The time has come when MarketWatch covers Chinese stocks officially. These stocks usually focus on the areas listed in Hong Kong. The desired reason for this is that there are few investors outside China like institutional investors with approved data will be easily able to buy what will be sold in Shenzhen, Shanghai, and various other mainland Chinese bourses. In addition, any other investor can buy Hong Kong-listed names worldwide.
Moreover, all this is about to cone to an end and change in a different way next Monday, when China will launch its game-changing program called “Shanghai-Hong Kong Stock Connect.” This is going to happen for the first time in the history of stock market of China that retail investors will be able to invest in mainland Chinese equities.
In some of the high-profile cases, there are companies that have stock listing in both Shanghai and Hong Kong. In addition, there are still opportunities for such companies in the form of arbitrage to trade their company’s A-shares and H-shares in the stock market.
At this time, beyond the changes for investors, many market participants have said that this new system will play an important role in transforming the China‘s market-reform measures.
As per words of China Merchants Securities managing director Ronald Man, “this is a state policy instead of a simple move concerning two cities’ stock markets.” This scheme will definitely play a vital role in reforming the country’s capital market and financial system. Moreover, according to Beijing’s government, this scheme will help China to make better and stronger economic reform for good financial capital stability.