Shanghaiist: PetroChina, now the world's most valuable company

Jay Sheng

Thu, 08 Nov 2007 14:21:20 +0800

Thanks for reading. Sorry for the late reply. Shorting on the local exchange is not allowed. There are several ways to get around that, HK being one possibility, then there is FXI and CAF over on the NYSE. Craziness can definitely outlast your solvency, and you're right, LTCM being the prime example.

alertipo

Tue, 06 Nov 2007 13:51:29 +0800

Jay, big fan of ur blog... I witnessed the exact same craziness (disconnect of stock prices of the same company on different exchanges) during my last visit to shanghai back in 2004 - i guess little has changed then. pardon my ignorance of the chinese stock market - is there any way to arbitrage it at all? Is shorting still not allowed? what about options? My guess is if arbitrage is allowed, who's to say this craziness won't continue until you run out of capital/time? just look at LTCM - and they were arbitraging discrepencies FAR smaller than this (albeit extreme leverage though).

nanheyangrouchuan

Tue, 06 Nov 2007 05:23:46 +0800

It's easy to be #1 when you are a monopoly with the entire resources of a major economy backing you.