What's going on?

Investors suffered from a spot of d�j� vu on Monday as last year�s pre-Christmas tech stock selloff repeated itself � only this time in China. Investors suffered from a spot of d�j� vu�

What does this mean?

The Chinese government�s imaginatively named �Big Fund�, which invests heavily in homegrown computer chipmakers, unexpectedly announced over the weekend that it was reducing its stake in three of the largest. The $20 billion fund owns as much as 16% of the tech firms, so freaked-out fellow investors followed suit and sold.

Chinese semiconductor stocks fell 3.5% on Monday, dragging down the overall Chinese market 1.4% in its biggest one-day drop for six weeks. Still, Chinese chipmakers aren�t fried just yet: in October, China launched an even bigger Big Fund to invest another $29 billion in them.

Why should I care?

For markets: All your baskets in one egg.

Investment funds are an easy way for investors big and small to spread their money across a pot of different stocks. But the upshot is that many companies are now largely owned by just a handful of funds with considerable power over stock prices. Saudi Aramco is another example: its newly public stock attracted $1 billion of foreign investment last week after it was included in a major emerging markets index of companies, effectively forcing funds tracking the index to buy it.

The bigger picture: Broken china.

Another reason for Monday�s selloff may have been investors� desire to lock in their 2019 gains ahead of the festive period � a sorely needed holiday, given the prospects for next year. Chinese economic growth is expected to slow in 2020, potentially hitting stocks worldwide. The country�s government is now responding with reduced tariffs on $390 billion worth of overseas goods, including costly pork, as well as plans to help struggling private companies compete with state-owned rivals. That could spur growth � and perhaps help China overtake the US as the world�s biggest economy before the next decade is out.