the government, jack ma disappeared from the public's eye for months. In dalia's perspective, this was obviously a horrible move by ma warren buffett's right-hand man, charlie munger, also took a similar stance as dalio. I think jack ma was very arrogant to be telling the chinese government how dumb they were and how stupid their policies were and so forth, considering their system. That is not what he should have been doing.
Dalio's reason is overwhelmingly positive for chinese stocks, but he does recognize that there are risks in china. The geopolitical environment is changing and this is leading to major changes. First of all, the sec is changing. Policies surrounding chinese companies on the u.s stock exchange, most notably the sec, has temporarily prohibited chinese companies from going public.
The second change is a recent threat by the u.s government to prohibit pension funds from investing in chinese stocks. Dalio believes that we should assume such things will happen in the future and invest accordingly, but don't misinterpret these wiggles as changes in trends and don't expect this chinese state-run capitalism to be exactly like western capitalism. As i covered earlier, dalio uses a pure alpha strategy where he invests in counteracting investments in order to increase investment returns, while reducing overall risk. He believes diversifying into china is vital for every investor's portfolio. Rey jalio's overall message can be summed up into two sentences. The recent moves by china are simply part of a long-term trend, which is that china is fostering an increasingly capitalistic environment, therefore, westerners, like kathy, which shouldn't be scared of lowered innovation, as that isn't in line with the goals of the chinese government. With that being said, i'm excited to announce that my research platform is officially available for the month of august. My platform includes my main portfolio, my real 25 000 model portfolio.
My watch list research reports personally written articles, valuation models and much more if you're interested or, if you're, just curious check out my patreon in the first link down below. If you enjoyed this video, please hit the like button and subscribe and i'll see you in the next one.
I realized that the secret to making a million is making better investment. I always tell myself you don't need that new Car or that vacation just yet and that mindset helps me make more money invest:ng. For example last year I invested 70k in blue chip stocks and crypt0 s (with the help of my advisor of course) and made about 380k, but guess what? I put it back and traded with her again and now I'm rounding up close to a million. Delayed gratification always pays off
AS CCP has no respect for human life even on their own citizens, and they want to dominate the world, I say stop investing in China and cut their financial resources.
I can't agree more with ray dalio as someone who grew up in China. Numbers don't lie, China is setting itself up for more stable growth. If you don't agree then do some research and visit China yourself.
Xi is making 2 judgments -1. that there are enough foreigners out there, who chase short term returns and DON'T care about stable rules, or respect for private property rights. And 2. China's domestic market is so large and irresistible to foreigners that the arbitrary exercise of CCP power won't materially hurt the Chinese economy. At this early stage, there is not enough evidence to say whether these judgements will prove correct.
Having a million-dollar portfolio is everyone’s retirement dream. Making that dream a reality requires some serious work and strategic planning.
Dalio misunderstands china. The ccp are not pro business. It is pro power, big difference. Furthermore, they are increasingly isolating themselves.
Do not presume China's decisions are based on any sort of reasoning. Do not buy "assets" that a communist regime might steal from you at some point. Period.
Manny points of Dalio are right but so is Woods. What’s missing? This is a trend to close off from and rely less on foreign influence/investment and increase control. They do see it as in their and their peoples best interest. This is a closing off, including les teaching of English so there is only one narrative.
Dalio fund has underperformed for the past 15 years for how much attention he gets for being a great investor quite underwhelming performance
The most important thing for CCP is "control". When they think things are getting out of hand, they WILL step in with full force regardless of the pressure and criticism that comes with it.
Stopping IPO of Ant Financial, taking down DiDi, capping salaries / auditing movie stars, are a few examples of that. As long as companies play by their rules (no matter how arbitrary), they won't have a problem with CCP.
It’s been two weeks since this video out , what happen to the Chinese stock now ? Reviews are the best method to test who’s correct
Many stock recommended by CASGAINS had dropped more than -60%. BEWARE OF THIS PUMP AND DUMP YOUTUBER!!!!! I lost because of CASGAINS recommendation. DON'T LISTEN TO CASCAIN.
Here is an invaluable tip for anyone looking into investing in China. When a time comes when the interests of ruling class cross the interests of the people they control, they always choose their own interests, not the greater good. People misread the recent Chinese government moves. Too much money means too much power and control.
