Who Will Rescue Chinese Stock Analysts?

China's stock market is the second worst market in the world in the past year.

Analysts who track the market are nowhere near the same.

Chinese banking regulators are cracking down on the "financial projects" used by Chinese banks to disguise trillions of dollars in high-risk loans as investment products.

The crackdown will force banks to make provision for loans previously disguised as investment, with the aim of restraining one of the fastest growing sectors of the shadow banking system.

From interbank pactions to

The shadow banking industry became a force 5 years ago. This kind of product promises inflation returns, and its collateral is often loans to troubled businesses.

Over the past three years, Chinese banks have used sophisticated accounting methods to pfer loans from balance sheets to one investment category, which requires less provision than loans.

This also reduces the default rate on banks' balance sheets, because related assets no longer have the characteristics of loans.

After experiencing the best performance in history, the Shanghai Composite Index has turned downward. Since April 2015, the market value has evaporated more than 1/3, and the global market has been greatly shaken. This can be seen from the forecast of China's stock market analysis of Miss Gao's one or two.

Their forecasts deviate from reality more than those of other top 20 stock markets in the world.

Bloomberg weighted the price of constituent stocks based on analysts' conclusions.

The forecast shows that if they were accurate at that time, the Shanghai composite index should have a 43% higher price than last week's 2938 point.

Bloomberg sampling covers 3/4 of the total weight of the Shanghai Composite Index, with about 2000 shares priced.

In the top 25 big weight stocks of the index, analysts forecast the most outlandish is CITIC Securities, with the company's market capitalization cut, CITIC Securities current stock price than a year ago analysts about 36 yuan (5.56 U.S. dollars).

It's down 54%.

Zheng Chunming, an analyst with Qunyi securities in Shanghai, said the market is almost unpredictable.

Last year he bought citic securities rating, which was much higher than the target price.

What is more difficult is that China's stock market has gone through two of the worst months in history, and one of them is even more volatile because of the early termination of the fuse by regulators.

Zheng Chunming said that from last July's market turbulence to the market fall triggered by the fuse in January this year, it is all difficult to foresee.

When the stock market has been hit hard, analysts predict that the serious deviation is not uncommon.

It turns out that, at the end of the 2013 year of the Greek debt crisis, the analysts tracking the stock market overestimated the stock price in the coming year by 50%, and the lowest accuracy in the prediction of the developed market.

In 2008, when the financial crisis broke out, the average forecast error of the top 25 markets was over 120%.