Global investors turn to Chinese stock options as AI trades crowd Asia

As artificial-intelligence trades in South Korea and Japan become crowded, international investors are increasingly turning to Chinese equity derivatives for technology exposure and diversification. Trading desks at Barclays, UBS and other banks report stronger demand for call options, call spreads and swaps tied to China’s CSI 300, CSI 500 and CSI 1000 indexes, particularly among small- and mid-cap stocks. Strategists cite China’s capital-market reforms, push for technological self-reliance, improving hardware earnings prospects and relatively cheaper option pricing, while cautioning that economic uncertainty and questions about government support remain. The CSI 1000 remains about 16% below its May peak despite a rebound, and Bank of America favors call spreads as a measured way to position for potential upside. Separately, Zhihu has committed RMB 1.5 billion—roughly a third of its cash holdings and comparable to its market value—to a new AI subsidiary, a move that could strengthen its data-driven AI strategy but reduces the balance-sheet cushion behind its deeply discounted shares.