No MSG, Please

High beta China internet plays are notoriously higher risk endeavors for traders, as they are more prone to violent reversals and, in some extreme cases, immediate delisting out of the blue as it is exposed that the companies were actually shells based out of a basement in Staten Island. 

Extreme cases aside, we saw the ghosts of high beta China past a few weeks back, with abrupt and harsh selling in the likes of SINA WB. 

Without question, there are plenty of legitimate, big-time firms trading as ADRs in America, such as BIDU and telecommunications giant CHL. The key is to separate the shady from the solid, looking for firms with, shall we say, no MSG in order to mitigate risk. 

This morning, China social/internet play MOMO is up 8% after earnings. With this in mind, a legitimate play which has earnings out of the way is Ctrip.com International, Ltd..

On the CTRP daily chart, below, the Shanghai-based travel service provider is basing impressively after its earnings rally. Note how price is tight in the context of an uptrend. I am looking at CTRP now as a fresh, but lower risk long idea if China stocks gather steam throughout March.