The last big successful short trade before I gave back money was shorting Chinese tech. It was a trade made solely on the observation that Chinese regulators had stated exactly what they wanted to do with tech companies - that is break down silos, only allow the use of data for the express purpose it was allowed, and to not favour portfolio companies in search results. All seems sensible, pro-consumer, pro-SME reforms to me - but obviously reduced the pricing power of big tech. At the time, everyone was all in on Alibaba, and other tech names - so was a great short.
In addition the war in Ukraine added another risk - that sanctions would turn you into a forced seller. Owners of the London listed Gazprom took a bath as sanctions were implemented. If China invaded Taiwan, would you become a forced seller?
War and regulators drove Chinese tech lower, but as can be seen from above, Chinese tech equities have had a nice move off lows - and famous investors like Dave Tepper have declared themselves all in on China. There are three catalysts I can see for this move.
