Arab Today, arab today shanghaihong kong stock link to accelerate chinas reforms
Last Updated : GMT 12:51:33
Arab Today, arab today
Arab Today, arab today

Shanghai-Hong Kong stock link to accelerate China's reforms

Arab Today, arab today

Arab Today, arab today Shanghai-Hong Kong stock link to accelerate China's reforms

Hong Kong stock
Beijing - XINHUA

A stock trading program linking the Shanghai and Hong Kong exchanges will speed up reforms of China's stock markets and make them more attractive to investors at home and abroad, according to analysts.
Test trading on the Hong Kong stock market began last week for the Shanghai-Hong Kong Stock Connect, a pilot program designed to allow mutual stock market access for investors in the Chinese mainland and Hong Kong.
From Aug. 11 to Sept. 5, securities brokerages on the Chinese mainland may make simulated investments in 14 selected stocks from the Hong Kong stock exchange to test the new system, the Shanghai bourse said.
The tests include regular stock trading and clearing, trading suspension in the case of high typhoon alerts, adapting to different work day systems on the Chinese mainland and Hong Kong, and other possible conditions.
The Hong Kong stock exchange said it will conduct tests for investments in Shanghai between Aug. 23 and Sept. 13.
The program was first announced in April. A joint circular released by both bourses said there would be a six-month preparation period before official launch of the scheme.
Analysts predict that mutual trading access will be officially launched in mid-October, following technological preparation and tests of both exchanges.
The program will step up the market-oriented reform of the mainland, especially reform in the securities market, and promote the integration of mainland and Hong Kong capital markets, said Dong Dengxin, a financial and securities researcher at Wuhan University of Science and Technology.
Compared with that of Hong Kong, an important global financial center, the mainland's stock market lags behind in terms of openness to global capital, effective supervision and protection for investors.
The program will press the mainland to bring its stock markets up to international standards, with well-functioning laws and regulations, high quality of listed companies and market-oriented initial public offering (IPO) and delisting mechanisms, experts said.
The mechanism will help raise the attractiveness of China's securities market to investors both at home and overseas, according to Dong.
At present, institutional investors outside the Chinese mainland can only invest on the Shanghai and Shenzhen bourses by becoming Qualified Foreign Institutional Investors (QFII).
China launched the QFII scheme in 2002 to allow licensed foreign investors to use offshore yuan to invest in China's capital market. Currently, 229 institutions are included in the program with a combined investment quota of 150 billion U.S. dollars.
The Shanghai-Hong Kong program provides another channel for overseas investors to invest in the mainland, although trading in the initial stage will only be allowed for a portion of stocks on both bourses and below a certain trading volumes.
Under the mechanism, the upper limit for trading Shanghai-listed stocks is set at 300 billion yuan (48.76 billion U.S. dollars), while that for Hong Kong-listed shares is 250 billion yuan.
If the restrictions are lifted in the future, the program will unleash huge growth potential for the stock market in the mainland, said Xi Junyang, professor with the Shanghai University of Finance and Economics.
Dong said that the new program will also help narrow the gap between a company's stock prices in Shanghai and Hong Kong.
At present, 68 Chinese companies are listed in both Shanghai and Hong Kong, and their share prices on both bourses are often drastically different.
In the future, share prices of those companies are likely to become more similar and approach a reasonable level, according to Dong.
However, experts also warned investors against risks from different trading rules on the two bourses.
For instance, stocks in Shanghai are subject to a daily rise or fall limit of 10 percent, but those in Hong Kong can fluctuate by any amount.
"If a situation like the 2008 financial crisis were to happen again, the daily fluctuation could be very huge. Investors must carefully do basic stock research and properly control risks," said Wang Xiaojun, analyst with Cinda Securities.

Name *

E-mail *

Comment Title*

Comment *

: Characters Left

Mandatory *

Terms of use

Publishing Terms: Not to offend the author, or to persons or sanctities or attacking religions or divine self. And stay away from sectarian and racial incitement and insults.

