ChiNex falls on Day 3

China's new Nasdaq-style board ChiNext saw a roller coaster ride in the first 3 trading days. On Tuesday, it continued to fall and is expected to see more volatility in the short-term.

ChiNext's third day saw continued profit-taking on most of the shares. Five stocks out of the 28 rose but the rest fell with 19 stocks down more than 5 percent and 4 stocks plunging by the daily limit of 10 percent. Aier Eye Hospital Group led the five gainers, jumping four and a half percent.

Analysts say the correction is milder than expected and strong performance of some chips show speculative interest in the new listings is still strong.

Huang Xiangbin, Researcher, Cinda Securities, said, "Last Friday share prices were corrected in afternoon trading, which means capital is not willing to chase such a high price. The high P/E ratio also put strains on further price hikes. So many people think these shares will all decline. However, that has not been the case. There are still investors and funds chasing these stocks. I think the growth potential of these stocks has been over-drawn. "

The market-wide decline still leaves all 28 stocks trading well above their initial public offering prices. But despite this, statistics show at least 200 thousand retail investors who bought shares are now suffering losses. Analysts say further declines may occur in the coming days. They caution that it's a pretty risky place to put money especially for retail investors.