GUANGZHOU (Fund China) - A big downward turbulence swept across the stock market these days. But words from Lombarda China Fund Management say that the long term bullish uptrend is still moving on. This huge shock may be a good buying opportunity for the sophisticated investment institutions nevertheless.

Though the turbulence is dramatic these days, the current situation yet can not affect the overall movement in the market. This round bullish market is not over referring to the corporate profits, valuation and liquidity factors. Meanwhile, research on stock market experiences home and abroad tell us that there is a certain “month domino offect” in the stock market. The China stock market’s relative low point will occur at the beginning and the end of a year probably and generally. For this sake, investors should be rational and calm in the huge turbulence.

As it can be seen from the data, since 1993, the average gap between Shanghai composite index closing performance at the end of the year and at the next year’s heaviest rise month reached 20% or more basically. Particularly, the 2006 largest rise month’s performance is more than 130% higher than it in the end of 2005. The financial experts of Lombarda Management said that sophisticated investors would enter the market with a lower cost for its investment protection. And for those who still look optimistic at the after market performance, this turbulence, however, provides a low cost and low risk investment opportunity.

Copyright Fund China 2008.

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