March 01, 2011
Christian Basi, BasiC@missouri.edu, 573-882-4430
By Brad Fischer
COLUMBIA, Mo. – China has the fastest growing economy in the world, yet its companies see very little interest from international investors. Investment in many Chinese companies is unavailable to foreign investors due to government regulation, but some Chinese companies seeking international capital are now listed on U.S. stock exchanges. Still, the companies get little attention from American investors due to a lack of information about the companies and the relatively small size of the firms. Now, a public-private partnership at the University of Missouri is providing unprecedented access to information that is making investing in U.S. listed Chinese equities and understanding the Chinese economy more accessible to U.S. investors.
The Asian Equity Research Institute (AERI), which was founded in April 2010, is housed in the Trulaske College of Business and jointly owned by MU and Rising Tide, LLC, a private firm. AERI obtains information on the Chinese market through Hexin Flush, a research firm based in Hangzhou, China. Hexin Flush has 100 financial and economic analysts who relay information to AERI concerning everything from Chinese A-share market trends, overall economic activity, and significant government policy changes. The A-share market is made up of companies that can only be owned and traded by Chinese citizens.
“Because of our team in China, we have incredible access to information,” said Philip Abbenhaus, Director of AERI in the Trulaske College of Business. “If you’re investing in companies doing business in China or actively trading U.S. listed Chinese equities, our reports should be required reading. As more Chinese companies list in the U.S. every year, AERI’s research capabilities have become extremely valuable.”
At the end of 2010, AERI released the China Business Conditions Index, which Abbenhaus described as the one of the most informed Chinese economic indicators available. The index, calculated monthly, uses a statistical analysis and correlation of various components of the Chinese economy to produce a view into the current economic conditions and, more importantly, an outlook for the coming months. The index is released around the 10th of every month and is currently available free of charge at AERI’s website: www.aeriresearch.com.
‘This index will give investors an easy way to assess the Chinese economy and determine how best to invest in China. This index will help open the Chinese market to U.S. investors and will likely make Chinese stocks more prominent in American investment portfolios,” said Steve Ferris, Rogers Chair of Money, Credit and Banking at the Trulaske College of Business.