Reduced to funding in the middle.
Foreign investors are still selling, and hedge funds are using short positions to go long on the NASDAQ Composite Index by going long on Microsoft and Nvidia with their left hand and shorting Tencent and Meituan-W with their right hand.
Recently, I chatted with some foreign friends in Hong Kong and here's what they think:
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Foreign investors are still selling, and there doesn't seem to be anyone buying. The headquarters have disputes over investing in AH, especially this year when the index is strong (due to the estimation of China's economy), and active management generally lags behind. Several LO offices in Hong Kong have closed down.
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Most people think that the recent improvement in geopolitics is just a small rebound in the downward trend, and it's not very meaningful in the long run. Both sides know that this is just a small rebound. Next year, there will be two major elections, and if you hold for 12 months or more, you may encounter some setbacks.
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Foreign investors currently have no interest in AH in the short term, and they don't see any catalysts. Even the most attractive stocks cannot be bought through the Stock Connect.
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Funds are flowing into other stocks, and hedge funds are using short positions in Chinese tech stocks to fund long positions in the NASDAQ Composite Index. For example, they may go long on Microsoft and Nvidia with their left hand, and short Tencent and Meituan-W with their right hand.
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Hedge funds are generally selling AEJ, and according to fund flow data, this is 1.5 standard deviations (specific data not found). There may be a flow-driven rebound.
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The AI sector of the US stock market is currently like a baby bubble (see the lower right corner of the figure), and the gains of the top companies have contributed the most to the index's rise.