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27 Aug 2015 (AFR) – Short term investors feed momentum – ‘Momentum investing’ driving China’s sharemarket to highs and lows

(27 August 2015, AFR, p22, by Rose Powell )

‘Chinese mum and dad investors with a week-long time horizon and a taste for riding their luck are driving volatility across financial markets.’ <snipped…>

‘That would be a reasonable assumption in the case of more developed economies, where crashes are usually associated with deep recessions. But it may be less true in the case of China’s sharemarket, where a gambling mind-set can drive prices rapidly higher – and lower. Retail investors account for 85 per cent of the daily trading volume on the so-called “A-share” market – shares in mainland China-based companies that trade on Chinese stock exchanges such as the Shanghai Stock Exchange and the Shenzhen Stock Exchanges. This is despite the fact they own just over a third of shares.’

Read more at AFR.com (might need AFR login access)

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Brainy's Share Market Toolbox. Read the honest truth about the sharemarket. Develop or fine tune your investing/trading strategies using share price charts (technical analysis), or learn about the investment strategies of others. Melbourne (Australia) based - supporting share market investors and traders to build wealth through smarter investing using my Share Market Toolbox arsenal of weapons to tackle the market.

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