Jim Rogers says put your money where his mouth is

Jim Rogers has three pearls of investment wisdom to pitch: "Get out of the dollar, teach your children Chinese, and buy commodities".

Rogers, 65, co-founded the Quantum Hedge Fund with George Soros, pocketing enough money to retire at 37 and fund a series of around-the-world road trips. In "A Bull in China: Investing Profitably in the World's Greatest Market", Rogers details how to put your money where his mouth is.

"Just as the 19th century belonged to England and the 20th century to America, so the 21st century will be China's turn to set the agenda and rule the roost," he writes.

"Whatever the risks, this much is clear: It's more scary to have all your savings in the US stock market than it is to put a portion in China - whether investing in China's growth or as a hedge against a potential US slowdown."

He's practicing what he preaches. His daughter, Happy, has a Chinese nanny. When we met at a conference in London on October 31, Rogers said he'd found a buyer for his six-storey New York townhouse at more than the $15 million asking price. He's moving his family to Asia, though he chose Singapore over China because the air quality is too poor in Shanghai or Beijing, he says.

Throughout the book, Rogers lists companies that investors should consider buying shares in. Juice makers, meat processors, tractor manufacturers, wine producers, brewers and medical companies are all analysed. You could construct an interesting portfolio just by following his recommendations.

Bumpy Ride
Don't expect a one-way ride, though. "From 1993 to 2001, the Shanghai market suffered 20 mini-crashes of more than 10 per cent in a month," Rogers warns. Right from the beginning, he addresses the key concerns that might deter investors.

The prospects of Taiwan provoking military conflict, for example, are slim: "Powerful business leaders are the first force pushing for a peaceful resolution to the Taiwan- China conflict," he writes. "They know better than anyone that poor relations with the mainland have only prevented Taiwan from reaching its full potential."

Not convinced? Then buy defence stocks that would benefit from a war, such as China Aerospace International Holdings, Jiangxi Hongdu Aviation Industry Corp, or Jiangnan Heavy Industry Co.

Rogers spies opportunities in most of the challenges China faces. Surging energy needs make oil and coal producers potentially lucrative. Water shortages and droughts boost the attractiveness of utilities in Singapore able to meet China's needs, such as Bio-Treat Technology, Asia Environment Holdings and Asia Water Technology.

'Hello, Sexy Sedans'
"For every 1,000 people, the US has 700 cars," Rogers writes. "At last count, and despite the increased congestion, China had only 24 cars per 1,000 people. So long, trusty bicycle. Hello, sexy sedans and Chinese convertibles. There are big gains to be had from China climbing into the driver's seat of the world auto industry."

The best way to play that evolution, however, might be by investing in toll-road companies, such as Jiangsu Expressway Co, rather than carmakers or auto-parts manufacturers, Rogers says.