We concentrate a great deal on the US market because the United States has some of the best visibility of all the Quantum technology companies and an investment-friendly environment. But what about the Chinese Quantum ecosystem? But no one can mistake the recent announcements from China that the nation is also working hard on building out their Quantum offering. China has also announced (like Google) that it has achieved Quantum supremacy. We take a look inside some of these Chinese Quantum Companies.
We analyze three Chinese companies in the Quantum technology space that could make up part of an integrated portfolio in 2021.
Chinese Quantum Stocks: Baidu
Perhaps most famous for its search engine. There is some overlap with the product offering of Google in that the Chinese company is probably most well known for being the jump-off point to the web with its cutesy paw print style on its home page.
Baidu has steadily been increasing its native tools in the Machine Learning arena. AI or, more applicable, ML (Machine Learning) has been rolled into several tools. Baidu is co-located in Silicon Valley, Seattle, and Beijing. It has created Baidu PaddlePaddle, a Machine Learning platform akin to those from Google and Facebook (Tensorflow and PyTorch). Like Google, it also has a Quantum flavor of its ML tools: Quantum Leaf, Quanlse, and Paddle Quantum. The company is focused on three main areas: Quantum AI, Quantum Algorithm, and Quantum Architecture (QAAA for short).
Baidu is aggressively pushing into the Quantum space and have a dedicated Quantum Computing Institute named after it which is headed by Professor Runyao Duan, a considered expert of Quantum Computing. Rather like Google, it sees the merging of AI/ML and Quantum toolsets.
Chinese Quantum Stocks: Tencent
Originators of some of the stickiest internet properties in the Chinese market, Tencent, are behind the very popular WeChat, which is a widespread tool in China for purchasing just about anything but originated as a chat tool.
Tencent Quantum Lab is run by Shengyu Zhang. The multi-disciplinary team embodies a range of talent, taking aim at Quantum Computing Engineering, Computing Chemistry, Quantum Algorithms, Electronic Engineering, and Machine Learning. As you’d expect, Tencent is pretty focused on the Quantum cloud.
Chinese Quantum Stocks: Alibaba
Perhaps most similar to Amazon, Alibaba is one of the biggest retail platforms. Founded by Jack Ma, the Juggernaut of the Chinese retail economy continues its upward growth.
The company is behind the Alibaba Cloud Quantum Development Platform (ACQDP) – a simulator-driven development tool for quantum algorithms and quantum computers. Yaoyun Shi Heads up the Quantum Lab of Alibaba. The company focuses on creating partnerships and collaborations in the quantum space. Alibaba made the DAMO Academy, dedicated to exploring the unknown through scientific and technological research and innovation. The driving force behind the Academy is the pursuit of the betterment of humanity through research.
Risk and Reward of Investing in China
For many investors, Chinese stocks will be too risky as we have seen trade wars emerge between the US and China. There have also been security issues brought up by Chinese products, with the result that the UK banned Huawei products for its 5G roll-out. There are also risks, such as Chinese shares being delisted from American exchanges, as can happen with secondary listings or ADR-listed shares. Alibaba shares have declined almost one-third since their October 2020 peak, declining nearly 14% on Christmas Eve alone.
China is, however, touted to overtake the US in 2028 by a prediction made by the Centre for Economics and Business Research. The better handling of the COVID-19 crisis has meant that it weathers the economic fallout considerably better.
