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China's largest e-commerce company Alibaba is expected to go public later in 2014, but investors who want to profit from China's soaring e-commerce industry don't have to wait to make money.
China's e-commerce industry is the second-largest in the world. It's on track to overtake the United States as soon as 2016, according to eMarketer.
And market researcher McKinsey & Co. estimated in May 2013 that China's e-commerce market was a $210 billion industry in 2012 – and will hit $420 billion by 2020.
Alibaba will be at the heart of that industry.
Alibaba's network of websites – that operate like Amazon.com Inc. (Nasdaq: AMZN), eBay Inc. (Nasdaq: EBAY), and PayPal – account for more than 50% of the e-commerce that takes place in China.
That's why the Alibaba IPO has been valued between $100 billion and $150 billion. That compares to the IPO of Facebook Inc. (Nasdaq: FB), which valued the social media stock at $104 billion, and was the biggest Internet initial public offering (IPO) in history.
The IPO date for Alibaba has yet to be announced, but some speculate it could occur by the end of the first quarter.
Fortunately there's another way to make money today from China's multi-billion dollar e-commerce industry.
Investing in Alibaba Before It Hits The Market
Yahoo! Inc. (Nasdaq: YHOO) owns a 24% stake in Alibaba and has watched its stock climb nearly 80% in the last year. While that's one way for investors to get a piece of Alibaba, there are more direct investment opportunities available.
For many investors, exchange-traded funds (ETFs) that deal with one industry's best players are a great way to get into an IPO while minimizing risk.
That's why Money Morning's Defense & Tech Specialist Michael Robinson recently recommended an ETF to his subscribers that has captured gains as high as 450% in the last 15 months – specifically in the Chinese IPO market.
Better still is to invest in Softbank (also avail from ADR's or on TSE code 9984). They own 37% of Alibaba and they are NOT selling when it IPO's like Yahoo is forced to. They also own a good chunk of RenRen China social web and recently bought a Chinese app store to sell their (Brightstar) games titles to 300million subscribers.. and then theres the US Sprint ownership… Softbank is far far more interesting..
Some of those companies KWEB owns are in direct competition to Alibaba so really only expect the Alibaba growth to push KWEB along mid to longterm..
Just starting to invest and trying to learn as much as i can. I also have been playing the horses for 50 years so i know hype from honesty. I plan to cross reference info i receive and hope the choices i make are sucessful. I hope to have fun in doing so. Thank you.