Since early January, the unusually frigid conditions in China have been shutting down transportation, closing airports and causing blackouts and dozens of deaths.

Although not all of it can be blamed on the unusual weather, the Chinese stock market has been equally as volatile, making wild swings in both directions as whimsical traders with large caches of funds (hedge funds, banks, sovereign funds) react to headlines and Fed-speak more like day-traders than money managers.

On one level the blustery weather in China is a potential positive for the markets there and select stocks, with the possibility of a government economic stimulus package increasing as the harsh weather slows the economy in large swaths of the country. Until now, the threat had been of government intervention in the other direction; to slow the red hot-economy and markets. Another positive: With the strong corrections we've already seen in many Chinese stocks, much of the downside - and risk - is already gone.

So what does this mean to us as investors in China and the emerging markets? Well, for one thing, with all the whipsawing we're seeing in the markets, we have to have a little longer time horizon for the stocks we are bullish on fundamentally. I have a positive longer-term view on the two current holdings in the fund associated with this blog (Jeff Manera Emerging Market Fund - symbol JMF) even though they've been buffeted around day to day like butterflies in a windstorm.

Suntech Power Holdings (US ADR symbol: STP), was founded in 2001 and is headquartered in Wuxi, China. I consider Suntech is the region's premier crystalline solar manufacturer, and it is now the globe's third-largest supplier of photovoltaic solar cells. It has a sustainable competitive advantage, with China's low-cost manufacturing base and favored taxing and treatment by the Chinese government. The company also has a clear technological edge which sets it apart from competitors.

The other current holding is Oriental Education Group (ADR symbol: EDU), an education company that teaches Chinese the English language. It's the dominant player in this field and a great growth story.

I'll be telling you more about Suntech and Oriental Education Group in future posts.

I currently have a small weighting in both these positions, and will likely add to them if we see either further downside which results in convincing basing and support or if I see some technical confirmation to the upside. At the moment, until the signals are less fuzzy, I would consider them both "holds" for now.

I have a strong list of other potential China, emerging markets and other international plays I'll be presenting to you as soon as the signals are clear, so stay tuned!

Best wishes,
Jeff Manera

Emerging Markets Insider
Jeff Manera Emerging Market Fund - symbol JMF
Email: Jmanera@EmergingMarketsInsider.net