NexusFi: Find Your Edge


Home Menu

 





China's Shanghai crash of 2015


Discussion in Traders Hideout

Updated
      Top Posters
    1. looks_one Big Mike with 9 posts (4 thanks)
    2. looks_two PeakGrowth with 7 posts (3 thanks)
    3. looks_3 Jigsaw Trading with 5 posts (0 thanks)
    4. looks_4 treydog999 with 4 posts (12 thanks)
      Best Posters
    1. looks_one treydog999 with 3 thanks per post
    2. looks_two xiaosi with 3 thanks per post
    3. looks_3 suko with 1.5 thanks per post
    4. looks_4 Big Mike with 0.4 thanks per post
    1. trending_up 18,241 views
    2. thumb_up 34 thanks given
    3. group 19 followers
    1. forum 43 posts
    2. attach_file 7 attachments




 
Search this Thread

China's Shanghai crash of 2015

  #21 (permalink)
 PeakGrowth 
Sydney, Australia
 
Experience: Intermediate
Platform: Sierra Chart, IRESS
Broker: IB, IQFeed
Trading: ES, SPI, ASX stocks, options
Posts: 399 since Jun 2015
Thanks Given: 169
Thanks Received: 465


treydog999 View Post
No China does not have any sort of company sponsored 401k, IRA or any real retirement investment vehicles. Their social security pay outs are very low as well only around 1-200 USD per month. Also they do not have as good of health insurance. This is why they are very good savers and depending on their children to support them when they are old. The level of retirement tools available are extremely low.

They must self direct invest. Of course they want to get rich quick. But that is in comparison to the USA. If you consider how fast they have been getting richer in the past 15 or 20 years in perspective, it really is more normal. So yes there are going to people out there who lose everything, their house ,their car, their retirement etc.

There are a lot of components to this knock on effect from the retail trader side. The government's news media was basically saying invest in the bull market is a sure thing. Allowing for huge 10 to 1 leverage on equities. And basically taking anything as collateral not just deposited cash but also real estate and basically anything. this made everyone feel safe because it good news was coming from the top. As well as a keeping up with the Jones type thing. Imagine the nightly news every night told you how good it is to trade stocks and you see your coworkers and neighbors making money. It is something that is just not possible in the usa.

Hence why the PBOC is losing cred, they tell everyone and their mum to invest and then goes down the tubes in just 3 weeks. Plus a lot of Chinese people love a good punt, we see that all the time, when they spin the wheel they spin it big.

Disclaimer: I'm Chinese and deal with Chinese investors, in case anyone thought I was being racist

Visit my NexusFi Trade Journal Reply With Quote

Can you help answer these questions
from other members on NexusFi?
ZombieSqueeze
Platforms and Indicators
Futures True Range Report
The Elite Circle
Ninja Mobile Trader VPS (ninjamobiletrader.com)
Trading Reviews and Vendors
Better Renko Gaps
The Elite Circle
NexusFi Journal Challenge - April 2024
Feedback and Announcements
 
Best Threads (Most Thanked)
in the last 7 days on NexusFi
Get funded firms 2023/2024 - Any recommendations or word …
59 thanks
Funded Trader platforms
37 thanks
NexusFi site changelog and issues/problem reporting
24 thanks
GFIs1 1 DAX trade per day journal
22 thanks
The Program
19 thanks
  #22 (permalink)
 
Big Mike's Avatar
 Big Mike 
Manta, Ecuador
Site Administrator
Developer
Swing Trader
 
Experience: Advanced
Platform: Custom solution
Broker: IBKR
Trading: Stocks & Futures
Frequency: Every few days
Duration: Weeks
Posts: 50,399 since Jun 2009
Thanks Given: 33,175
Thanks Received: 101,539

I can't understand why the Chinese government thought that was a good idea.

