Central Huijin Bought CSI300 ETF with an Estimated Volume of ¥8-10bn

Central Huijin bought $CSI300(000300.SH)$ just before market close yesterday.

While the amount wasn’t disclosed, it’s estimated to be ¥8-10bn from the sudden surge of trading volume in a few of the highly liquid CSI300 ETFs.

Two weeks ago when Huijin bought the big four SOE banks, it only spent <¥500m.

Yesterday HK market was closed to celebrate the Double Ninth Festival.

It’s the day of the most Yang (positive) energy described in Chinese classics Iching.

It’s this day a new cycle begins and everything should start to rejuvenate. Foreign selling via the northbound connect channel was blamed for the market plunge.

But yesterday HK was closed and onshore market sold off. Many thought the catalyst of the selloff was the option straddles that brokers sold to clients.

As market falls, these straddles are in the money and will be exercised.

Thus, brokers will have to close some long futures positions and thus pressure on the market.

While plausible, if the selling pressure is from trading setup, and clients who bought the straddles will have to take delivery to hold long positions, then the pressure from the straddles should be fleeting.

Yet given that the market has been falling for some time, these straddles are not the reason but sounds more like an excuse for the plunge.

Image

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wendytan
2023-10-26
wendytan
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TeoHY
2023-10-26
TeoHY
Ok

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Foreign selling via the northbound connect channel was blamed for the market plunge. </p><p>But yesterday HK was closed and onshore market sold off. Many thought the catalyst of the selloff was the option straddles that brokers sold to clients.</p><p>As market falls, these straddles are in the money and will be exercised. </p><p>Thus, brokers will have to close some long futures positions and thus pressure on the market. </p><p>While plausible, if the selling pressure is from trading setup, and clients who bought the straddles will have to take delivery to hold long positions, then the pressure from the straddles should be fleeting. </p><p>Yet given that the market has been falling for some time, these straddles are not the reason but sounds more like an excuse for the plunge.</p><p class=\"t-img-caption\"><img alt=\"Image\" title=\"Image\" src=\"https://community-static.tradeup.com/news/358df557300e25550774057aad818997\" tg-width=\"2400\" tg-height=\"1080\"><span>Image</span></p><p> <a data-mention-id=\"YINN\" class=\"teditor-mention\" data-mention-name=\"FTSE China Bull 3X Shares\" href=\"https://ttm.financial/S/YINN\">$FTSE China Bull 3X Shares(YINN)$</a>  <a data-mention-id=\"YANG\" class=\"teditor-mention\" data-mention-name=\"FTSE China Bear 3X Shares\" href=\"https://ttm.financial/S/YANG\">$FTSE China Bear 3X Shares(YANG)$</a>  <a data-mention-id=\"KWEB\" class=\"teditor-mention\" data-mention-name=\"CSI China Internet ETF\" href=\"https://ttm.financial/S/KWEB\">$CSI China Internet ETF(KWEB)$</a> <a href=\"https://twitter.com/HAOHONG_CFA/status/1716602580955283519/photo/1\" title=\"\n\n\" class=\"css-4rbku5 css-18t94o4 css-1dbjc4n r-1loqt21 r-1pi2tsx r-1ny4l3l\"><br></a><a href=\"https://twitter.com/HAOHONG_CFA/status/1716602580955283519\" title=\"Read more>>\" target=\"_blank\">Read more&gt;&gt;</a></p></body></html>","text":"Central Huijin bought $CSI300(000300.SH)$ just before market close yesterday. 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