The Chinese market on the whole, is growing faster than any other in the world, and it has been for decades. I would be very very surprised if the US or European stock markets grew more over the next 20 years than the Chinese market. That said, I do make an effort not to buy into things that are over-valued. One example is Baidu. It was the very first stock I analyzed on this blog and I’ve been wanting to buy it for quite a while. At its current price, though, it just isn’t the most attractive option for me.

There’s a reason I pick the companies I do. If I were to investigate huge companies that draw tons of attention from major investors, then I’d have some stiff competition. They have money, connections, and resources that I don’t. One of the main parts of my strategy is to buy companies that aren’t being talked about in mainstream financial circles yet. The less analysts that follow a given company, the more likely it is to be mis-valued. If it happens to be under-valued, then that’s a great opportunity for me. Another advantage is that small caps, and especially Chinese companies, are growing faster than large American companies are.

I agree with you completely that investing is like gambling, but I don’t think luck is the main determinant in the success of an investor or a gambler.