Home Daily Blitz Down $4 Trillion, China Faithful Buy Stocks That Hurt Them Most
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Down $4 Trillion, China Faithful Buy Stocks That Hurt Them Most

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A European Union (EU) flag, left, flies beside a Greek national flag in front of the Parthenon temple on Acropolis Hill in Athens, Greece, on Wednesday, July 8, 2015. The European Union set a Sunday deadline to reach a deal with Greece on a financial rescue in exchange for austerity measures and economic reforms. Photographer: Yorgos Karahalis/Bloomberg
A European Union (EU) flag, left, flies beside a Greek national flag in front of the Parthenon temple on Acropolis Hill in Athens, Greece, on Wednesday, July 8, 2015. The European Union set a Sunday deadline to reach a deal with Greece on a financial rescue in exchange for austerity measures and economic reforms. Photographer: Yorgos Karahalis/Bloomberg

The following is an excerpt from Bloomberg.com | November 1, 2015 |

Wu Xin says she’s got a sure-fire plan to recoup losses from the $4 trillion selloff in China’s stock market: pile into equities that hurt her the most.

The 28-year-old from Hangzhou has been snapping up shares in China’s small-cap ChiNext Index, undeterred by a tumble earlier this year that erased half the measure’s value in three months.
“I lost most of my money investing in ChiNext stocks, but they are still worth buying,” said Wu, an ad saleswoman in the media industry. “I can make the most money from them in a rally, too.”

Doubling down on the most volatile equities has become a go-to strategy for China’s 96 million individual investors as the stock market shows early signs of recovery. The ChiNext has rallied 38 percent from this year’s low in September -- three times as much as the benchmark Shanghai Composite Index -- and volumes on the small-cap bourse surged to an all-time high last month.

For more visit: Bloomberg.com

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