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What do Sino-Forest (TRE) and Silvercorp (SVM) have in common?What do Sino-Forest (TRE) and Silvercorp (SVM) have in common?
Nothing except, they both have their operations in China . More and more, short sellers are seeking to attack legitimate Chinese companies with comparisons that are unfair and potentially slanderous.
I don't know much about Sino-Forest apart from what I read in the media, so I am not one to judge. But I follow Silvercorp, and the company has been targetted by short sellers, unfairly. The fact that investors require a country-risk premium for investments in emerging nations isn't surprising - SVM would be trading at much higher prices if its operations were in North America - but right now the level of skepticism among investors is breathtaking.
So hang in there - to look at management, ownership structure, and taxes paid in China. There are good Chinese companies out there.
posted...September 04, 2011