AlphaShares, LLC is an investment management firm dedicated to providing investors with strategies and products that allow them to participate in China’s economic boom. The Chief Investment Officer of AlphaShares is world renowned Princeton University economist and author, Dr. Burton G. Malkiel.
Since market-oriented reforms were initiated in 1978, China has successfully transformed itself from an agriculture-based economy into a manufacturing-based economy and from an economy almost entirely composed of state owned enterprises to one with increasing private ownership and market-based incentives. As a result, the Chinese economy has experienced significant and rapid growth over the last ten years. China has become, and will continue to be, the principal driver of global economic growth for the 21st century.
AlphaShares believes that U.S. investors are, on average, greatly underexposed to China. Consider that China will soon pass Germany to become the world’s 3rd largest economy after ranking 7th as recently as 1999. Most economists agree that it will not be long before China passes Japan to become the second largest in the world. Furthermore, it is widely agreed that China will eventually pass even the U.S. making China the largest economy in the world, again. Yet, China carries only a 2.0% weight in broad global equity indexes.
Compounding this problem is the fact that the Chinese markets are not easily accessed by U.S. investors. Shares of Chinese Companies trade in a virtual “alphabet soup” of share classes and the exchanges in China where “A Shares” trade are largely closed to non-Chinese investors. Furthermore and importantly, Chinese equity markets are extremely volatile and extremely risky.
However, while challenges and risks exist, China’s continued economic growth and development will provide opportunities for long-term investors. AlphaShares’ mission is to increase awareness, understanding, and exposure to China through thoughtful, risk managed, proven, and cost effective investment strategies.