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Market Update

Is It Really a Bear Market for China Stocks?

The unusual structure of the Chinese market means the answer depends on where you’re investing.

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There was nowhere for investors who are bullish on China to hide during the country’s stock-market battering of the summer. Or was there?

Giant Chinese companies such as Tencent (TCEHY) and Alibaba (BABA) have posted big losses and the collapse of real estate giant Evergrande was front-page news. Shares in TAL Education have been crushed by a 94% year-to-date loss as the government has stripped its ability to make a profit in tutoring core subjects. Out of 71 mutual funds focused on Chinese stocks that have full year-to-date records, one third are down by more than 10% and a dozen have lost more than 15% so far in 2021.

Kate Lin does not own (actual or beneficial) shares in any of the securities mentioned above. Find out about Morningstar’s editorial policies.