how would a US citizen short China?

Apparently HK index options are not legal to offer for trade at least according to IB.

What are your suggestions?

 

There are a whole bunch of Chinese stocks listed on the NYSE I think.

 

Start w/ PTR, then check which other components of the HHI futures contract also have ADR on NYSE. China Life also recently listed. Sinopec and Huaneng Power (HNP ?) fall into this category.


CYD is another ticker that comes to mind, though it wouldn't be my preferred short vehicle.

 

Avoid shorting individual stocks, *especially* ADR's.
Always try short futures and long stocks.

 

Why would you give that advice?

I'd disagree. For example, if you think a particular stock is over valued, wouldn't it make sense to short the stock and use the index as a hedge?

 

Actually, my comment pertained *only* to foreign-based stocks.
In many cases, I'd agree, but ADR's are a lot trickier to short.
First, many are not available to short, second, they can easily be called away from you due to small float, and third, the time zone difference makes it very hard to respond in a timely way to changes in the marketplace.

Having said that, I guess it might still make sense for longer term position traders.

 

In that context - especially if stock loan is tight - I'd agree. However, if stock is available, an argument can be made for trading them in the US. Among the reasons: spreads are often tighter, commissions lower and access to the market is faster .

 

I would suggest shorting the ETF for Taiwan, EWT is the symbol.

 

Form a company outside the US (e.g. a UK company), then use that to open another account to trade markets that are illegal for US citizens. Cost would be perhaps $150 and it would take a few days.

 

http://www.usxchinaindex.com/