Analysis of Hong Kong Stock Market(Group 6).ppt

Comparison of stock markets between Hong Kong and Shanghai The value of turnover in Shanghai stock market from 1991 to 2002. The value of transactions for stocks in Shanghai stock market SWOT Analysis of Shanghai Stock Exchange (SSE) Strengthen Potentially a huge market Catching up effect The comparison in number of companies listed in the stock markets Strengthen Potentially a huge market Catching up effect Investors are better educated Weaknesses The immature of the legal system The apply of strict foreign exchange rules Lengthy lock up periods for QFII Opportunities -In the past: foreign companies restricted to invest B shares. -In 2002: QFII scheme is developed. Foreign companies is allowed to invest A shares after approved by CSRC. -Now: the restriction of QFII scheme is reduced. Opportunities China has a huge population (1.3 billion) Large development potential Foreign companies willing to invest to Shanghai rather than Hong Kong. Opportunities -Infrastructure in Shanghai is improving in recent years. -one of the most efficient infrastructures among the stock markets in Asia -More companies are willing to take part in Shanghai Stock Market to gain the profit. Threats -QFII restricted foreign companies invest to Shanghai Stock Market -Restriction of the QFII scheme is benefit to the other Stock Market. Threats Only Shanghai Stock Market is activated. Other financial market is not well developed. Such as bond market. Foreign can diversify their risks. Foreign companies invest in Hong Kong instead of Shanghai. The Development of Hong Kong Stock Market Ranking of world markets by total equity funds raised (2004) Market Capitalisation of the Worlds Top Stock Exchanges Hong Kong’s reunification with the Mainland ? bridge/platform: Mainland ??World Yr. 2004 - 304 Mainland China Co. listed in HK =28% of the total - Buying and selling Mainland Co. s’ shares: HKD 1665.1 bn, 42% of the total turnover - IPO by Mainland Co. s’ raised