If you want to beat the pros, you’ve got to stop competing with them.
Instead, your best bet is to change the game completely. And like I explained in yesterday’s DailyWealth essay, examining investor sentiment is one of the best ways to do just that.
You want to find what others have no interest in owning and put your money to work. That’s how you can make big profits… That’s how you can beat the investment pros on Wall Street.
Folks absolutely hate the idea of owning it.
And they’ve pulled out billions of dollars recently.
You might have a hard time going against the crowd on this idea.
But it’s exactly what you want to find as an investor.
Let me explain…
If you want to bet against the crowd today, there’s no better place to put money to work than China.
Thanks to the failed trade deal, investors around the globe are scared to death of China once again.
What seemed to be the final stages of a deal now appears further out of reach. Both the U.S. and China have implemented new tariffs in recent weeks… further escalating the trade war.
Now, most investors were leery of China even before this all happened. And now that the trade war is back in the news, investors have fled at a furious pace.
This recent Epoch Times headline paints the picture perfectly…
Investors have pulled billions of dollars out of Chinese stocks. That major flow of money tells us the herd is giving up on China.
This is setting up an incredible opportunity for investors…
Again, the best way to beat Wall Street is to change the game. Don’t try to out-analyze the folks on the Street. Instead, look for opportunities like this one – where everyone is pulling money out of one area – and make the opposite bet.
This negative money flow will likely reverse and become a major tailwind in the coming months. As this money gets injected back into Chinese stocks, we could easily see 20%-30% gains in this sector.
The simplest and best way to take advantage of this idea is through the KraneShares Bosera MSCI China A Fund (KBA). This fund holds a basket of locally traded Chinese stocks. It’s the simplest and best way to put money to work in China now.
Of course, you must understand one more thing before putting this strategy to work…
Do not invest a penny until the trend is back in your favor. Bad situations can always get worse before they get better. And downtrends can always last longer than you expect. I urge you to never bet against the trend… no matter how good or safe the opportunity seems.
Chinese stocks have stopped falling. But they haven’t begun rising yet, either. Once we see that reversal begin, shares of KBA are an excellent way to take advantage of it.
Again, this is how you can beat the “quants” on Wall Street who obsess over data and algorithms – the guys who hold all the cards.
Focus on the one thing that matters – betting against the crowd at the right time.
Thanks to the recent record outflows, Chinese stocks are the best way to take advantage of this strategy. Just wait for the sign of an uptrend before putting money to work.
Good investing,
Chris Igou
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Source: Daily Wealth