Chinese stocks trading overseas may emerge as a shelter for global investors, as confusion over the Federal Reserve’s monetary path drives diversification away from US equities and bonds amid a stumbling artificial intelligence trade. The Nasdaq Golden Dragon China Index of the biggest Chinese companies listed in the US has bucked a broader sell-off since the Fed’s July rate-decision meeting, rising 1.7 per cent. The Nasdaq-100 slumped 2.1 per cent and longer-dated Treasuries also fell during the span, as investors questioned the Fed’s credibility after its decision to keep the benchmark interest rate unchanged despite inflation staying above target for five years. With new Fed chairman Kevin Warsh abandoning policy guidance and the dot-plot map, the lack of clarity over the monetary outlook may fuel the biggest volatility in US stocks already battered by doubts over the returns from massive AI build-outs by cloud service providers. Chinese stocks trading in the US aren’t a crowded trade or high-leveraged bets and they are now viewed more as defensive in an uncertain market Wang Chen, partner, Xufunds Investment ManagementChinese stocks trading in the US aren’t a crowded trade or high-leveraged bets and they are now viewed more as defensive in an uncertain market