China stocks rebound after the selloff

Result

If held over the last 3 months (Jul 30, 2026 – Oct 29, 2026): −13.8%. Over the same days: S&P 500 +5.1%.

What it holds

• China rebound, 100% of the money, −11.8% over 3 months: BABA (Alibaba). Cheap valuations and state buying set up a rebound.

The plan behind it

Hao Hong wrote on 23 Oct that the 5% one-day drop in Chinese stocks was a 2.65-sigma event. Data are better than expected, the state is buying broad ETFs, and Hong Kong trades under 10 times earnings against over 19 for the US. He said the harder the selloff, the stronger the rebound, and named $BABA with other China tickers. This holds Alibaba as the China large-cap proxy.

The Chinese market is in a dump. The 5% single-day plunge yesterday was one of the worst in the past 3 years — a 2.65-sigma event. Many are blaming the bursting semi bubble and the French, but Chinese economic data are better than expected, and yields are at historical lows. Given that this year’s growth target is within reach, policy support will be more directly market-related than traditional stimulus. Recently, large buy-ins in broad-based ETFs clearly signal the national team at work. An overlooked catalyst for the selloff is the SFC investigation into irregular IPO activity. The SFC found that many IPO subscription processes had been rigged to create a false appearance of oversubscription. It's basically a pump-and-dump scheme. By some estimates, over half of the IPOs involved some form of rigging. Such frauds undermine market confidence, harm retail investors' interests, and could trigger a sell-off due to investigations and penalties. Tax law changes around rich Chinese offshore family trusts and potential penalties also didn't help. There are many catalysts for the selloff. Every snowflake is guilty when there is an avalanche. HK valuations are now <10x, vs. the US at >19x. We warned of an accelerated late-stage selloff in this episode of our monthly podcast. The good news is that the harder the selloff, the stronger the rebound later. $FXI $KWEB $EWH $PGJ $BABA $CQQQ $YINN $YANG $ASHR

Picked by fxyz from @HAOHONG_CFA’s post.

What would prove it wrong: The selloff goes on even with state buying and better data.

FAQ

Can I make one from my own idea?

Yes. Write what you believe in plain words at https://f.xyz/create. fxyz asks a couple of questions, builds the portfolio and shows how it would have done over the last 3 months.

Can I turn a post on X into a theory?

Yes. Reply to the post and tag @fxyzai. It tests the view in the post and replies with the 3-month result and a link.

What can it trade?

Stocks (Tesla, Apple, Nvidia), crypto (Bitcoin, Ethereum, Solana), pre-IPO companies (OpenAI, Anthropic), indices (Nasdaq 100, S&P 500), commodities (gold, silver, oil, copper) and currencies (EUR/USD, USD/JPY). One theory can mix them, and bet for or against any of them.

How does it react to news?

On each check it reads the last two days of news on its biggest holdings and says whether the idea still holds. It can make one small change at a time: trim or drop one holding by up to 5 points. On autopilot the change waits 10 minutes so the owner can skip it; otherwise it asks first.

How do I run it with real money?

For real money, tap Make it mine, open your copy and choose Use real money, with an exchange connected: Hyperliquid, Lighter, Lighter (Robinhood), Backpack, Pacifica or Binance. The money stays in your own account there. fxyz can place trades, but it can never withdraw.

Can the AI get it wrong?

Yes. fxyz's AI turns the idea into holdings, and it can get that wrong: add a coin or stock that doesn't fit, or miss one that does. Check the holdings before you put money in. In your own copy, ask its chat to add or drop any of them.

What do the 3-month numbers mean?

What $100 would have done holding this mix over the last 3 months, at real prices. It is a what-if, not a record: past or simulated results are no promise of future ones, and nothing here is investment advice.