JINGZHOU CITY, China ( TheStreet) -- We first called China Automotive Systems ( CAAS) an attractive small-cap bet in December, before Toyota ( TM) began recalling millions of cars. Since then, big stock-price swings have been testing investors' stomachs. China Automotive is still rated "buy" and if you can handle risk, it could be a great time to own the shares.Akio Toyoda, Toyota's embattled chief executive, took his apology tour to Beijing this week as the company tried to save face in one of the most important car markets. While the auto industries of the U.S. and other developed economies struggle to stay profitable, car sales in China are key to performance. The number of cars traveling on Beijing's streets increases by 1,500 a day, by some estimates. Toyota's troubles have dragged the reputations of other Japanese carmakers through the mud, leaving Chinese companies to benefit from the hot Chinese auto market. China Automotive supplies components to several automakers in China, ensuring a diverse customer base that can shield it from the struggles of any one brand. The company has few customers outside China, but the nation's economy is expected to grow faster than those of developed nations by several percentage points. While American companies fight over small slices of market share, the Chinese car industry is new enough to fuel explosive growth. The byproduct of strong growth potential is volatility, which is apparent in its beta value of 2.5. That means the stock's price swings are wider than those of the broader market. Because the company is only valued at $550 million and trades infrequently, investors need to be ready for big shifts in the share price. Still, China Automotive shares have increased almost eightfold during the past year, outperforming the 68% advance of the Russell 2000 Index. During the past five years, the stock has gained 19% annually, on average, beating the Russell's 1.5% return. The U.S. economy may be poised to expand in 2010, but China's will still outgrow it because it has more room to move. American companies, in contrast, have fewer new opportunities to exploit. China's car industry will be hot for years to come as the country's new middle class equips itself with the same luxuries Americans have enjoyed for years. Toyota's problems could cause these consumers to buy Chinese models, creating more business for China Automotive.