I agree with the Terms of Use

Security Code*

Arab Today, arab today shanghaihong kong stock link to accelerate chinas reforms Arab Today, arab today shanghaihong kong stock link to accelerate chinas reforms

 



Arab Today, arab today
Arab Today, arab today Fadi explains secrets of  Nancy Ajram's newlook

GMT 18:23 2017 Friday ,24 February

Fadi explains secrets of  Nancy Ajram's newlook
Arab Today, arab today Tourist guide explains types of tourism

GMT 18:28 2017 Saturday ,25 February

Tourist guide explains types of tourism
Arab Today, arab today Expresses Algerian history by woody figures

GMT 13:26 2017 Friday ,24 February

Expresses Algerian history by woody figures
Arab Today, arab today Iran complying with nuclear deal

GMT 07:14 2017 Saturday ,25 February

Iran complying with nuclear deal
Arab Today, arab today Ayat Abaza says state TV presented major stars

GMT 03:52 2017 Sunday ,26 February

Ayat Abaza says state TV presented major stars
View News in Arabic - Business: اقتصاد دولي
Arab Today, arab today
Arab Today, arab today
Arab Today, arab today Reading therapy relieves mental disorders

GMT 15:39 2017 Friday ,24 February

Reading therapy relieves mental disorders
Arab Today, arab today UK appoints 1st Scotland Yard chief in 188 years

GMT 05:14 2017 Thursday ,23 February

UK appoints 1st Scotland Yard chief in 188 years
Arab Today, arab today Penguins in the age of dinos

GMT 11:44 2017 Saturday ,25 February

Penguins in the age of dinos
Arab Today, arab today Pluto's unruly moons

GMT 06:31 2015 Thursday ,04 June

Pluto's unruly moons
Arab Today, arab today 'Constructive' Vauxhall talk with union

GMT 08:54 2017 Saturday ,25 February

'Constructive' Vauxhall talk with union
Arab Today, arab today Tesla back into red but revenue grows

GMT 07:27 2017 Thursday ,23 February

Tesla back into red but revenue grows
Arab Today, arab today Ola Ghanem hopes to work with M.Ramadan

GMT 07:23 2017 Friday ,24 February

Ola Ghanem hopes to work with M.Ramadan
Arab Today, arab today Ex-yoga missionary unleashes rage

GMT 12:16 2017 Thursday ,23 February

Ex-yoga missionary unleashes rage

GMT 06:08 2017 Thursday ,23 February

Actress Lobna Abdel Aziz proud of her career

GMT 12:35 2017 Tuesday ,21 February

63-Year-Old Woman Delivers Baby

GMT 22:42 2017 Thursday ,23 February

Nasima Gamei revives heritage in jewelries

GMT 10:28 2017 Wednesday ,22 February

Milan laughs while Rome cries

GMT 20:33 2017 Friday ,17 February

To release new antiques collection

GMT 10:20 2017 Thursday ,23 February

Brazil's top diplomat resigns

GMT 11:54 2017 Thursday ,23 February

Saudis await visitors but will they come?

GMT 13:12 2015 Saturday ,09 May

Sheikh Sultan opens Sharjah Centre

GMT 20:02 2017 Tuesday ,21 February

Nohan Seyam designs beautiful accessories
Arab Today, arab today
Arab Today, arab today
 
 Arab Today Facebook,arab today facebook  Arab Today Twitter,arab today twitter Arab Today Rss,arab today rss  Arab Today Youtube,arab today youtube  Arab Today Youtube,arab today youtube
arabstoday arabstoday arabstoday arabstoday
arabstoday arabstoday arabstoday
arabstoday
بناية النخيل - رأس النبع _ خلف السفارة الفرنسية _بيروت - لبنان
arabstoday, Arabstoday, Arabstoday