“What are we missing here?”
That’s what Yahoo Finance anchor Akiko Fujita asked me Monday during the interview on her show, The Ticker. We had talked about the selling in the market, the trade dispute with China, where there may be opportunities, and more. Then she wanted to know what investors are overlooking. It took me a fraction of a second to answer.
“The opportunity in China,” I said.
I know the headlines are scary. I know stocks sell off when we get the latest tweet or threat from the U.S. or China to add more tariffs or devalue currency.
But there are two critical reasons to buy now, and most investors are missing them:
1. A trade deal will get done sooner than later. I’ve said this all along, and while the dispute has dragged on longer than I thought it would, there is just no way President Trump will head into the 2020 election with this hanging over his head. Especially if the stock market is down. Today gave us more evidence of this as the market popped on word that the administration would delay some of the new tariffs.
2. Even with the tariffs, there is one area of trade between China and the U.S. that is actually improving. What’s more, it’s in a sector that the Chinese government has publicly stated it wants to grow 116X in just two years. The government doesn’t make a proclamation like that if it doesn’t mean it. And even if it takes five years to get there instead of two, who cares when you’re talking about that kind of growth?
Investors are selling stocks in this sector along with everything else … just because of the trade headlines. This creates a huge buying opportunity that could easily return 10X your money in the coming years.
I don’t want you to miss it.
You can watch my full interview on Yahoo Finance by clicking here. And then let’s talk about an investment that may have the biggest upside potential I have ever seen.
The Biggest Boom Yet
No one else is talking about this yet, which means even more upside potential. But I’ll tell anyone who will listen.
During the summit, I said it probably has the biggest upside potential I’ve ever seen in my investing career.
In a nutshell, the Chinese government announced two years ago that it intends to make its domestic biotechnology sector constitute 4% of the country’s economy by 2020. That’s a HUGE deal if you connect the dots.
When the Chinese government says it’s targeting one of its domestic industries for massive growth, it pays to listen. Whether you like the government there or not, it has a history of creating economic champions whose stocks soar in value.
From there, our analysis is straightforward. The Chinese economy is projected to reach roughly $15.7 trillion by 2020. In 2017, the revenue generated by China’s domestic biotech industry was a tiny $5.4 billion, according to Goldman Sachs. So in order for China’s biotech industry to constitute 4% of the economy (or $627 billion) by 2020, the industry must increase its sales by 116-fold.
For decades, China focused on growing its “basic” industries like manufacturing, mining, oil, shipping, and infrastructure building. But now, the government is set on fast-tracking high-tech industries like artificial intelligence, autonomous vehicles, electric vehicles, e-commerce, and biotechnology.
China wants to compete on the highest levels and dominate all the critical industries of the future. This includes having a huge domestic biotechnology industry that develops and sells the medical treatments and therapies of the future.
The One Area Where Trade Is Improving
If you’re worried about trade relations with China, here’s what you need to know: With all of the tension between the U.S. and China, biotech trade is actually getting better between the two countries.
In 2018, China eliminated tariffs on 28 classes of medicines. Nobody talks about that. It’s the diamond in the rough of all the gloom and doom headlines.
For many years, Chinese companies licensed drugs from their large Western counterparts to sell in China, so the link between U.S. and Chinese drug companies is already strong. Cross-border deals between the U.S. and China increased 70% from 2012 to 2018.
Up until now, the “drug trade” has been one-sided with China licensing drugs from the U.S. That is quickly changing. Chinese biotech firms are starting to license their drugs to U.S.-based companies to sell outside of China.
10X or More
Investing in industries with huge growth potential and gale-force tailwinds at their backs is how you set yourself up to make giant returns. Think of the internet in the 1990s … personal computers in the 1980s … and smartphones over the past decade.
Chinese biotechnology is that kind of industry right now. It is absolutely loaded with incredible potential and powerful catalysts. I go into even more detail in the 10X Innovation Summit. Be sure to watch it now before it’s too late so you can catch my discussion of nine catalysts set to push Chinese biotech stocks higher. I’ll also share a Chinese biotech stock for you to consider.
I said it earlier, and I’ll say it again: This is undoubtedly one of the best early stage investment opportunities you’ll ever see in your life. And I don’t say that lightly.
I don’t know that the government will hit its deadline of 116X growth by 2020. It may take a few years beyond that, but so what? That kind of growth in even 10 years will make the Chinese biotechnology sector one of the greatest growth stories in modern history.
Let me leave you with the last two words I said during the interview ….
Matthew McCall is the founder and president of Penn Financial Group, an investment advisory firm, as well as the editor of Investment Opportunities and Early Stage Investor. He has dedicated his career to getting investors into the world’s biggest, most revolutionary trends BEFORE anyone else. The power of being “first” gave Matt’s readers the chance to bank +2,438% in Stamps.com (STMP), +1,523% in Ulta Beauty (ULTA), +1,044% in Tesla (TSLA), +611% in Liquefied Natural Gas Limited (LNGLY), +324% in Bitcoin Services (BTSC), just to name a few. If you’re interested in making triple-digit gains from the world’s biggest investment trends BEFORE anyone else, click here to learn more about Matt McCall and his investments strategy today.
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