Submitted by Businomics Blog

In May 2007, I titled a post, “Is China’s Stock Market Overvalued?”  I closed with these words:

“… don’t get carried away with the momentum play.  It may work early in the cycle, but momentum investors always get burned when the market changes.

Let’s take a look and see what happened.  The date of my previous post has a blue marker:

Is the Chinese market low enough to buy in now?  Keep in mind that the market has tripled in three years!  That does not strike me as low.

I still like Chinese investments as a diversification play, but I think it’s a fool’s game to go chasing price trends.

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