I haven't traded A-shares in years because the inability to day trade made me feel like a fool played by market makers.
Binance has just launched ChangXin Memory Technologies (CXMT) perpetual contracts. If you trade A-shares, you must try this.
Because the three most disgusting problems I faced in A-shares can now be solved!
Article Outline:
🔒 What are the three most frustrating things about A-shares?
🌏 What to do when US stocks surge or crash after A-shares close?
🚦 How can I arbitrage when A-shares hit the price limit?
⏱ When bad news hits and you can't sell on day one, where does that selling pressure go?
🀄 How can this order book hold so much money?
PS: The full text is about 3,600 words. Your likes, bookmarks, and shares are my greatest encouragement ❤️
The text begins 🙏
1. What are the three most frustrating things about A-shares? 🔒
In all my years of trading A-shares, the things that truly made me feel stifled were always these three.
First is T+1. You buy today and can only sell tomorrow.
Second is the price limit. For the STAR Market, it's ±20%. Once it's locked, you just stare at it.
Third is the leverage threshold. To open margin trading, you need to meet trading volume requirements, trading duration, risk tests, and visit the brokerage office. I never bothered because I eventually stopped playing. Plus, there's interest—you pay interest whether you are long or short, unlike the crypto world where you can even earn money (funding fees) 😂
These three rules seem independent, but when you look at them together, they lock three different things.
T+1 locks time, price limits lock price, and margin thresholds lock capital.
Trading only has these three dimensions, and A-shares lock every single one. The state thinks retail investors are irrational, but in reality, it just benefits the market makers...
Previously, these three locks were non-negotiable because there was only one entry point for trading CXMT in the world. If you didn't accept it, there was nowhere else to go. Now, there is another order book next door, opening a gap outside each of the three locks.
Let's go through them one by one; every point is an actionable move.
2. What to do when US stocks surge or crash after A-shares close? 🌏
First, let's talk about the lock on time; it's the harshest.
A-shares are open for four hours a day—two in the morning and two in the afternoon.
The real problem is that while the market is closed, global markets—especially US stocks—keep moving. When Micron moves or Samsung moves, the fair price of CXMT has actually changed, but you can do nothing.
The drops happen outside, the gains happen outside, and then at 9:30 the next morning, it's all dumped on you at once. 🐶
The first minute of the A-share opening is often the most brutal minute of the day. It's not that the market is brutal, but that over ten hours of information is released in a single instant. That's why they say A-share investors are always the ones getting hurt.
Now, during those ten-plus hours of downtime, you can trade on Binance.
If you hold CXMT in A-shares and see Micron surging at night, given the current storage trend, CXMT will likely follow the next day. You have two paths: place a long position in the perpetual market early to capture that opening gap the next day; or conversely, if Micron crashes and you judge it will fall, and your spot holdings are stuck, you can open a short position in perpetuals to hedge it first.
These two moves were impossible before. Previously, the only thing you could do was wait like a fool.
3. How can I arbitrage when A-shares hit the price limit? 🚦
Next is price.
The STAR Market is ±20%. CXMT is currently around 58 yuan; the upper limit is over 69, and the lower limit is over 46.
Many people think price limits only restrict the range of movement. What they truly restrict is execution. When a stock hits the upper limit, billions in buy orders are stacked there; if you want to buy, you're at the end of the line and will never get filled. When it hits the lower limit, there isn't a single buy order below; if you want to sell, who do you sell to?
This isn't a question of whether the price is expensive; it's a question of whether there is a counterparty.
Here comes the key part.
If CXMT releases major positive news, the A-share side locks at +20% and stays there all day. The perpetual side has no price limits; sentiment goes wherever it needs to go, perhaps already at 25%.
That five percent gap is reserved for those holding A-share spot positions.
If your shares are locked at the limit and you can't sell, you can open a short position in the perpetual market to lock in the gains beyond the limit. When A-shares open the next day for the catch-up rise, you close both sides, and that profit lands in your pocket.
There's an even faster layer: information asymmetry.
The moment major news breaks, the perpetual price won't adjust instantly. While A-shares are already locked, people here are still hesitating and observing, creating a lag of several to over ten minutes. That lag is the money of emotional inertia; bots can catch it, and manual monitoring can too.
Such opportunities simply didn't exist before. There was only one order book and one price; you didn't even have a reference point.
Is CXMT's volatility enough to sustain such opportunities? On its listing day, it rose 465%, with an intraday high of over 55 and a low of over 38—a seventeen-yuan range tearing back and forth in one day.
4. When bad news hits and you can't sell on day one, where does that selling pressure go? ⏱
T+1 has another side, even more disgusting than the one in Chapter 2.
