Proceedings of World Business and Social Science Research Conference
25-25 October, 2013, Novotel Bangkok on Siam Square, Bangkok, Thailand, ISBN: 978-1-922069-33-7
A Preliminary Study of the Emerging and Developing Stock
Market of China
Hai Long*
Chinese share market as an emerging and fast-growing listing venue has
experienced a significant development since 2000. Prior studies on this market
are overwhelmingly interested in IPO-pricing-related and post-IPO performance
based propositions with lagging data. Adopting the updated data within the last
couple of years, this paper comprehensively explores and accounts for some
striking features of Chinese stock market based on previous literature, and
unfoldes some new causes contributing to these characteristics.
Some new findings are received. 1) There are two new factors may lead to the
extreme underpricing in China’s market, which are unseasoned market
participants (including inexperienced issuers, underwriters, and investors) and
high demand of IPO shares. 2) The foreign-currency trading platform is not
effective and efficient to attract overseas investors. 3) The unbalanced industry
structure of listed firms is very significant, Chinese share market is dominated
by manufacturing firms. 4) The Alternative Share Market in China is essential to
address the long-standing financing difficulties for Chinese Small and Mediumsized Enterprises, which are unqualified to raise capital from the Primary Stock
Market.
JEL Codes: G10, G14
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Mr. Hai Long, School of Business, Edith Cowan University, Australia. Email:soholonghai@163.com