The information supplied on this site does not constitute financial advice. Always do your own research before making any financial decisions. We do our very best to give you the most accurate journalistic information, but we can’t guarantee to be perfect. You use the information at your own risk, for more details read how our site works . Banks do offer a wide range of currencies that you can buy but make sure you spend your foreign currency overseas because you might not be able to convert it back to dollars when you get back home. Travel money cards are a safe and convenient way to spend in Chinese yuan (CNY) – and if you pick the right one they could help you save on currency conversion, too.
Beware of fees when using a dedicated in-person currency exchange store. If you do hold physical yuan, use a fireproof safe or bank safe deposit box to keep your money safe and secure. The easiest way for most investors to get exposure to yuan in their portfolio is through an exchange-traded fund (ETF). You buy an ETF through your brokerage account just like buying a stock.
Other currencies that are considered reserve currencies include the U.S. dollar, the euro, the British pound, and the Japanese yen. The elevation of the renminbi’s status allows it to be used more frequently in global trade and international financial transactions. Another marker of the RMB emerging as a global currency came in 2022, when the Chinese renminbi became an international reserve asset of the International Monetary Fund. The move will mean that the renminbi is used more frequently in trade and international transactions of commodities, such as crude oil and gold. This puts it alongside other reserve currencies such as the US dollar, euro, British pound, and Japanese yen. For example, the WisdomTree Chinese Yuan Strategy Fund (CYB) allows you to invest in yuan through your brokerage account.
Another way to invest in the yuan is through exchange traded funds (ETFs) designed to perform in accordance with the value of the Chinese currency. One is the Invesco Chinese Yuan Dim Sum Bond Portfolio Fund. This ETF is invested in a portfolio of dim sum bonds, which are issued outside of mainland China but are nonetheless denominated in the yuan.
Investing in the Yuan through ETFs or ETNs
If the bet is a good one, the option is “in the money” and can be exercised for a profit. China’s economy has been on a massive growth streak for decades. And it’s positioned to remain one of the most powerful economies in the world for the foreseeable future. Moreover, strong and growing economies tend to maintain strong currencies.
Among Chinese stocks, the energy sector has performed particularly well. This leads to a massive demand for natural resources and fuels like oil. Even as China slowly moves to sustainable energy, fossil fuels will remain in high demand in China for many years to come.
Top up your card balance in dollars and convert those dollars to yuan to spend in stores and restaurants, or withdraw cash from ATMs when you need it. Due to China’s cross-border currency controls, there are two markets for the yuan. The onshore yuan, which is traded in mainland China, is known under the ticker CNY. The offshore yuan, which is used on international markets, is known by the ticker CNH.
The difference in the exchange rates between the original forward and the offsetting trade is the gain or loss from the currency exchange rate movements. The net difference is typically settled in dollars, and no yuan changes hands. Futures, Options on Futures, Foreign Exchange and other leveraged products involves significant risk of loss and is not suitable for all investors.
Popular yuan FX pairs
However, the Chinese government still controls the value of the yuan and renminbi exchange rates and has capital controls in place, which prevent Chinese investors from moving money out of China. Reserve currencies are used to price commodities, such as gold and crude oil, as well as facilitate global trade transactions in developing countries that have less stable currency regimes and financial systems. Nevertheless, it’s fair to say that the Chinese currency is on the path to becoming a larger player in international transactions.
The two currencies can move differently, but there is a strong correlation between the two. The Standard Mandarin term ‘yuan’ literally translates to round object or coin. The official symbol is “Ұ” – it’s different to the Japanese yen symbol which has two lines across the Y.
- A limited number of forex brokers offer trading in the U.S. dollar-yuan currency pair (designated as USD/CNY).
- Other currencies that are considered reserve currencies include the U.S. dollar, the euro, the British pound, and the Japanese yen.
- In the same way that a pound is a unit of Britain’s sterling currency, the yuan is a unit of renminbi.
- Beware of fees when using a dedicated in-person currency exchange store.
The savviest investors know their investment choices can go far beyond the typical mix of stocks, bonds and funds the typical investor uses when building a portfolio. The Chinese yuan recently gained attention as a potential foreign exchange investment opportunity, but it’s not perfect for everyone. One of the most widely traded Chinese Yuan ETFs is the WisdomTree Dreyfus Chinese Yuan Fund. The fund aims to mirror the performance of Chinese interest rates and the value of the yuan relative to the U.S. dollar. There is also the Market Vectors Chinese Renminbi/USD ETN, which looks to reflect the overall performance of the yuan in relation to the U.S. dollar by tracking the S&P Chinese Renminbi Total Return Index.
We offer multiple shipping and payment options to buy currency on your terms. China’s economic growth in recent years has made the yuan an increasingly attractive investment. Receive our newsletter for information on new features, special promotions and exchange industry news. We are actively working to expand our service and offer new payment methods. We provide multiple convenient & secure methods for you to deliver documents required to comply with US Treasury and state guidelines.