When bad news comes out, you can't run if you want to that day. Shares bought that day cannot be sold, and once the lower limit is hit, you can't even get in line with a sell order.
In other words, A-share selling pressure is delayed; it isn't reflected at all on the first day.
In the perpetual market, the order book moves the second news breaks. You can sell whenever you want, multiple times a day. For those holding a lot of shares, the appeal is direct: the risk you can't escape in A-shares can be hedged here immediately, without waiting all night.
And this conveniently unlocks the third lock.
If you want to hedge 10 million in spot holdings through traditional margin trading, you first need to gather 500,000 for capital verification, wait 20 trading days, and visit a brokerage office. In the end, you get 1x leverage and have to pay interest daily. In the perpetual market with 20x leverage, you only need about 5% of the spot market value as margin to cover the entire exposure.
The same task: one side requires hundreds of thousands in capital lock-up plus a bunch of prerequisites, while the other side covers a 10 million exposure with just a few hundred thousand. This isn't just about saving fees; the capital efficiency is much higher.
5. How can this order book hold so much money? 🀄
By now, you probably have a question: these operations sound great, but can that order book really handle my orders?
This is the most critical question. Because in hedging, the biggest fear is that when you try to dump a position, slippage eats half your profit.
SanDisk (SNDK) is currently the largest stock-type perpetual target in the entire market by open interest, once reaching $1.72 billion. That's 85% higher than the SpaceX concept contracts everyone has been arguing about for two months, and more than three times the second-ranked storage stock. A US stock has developed an independent trading narrative in the crypto derivatives market.
The numbers for each platform are even more telling. Looking at Coinglass data (which may not be perfectly precise): the first-place open interest is 2.7 times the second-place, and the third-place is only about 10% of the first. In the entire TradFi perpetual market, the leader holds about 60% share, with $380 billion in quarterly volume; specifically in the stock perpetual category, the share once hit 63%.
Actually, other platforms brought A-shares to perpetuals earlier—about a dozen stocks, 20x leverage, long and short. Why did no one care then?
Because the significance of a contract never depends on whether it's listed; it depends on how much money is behind it. If it's listed but you can't use it, that's not an order book; that's an exhibit.
As for why only this platform succeeded, three words: timing, location, and people.
- Timing: The current US government is quite lenient toward this area. A capital-driven government that aggressively promotes technology and capital changing the world simply doesn't interfere with this.
- Location: This is something centralized crypto exchanges are best suited for. It can accommodate all types of money from around the world—if you find opening a US stock account troublesome, open one here; if you worry about tax risks or CRS risks, you can come here. One pool accepts all money.
- People: This happened only after the leadership (Yi He) took full control of the entire operation. A year ago, it might not have been as smooth.
The third point is most easily overlooked by outsiders. Logically, internal resistance is always greater than external resistance. This involves compliance, the interests of many people, and risk responsibility. Internally, everyone is just an employee; asking me to sign off and take risks on this—it's normal to be unwilling.
External regulation is a wall, but every internal department is a door. You can go around a wall, but you must push open every door.
It only launched its first TradFi contract at the beginning of this year, with gold as the target. From gold to individual US stocks, industry ETFs, Hong Kong stocks, Korean stocks, and A-shares—eight months. Hong Kong stocks were very troublesome, but they got listed. A-shares were considered the hardest to touch, but they still got listed, using their own shell with products provided by the Nest entity under Abu Dhabi regulation, not issued directly by the main entity.
Eight months to build an order book covering major global stock markets. That speed is the answer itself.
6. Summary
CXMT is definitely not the last.
Guess who will be moved up next?
After a few more are listed, even something like Moutai isn't impossible. When that time comes, this order book won't just be a few lonely contracts; it will be a shadow market for A-shares—open when A-shares are closed, quoting when A-shares are locked, and letting you sell when A-shares won't.
The room for imagination here is massive. From a platform perspective: you can hold as many VIP events as you want, but none compare to listing CXMT.
My judgment is: in the end, exchanges fight over assets.
Finally, risks must be clarified, on two levels.
At the product level, these are high-risk derivatives, not stocks. There is no physical delivery, no voting rights, and no shareholder status. 20x leverage can wipe you out in either direction; coming in with a stock-trading mindset makes it easy to lose everything mysteriously.
At the market level, as I wrote in the Warring States era piece: after A-shares and Hong Kong stocks close, there is no index reference. No one can quantify exactly how much a violent fluctuation should rise or fall.
The gap pried open in these three locks is an opportunity, but also a faster meat grinder.
I hope more and more A-share and Hong Kong stock targets get listed, truly achieving:
"No need to look far and wide, Binance has it all."
