Check on China: China Finance Online

The Shanghai Composite, the Chinese stock market's main index, fell 16.7% in January, its second-largest monthly drop this decade, sending whispers of an impending crash through the grapevine among some market watchers.

Recent media reports point to former U.S. Federal Reserve chairman Alan Greenspan and Li Ka-shing, Asia's wealthiest man, saying the swelling of the Chinese stock market has created a "bubble" that may be on the verge of bursting. Along a similar vein, billionaire Warren Buffett has urged investors to be "cautious" investing in China.

While an economic slowdown, fears of a U.S. recession and turmoil in global markets have created a slump in China's stock market (panicked selling has resulted in the fall of many Chinese companies from their previous high valuations), most experts predict the mainland market will continue the upward trend in 2008, but at a slower pace than recent years.

Enter China Finance Online Co. Ltd. (Nasdaq: JRJC), one of China's leading providers of online financial and listed company data, information and research. Through its Web sites, jrj.com and stockstar.com, the company provides individual investors with subscription-based service packages delivered through proprietary software available by download, through the Internet or through mobile handsets. Its subsidiary, Shenzhen Genius Information Technology Co. Ltd, provides financial information and analysis to institutional customers including domestic securities and investment firms.

Some savvy acquisitions have played a role in the company's growth. In 2006, China Finance purchased CFO Genius, a company in the business of building and maintaining financial information databases and data network solutions. Its Hong Hong unit acquired both CFO Stockstar and CFO Meining, which operates stockstar.com, a leading finance and securities site with over six million registered users. This past November, China Finance completed the $3 million acquisition of an 85% stake in Daily Growth Investment Company Limited, which offers securities brokerage services for stocks listed on Hong Kong Stock Exchange.

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