3 Things the Beginning Investor Needs to Know Before Buying LightInTheBox Holding Co. Ltd-ADR

Roughly three years ago, investors more or less decided to shun small, publicly traded companies operating out of Mainland China. The incidences of fraud and manipulation, as well as simple lack of exposure to the country, led many to believe that investing in such companies was akin to gambling --with the house having a decided advantage.

It seems like those times have passed, however, as a new set of small Chinese e-commerce players have enjoyed great years. E-commerce upstart and bookseller Dangdang has seen shares rise 80% since last July, while flash-sale specialist Vipshop stands 550% higher over the same time frame.

That has led many to believe that other players in the space—particularly LightInTheBox  -- have an equally lucrative future. But not all tiny Chinese e-commerce stocks are created equally. In the slideshow below, beginning investors can see three big reasons that they need to be cautious with LightInTheBox, and why comparisons to Vipshop and Dangdang are likely not warranted.

Leaked: Apple's next smart device (warning, it may shock you)
Remember, you don't have to go looking into China to benefit from its economy.  Many American companies make a killing in the country as well, like Apple.  And recent indications point to an even more lucrative future.

Apple recently recruited a secret-development "dream team" to guarantee its newest smart device was kept hidden from the public for as long as possible. But the secret is out, and some early viewers are claiming its everyday impact could trump the iPod, iPhone, and the iPad. In fact, ABI Research predicts 485 million of this type of device will be sold per year. But one small company makes Apple's gadget possible. And its stock price has nearly unlimited room to run for early in-the-know investors. To be one of them, and see Apple's newest smart gizmo, just click here!

The article 3 Things the Beginning Investor Needs to Know Before Buying LightInTheBox Holding Co. Ltd-ADR originally appeared on Fool.com.

Brian Stoffel owns shares of Apple and E-Commerce China Dangdang. The Motley Fool recommends and owns shares of Apple. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

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