Formal Name: People’s Republic of China
Local Name: Zhong Guo
Local Formal Name: Zhonghua Renmin Gongheguo
Trend Following Investment Research
Trend Following Investment Research is a publisher of trend following trading strategies reaching thousands of investors globally. Our unique edge is an extensive network within trend following, behavioral economics and risk management. This allows us to teach decades of outstanding performance. Our approach is to provide customers with a single product requiring no extra purchase. Delivering a comprehensive service of trading systems, risk management strategies and psychological guidelines allows our customers to trade in less than thirty minutes per day. Giving us your money is giving us your trust. And our goal is always to make sure that what we give you is more valuable than what you give us. That straightforward business principle is the foundation of our long-term relationship with all clients.
Trend Following Podcast
Our highly ranked podcast Trend Following now reaches over one hundred eighty-eight countries with over 3.5 million listens. Guests (all guests) include world-class thinkers, psychologists, economists and traders.
Why China Is Critical for Global Trend Following Traders
China is the world’s second-largest economy and the largest consumer of most globally traded commodities: copper, iron ore, soybeans, aluminum, zinc, and oil. Chinese demand cycles produce some of the largest and most sustained price trends in global commodity futures markets. When Chinese industrial activity accelerates, commodity prices trend higher across multiple markets simultaneously. When Chinese growth slows, commodity prices trend lower across the same markets. A systematic trend follower with positions in global commodity futures is, in an important sense, trading Chinese economic cycles whether they realize it or not.
The renminbi’s relationship to the US dollar and other major currencies is one of the most watched in global currency markets. Chinese monetary and currency policy decisions produce sustained directional trends in the USD/CNH market and in the currencies of commodity-exporting countries whose economies are linked to Chinese demand. The Australian dollar, the Canadian dollar, the Chilean peso, and the Brazilian real all have documented correlations to Chinese economic conditions that manifest as currency trends. A systematic approach trading global currency futures captures these trends through the instruments rather than through direct Chinese market access.
China’s domestic equity markets, the Shanghai and Shenzhen exchanges, have produced some of the most dramatic price trend cycles of any major equity market. The 2007 Shanghai bubble, the 2015 equity crash, and subsequent policy-driven recoveries each produced the large, sustained directional moves that systematic trend following is designed to capture. Chinese retail investor participation rates are high, and behavioral dynamics including herding, momentum chasing, and panic selling are pronounced, producing cleaner trend signals than markets with more institutional participation.
For Chinese traders and investors, access to global futures markets through offshore accounts provides diversification from the renminbi’s managed exchange rate and from the concentration risk of domestic equity and real estate markets. A systematic approach trading global currencies, bonds, commodities, and equity indices provides exposure to trends that are genuinely uncorrelated with Chinese domestic market conditions, which is the diversification that holding domestic equities and bonds cannot provide.
The thirty-minutes-per-day implementation standard requires attention to session timing for Chinese practitioners. Most major global futures markets close during Chinese overnight hours. An end-of-day systematic approach can process the previous session’s close each morning before Chinese market open, making implementation practical without requiring real-time monitoring of overseas markets.
Frequently Asked Questions
How does China’s commodity consumption drive global futures trends?
China is the world’s largest consumer of copper, iron ore, soybeans, aluminum, zinc, and a major consumer of crude oil. Shifts in Chinese industrial activity and infrastructure investment produce sustained directional moves in the prices of these commodities in global futures markets. When Chinese demand expands rapidly, commodity prices trend higher across multiple markets simultaneously. When Chinese growth moderates, the same markets trend lower. Systematic trend following positions in global commodity futures capture these moves as price trends regardless of the underlying Chinese economic driver.
Why do Chinese equity markets produce strong trend signals?
Because high retail investor participation rates in China amplify the behavioral dynamics that produce price trends: herding, momentum chasing, and delayed response to changing conditions. When markets begin trending in one direction, retail investors follow the trend, amplifying it. When markets reverse, panic selling produces sharp declines. These behavioral patterns produce cleaner and more sustained price trends than markets with higher proportions of institutional, rules-based participants who provide contrarian stabilization.
What global market access options are available to Chinese trend following traders?
Chinese traders can access global futures markets through offshore brokerage accounts that allow trading on CME, ICE, and other major exchanges. This provides access to USD-denominated currency, commodity, bond, and equity index futures. Trading these markets provides genuine diversification from renminbi exposure and from domestic Chinese equity and real estate markets, which are subject to capital controls and regulatory interventions that global futures markets are not.
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