"The Chinese Dragon strikes again," says small cap expert Jim Oberweis, Jr., adding, "So far in 2009, the MSCI China Index is up 30% and our Oberweis China Opportunities Fund (OBCHX) has gained 62%."

In his The Oberweis Report, he says, "China will be a great place to invest over the medium-to-long term, even if unpredictable in the short term." Here, he reveals four stocks that he considers "some of the most interesting Chinese ADRs to buy now."

"E-House (NYSE: EJ) is the largest Chinese property agent. It is the Chinese version of Century 21. However, the firm faces very different housing market dynamics in China.

"Chinese consumers tend to borrow considerably less than Americans or Europeans to finance home purchases, with down payments averaging about 40%. As a result of this lower leverage, China faces a less severe drop in property prices.

"Further, in 2007, the government tried to curb the rapid rise in real estate prices by raising interest rates and increasing down payment requirements. Buyers paused, but the recent reversal of those policies has bolstered the housing market. 

"We see E-House as the best way to play a continued rebound in Chinese property sales volumes. The firm has a strong market position, doesn’t carry inventory like developers, and has a healthy balance sheet with no debt.  Shares trade for 18x our forward EPS estimate of $.75 per ADR. 

"Our second pick is a telecom company called Asia Info Holdings (NASDAQ: ASIA). The firm provides billing software to major telecom carriers.

"Growth in data services increases the complexity of billing. China’s plan to adopt 3G, a much faster wireless protocol, was approved by the government in late 2008. Implementation cost is expected to top a whopping $60 billion.

"Furthermore, the government created a new wireless competitor by merging the wireless units of the two dominant fixed line operators in China, curbing China Mobile’s wireless monopoly.

"Greater competition amid carriers means higher investment in new services designed to retain and attract subscribers.

"Asia Info Holdings stands to benefit from both catalysts, as their billing becomes increasingly necessary as data services expand. Shares trade for 25x our forward EPS estimate of $0.85 per ADR and the company has $4.64/share in cash.

"Our third pick is New Oriental Education (NYSE: EDU), which provides foreign-language training and college test preparation courses. Education is highly prized in China, and the huge gap in wages between the educated and uneducated is leading families to invest heavily in their child’s studies. 

"As the dominant player in providing early English education for children, New Oriental is a household name in China.

"The company has demonstrated success in helping students prepare for the Gao Kao college entrance exam, similar to the ACT or SAT here in the States. Shares trade for 25x our forward EPS estimate of $2.20 per ADR.

"Lastly, Longtop Financial (NYSE: LFT) is a great way to invest in the development of the financial sector in China.

"Longtop develops software to help banks run their business. By investing in Longtop, one can ride the wave of financial sector growth yet avoid some of the risks inherent in China’s government-influenced banking sector.

"The company reported outstanding quarterly results this past week in excess of expectations; its outlook was equally as strong.

"We see the company gaining more customers outside of its core banking clients. For example, we hope to see inroads in the Chinese insurance industry, where IT systems have largely been ignored. Shares trade for 21x our forward EPS estimate of $1.30 per ADR.

"As we have seen over the past few years, investing in China will yield a bumpy ride. For those who can handle the volatility, however, we believe the long-term reward will be worth the short-term volatility."