Sent from my phone

We're here to help: just ask the community or contact our Help Desk

Quick Links: Change your Username or Register as a Vendor
Searching for trading reviews? Review this list
Lifetime Elite Membership: Sign-up for only $149 USD
Exclusive money saving offers from our Site Sponsors: Browse Offers
Report problems with the site: Using the NexusFi changelog thread
Follow me on Twitter Visit my NexusFi Trade Journal Started this thread Reply With Quote
  #23 (permalink)
 PeakGrowth 
Sydney, Australia
 
Experience: Intermediate
Platform: Sierra Chart, IRESS
Broker: IB, IQFeed
Trading: ES, SPI, ASX stocks, options
Posts: 399 since Jun 2015
Thanks Given: 169
Thanks Received: 465



Big Mike View Post
I can't understand why the Chinese government thought that was a good idea.

Sent from my phone

Could probably debate this to the moon and back but from what I understand it's so that they can use the stock markets to raise capital for companies. There is too much debt (that is also going sour now) floating around so they are trying to tap in to the very large amounts of equity floating around inside savings to try balance that out.

Of course the irony is not lost in me in that raising equity with debt is really just debt anyway...

Visit my NexusFi Trade Journal Reply With Quote
Thanked by:
  #24 (permalink)
 
treydog999's Avatar
 treydog999 
seoul, Korea
 
Experience: Intermediate
Platform: Multicharts
Broker: CQG, DTN IQfeed
Trading: YM 6E
Posts: 897 since Jul 2012
Thanks Given: 291
Thanks Received: 1,039


PeakGrowth View Post
Hence why the PBOC is losing cred, they tell everyone and their mum to invest and then goes down the tubes in just 3 weeks. Plus a lot of Chinese people love a good punt, we see that all the time, when they spin the wheel they spin it big.

Disclaimer: I'm Chinese and deal with Chinese investors, in case anyone thought I was being racist


PeakGrowth View Post
Could probably debate this to the moon and back but from what I understand it's so that they can use the stock markets to raise capital for companies. There is too much debt (that is also going sour now) floating around so they are trying to tap in to the very large amounts of equity floating around inside savings to try balance that out.

Of course the irony is not lost in me in that raising equity with debt is really just debt anyway...

I completely agree with your two posts. I do not understand the overall strategy of basically just moving the debt around and financing it with more debt in another sector. Yes the Chinese need a way to get financing for companies, by this i mean entrepreneurs who are actually building value. This was supposed to go through the IPO mechanism and 3rd tier exchange because the banks were just not giving out credit on good terms and making it too difficult and expensive. But it ends up being a giant ponzi scheme as everyone just has laid off debt with someone else, all of which is making interest in some cases in excess of 15%. Around 8% is what rich people consider the risk free rate.

Reply With Quote
Thanked by:
  #25 (permalink)
 PeakGrowth 
Sydney, Australia
 
Experience: Intermediate
Platform: Sierra Chart, IRESS
Broker: IB, IQFeed
Trading: ES, SPI, ASX stocks, options
Posts: 399 since Jun 2015
Thanks Given: 169
Thanks Received: 465


treydog999 View Post
I completely agree with your two posts. I do not understand the overall strategy of basically just moving the debt around and financing it with more debt in another sector. Yes the Chinese need a way to get financing for companies, by this i mean entrepreneurs who are actually building value. This was supposed to go through the IPO mechanism and 3rd tier exchange because the banks were just not giving out credit on good terms and making it too difficult and expensive. But it ends up being a giant ponzi scheme as everyone just has laid off debt with someone else, all of which is making interest in some cases in excess of 15%. Around 8% is what rich people consider the risk free rate.

Moving public (or is it corporate? Not sure with China with their SOE) debt to private debt, private can absorb a very large amount of debt (i.e. Japan)

But yes you are right, it's just shifting it around.

