Investing In Taiwan

Taiwan is home to some of the world’s largest semi conductor companies, manufactures who make pc’s as well as electronic component suppliers. TSMC for example which is the world’s largest semiconductor maker has just reached a landmark decision from the California courts to the tune of $200 million over the theft of trade secrets by its Mainland rival SMIC. In addition TSMC has an option of buying 10% of SMIC which gives it an important hold into the Mainland.

Taiwan is not just a story of tech; an important feature which has encouraged many of the analyst and fund managers is the election of Ma Ying-jiou. One of the first things Ma did was to allow direct flights between the Mainland and Taiwan ending a 6 decade ban on direct routes travel. He’s also reduced taxes on capital gains and inheritance and for the first time you are seeing a reversal of the Capital flying from Taiwan.

For U.S investors you could either stock pick most of the companies already mentioned or you can buy mutual funds offered by the likes of J.P Morgan. One word of warning is Taiwan is still an emerging market; retail investor’s account for 70-80% and the kind of swings you can see on this market are only from those with really strong stock.