[White House deliberates block on all US investments in China]

Discuss all general (i.e. non-personal) investing questions and issues, investing news, and theory.
Locked
Topic Author
mikemikemike
Posts: 119
Joined: Fri Mar 29, 2019 7:25 pm

[White House deliberates block on all US investments in China]

Post by mikemikemike » Fri Sep 27, 2019 12:52 pm

[Thread merged into here, see below. --admin LadyGeek]

Some interesting news today, wherein all Chinese companies might be de-listed from US stock exchanges.

https://www.cnbc.com/2019/09/27/white-h ... china.html

I own some shares of JD and Alibaba. What would this delisting mean for owners like me? Would our shares become worthless? Would I have to somehow go to China to sell? Or could I somehow still enter sell orders into my Fidelity account?

gougou
Posts: 217
Joined: Thu Sep 28, 2017 7:42 pm
Location: San Francisco Bay Area

Re: China stocks delisting?

Post by gougou » Fri Sep 27, 2019 1:09 pm

Those big companies would probably be listed in Hong Kong and if you have a good brokerage you should be able to sell them fairly easily.

But if they really get delisted their stock prices could drop massively.

atdharris
Posts: 156
Joined: Wed Jan 02, 2019 3:18 pm

Re: China stocks delisting?

Post by atdharris » Fri Sep 27, 2019 1:32 pm

If I remember correctly, Hong Kong rejected Alibaba's attempt to list themselves on their exchange.

Topic Author
mikemikemike
Posts: 119
Joined: Fri Mar 29, 2019 7:25 pm

Re: China stocks delisting?

Post by mikemikemike » Fri Sep 27, 2019 1:34 pm

Thanks for the info. I agree that share prices would go down a fair bit if the delisting was announced: just the threat of delisting has had a big negative effect today :(

It's good to know that I could probably still sell my shares at some point, through the HK SE. I'm guessing I'd enter the sell order through the same Fidelity interface as for buying things on NYSE or Nasdaq?
Last edited by mikemikemike on Fri Sep 27, 2019 1:45 pm, edited 1 time in total.

alex_686
Posts: 5097
Joined: Mon Feb 09, 2015 2:39 pm

Re: China stocks delisting?

Post by alex_686 » Fri Sep 27, 2019 1:41 pm

This would be a interesting situation. Assuming that these are sponsored ADRs, it is next to impossible to delist. IIRC, the regs say you can only delist if you have less than 20 shareholders. Or at least that was the rule ~10 years ago. This could, sadly, be a test of power where the 2 governments stake inflexible positions and shareholders are harmed in the crossfire.
Last edited by alex_686 on Fri Sep 27, 2019 1:42 pm, edited 1 time in total.

z3r0c00l
Posts: 1500
Joined: Fri Jul 06, 2012 11:43 am
Location: NYC
Contact:

Re: China stocks delisting?

Post by z3r0c00l » Fri Sep 27, 2019 1:42 pm

Hopefully cooler heads will prevail before this happens, protectionism has already cost international investors quite a bit.

scimitar
Posts: 15
Joined: Thu Oct 19, 2017 8:05 pm

Implications for International Funds if US Imposes Capital Controls

Post by scimitar » Fri Sep 27, 2019 1:57 pm

I'm sure many of you are aware that the US government is now considering delisting Chinese companies and imposing limitations on the ability of US residents to invest in China: https://www.cnbc.com/2019/09/27/white-h ... china.html

At the risk of starting a political discussion and getting this thread locked, can anyone with more knowledge than I have explain what would happen if the US decided to impose capital controls and limit its citizens' ability to invest in Chinese companies? Are shareholders in passively-managed funds with exposure to Chinese companies going to have to divest their holdings? Are Chinese companies going to be kicked out of the indices created by US-based providers like MSCI? As a US-based investor and holder of international funds, this is unfamiliar territory for me.

grettman
Posts: 462
Joined: Mon Sep 29, 2014 1:47 pm

Re: China stocks delisting?

Post by grettman » Fri Sep 27, 2019 2:13 pm

z3r0c00l wrote:
Fri Sep 27, 2019 1:42 pm
Hopefully cooler heads will prevail before this happens, protectionism has already cost international investors quite a bit.
And unfair trade has hurt workers and IP rights.