Pretty much all organic and well functioning democracies emerged from ruling class’ ever receding power hold with consecutive concessions to the bourgeoisie. Chinese ruling class knows this. They don’t want that to happen. Hence the crackdowns.
China is a brutal dictatorship for sure, and they have no qualms about implementing policies that hurt foreign investors if they further their political goals. Only Han Chinese people are considered to deserve some rights and protections, and everybody else are tolerated at best. However, Chinese politics has famously been focussed on very long term strategies for many centuries, and being too outwardly aggressive and antagonizing the rest of the world (including investors) induces risk and instability that the Party won't abide. However, we are seeing a worrying amount of Chinese military expansion these days, so maybe we shouldn't feel too secure about their intentions?
The new model is authoritarian capitalism. Both US and China will move closer towards this model. The super rich will say it is necessary to save the planet while it makes them even richer.
Well, west is no longer capitalist, maybe a bit capitalistic, but world is rather socialism in various ways.
As a student of the chinese culture past and present (it really hasn't changed for the past 2000 years) it is obvious that westerners fail to understand these people. In short, china has a planned economy and the obvious communist government that wants it's people to prosper. The CCP allows capitalism to occur. The CCP has no experience doing this so it is making adjustments as time goes on. The most recent adjustments show that it is taking away some of the freedoms it allowed some companies to have. It does not want any company to have too much control over their economy or monetary system – as seen with Alibaba fast becoming an ecommerce, data, AI and payment system giant. Any personality or company who becomes too strong will be 'corrected'. The need for foreign investment in china has significantly decreased in the past few years as the planned economy has reached many milestones. Fast growth is no longer their goal as much as fine tuning their economy. In the end the CCP is going to control their economy and do whatever it wishes to in order to maintain that power.
Ray is a high level CCP asset. He is a known globalist and doesn't give a $hit about the USA. And like the video says he only cares about "maximizing alpha."
Doesn’t matter how much the risk in the asset is there, if you know how to manage risks every asset will feel like high return assets
This is pure BS! What's going on in China is that the CCP is desperate to hold onto power at all costs. Their silencing of powerful/rich men is a sign of the abject fear in their hearts that their power is waning. This is most likely because of the horrible state of their economy and their dwindling USD reserves. This trend began long before they unleashed covid on the world and was only exacerbated when they released covid inside their own country. The CCP's desperation is consistent with their increasing belligerence on the world stage. They are playing by Sun Tzu's book, "The Art of War" which states: “Appear weak when you are strong, and strong when you are weak.” In no way is China moving towards capitalism and increased personal liberty.
Very informative video, well the crypto market seems to have waken up in a bullish pattern and a better season to go into bitcoin day trading with a working strategy and signals backed with the help of a pro which turns out be so accurate and profitable. Shaw Rufus has been a real mentor so far which have been able to grow my portfolio from 1.1btc to a total of 6.8btc through daily trading.
"Truth in labelling", if you label a behaviour incorrectly because you do not have accurate knowledge about it, then misidentification is basically the same as Magical Thinking.
The comments section here gives me joy. I'm so happy other people have become 'woke' to Mr CCP Dalio too. Great work on not becoming subdued to those with vested interests guys 🙂
How do we explain the hong kong and taiwan hawkish behavior? Is that part of the capitalist vision? Maybe they are capitalist but nationalist in nature within a dictatorship?
This is a brain wash robo video. Bridge Water average return profile: typically makes +8-10% per year on good years but down over -20% on bad years Bad risk reward. Big AUM$ only makes the "manager" billionaire.
Ray and other billionaires had been praising China for at least 3 years ever since Trump kracked down on the tarifs. I want that to be a coincidence, but I know it is not. Meanwhile China has greatly underperformed, his clients must have lost billions
To the people who cant help but talk bad about china,
Didi was charged with illegal collection of user data. The for profit education space was FULL of bad actors, taking advantage of the country's citizens wanting a better education for their children.
The government was right to fix those problems.
Lmfao, Ray is the one that doesn’t understand China. Xi and his pals are pure maoists. I do business in China and completely disagree with ray dalio. I don’t think Chinese stocks are worth investing in, especially now when many stocks just had 4 years of growth eliminated
To the commenters bashing dalio on this one… You are the kind of people who see stocks going down and think it means more risk