Capitalist Roader Fund: A refreshing break (Hold)

Despite the mainland markets falling to four-week lows before the national holiday, investors returned to the market reinvigorated and pushed hard for the week’s one day of trading. This is unsurprising, as many investors reduced their exposure in order to minimize risk over the long break. With no economic disasters (touch wood), investors are happily dipping back into the market. This has seen the Shanghai Composite Index (SCI) up 4.76% to close at 2,911.72 for the day.

Jiangsu Expressway (600377.SH) saw Wellington Management increase its stake to 5% recently, indicating the asset management advisor shares our positive sentiment for the toll road operator. However, Jiangsu’s return today was sluggish, trailing the market with only 2.4% growth to close at RMB6.03 (US$0.88).

Our other holding in China Vanke (000002.SZ) was more rewarding, gaining support from investors after its COFCO Property Group joint venture recently won the bid for a US$429 million piece of land in Beijing. Vanke closed today at RMB10.96 (US$1.60), up 5.2% to outperform the SCI by 0.44%.

The Capitalist Roader Fund is down 32.26% since June 3, 2008. The SCI is down 15.2%.