5 Things Investors Should Know About China’s Stock Marke
For the uninitiated, it can be a surprise to learn that relying on a single form of income (such as a payslip or government-issued cheque) is dangerous and too unstable to build a life around. Professional investors all agree that having many different cash-producing assets is the superior way of managing finances.
Robert Kiyosaki (known for his expertise in the financial world) says that the best use for your personal money is by acquiring assets. The best way for a beginner to acquire assets is by investing in stock, and if you keep reading, we’ll give you five good reasons why you should invest in China’s stock market.
1. China’s Economy is Growing Really Quickly
Economic growth means that a country’s real GDP has increased from the previous year. This growth is driven by stronger output and higher value of all the goods produced by the country, which means more money coming in. Over the last few years, China’s economy has consistently grown by more than double the global average.
Chinese companies invest the extra money they make so that they can produce more valuable goods and services and provide better returns for their investors.
2. The Strong Shanghai Strock Exchange
China currently has two independent stock exchanges. The Shanghai Stock Exchange (SSE) has two trading boards. The mainboard features large Chinese companies that have histories of success. A-Class and B-Class shares in these companies nearly guarantee returns.
The SSE’s secondary board is known as the STAR Market and lists mostly Chinese technology firms. These kinds of investments are a little riskier but offer better rewards as the world continues to depend on better technology.
3. The Shenzhen Stock Exchange
China also has a secondary stock exchange based in the city of Shenzhen and also has two boards. Most of the companies listed on the mainboard are manufacturing companies, whereas the ChiNext board is like the SSE’s STAR Market, offering shares in smaller start-up companies.
What makes the SZSE so attractive is that it offers a wide range of different share options, bonds, and securities.
4. The Upcoming Beijing Stock Exchange
Also known as the “New Third Boar”, China is opening up another stock exchange in Beijing to allow small and medium enterprises (SMEs) to list their stock for sale. This will allow smaller companies to raise capital quickly with the hopes of growing to the point where they can be listed on bigger stock exchanges.
5. Anyone can Invest in China’s Stock Market
Having access to a diverse array of stock options is an investor’s dream, but China has laws to encourage citizens to buy Chinese stocks. One such regulation is that Chinese citizens have almost exclusive access to A-Class shares.
Luckily there are programs that allow foreign investors to qualify for A-Class shares as well as any other kind of Chinese securities or stocks that are listed. One such service can be found at https://www.monexsecurities.com.au/investing-in-china-stock-market/.
Buying Chinese Stock is Good for Your Portfolio
There are many benefits to adding stocks from China’s Stock Market to your investment portfolio. It’s also open to anyone, from the seasoned investor to someone just starting out.
If you found this article informative, be sure to check out the rest of our blog to learn more about investing and financial trends.