Shanghai Stock Exchange

Shanghai Stock Exchange

Introduction

The shanghai Stock Exchange is the first Chinese Stock Exchange. It has a history, the Shanghai Stock Exchange reestablished in 1990. The old Shanghai Stock Exchange was closed in 1949 when communist took over the country. (www.advfn.com, 2012).The trading of the securities in China started from 1866. In 1891the foreign business persons founded “Shanghai Share broker's Association” which became china's first stock exchange market. Shanghai share broker's association applied for the registration in 1904 under company's ordinance in Hong Kong and changes its name to “Shanghai Stock Market”. Shanghai Stock Market had emerged as the hub of trading securities in Far East. On 8th December 1941 shanghai Stock exchange stops it's working because Japanese troops occupied shanghai. After five years in 1946 Shanghai Stock Exchange again became functional but in 1949 when communist revolution came, Shanghai Stock Exchange again stopped working. Shanghai Stock Exchange again established on November 26th, 1990 but it started its operation on 19th December. The Shanghai Stock Exchange is governed by the “China Security Regulatory Commission” (CSRC). The Shanghai Stock Exchange wants to generate a safe and efficient market which should be open for all. Shanghai Stock Exchange wants to make the market operations transparent. There are several activities which are performed by the Shanghai Stock Exchange like it provides the platform for trading of the securities. It formulates the standards and rules of the stock exchange and it also monitor and organize the trading of the securities. Shanghai Stock Exchange has become one of the top performing markets of China. By the End of December 2007 the number of investors in shanghai Stock Exchange were 71.3 million and the number of listed companies were 860. It has helped many companies in raising the capital. (www.sse.com.cn, 2012). It can be said that Shanghai Stock Exchange is the first and the largest stock Exchange of China. There are four main indexes operating in the Shanghai Stock Exchange SSE 50 index, SSE 180Index, SSE Composite Index and SHSE-SZSE 300Index. Shanghai Stock Exchange itself is a nonprofit institution. The stocks which are traded in the Shanghai Stock market can be categorized into two stock that is stock A and Stock B. Stock A are those stocks which are traded in the local currency of China whereas Stock B are those stocks which are traded in U.S. dollars. Majority of the stocks in the Shanghai Stock Exchange are Stock A.

Responsibilities

There are some responsibilities of the capital markets which should be served or delivered by the market and if the stock market does not perform its duties it can cause a significant loss not only to the market but also to the investors and to the economy as well. The responsibilities of the Shanghai Stock Exchange are to provide the platform for the trading of securities, formulate business rules or set the standard of the trading which are in the favor of the investors. One of the major duties of the Shanghai Stock Exchange is the listing of ...