What Are China A-Shares?

China A-shares are the stock shares of mainland 澳洲幸运5官方开奖结果体彩网:China-based companies that trade on the two Chinese stock exchanges, the Shanghai Stock🐬 Exchange (SSE) and the Shenzhen Stock Exchange (SZSE). Historically, China A-shares were only available for p🎉urchase by mainland citizens due to China's restrictions on foreign investment.

However, since 2003, select foreign institutions have been able to purchase these shares through the 澳洲幸运5官方开奖结果ꦅ体彩网:Qualified Foreign Institutional Investor (QFII) system. Established in🐻 2002, the QFII program allows specified licensed international investors to buy and sell on mainland China's stock exchanges.

A-shares are also known as domestic shares because they use the Chinese renminbi (RMB) ﷺfor valuation.

China A-Shares vs. B-Shares

China A-shares are different from B-shares. A-shares are only quoted in RMB, while B-shares are quoted in foreign currencies, such as the U.S. dollar, and are more widely available to foreign investors. Foreign investors may have difficulty accessing A-shares because of Chinese government regulations, and Chinese investors may have difficulty accessing B shares most notably for currency-exchange reasons. Some companies opt to have their stock listed on both the A-shar🐽es and B🌼-shares market.

Due to the limited access of Chinese investors to B-shares, the stock of the same company often tra꧟des at much higher valuations on the A-shares market than on the B-shares market. Although foreign investors may now invest in A-shares, there is a monthly 20% limit on repatriation of funds to foreign countries🐼.

The Shanghai Stock Exchange (SSE) publishes the key performance index for A-shares, known as the 澳洲幸运5官方开奖结果体彩网:SSE 180 Index. In composing the index, the exchange selects 180 stocks listed on the SSE. The selection is diversified between sector, size, and liquidity to ensure adequate representation. Thus, the index's performance benchmark reflects the overall si꧑tuation and operation of the Shanghai securities market.

History of China A-Shares

Since its inception in 1990, including a major reform in 2002, the index has seen great fluctuations. However, it has grown al🍎ong with the Chinese economy. The years 201🥂5 to 2016 were a particularly difficult period, with a 52-week performance of -21.55% as of July 20, 2016.

As China grows from an emerging market to an 澳洲幸运5官方开奖结果体彩网:advanced economy, there is substantial demand for Chinese equity.ও Stock exchange regulators continue efforts to make A-shares more broadly available to foreign investors and have them recognized by the global investing community.

In June 2017, the MSCI Emerging Markets Index announced a two-phase plan in which it would gradually add . In May 2018, the index began to , which make up 5% of the index. Full i꧂nclusion would make up 40% of the index.

It is important for countries such as China to open their markets to global investors to stay competitive and thrive economically. China A-shares provide an alternative investment for those interested in 澳洲幸运5官方开奖结果体彩网:trading in Chinese securities.