The Shanghai Stock Exchange is the Stock Exchange in China that is based in the city of Shanghai. The Shanghai Stock Exchange was established on 26 th November 1990. The Shanghai Stock Exchange is governed by the Chinese Securities Regulatory Commission . Trading in Shanghai Stock Exchange is safe, transparent and efficient.
Role of the Shanghai Stock Exchange
The Shanghai Stock Exchange performs the following functions:
Provision of a market place where securities can be traded.
- Formulation of business rules.
- Accepting and arranging the listing of companies and securities.
- Organizing and monitoring the trading of securities.
- Regulating the activities of the participating members and the listed companies.
- Managing and circulating the market information.
Structure of the Shanghai Stock Exchange
When we look at the securities list of the Shanghai Stock Exchange then we see that are three kinds of bonds, stocks and funds . The three kinds of bonds are the Treasury bonds, corporate bonds and the convertible bonds. Among these the treasury bonds are the most active.
There are again two kinds of stocks issued in the Shanghai Stock Exchange. They are:
A shares: They are priced in the local Renminbi yuang currency . These shares were restricted to the domestic investors. After the reforms in 2002 the foreign investors also have right to these shares.
B shares: They are quoted in the US dollars. T hese shares are made available to the domestic as well as the international investors.
Market Size of Shanghai Stock Exchange
As per the data on 2006 there were 842 companies on the Shanghai Stock Exchange. The total market capitalization was RMB 7.1612 trillion. The market value of the A shares was 7111.8 billion yuang with an annual turnover of 5724.5 billion yuang. The market value of the B shares was 49.4 billion yuang with an annual turnover of 57.1 billion yuang.
Top Five Largest Stocks in the Shanghai Stock Exchange
- Industrial and Commercial Bank Of China
- China Life Insurance
- Bank Of China
- Sinopec
- China Merchants Bank
Indices used in the Shanghai Stock Exchange
Shanghai Stock Exchange Composite Index : This indicator is widely used and used to measure the market performance of the Shanghai Stock Exchange. The Shanghai Stock Exchange Composite Index comprises of the listed stocks, both A and B types in the Shanghai Stock Exchange. This index began operation in July 15, 1991.
The other indices that are used in the Shanghai Stock Exchange are:
- Shanghai Stock Exchange 50 index or the SSE 50 Index
- SSE 180 Index.