When the trade war tensions escalated, investors should stay away from Chinese stock markets, especially Hang Seng Index.
Last Tuesday, HSI tanked nearly 700 points and plunged around 2% after US president Donald Trump threatened new tariffs on Chinese imports. And today, HSI drops 1% even though China’s government released 700 billion yuan in cash to markets. We will see that the major investors are not going to buy more stocks from HSI and actually they might already locked in profits before the large fall. While Xiaomi opens its retail book today, I may suggest individual investors think twice before subscribing during a bearish market sentiment.
The stock market is a device for transferring money from the impatient to patient. Be patient!