CalSTRS CIO Ailman: Investing in China Presents 'Conundrum'

The transcript discusses the complexities and challenges of investing in China, highlighting the fund's exposure and the political and economic risks involved. It emphasizes the dual nature of China as both a friend and a foe, making investment decisions difficult. The impact of government decisions, such as the postponement of Ant's offering, is analyzed, illustrating the influence of China's one-party system on investments. The transcript concludes with the conundrum faced by investors in balancing exposure in a growth economy with significant political risks.

What is the main challenge for investors when considering exposure to China?

• The high cost of investing

• The lack of economic growth

• The dual nature of China's relationship as both a friend and a foe

• The absence of investment opportunities

What recent event raised concerns about the predictability of the Chinese government's decisions?

• The decline in China's economic growth

• The increase in China's market weight

• The postponement of Ant Group's IPO

• The growth of China's Navy

How does the Chinese government's ability to make wholesale decisions affect investors?

• It ensures stable returns

• It creates uncertainty about the future of companies

• It guarantees high profits

• It provides more investment opportunities

What is a significant concern for investors in a one-party system like China?

• The absence of a growth economy

• The high level of competition

• The influence of political decisions on economic outcomes

• The lack of technological advancement

What ethical dilemma do investors face when investing in China?

• Balancing between local and international markets

• Ignoring S&G issues for potential profits

• Choosing between different investment sectors

• Deciding on the right time to invest