Visit my NexusFi Trade Journal Reply With Quote
  #26 (permalink)
 
yongthanyee's Avatar
 yongthanyee 
Penang, Malaysia
 
Experience: Intermediate
Platform: NinjaTrader
Broker: Philips Futures/PATS; eSignal
Trading: BMD CPO
Posts: 49 since Feb 2012
Thanks Given: 77
Thanks Received: 23

Traders can get access to the China market action through SGX China A50 index futures...it is a wild market but sure make your heart stronger...Just note these for your preparation...

SGX China A50 index futures
XINHUA A50 FUTURES UPPER LIMIT

1st Upper Limit: 13050 (10%)
2nd Upper Limit: 13642.5 (15%)

There will be a Cooling period of 10 minutes when the limit is trigerred.
Please Note upon triggered the Final 15% limit, it will be a free fall.

This thread cover the index discussion of late..
SGX A50 Index future | Elite Trader

Cheers...eric
Reply With Quote
Thanked by:
  #27 (permalink)
 mdsvtr 
Memphis,TN
 
Posts: 232 since Sep 2010

yongthanyee ,
where can USA residents trade the Chinese Indexes ?

Is IB currently the only broker that offers it to US residents ?

Thanks again

Reply With Quote
  #28 (permalink)
 i960 
San Francisco, CA
 
Experience: Advanced
Platform: SC, eSignal
Broker: IB
Trading: Spreads
Posts: 46 since Jan 2015
Thanks Given: 44
Thanks Received: 43

My take on this market situation is that it's basically just China's version of Nasdaq 99 - complete with a similar ending (albeit their govt steps in and tries to prop it up).

I trade this nightly on SGX (IB symbol XINA50, Barchart: HN) and it's more active than US futures. Huge volume, big moves, great stuff. Liquidity, and IMO action, is better than HSI or MHI (Hang Seng and Hang Seng mini). There are correlations with HHI.HK and MCH (Hang Seng China Enterprise and the mini variant).

I've traded through both days of recent limit moves (1st day was 2 limit downs, 2nd day was limit up within an hour) and at no point was it untradeable. Something to be aware of though is that if near the limit the exchange will reject your profit target for being outside the current limit. I don't expect it to be making any 2nd limit moves this week and there may even be trading interruptions with the approaching typhoon.

Reply With Quote
  #29 (permalink)
 
yongthanyee's Avatar
 yongthanyee 
Penang, Malaysia
 
Experience: Intermediate
Platform: NinjaTrader
Broker: Philips Futures/PATS; eSignal
Trading: BMD CPO
Posts: 49 since Feb 2012
Thanks Given: 77
Thanks Received: 23

Hi...you can get the answer from this thread...



mdsvtr View Post
yongthanyee ,
where can USA residents trade the Chinese Indexes ?

Is IB currently the only broker that offers it to US residents ?

Thanks again


Cheers...eric
Reply With Quote
  #30 (permalink)
 
Jigsaw Trading's Avatar
 Jigsaw Trading  Jigsaw Trading is an official Site Sponsor
 
Posts: 2,988 since Nov 2010
Thanks Given: 831
Thanks Received: 10,393



Big Mike View Post
I can't understand why the Chinese government thought that was a good idea.

Sent from my phone

All governments want to prop up the markets.

It's populism

If you have any questions about the products or services provided, please send me a Private Message or use the futures.io " Ask Me Anything" thread
Visit my NexusFi Trade Journal Reply With Quote




Last Updated on July 21, 2015


© 2024 NexusFi™, s.a., All Rights Reserved.
Av Ricardo J. Alfaro, Century Tower, Panama City, Panama, Ph: +507 833-9432 (Panama and Intl), +1 888-312-3001 (USA and Canada)
All information is for educational use only and is not investment advice. There is a substantial risk of loss in trading commodity futures, stocks, options and foreign exchange products. Past performance is not indicative of future results.
About Us - Contact Us - Site Rules, Acceptable Use, and Terms and Conditions - Privacy Policy - Downloads - Top
no new posts