China Has an Exchange for Just about Anything

From Liquor to Donkeys

China has over 1,000 exchanges for just about anything – and that’s quite an increase from the roughly 300 that existed, according to research, in 2011.

On top of the national stock exchanges in Shanghai and Shenzhen, Asia’s largest economy now boasts has regional trading venues that deal with chemical, metals, agricultural products and far more bizarre examples such as – wait for it – the donkey exchange. Last September, an orchid exchange opened in Yunnan province.

Oh yes, we know you want to go back to that donkey exchange, and it’s actually not too difficult to explain. In Asia donkeys are a valuable agriculture commodity and are therefore traded in the same way that you can trade soybeans, sugar or wheat in the form of CFDs at iFOREX. These animals, whose skin is also used in China as a popular remedy, are difficult to breed and their price has surged, with impact felt outside of China as well. Since the donkey exchanged opened it handled over 370 million yuan’s worth of donkeys and the figure could reach 1.5 billion yuan by the end of 2017. The exchange is planning to go into web- and app-based trading this month.

While exchanges can be extremely valuable to a growing economy – especially one as large and as complex as China – there are concerns that some of these exchanges are turning into avenues for speculation – that is hardly helpful for the general economy. Policy makers in Beijing are worried that local authorities lack the tools to adequately supervise these exchanges. They have reasons for concerns. In 2015, the owner of a commodities exchange in the northern autonomous region of Inner Mongolia allegedly disappeared with clients’ funds. On the other hand, there are many examples of well-performing and well-managed exchanges operating in China that are becoming integrated and vital part of the nation’s economy.

While you cannot trade donkeys at iFOREX, you can invest in a wide variety of tradable CFD instruments including shares, commodities, indices and currencies and without having to actually buy or own them. Find out more.



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