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Emerging Markets
Finding investment opportunities in China
Arthur Caye
Portfolio Manager
October 28, 2024

Arthur Caye, equity portfolio manager, shares his views on China and where he sees investment opportunities there.


This transcript is intended to be presented only when accompanied by the video that includes additional important information and disclosures.

Apu Sikri: When we solicited for questions from our clients the preponderance of questions was on China, expectedly. It makes up 25% of the emerging markets benchmark. How are you calibrating what has been persistent weakness in China, and how is that informing your thinking and how you're building your portfolio?

Arthur Caye: Yes, Apu. So, everyone knows about the challenges, particularly in the real estate sector in China. So, our approach is to be selective and, because we are stock pickers, we very much do research on the ground. We're not just visiting companies from the outside, we are also having a team of dedicated specialists who are based in Shanghai in addition to the teams that are in Hong Kong, Singapore and other markets.

I find that still that there are good opportunities in China. And you need to be selective, so some sectors are doing well. We are seeing, for example, opportunities in the travel sector, the electric vehicle (EV) supply chain, where China has become a leader. Social media, entertainment, online gaming; all these sectors have interesting companies with good prospects. And so, we still find opportunities, but we need to be selective and think about not just a property sector, but sectors that are related to this ecosystem, and sectors that may be subject to regulatory pressures or geopolitical risk.

 


Arthur Caye is an equity and multi-asset portfolio manager at Capital Group. He has 27 years of investment industry experience (as of 12/31/2023). He holds an MBA from Stanford Graduate School of Business, a master’s degree in computer science from École Centrale Paris and an engineering diploma from École Polytechnique Fédérale de Lausanne.

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