There are several cities in the world that can be called centers of business and financial activity. Shanghai, China, is definitely one of them. This is the home to China's biggest stick exchange. Shanghai Stock Exchange (or SSE for short) is the world's 4th biggest stock exchange in terms of market cap and number one in terms of the pace of growth.
Masterforex-V Wiki experts say that SSE differs a lot from its peers. Unlike many other stock exchanges out there, SSE is a public enterprise owned by the Chinese government.
Other private exchange out there, which belong to private operators, sell their stocks to retail investors, which means anyone can become a shareholder. Chinese exchanges are totally owned and controlled by the Chinese government, which makes their stocks inaccessible to retail investors.
On top of that, SSE is a relatively young exchange. It was founded in 1990. However, since then it managed to enter the list of the 60 biggest stock exchanges in the world. In terms of market cap, SSE yields only to NYSE, NASDAQ, and Tokyo Stock Exchange.
The pace of its growth is only capped by the inability of foreign investors to access the exchange. In general, Chinese are against foreign investors buying Chinese stocks. For those of you who don't know, the used to allow foreign entities to buy Chinese stocks until October 2014, but those entities were mostly limited to big-scale institutional investors. Beijing allowed foreign investors to buy only the stocks denominated in USD, but the total market cap of those stocks was way below the one of CNY-denominated stocks.
In 2014, the Chinese authorities allowed foreign retail investors to buy Chinese stock, but only through authorized brokers operating in Hong Kong and Singapore. All in all, there are only 500 of them.
According to Masterforex-V Academy, foreign capital may flood SSE and the entire Chinese stock market in the near future. As a result, SSE may rapidly move up the rating to become number one or even number two in the rating.
Biggest SSE-Traded Stocks
In early April 2019, SSE offered 1556 stocks, with a market cap of 35,115 trillion CNY (well over 5 trillion dollars) and a turnover of 443 trillion CNY (over 66 trillion dollars). Like with other exchanges, SSE's group A is represented by dozens of big-scale stocks - the so-called blue chips. By the way, this is the list of the TOP 20 SSE stocks:
PetroChina Company Limited. Petrochemical industry. Market Cap: 248 billion dollars (2008).
Industrial and Commercial Bank of China. Based in Beijing. World's biggest bank in terms of asset value. Quoted on SEHK and SEZ. In 2014, was number one in Global Forbes rankings and number 25 in Fortune's Global 500. Can boast offices in all parts of the world.
Sinopec. Oil and NG mining and refinery. Shanghai's international port and airport. On top of that, the stocks include a number of promising bans and enterprises. At first, it may seem strange that Alibaba Group is not listed on SSE. This is the world's leader in online trading. It's listed on many exchange worldwide, but not on SSE. Masterforex-V experts say this is a good marketing trick. The reasons for this become obvious if to consider the following facts:
- any Chinese company is controled by the Chinese authorities, which makes it beneficial for CHina to place such a big-scale stock on international stock exchanges
- alibaba.com is an online marketplace where the entire world buys Chinese goods. By selling the stock on international exchanges, the company can attract foreigg investments
- the cornerstone of Alibaba Group's PR strategy is the thesis about the unique and exclusive nature of the brand, with international placement of its stock being a big integral part of this strategy making it possible to achive outstanding results. That's why w dare assume that adding Alibaba's stock to SSE's listing is just a matter of time.
