As to the Capitalist Roader’s promise to take the upcoming National People’s Congress as a chance to speculate, the fund followed through and purchased 200 shares of Guangshen Railway (601333.SH) at RMB4.55 (US$0.67). Regardless of the specific initiatives that the NPC rubber stamps, we anticipate that improved economic outlook and continued macroeconomic spending will offer a company like Guangshen – with passenger and freight routes that connect parts of Guangdong province internally and to northern railways – significant profit opportunities. In the case of an economic downturn, we also believe that reverse migration would still benefit Guangshen’s passenger lines.
The Capitalist Roader Fund is down 34.4% from June 3, 2008. The SCI is down 12.0% from June 3, 2008.