- Hong Kong marble stock ArtGo plunged 98% in a day earlier this week, wiping out $5.7 billion.
- It’s the latest in a string of massive Asian stock bubbles including Kasen International and Tibet Water.
- Recent trading bubbles makes bitcoin’s ‘bubble’ look practically placid.
One of the world’s best-performing stocks just took a 98% hammering when its over-inflated bubble popped. ArtGo, a marble company listed on the Hong Kong stock exchange, climbed 3,800% since January, then saw most of its value wiped out in a matter of hours.
Just one day before the bubble burst, the Wall Street Journal shed light on the outrageous valuation.
Shares of ArtGo Holdings have become unhinged from the reality of the underlying company. The share price equates to 85 times revenue, more expensive than some of the fastest-growing tech companies.
The actual trigger came hours later when MSCI announced it would no longer include ArtGo in its China Index. The selling was so vicious, trading was suspended.
This isn’t a freak occurrence on the Hong Kong stock market.
A series of Hong Kong bubble stocks
On the same day, another Asian stock collapsed 91% and had to be suspended. Kasen International – a furniture company and property developer – had seen a bubble grow 548% since 2018. It was pierced in seconds by a savage bout of short-selling by Blue Orca Capital.
Earlier in the year, a Chinese stock listed in Hong Kong – Ding Yi Feng – snapped after an 8,500% streak. Regulators suspended trading on the stock because it was “irrationally high.”
And in November Tibet Water, a luxury water company, saw two-thirds of its value wiped out in a day.
What causes the Asian bubbles?
Some analysts have pointed out that assets in Hong Kong are way over-leveraged, artificially pumping up asset…