Top 10 Performing Chinese ADSs in 2017

A booming year for Chinese ADSs meant terrific returns for investors in 2017.

Peter H. Frank
    Jan 03, 2018 3:24 PM  PT


Of the top 100 ADSs measured by market capitalization – out of roughly 200 Chinese ADSs that exist,

 these were the top 10 performers for the year.

If it was a booming year for U.S. companies trading on the New York exchanges in 2017, then it was an even boominger year for Chinese ADSs.

While the Dow Jones Industrial Average was jumping 25 percent, the S&P was climbing 19 percent, and the Nasdaq was soaring more than 28 percent, the index of Chinese companies trading their American depositary shares here enjoyed an appreciation of roughly twice that amount.

The Bank of New York Mellon China Select ADR Index, for example, which tracks those publicly traded companies in China that also have depositary receipts here in the U.S., soared more than 47 percent during the 12 months.

That came in stark contrast to the broader markets in China, where the gains were much more muted, with the Shanghai Stock Exchange Composite Index only rising 7 percent last year and the Shenzhen Stock Exchange Component Index climbing 8.5 percent. For those companies with depositary shares here, however, the appetite of investors – as well as the appetite for Chinese companies to list in New York – showed little signs of slowing.

For U.S. stocks, consumer confidence here, now at 17-year highs, booming corporate profits, and strong economy provided much of the impetus for the impressive performance.

But the terrific desire for Chinese ADSs in general is a bit more difficult to pin down, though that country's estimated 6.8 percent growth last year, strong consumer spending, and government support certainly helped the fortunes of the larger ADSs.

Still, as you might expect, it was in the small- and mid-cap ADSs that the real market boom was found. And in each case, the top 10 performing ADSs outperformed even the top performing stock in the S&P 500, Align Technology's (Nasdaq: ALGN), which enjoyed an appreciation of "just" 132 percent, according to The Motley Fool.