lesson

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

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