BROWSE

B-Shares

Definition

In finance a B share or C share is a designation for a 'class' of common or preferred stock that typically has strengthened voting rights or other benefits compared to A share that may have been created. The equity structure, or how many types of shares are offered, is determined by the corporate charter.

What is 'B-Shares'

Shares in companies based in mainland China that trade on either the Shanghai or Shenzhen stock exchanges. B-Shares are eligible for foreign investment provided the investment account is in the proper currency (Shanghai B-shares trade in U.S. dollars, while Shenzhen B-shares trade in Hong Kong dollars).

Explaining 'B-Shares'

B-shares trade alongside A-shares in the Chinese companies on the mainland exchanges. Changes in government regulation have allowed Chinese citizens to invest in both A-shares and B-shares after previously limiting investment to only the A-shares.

B-shares are typically what a mutual fund or exchange-traded fund that invests in China will hold, along with H-shares from the Hong Kong Exchange and N-shares, which trade on the New York Stock Exchange.

As part of a long-term effort to open up China's economy, plans are in place for the two share types to be combined in the future to allow for more uniform investment policies; if and when this occurs it should encourage more outside investment in the world's most populous country.


Further Reading


Herding behavior in Chinese stock markets: An examination of A and B shares
www.sciencedirect.com [PDF]
… Volume 16, Issues 1–2, January 2008, Pages 61-77. Pacific-Basin Finance Journal … Herding behavior. Chinese stock market. Asymmetric behavior. A and B shares … Herding in financial markets has been typically described as a behavioral tendency for an investor to follow the …

Panel cointegration of Chinese A and B sharesPanel cointegration of Chinese A and B shares
www.tandfonline.com [PDF]
… Volume 16, Issues 1–2, January 2008, Pages 61-77. Pacific-Basin Finance Journal … Herding behavior. Chinese stock market. Asymmetric behavior. A and B shares … Herding in financial markets has been typically described as a behavioral tendency for an investor to follow the …

The information environment of China's A and B shares: Can we make sense of the numbers?The information environment of China's A and B shares: Can we make sense of the numbers?
www.sciencedirect.com [PDF]
… Volume 16, Issues 1–2, January 2008, Pages 61-77. Pacific-Basin Finance Journal … Herding behavior. Chinese stock market. Asymmetric behavior. A and B shares … Herding in financial markets has been typically described as a behavioral tendency for an investor to follow the …

The relationship between bid–ask spreads and holding periods: The case of Chinese A and B sharesThe relationship between bid–ask spreads and holding periods: The case of Chinese A and B shares
www.sciencedirect.com [PDF]
… Volume 16, Issues 1–2, January 2008, Pages 61-77. Pacific-Basin Finance Journal … Herding behavior. Chinese stock market. Asymmetric behavior. A and B shares … Herding in financial markets has been typically described as a behavioral tendency for an investor to follow the …

Behavioral finance in AsiaBehavioral finance in Asia
www.sciencedirect.com [PDF]
… Volume 16, Issues 1–2, January 2008, Pages 61-77. Pacific-Basin Finance Journal … Herding behavior. Chinese stock market. Asymmetric behavior. A and B shares … Herding in financial markets has been typically described as a behavioral tendency for an investor to follow the …

The valuation differential between class A and B shares: country risk in the Chinese stock marketThe valuation differential between class A and B shares: country risk in the Chinese stock market
onlinelibrary.wiley.com [PDF]
… Volume 16, Issues 1–2, January 2008, Pages 61-77. Pacific-Basin Finance Journal … Herding behavior. Chinese stock market. Asymmetric behavior. A and B shares … Herding in financial markets has been typically described as a behavioral tendency for an investor to follow the …

A Study on Co-integration and Causality among HongKong Red Chips, H-Shares and Mainland Stock Market <span style=[J]' src='/thumbnails/?img=http%3A%2F%2Fen.cnki.com.cn%2FArticle_en%2FCJFDTotal-GLXB200502012.htm' />A Study on Co-integration and Causality among HongKong Red Chips, H-Shares and Mainland Stock Market [J]
en.cnki.com.cn [[J]' href='https:/api.miniature.io/pdf?url=en.cnki.com.cn%2FArticle_en%2FCJFDTotal-GLXB200502012.htm'>PDF]
… Volume 16, Issues 1–2, January 2008, Pages 61-77. Pacific-Basin Finance Journal … Herding behavior. Chinese stock market. Asymmetric behavior. A and B shares … Herding in financial markets has been typically described as a behavioral tendency for an investor to follow the …

Stock returns and volatility under market segmentation: the case of Chinese A and B sharesStock returns and volatility under market segmentation: the case of Chinese A and B shares
link.springer.com [PDF]
… Volume 16, Issues 1–2, January 2008, Pages 61-77. Pacific-Basin Finance Journal … Herding behavior. Chinese stock market. Asymmetric behavior. A and B shares … Herding in financial markets has been typically described as a behavioral tendency for an investor to follow the …

Removal of an investment restriction: the 'B'share experience from China's stock marketsRemoval of an investment restriction: the 'B'share experience from China's stock markets
www.tandfonline.com [PDF]
… Volume 16, Issues 1–2, January 2008, Pages 61-77. Pacific-Basin Finance Journal … Herding behavior. Chinese stock market. Asymmetric behavior. A and B shares … Herding in financial markets has been typically described as a behavioral tendency for an investor to follow the …

Evaluating the impact of market reforms on Value-at-Risk forecasts of Chinese A and B sharesEvaluating the impact of market reforms on Value-at-Risk forecasts of Chinese A and B shares
www.sciencedirect.com [PDF]
… Volume 16, Issues 1–2, January 2008, Pages 61-77. Pacific-Basin Finance Journal … Herding behavior. Chinese stock market. Asymmetric behavior. A and B shares … Herding in financial markets has been typically described as a behavioral tendency for an investor to follow the …



Q&A About B-Shares


What is required to invest in B-shares?

The investor must have a currency account for the proper exchange. For example, if you want to buy Shanghai B-shares, you need a U.S. dollar account with which to purchase them (Shanghai stocks trade in U.S. dollars). If you want to buy Shenzhen stocks, you need a Hong Kong dollar account with which to purchase them (Shenzhen stocks trade in Hong Kong dollars).

What are some examples of these terms?

Some examples include the following terms, among others, and their definitions in this context include but are not limited to these examples.

Where do B-shares trade?

They trade on the Shanghai and Shenzhen stock exchanges.

Why was it important for Chinese citizens to be able to invest directly into A shares?

It was important because previously only A shares were available for investment by Chinese citizens; this limited investment opportunities within China's borders while encouraging outside investment into China's markets through foreign investors who could participate directly in A share trading without needing local currency accounts or being subject to regulations limiting how much money could be invested at any given time by an individual investor or group of investors acting together; these limits were put into place after several large losses suffered by individuals

What is a B share?

A B share is a designation for a share class of common or preferred stock that typically has strengthened voting rights or other benefits compared to the Class A shares.

How does one invest in Chinese companies through mutual funds or ETFs?

Mutual funds and ETFs typically hold both A-Shares and B-Shares of Chinese companies as part of their portfolio holdings; they also may include H Shares from the Hong Kong Exchange and N Shares from the New York Stock Exchange as well as other international investments such as American Depositary Receipts (ADRs) of foreign firms listed on American exchanges and European Depositary Receipts (EDRs) of foreign firms listed on European exchanges.

What are B-shares?

B-shares are shares in companies based in mainland China that trade on either the Shanghai or Shenzhen stock exchanges.

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