Volumes in these two offshore yuan markets on average are about $6 billion each day.
But the biggest bets are through the options market, where dollar puts, or options to sell the dollar for yuan, permit investors a cheap gamble on yuan appreciation, traders said.
Then there are wealth management products sold by Chinese banks, which offer offshore investors the opportunity to lend yuan onshore at attractive yields averaging about 6 percent. These are typically structured products routed through banks in Hong Kong.
The claims Hong Kong banks have on mainland counterparts give a rough idea of the size of these yield-seeking structured products. As of October, those claims were a record HK$2.3 trillion ($295 billion) and had climbed 53 percent since the end of 2012, a rise many analysts said reflected speculation on the yuan.
Another potential hit to the carry trade could come from within China. Some onshore exporters and importers have been inflating their receipts and under-stating their payments in order to earn more yuan. That would stop if their bullish outlook for the yuan changes.
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Those camouflaged trade flows are also difficult to estimate. But hot money flows into China in the final quarter of 2013 were about $38 billion, based on the difference between the rise in China's dollar reserves and the total for trade and investment flows.
Still, a 50 percent growth rate in trade financing by Hong Kong banks, the trillion yuan that depositors have placed with those banks and the jump in the value of Chinese exports - all point to how big the carry trade might be.
There is little doubt China can defend its currency, given it has $3.8 trillion in currency reserves.
If and when the yuan carry trade unwinds, analysts expect volatility will increase first, causing some of the options trades to reverse. That will be followed by investors trimming their long-yuan positions, and some hedging of payments by Chinese importers.
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Even then, the yuan exchange rate might at the most move lower and stop trading at a premium to the central bank's fixing rate. The offshore yuan was quoted at 6.0350 on Thursday and the onshore rate was 6.0594, firmer than the daily fixing of 6.1050 per dollar.
"There might be an increase in volatility, and people will need to de-lever their portfolios and they will need to cut their short dollar-yuan positions," said Baig.
"But that won't drive China to devalue the yuan. It won't drive them to take the fixing higher. After the initial correction, when people realise that fixings aren't going up, then they will go back and buy China."
The odds of China becoming a source of stress for emerging markets are still low, but China will dominate sentiment, analysts said.
News this week that a Chinese trust firm had reached an agreement to resolve a troubled high-yield investment product to avoid a default relieved markets fearful that one default could trigger others and so undermine China financial stability.
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But China's 10 trillion yuan shadow banking market, or non-bank lenders, is seen as a big source of risk, and one that is directly linked to the prospects for the economy and policy.
"We are skeptical that we will see any fundamental rebound in emerging markets before we get more transparency on the outlook for the Chinese economy and the Chinese financial system and that could take some time," said Lars Christensen, a strategist at Danske Bank in Copenhagen, in a note to clients. "Therefore, caution is still very much warranted."