This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
TheStreet Open House

The 3 Best Stocks to Play China's Still-Amazing Growth

By Dave Goodboy

NEW YORK (StreetAuthority) -- I love buying when there is blood in the streets.

When negativity hits its apex and everyone is down on a particular stock, sector or economy, it's often a sign it's time to buy.

This bottom-fishing style of investing is not easy psychologically. In fact, it's very difficult to go against the crowd. But this is exactly why it works. In the annals of the stock market, buying when things appear worst has proven itself time and again.

This is particularly true when it comes to large global economies.

Recently, investors have been besieged by negative economic news out of China. Slowing growth, weak property markets and internal strife have rocked the world's second-largest economy so far in 2012. These items, combined with several high-profile corporate scandals, have worked together to send the once high-flying Chinese stock market skidding lower.

But even with all of these issues, China remains a rapidly growing economy with a very bright future. In fact, investment opportunities in China are not nearly over and the recent downturn just created a nice buying opportunity for investors who want to make money on China's growth.

Here are three reasons why China is still a good investment...

1. Economic liberalization and political reform

This fall, a political transition is slated to take place with Vice President Xi Jinping to assume power from President Hu Jintao. Jinping is a strong proponent of what is called Chinese socialism. This twist on the Socialist manifesto favors economic liberalization and an aggressive political reform. In other words, he believes in the free market, at least as much as a member of his party can.

In addition, the Chinese central bank is taking market positive actions to counteract the slowing economy. For instance, the bank recently lowered interest rates twice within the same month. This type of economic stimulus should help reverse the slowdown.

2. Chinese economy still in growth mode

Next, although economic growth is slowing, it's still at 8.1% year-over-year. Compared with the European economies or even the United States, this is impressive growth. China has a huge population hungry for advancement. Internet usage, for example, is double that of the United States, while Chinese consumption has superseded that of Japan.

Remember, this remains a nation of super-low average wages. Imagine what is going to happen with the economy when wages eventually catch up with more-developed nations.

1 of 3

Select the service that is right for you!

COMPARE ALL SERVICES
Action Alerts PLUS
Try it NOW

Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
  • Weekly roundups
TheStreet Quant Ratings
Try it NOW
Only $49.95/yr

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
  • Upgrade/downgrade alerts
Stocks Under $10
Try it NOW

David Peltier, uncovers low dollar stocks with extraordinary upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
  • Weekly roundups
Dividend Stock Advisor
Try it NOW

Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Alerts when market news affect the portfolio
  • Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
Real Money Pro
Try it NOW

All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.

Product Features:
  • Real Money + Doug Kass Plus 15 more Wall Street Pros
  • Intraday commentary & news
  • Ultra-actionable trading ideas
Options Profits
Try it NOW

Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • 100+ monthly options trading ideas
  • Actionable options commentary & news
  • Real-time trading community
  • Options TV
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!
DOW 17,067.56 -30.89 -0.18%
S&P 500 2,002.28 -1.09 -0.05%
NASDAQ 4,598.1880 +17.9170 0.39%

Brokerage Partners

Rates from Bankrate.com

  • Mortgage
  • Credit Cards
  • Auto

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs