This is the last part of my series on China stock picks for next year. (Here's part 1 and part 2.)

One of my core beliefs is that as companies grow the tendency is that more people own them. In other words, more people own larger companies. Going along with this philosophy, as companies grow they get more shareholders. I feel that the more shareholders a company has the more likely it will trade around what it is worth and shareholders may experience the winner's curse.

The way to take advantage of this is to own small companies priced to be small companies that are on the path to becoming larger companies. The same applies to exchanges. The larger the exchange, the more likely the company is closer to intrinsic value. I'll illustrate briefly three potential values using this framework.

Starting on the Pink Sheets, which is the lowest of the lows, is Sino Agro Foods. The rumor is that the company is going to be paying a dividend and uplisting to the OTC. Shares are currently selling at less than book value, and I don't find them excessively cheap by my absurd standards, but nonetheless they are worth more.

You might be interested in the company's January 2010 presentation, which is out this week. Click here to take a look. One thing that might interest you is the intent to pay a dividend. You can barely find that in the OTC, not to mention the Pinks. This suggests that Sino means business.

China Armco ( CNAM.OB) is on the OTC, but in my opinion, not for long; it's moving up. This is my "grand slam" breakfast meal and part of my daily diet. If you are able to crunch numbers on the back of a napkin or envelope, I would recommend doing so here. Keep it, you might just find yourself stopping by the framing store a couple years from now or maybe this next year looking to frame your first grand slam as well.

From the OTC, you start getting into the larger exchanges. In the U.S., these are the American Stock Exchange, Nasdaq and the New York Stock Exchange. The NYSE would be the home of all the big boys, but the technology boom created room in Nasdaq that some of the big boys didn't want to leave.

Telestone Technologies ( TSTC) may look expensive at first glance. Check out the forecasted growth and management's naked enthusiasm about the company's forward growth potential, not in double-digit percentages but in whole number multiples of where we are today.

I'll close this series with a couple of stocks that are also worth mentioning. China Gerui ( CHOP) is another idea to take advantage of high-end specialty steel in China. As I've mentioned before, that's been heating up on the stimulus package over there.

Lastly, ZST Digital Networks ( ZSTN) could be really cheap after popping out a darling quarter.

At the time of publication, Bradford was long China Armco and Telestone.
Glen Bradford is the CEO of ARM Holdings LLC. He's pursuing an MBA at Purdue University and gained recognition by trading his entire tuition in the stock market as well as that of his roommate. He intends to not lose money for his clients by buying the most undervalued companies that are making money and set to make more money that he can find. In March 2009, he was quoted for saying, "Uncertainty will certainly work for me."