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Active Equity Investing: Post-COVID-19 Investment Strategies and Portfolio Construction Under the Unique Institutional Settings of China

Active Equity Investing: Post-COVID-19 Investment Strategies and Portfolio Construction Under the Unique Institutional Settings of China

Poshan Yu (Soochow University, China & European Business Institute, Luxembourg & Australian Studies Centre, Shanghai University, China), Shuhan Tang (Independent Researcher, China), Aashrika Ahuja (Independent Researcher, India), and Xiaochang Chang (Independent Researcher, China)
Copyright: © 2022 |Pages: 28
DOI: 10.4018/978-1-6684-5528-9.ch016
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Abstract

The purpose of this chapter is to study China's securities investment strategy through active equity investment especially in the period of COVID-19. This chapter will explore changes and trends in international and domestic investment and capital markets during this period. In addition, this chapter also examines how these changes will impact the equity investment strategy of the private equity (PE) and venture capital (VC) industries. This chapter will conduct bibliometric analysis to compare the hot spots of portfolio investment strategies in SSCI and CSSCI databases so as to better analyze China's upcoming industries and determine the investment direction. Event-driven strategies will be used to analyze investment cases in China. Finally, this chapter puts forward suggestions for formulating investment strategies in the face of related crises such as COVID-19.
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Private Equity And Venture Capital Investment Strategies

Venture capital (VC) is a high-yield, high-risk investment method that provides capital to start-ups while obtaining equity. Private equity (PE) is an equity investment in non-listed companies or listed companies with non-publicly traded equity and focuses on the later stages of VC (Harris, 2012). In terms of operational processes and profitability, VC and PE broadly go through five stages, namely fund raising, investment in enterprises, subsequent management, exit mechanisms and distribution of earnings, mainly through the exit of the incidental proceeds from the sale of holdings and capital management fees to earn profits (Harris, 2020).

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