Hopefully both sides will come to an agreement— soon.

z3r0c00l
Posts: 1500
Joined: Fri Jul 06, 2012 11:43 am
Location: NYC
Contact:

Re: China stocks delisting?

Post by z3r0c00l » Fri Sep 27, 2019 2:36 pm

grettman wrote:
Fri Sep 27, 2019 2:13 pm
z3r0c00l wrote:
Fri Sep 27, 2019 1:42 pm
Hopefully cooler heads will prevail before this happens, protectionism has already cost international investors quite a bit.
And unfair trade has hurt workers and IP rights.

Hopefully both sides will come to an agreement— soon.
You mean those $45 per hour jobs screwing hub-caps onto cars? Yeah they are gone and no amount of tariffs will bring them back.

User avatar
LadyGeek
Site Admin
Posts: 57777
Joined: Sat Dec 20, 2008 5:34 pm
Location: Philadelphia
Contact:

Re: Implications for International Funds if US Imposes Capital Controls

Post by LadyGeek » Fri Sep 27, 2019 2:41 pm

This thread is locked. Speculation about future legislation is prohibited by forum policy, see: Unacceptable Topics
Politics and Religion

In order to avoid the inevitable frictions that arise from these topics, political or religious posts and comments are prohibited. The only exceptions to this rule are:
  • Common religious expressions such as sending your prayers to an ailing member.
  • Usage of factual and non-derogatory political labels when necessary to the discussion at hand.
  • Discussions about enacted laws or regulations that affect the individual investor. Note that discussions of proposed legislation are prohibited.
  • Proposed regulations that are directly related to investing may be discussed if and when they are published for public comments.
This forum is focused on investing that is directly actionable to personal investors. We don't hold debates on conjecture.

The whole point of the policy is to (1) eliminate contentious disagreements that result from these discussions and (2) keep investors from making bad decisions. Proposed legislation changes many times between the time it's introduced and signed into law.

The disagreements will indeed occur, which is more work for the moderators and results in locking the thread. See: Yellen: "We're taking a look at negative interest rates."

(This thread is left visible as an example of an unacceptable topic.)
Wiki To some, the glass is half full. To others, the glass is half empty. To an engineer, it's twice the size it needs to be.

User avatar
LadyGeek
Site Admin
Posts: 57777
Joined: Sat Dec 20, 2008 5:34 pm
Location: Philadelphia
Contact:

Re: [White House deliberates block on all US investments in China]

Post by LadyGeek » Fri Sep 27, 2019 2:57 pm

I merged mikemikemike's thread into the on-going discussion. The software sorts by time, mikemikemike's thread is first. I also retitled the thread.

The combined thread is in the Investing - Theory, News & General forum (news).

This thread remains locked for the reasons in my previous post.
Wiki To some, the glass is half full. To others, the glass is half empty. To an engineer, it's twice the size it needs to be.

bandit510
Posts: 33
Joined: Thu Apr 23, 2015 6:57 pm

Theoretical Impact of a ban on U.S. investment in China

Post by bandit510 » Sat Sep 28, 2019 7:17 am

This is very early and theoretical at this time, but worth discussing. I’m not suggesting anyone run out and change their allocations.

Very recent news has indicated that the White House is considering a ban on US investment in China. I have read that could include (1) US companies excepting Chinese capital, (2) delisting Chinese companies from US exchanges, (3) restricting pension fund investments China, and (3) restricting other capital flows into China. Link to Bloomberg: https://www.bloomberg.com/news/articles ... nd=premium

Could that include restricting US investors from investing in China via index funds? I am a buy-and-hold, index fund investor. If there was a restriction on Chinese investment via mutual funds, that would be a significant change for buying hold investors that have exposure to foreign markets. Thoughts?

User avatar
LadyGeek
Site Admin
Posts: 57777
Joined: Sat Dec 20, 2008 5:34 pm
Location: Philadelphia
Contact:

Re: [White House deliberates block on all US investments in China]

Post by LadyGeek » Sat Sep 28, 2019 7:47 am

I merged bandit510's thread into the on-going discussion.

The thread remains locked for the reasons stated in my previous post (3 up from here).

Please do not start a new discussion.
Wiki To some, the glass is half full. To others, the glass is half empty. To an engineer, it's twice the size it needs to be.

Locked