It’s free to open a Wise account, with a one time fee of 9 USD for the Wise debit card. Converting USD to CNY costs 1.06% with Wise – making this by far one of the cheapest ways to get your hands on travel money for China. SafeDinar.com offers sixteen international currencies for sale with more coming soon. ✔ Confidence – When buying currency, knowing the reputation of your seller is the best way to ensure a safe, secure transaction.
Government policy in China is constantly changing, so it’s important to stay up to date with economic and political news. Gold mining is a major Chinese industry, as are rare earth metals. These metals are located in just a few places around the globe, with a heavy concentration in China. That makes Chinese miners an even more likely high performer in the future. With futures, you also pick a specific price and future date.
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Or look to emerging market currency ETFs and other foreign exchange and currency funds to invest in yuan with relative ease and low costs. FX investors should heed a word of caution that’s both a positive and negative for investing in the yuan. The Chinese government takes a very active approach in managing the nation’s currency and forex rates. Government officials work to keep the yuan exchange rate favorable for Chinese exports. A limited number of forex brokers offer trading in the U.S. dollar-yuan currency pair (designated as USD/CNY). The Bank of China has branches in New York, Chicago, and Los Angeles where investors can open savings or high-yield time deposit accounts with U.S. dollars but are denominated in yuan.
While the yuan is still somewhat pegged to the U.S. dollar and not yet altogether freely traded, it is approaching that status quickly and becoming more readily accessible to investors. Investors have several yuan investment options, including purchasing yuan directly and holding it in cash, investing in funds that hold the Chinese yuan, and buying yuan futures contracts. With a forex account or an account at a brokerage that supports direct forex trading, you convert your dollars into yuan directly with a few clicks of your mouse.
Spot Gold and Silver contracts are not subject to regulation under the U.S. Contracts for Difference (CFDs) are not available for US residents. Before deciding to trade forex, commodity futures, or digital assets, you should carefully consider your financial objectives, level of experience and risk appetite. You should consult with appropriate counsel or other advisors on all investment, legal, or tax matters. References to FOREX.com or GAIN Capital refer to StoneX Group Inc. and its subsidiaries. Please read Characteristics and Risks of Standardized Options.
In the same way that a pound is a unit of Britain’s sterling currency, the yuan is a unit of renminbi. As long as you understand the risks and have a solid investment strategy, there’s no reason the yuan couldn’t be part of your diverse international portfolio. The cryptocurrency version of the yuan opens up the currency to international investors with the right tech-savvy to buy and hold digital yuan in their cryptocurrency wallets. J.B. Maverick is an active trader, commodity futures broker, and stock market analyst 17+ years of experience, in addition to 10+ years of experience as a finance writer and book editor. Currency exchange services offered by the bank might not offer the best CNY to USD rates but they are convenient, particularly if you are an existing customer. You can buy Chinese yuan with dollars at major banks like Wells Fargo and Bank of America.
Simply use our free email alerts to track the CNY rate daily. Or set the rate you want and we’ll email you when it’s time to buy your yuan. Money changers can be the cheapest way to buy Chinese yuan. The problem is, it can be a hard to find them outside of the city and they regularly run out of less common currencies.
They are IRA-eligible, and a monthly maintenance fee may apply. As long as the yuan remains a non-deliverable currency, withdrawals can only be made in U.S. dollars. However, currency conversions will typically be charged a 1% spread, which is built into or added to the exchange rate conversion. Some banks and currency exchange businesses offer this service.
But instead of buying a company, you buy yuan or a basket of currencies that includes the yuan. For investors in the U.S. or anywhere outside of China, the Chinese yuan (sometimes called “the renminbi”) is available as a foreign exchange investment. In foreign exchange — often called “forex” or “FX” — investors buy a foreign currency with the goal of the currency becoming more valuable compared to their home currency. Just as a share of stock can go up in value, so can the relative value of a currency.
If you do, be aware that currency markets operate around the clock and can move quickly. As with futures and options, this is considered a risky investment strategy and isn’t suitable for the typical investor. If you decide to invest in forex, don’t fund your account with more than you can afford to lose. Forward contracts allow two parties to exchange two currencies by locking in the pair’s exchange rate today for settlement at some point in the future. The initial forward contract is offset or unwound when its settlement date comes due.
The fund offers capital appreciation in accordance with the yuan, a generous dividend yield that can range from 3.50% to 4.00% per year. Dividends are typically cash payments made to investors as a reward for investing in a security, fund, or stock. The fund also offers the potential for capital gains resulting from increased bond values. Investors wishing to maximize investment in the yuan through the use of leveraged investments may consider currency futures or forex market trading. Leveraged transactions use borrowed funds to enhance the gains or returns on an investment.