China stocks

EV/EBITDA sector-relative strategy on China A-shares (SHZ+SHH) vs S&P 500 cumulative returns 2000-2025. Strategy returned 165.5% total vs 530.71% for SPY.

China stocks

EV/EBITDA Sector-Relative Value on China A-Shares: When the Signal

We ran a sector-relative EV/EBITDA screen on 25 years of China A-share data across SHZ and SHH. The signal always fires, zero cash periods, 22.8 average stocks per year, but 3.98% CAGR vs 7.64% SPY and a max drawdown of -64.54% tell the story. China

P/E compression

China P/E Compression: -0.68% CAGR, -8.32% vs SPY

P/E compression on Chinese stocks delivers -0.68% CAGR, the worst absolute performance among all 21 tested markets. The strategy underperforms SPY by 8.32% annually with negative Sharpe ratio and -63.70% max drawdown. P/E dynamics differ in Chinese markets: government policy, state ownership, and speculative trading