Definition of H-shares

H-shares are shares of mainland Chinese companies traded on the Hong Kong stock exchange and denominated in Hong Kong dollars. Many of the companies listed in Hong Kong trade simultaneously on mainland Chinese stock exchanges. H-shares are seen as more liquid and less volatile than Chinese-listed A-shares and B-shares.

 

H-shares in the news

In March 2013 it was reported that H-shares were underperforming woefully along with stock of western companies whose revenues are exposed to China. The underperformance was attributed to the fact that China's growth, while still brisk compared to western countries, was slowing. The sluggish performance of H-shares was a little surprising to some who had expected a poor performance in Chinese A-shares, which suffered a bubble in 2007 and shattered the confidence of the domestic investors permitted to invest in them.

In February 2013, the FT's Lex team commented that the H-shares of Ping An, the Chinese insurer, were up only half as much as its Shanghai-based A-shares since the Chinese market went on a tear in December, while Hong Kong-listed China stocks have generally gained only a third less over that time. 

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