In Depth: A bitter $1.4bn lesson on commodity price speculation

The epic crash last week of crude oil taught 60,000 Chinese investors a bitter, 10 billion-yuan ($1.4 billion) lesson on the risks of speculating in commodity prices.

The clients of Bank of China (BOC), one of the country’s largest state-owned lenders, were trying to buy on a dip in crude prices using a paper investment product known as Yuan You Bao. Little did they expect that values would keep on plunging past zero and well into negative territory.

One investor told Caixin that his entire 50,000 yuan ($7,063) investment in the bank’s Yuan You Bao product linked to West Texas

Read More

In Depth: Investors sip bitter taste of Luckin Coffee scandal

China’s upstart Luckin Coffee wowed investors with astonishing growth and an ambitious narrative that it was a successful challenger in the making to Starbucks. And then it all blew up unexpectedly.

In two and a half years, Luckin rose from nothing to become China’s biggest coffee chain, with 4,500 shops, outnumbering Starbucks in the world’s most populous country. The company debuted on the Nasdaq last May with a $561 million initial public offering only 18 months after its founding. In just six months, Luckin’s market value shot up more than twentyfold to nearly $12.5 billion.

Investors were dazzled by Luckin’s

Read More