Mainland China market like a 'casino': Expert

China's benchmark Shanghai Composite index, which crashed more than 7 percent on Friday, is like a "casino," and those looking to invest in Chinese stocks should do so carefully, veteran market pro Mike Holland warned Friday.

Friday's plunge was the biggest one-day loss for Chinese mainland stocks in five months. It's down over 14 percent in one month, after a wild ride higher that saw it double in a year.

"This market is almost entirely retail. It's almost made up entirely of Chinese speculators, and so these moves are fueled in the last several months by a huge amount of margin debt," the chairman of private investment firm Holland and Co. said in an interview with CNBC's "Power Lunch."

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China A-shares are trading at over 50 times earnings, Holland noted, while the rest of the Chinese market is trading closer to 10 times earnings. Generally only mainland citizens can buy A-shares.

"You have two disparate markets here," said Holland.

His advice for investors who want to take advantage of the recent downdraft in Chinese stocks is to turn to someone with experience in the market.

"You really want to go with an active manager who has a history of being able to traverse these ups and downs because they are so huge," he said.

"You have to have people on the ground which is how I've always invested over there. [I] wouldn't think of doing it myself."

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—CNBC's Jackson Burke contributed to this report.

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