Why Did the CSI 300 Fall 10% Before Recovering?

Why Did the CSI 300 Fall 10% Before Recovering?

Assessment

Interactive Video

Business

University

Hard

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The video discusses a market anomaly known as a 'fat finger' that led to a brief flash crash in the CSI 300 futures market, causing a 10% decline. Despite this, the underlying index remained stable, trading higher in China. Concerns are raised about state intervention in the equity market. The video explains that fat finger errors occur due to illiquidity.

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2 questions

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1.

OPEN ENDED QUESTION

3 mins • 1 pt

What concerns are mentioned regarding the equity market in China?

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2.

OPEN ENDED QUESTION

3 mins • 1 pt

What does the term 'illiquidity' refer to in the context of market movements?

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