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Saturday, March 7th, 2015


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China’s Surging Economy Creates a Booming IPO Market

China's exploding economy makes the country ripe for IPOs.China leads the world in economic growth – and it was also tops in initial public offerings during the third quarter.

According to accounting firm Ernst & Young, Chinese companies raised $40.1 billion through IPOs between July and September. That's 76 percent of the planet's third-quarter IPO proceeds.

With new offerings pricing nearly every day – or so it seems – the explosive growth in China's IPO market shouldn't cool anytime soon.

One firm that expects to have an IPO in the Chinese market is Yashili Group, a Chinese producer of food products for infants; the company expects to go public in Hong Kong in the near future, Reuters reports. Another is the iron-ore arm of a Russian mining firm, Petropavlovsk. That company, IRC, sold more than a billion shares in a recent Hong Kong offering, according to Bloomberg News.

With investors eager to park money in Chinese-traded companies, young investors in the U.S. may want to consider Chinese investments, too. Some firms – like Chinese solar firms Suntech Power and JA Solar Holdings – trade American Depositary Receipts on American exchanges; ADRs are a smart way to buy into foreign companies. Exchange-traded funds are also a good option.

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