Unveiling China's Stock Market Bubble:Margin Financing, the Leveraged Bull and Governmental Responses
In: Lu , L & Lu , L 2017 , ' Unveiling China's Stock Market Bubble : Margin Financing, the Leveraged Bull and Governmental Responses ' , Journal of International Banking Law and Regulation , vol. 32 , no. 4 , pp. 146-160 .
From 2014–15, China witnessed a super bull in its stock market, as the major SSE Composite Index was more than doubled, but it was followed by an unprecedented crash triggering a global sell-off. This article argues that margin trading, which means investors that borrow money from stock brokers or shadow banks to purchase shares, accounted for the stock bubble.