Chart: Spot the correlation

James Marlay

Livewire Markets

No doubt you have read numerous articles about the dramatic run up in valuation on the Shanghai Composite index. Overnight stocks fell dramatically - down some 6.5%. I personally don't know much about investing in China - so I don't try to do it. However, I have worked with margin lending and most recently in 2007/08. When margin lending is introduced to new investors. On the upside it generates quite a bit of excitement as eyeballs google and the expanded position sizes on offer. On the downside - well things get out of control as accounts freeze and selling becomes uncontrolled and indiscriminate.


James Marlay
Co Founder
Livewire Markets

Livewire is Australia’s #1 website for expert investment analysis. We work with leading investment professionals to deliver curated content that helps investors make confident and informed decisions. Safe investing and thanks for reading Livewire.

I would like to

Only to be used for sending genuine email enquiries to the Contributor. Livewire Markets Pty Ltd reserves its right to take any legal or other appropriate action in relation to misuse of this service.

Personal Information Collection Statement
Your personal information will be passed to the Contributor and/or its authorised service provider to assist the Contributor to contact you about your investment enquiry. They are required not to use your information for any other purpose. Our privacy policy explains how we store personal information and how you may access, correct or complain about the handling of personal information.