Indicator: China vs U.S. market index ratio (MCHI / SPY)

Current value

0.0865

Updated 2026-03-18

Range

Min 0.0735

Max 0.2108

Mean 0.1116

Percentiles

1Y 5%

5Y 22%

10Y 11%

Correlation

1Y 0.0263

5Y -0.0079

Full 0.0020

MCHI vs SPY daily returns

Chart

Log

Relative move

-2.5%

-2.4%

-1.9%

ytd

-10.8%

vs SPY — negative = MCHI lagged

Market Regimes

Regime	Macro axis	Change	Min	Max	Mean	Corr
Policy-led rebound / euro-sovereign-crisis overlay 2009-03 → 2012-07	easing/backstop	-23.3%	0.29	0.4	0.34	0.0369
Secular stagnation / QE / low inflation / duration bull 2012-07 → 2020-02	disinflation/low rates	-38.6%	0.18	0.35	0.24	0.0168
Pandemic shock / liquidity crash 2020-02 → 2020-03	liquidity shock	+39.3%	0.18	0.26	0.21	-0.0749
Policy bazooka / monetary euphoria 2020-03 → 2020-11	liquidity impulse	-3.2%	0.2	0.24	0.22	-0.0770
Reopening reflation / fiscal boom / supply bottlenecks 2020-11 → 2021-11	growth reopening	-37.6%	0.14	0.24	0.19	-0.0752
Inflation shock / duration crash / aggressive tightening 2021-11 → 2022-11	inflation shock	-12.2%	0.09	0.15	0.12	-0.0248
Disinflation rebound / AI-led narrow bull / higher-for-longer 2022-11 → 2024-09	disinflation + narrow equity leadership	-24.1%	0.07	0.14	0.1	-0.0023
Disinflationary easing / resilient growth / AI capex under oil-shock test 2024-09 → now	disinflation under stress	-4.6%	0.08	0.1	0.09	0.0207

What is this indicator?

This is the most violent ratio. It compares the cheapest major market (China, P/E ~9) to the most expensive (US, P/E ~24).

For this ratio to rise, Global Allocators (Pension funds, Sovereigns) must make a conscious decision to reduce US exposure and increase Emerging Market exposure.

This rarely happens based on earnings; it happens based on Geopolitics (e.g., US-China relations thawing) or Dollar Weakness (DXY down).

Hedge funds use it to spot "Peak Fear." When MCHI/SPY hits a multi-year low, it often signals that US optimism is maxed out and China pessimism is maxed out. Contrarians buy here for a "snap back" rally (which can be +20% in weeks, but as any market timing play is a very high risk move).