The Contrarian Investor: China's time to shine?

Markets are fickle creatures. This time last year, China was a veritable investment dog for most institutional investors. Now, a short 12 months later, it must qualify as the top contrarian bet for 2014.

Simple stats paint a telling picture. China ETFs, for instance, have suddenly reversed flows, recording $1.2bn in new assets within the space of just a few months. A large proportion of that money is following in the steps of local stock market advances in recent weeks. The Shanghai Composite index of local shares advanced 3.7% in November, the biggest monthly gain since August. That upsurge is partly a result of growing domestic business confidence. Yet this roll call of good numbers should not hide the fact there are still plenty of local risks and challenges lurking in the wings. T...