$XI2CSOPHSTECH(07552.HK)$Tesla(TSLA.US)

Small sell-off of short interest in the Hang Seng TECH Index, timing to replenish later

Yesterday, a friend suggested I short the Hang Seng Index and go long on the Hang Seng TECH Index, as the latter appears to be a higher-quality asset

This actually contradicts my understanding

The "quality" attribute of the Hang Seng TECH Index is based on growth potential and future "monopoly expectations," which only play out under a pro-cyclical logic

Similar to U.S. tech stocks from 2021 to now

Clearly, this differs from the recent economic situation in China

Drawing parallels with Japan, Buffett chose the five major trading houses

Earlier this year, CLSA's "top pick for Hong Kong stocks" was First Pacific, all for the same reason

Under the pessimistic expectations of a "U.S. debt crisis" and "global recession," the narrative of "East rising, West falling" cannot become mainstream

True defense means running, staying in cash, not betting on both sides

This means foreign capital prioritizes safety over aggression

Only stable, profitable assets with sustainable shareholder return expectations can attract foreign long-term capital during portfolio adjustments

On the other hand, excluding the tech and biotech sectors, most large-cap Hong Kong stocks are at extremely low valuations, which do not match their actual profitability and stability

From this perspective, going long on Hong Kong stocks in bulk commodities, energy, shipping, etc., may have a lower return ceiling but significantly higher safety margins