I know so many people hold 3988 and don't know why it doesn't rise, here is the reasons:
1) RMB revaluation
2) Too large capitalization
3) So many people hold
4) Too much hidden bad debt
5) Follow 2388 pattern, 1-year collect period
However, all the above should not be the real reasons. For 1), 3988 current forex exposure is only RMB 10 billion, thus 3% volatility may cost only RMB 300 million loss. That can easily be set-off by the gain in RMB bonds.
Also, the market rise a lot and any downturn may tumble 3988 even it did not rise beforehand. Thus, risk is very high if 3988 does not follow the market to rise now. The market-maker bear a very huge risk. But why they still press the price? Here is the real real reason:
1) A huge amount of Forward/Hedging to fix the price between $3.3 to$3.5 till 30Nov06 (the first-half year after listing), and
2) My friend in foreign bank told me the Saudi Prince keeps on buying 3988 everyday until 10% in total, just like his holding in Citibank
So, even 3988 join HSI index would not rise a lot, or may even fall on Monday.
However, 3988 will rocket to over $5 after Nov06 and after the Saudi Prince collect all shares in market.
Good luck on Monday!
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