The good news is that oversight agencies in both Hong Kong and China are starting to cooperate. The SFC's Neoh says Beijing has promised full support for actions against red chips. But the SFC has 280 staff to police 614 public companies, and most of the new companies have little or no experience with international business practices. Beijing's CSRC has 150 regulators for two stock exchanges and a number of small commodity exchanges. They won't be able to help it,'' he says.
Many analysts believe that other blue chips are undervalued and due for a runup.
But for investors who are gambling on Hong Kong's red chips, the coming months are likely to remain a wild ride. The McGraw-Hill Companies Inc. All rights reserved.