Getting Inside the Stock Markets of China

Introduction

"China Hot Stocks" is a popular topic among stock investors in recent years. There are many areas of differences, as the American and European stock markets compared, must be understood by prospective investors if they want to participate in a strong bull run China from 2005 after the bear was beaten off.

Color codes of the move

Color codes for price movements are the direct opposite of the Western stock markets. If the price movement is positive becausecompared to the previous day's closing price, the price will immediately be labeled in red. Conversely, if the price moves as on the previous day's close in comparison, the instant price on the particular moment in green.

Shanghai Stock Exchange.

There are 2 boards-A-and B-shares. Shanghai A-shares are traded in Reminbi, while Shanghai B are traded in U.S. dollars. Because China must have currency, the local Chinese are limited in use and trade of the U.S. DollarShanghai B-share price. So the locals mainly traded in the A market, while foreigners could only in the B-market action. From January 2008 there are 840 A-shares listed companies and 54 B-share counters. You can see that B is a relatively small market, a comparison is market.There companies that are listed in both the A and B markets.

Shenzhen Stock Exchange.

There are 2 boards-A-and B-shares. Shenzhen A-shares and Shenzhen B Reminbi are made are made inHong Kong Dollar. The locals mainly trade in the A market controlled by foreign currency, while foreign companies are not limited to the Hong Kong dollar cheap B shares. From January 2008 there are 670 shares, which listed on Shenzhen A market and only 55 on the B market. B-market is less than 10% of the A market.

Hong Kong Stock Exchange - H shares (China companies or affiliated companies in China, Hong Kong-listed ") and Hong Kong companies' stocks are traded in Hong Kong dollars. HongKong's international exposure to western funding, established financial and legal systems attracted many China companies IPO on Hong Kong Stock Exchange, including many China government linked companies such as PetroChina, Bank of China and China Mobile, China Shenhua. An important private stock listed on HKSE in late 2007 is Alibaba.com, an online trading platform for wholesalers by a western-educated Jack Ma.

Taiwan Stock Exchange Index was dark for nearly 10 years. Themain negative factor is a political issue on China's conflict with Taiwan government and its Resultance of disposable drainage of investment flow from Taiwan to China. With the upcoming presidential elections in Taiwan in March 2008, a new nationalist government could decrypt the current economic chaos on the island and to revive Taiwan has the confidence of the market. I would not advise you every step of the Taiwan stock until the election results on 22 March.

What Foreigners CouldBuy me!

Only in Shanghai and Shenzhen B shares, Hong Kong and Taiwan, the markets are open to foreigners. The Authority is slowly opening up channels, indirectly by foreigners could invest in the A-listed shares in Shanghai and Shenzhen.

Price differences

Price differences between A and B shares of the same stock are significant. Real estate developer giant Wangke's A-shares on 28 January 2008 were traded at around 60% higher than the B shares in ShenzhenStock Exchange. This is a major investment in the relative value of B is, if investors are optimistic about this company.

Some Chinese companies are on both the A market in China and Hong Kong Stock Exchange is listed. Price differences between A and H shares of the same camp as Jiangxi Copper H-shares with a dynamic PE of below 10 (Stock Code 358) is only 30% of A-shares (stock code 600362) on the last day of the 25th January 2008. This illustrates the investment valuethe H-shares and the unbelievable huge gaps between A and H shares.

Buying and Selling

Acquisition of shares in the A-and B-markets in Shanghai and Shenzhen markets may be sold only on the next trading day. And there is no "short circuit" allowance for the game. This is very different compared to the Hong Kong market and many western exchanges, where selling of shares could happen in the next minute after you buy or shorting the stock.

Price Movement Limits

PerformanceChinese stocks on the A and B markets are either 5% or 10% per day Trading Limited. Stock closed at $ 10 the day before allowed to move only between the lowest to highest $ 9 $ 11 limits. These limits do not apply to the 1st Trading day after the IPO. And on Stock Exchange rule also does not apply to the market in Hong Kong.

China Stock Market Trend

The locals are hoping a 10-year bull run from 2005. The underlying forces behind the fundamental forces would beaggressive GDP growth of 10% on average over the past 10 years, the global pressure on the Chinese currency appreciation Reminbi, politics, the new tax came into force on 1 January 2008, the successful restructuring of many large state-owned enterprises, government push for high-end production for export values to continue to improve and major international sporting and business events, visits to China in the nest few years such as the Olympic Beijing Games 2008 and Shanghai World Expo2010th