The Chinese disruption paradox

17/10/2018

Download


Innovative internet companies are highly disruptive and increasingly dominant within the Chinese economy but they are regulated by the Communist Party, which perceives disruption to be a threat to the status quo. In this video update, Charlie Awdry discusses the interesting implications of this dynamic for investing in China.

Key takeaways:

  • Disruption is both an opportunity and a threat in China
  • The Communist Party is the antithesis of disruption; for them, disruption is a threat
  • Innovators within the technology space look well placed to benefit as they disrupt traditional supply chains and customer relationships, becoming more dominant



     

       

      These are the views of the author at the time of publication and may differ from the views of other individuals/teams at Janus Henderson Investors. Any securities, funds, sectors and indices mentioned within this article do not constitute or form part of any offer or solicitation to buy or sell them.

      Past performance is not a guide to future performance. The value of an investment and the income from it can fall as well as rise and you may not get back the amount originally invested.

      The information in this article does not qualify as an investment recommendation.

      For promotional purposes.


      Important information

      Please read the following important information regarding funds related to this article.

      Janus Henderson China Opportunities Fund

      Specific risks

      • This fund is designed to be used only as one component in several in a diversified investment portfolio. Investors should consider carefully the proportion of their portfolio invested into this fund.
      • This Fund may have a particularly concentrated portfolio relative to its investment universe or other funds in its sector. An adverse event impacting even a small number of holdings could create significant volatility or losses for the Fund.
      • The Fund could lose money if a counterparty with which it trades becomes unwilling or unable to meet its obligations to the Fund.
      • If a Fund has a high exposure to a particular country or geographical region it carries a higher level of risk than a Fund which is more broadly diversified.
      • The Fund may use derivatives with the aim of reducing risk or managing the portfolio more efficiently. However this introduces other risks, in particular, that a derivative counterparty may not meet its contractual obligations.
      • Emerging markets expose the Fund to higher volatility and greater risk of loss than developed markets; they are susceptible to adverse political and economic events, and may be less well regulated with less robust custody and settlement procedures.
      • Shares can lose value rapidly, and typically involve higher risks than bonds or money market instruments. The value of your investment may fall as a result.
      • If the Fund holds assets in currencies other than the base currency of the Fund or you invest in a share class of a different currency to the Fund (unless 'hedged'), the value of your investment may be impacted by changes in exchange rates.
      • If the Fund or a specific share class of the Fund seeks to reduce risks (such as exchange rate movements), the measures designed to do so may be ineffective, unavailable or detrimental.
      • Securities within the Fund could become hard to value or to sell at a desired time and price, especially in extreme market conditions when asset prices may be falling, increasing the risk of investment losses.
      • The Fund may incur a higher level of transaction costs as a result of investing in less developed markets compared to a fund that invests in more developed markets. These transaction costs are in addition to the Fund's Ongoing Charges.

      Risk rating

      Janus Henderson Horizon China Fund

      Specific risks

      • Shares can lose value rapidly, and typically involve higher risks than bonds or money market instruments. The value of your investment may fall as a result.
      • This fund is designed to be used only as one component in several in a diversified investment portfolio. Investors should consider carefully the proportion of their portfolio invested into this fund.
      • The Fund could lose money if a counterparty with which it trades becomes unwilling or unable to meet its obligations to the Fund.
      • Emerging markets are less established and more prone to political events than developed markets. This can mean both higher volatility and a greater risk of loss to the Fund than investing in more developed markets.
      • Changes in currency exchange rates may cause the value of your investment and any income from it to rise or fall.
      • If the Fund or a specific share class of the Fund seeks to reduce risks (such as exchange rate movements), the measures designed to do so may be ineffective, unavailable or detrimental.
      • Any security could become hard to value or to sell at a desired time and price, increasing the risk of investment losses.

      Risk rating

      Share

      Important message