These days, Zhang Nin gladly sacrifices her short lunch breaks so she can line up at the bank and buy US dollars for local currency.
The 24-year-old marketing executive at a Shanghai wine company needs the money to buy hard-currency B-shares, which recently have emerged as an even hotter commodity than the sizzling local-currency A-shares.
"I bought some B-shares on Tuesday and two days later they had risen by about 15 percent," she said. "That's amazing, as A-shares I bought three weeks ago only earned me about 20 percent of profit."
China's stock markets have skyrocketed in recent days and weeks, boosted by massive inflows of investor money.
But while the A-share market has boomed, retail investors have found that some B-shares issued by the same companies have risen even faster.
A-shares are denominated in the Chinese currency and were originally reserved for local investors, while previously only foreigners could buy B-shares, denominated in either US dollars or Hong Kong dollars.
The distinctions between the two have disappeared somewhat as local people have been permitted to buy B-shares since early this decade, while foreigners are allowed into the A-share market via qualified foreign institutional investors.
Most of the 110 B-shares are also listed on the A-share market and they are generally cheaper than their A-share peers, with an average discount of 20 percent to 30 percent, said Zhang Qi (
"The price disparity of A-shares and B-shares has always been there," Zhang said.
"But it was only in late April that retail investors suddenly woke up to find the value of B-shares was low from the past bearish years and started to speculate on them," Zhang said.
The Shanghai B-share Index surged 80 percent in the month ending on Thursday, compared with a 12 percent rise in the benchmark index in the same period.
Turnover on Thursday was more than US$7 billion, more than double the value of the Taiwanese market.
The B-share market was originally established in an attempt to channel foreign funds into listed firms, but foreigners have shown little interest.
"Foreign investors have better options like the Hong Kong market if they want to invest in Chinese firms, that's why B-share market is now dominated by retail investors -- they prefer inexpensive stocks," said Gui Haoming with Shenyin Wanguo Securities (
The once marginalized B-share market, with a market capitalization merely 2 percent of the US$2.3 trillion A-share market, is seeing sharper rises now, but it may also become a spearhead should a correction come.
"I think some B issues are obviously overvalued as their fundamentals have barely changed from years ago. We had better be cautious," Gui said.
"The B-share market would be more vulnerable to large swings as most participants are individuals," he said.
MORE VISITORS: The Tourism Administration said that it is seeing positive prospects in its efforts to expand the tourism market in North America and Europe Taiwan has been ranked as the cheapest place in the world to travel to this year, based on a list recommended by NerdWallet. The San Francisco-based personal finance company said that Taiwan topped the list of 16 nations it chose for budget travelers because US tourists do not need visas and travelers can easily have a good meal for less than US$10. A bus ride in Taipei costs just under US$0.50, while subway rides start at US$0.60, the firm said, adding that public transportation in Taiwan is easy to navigate. The firm also called Taiwan a “food lover’s paradise,” citing inexpensive breakfast stalls
TRADE: A mandatory declaration of origin for manufactured goods bound for the US is to take effect on May 7 to block China from exploiting Taiwan’s trade channels All products manufactured in Taiwan and exported to the US must include a signed declaration of origin starting on May 7, the Bureau of Foreign Trade announced yesterday. US President Donald Trump on April 2 imposed a 32 percent tariff on imports from Taiwan, but one week later announced a 90-day pause on its implementation. However, a universal 10 percent tariff was immediately applied to most imports from around the world. On April 12, the Trump administration further exempted computers, smartphones and semiconductors from the new tariffs. In response, President William Lai’s (賴清德) administration has introduced a series of countermeasures to support affected
CROSS-STRAIT: The vast majority of Taiwanese support maintaining the ‘status quo,’ while concern is rising about Beijing’s influence operations More than eight out of 10 Taiwanese reject Beijing’s “one country, two systems” framework for cross-strait relations, according to a survey released by the Mainland Affairs Council (MAC) on Thursday. The MAC’s latest quarterly survey found that 84.4 percent of respondents opposed Beijing’s “one country, two systems” formula for handling cross-strait relations — a figure consistent with past polling. Over the past three years, opposition to the framework has remained high, ranging from a low of 83.6 percent in April 2023 to a peak of 89.6 percent in April last year. In the most recent poll, 82.5 percent also rejected China’s
PLUGGING HOLES: The amendments would bring the legislation in line with systems found in other countries such as Japan and the US, Legislator Chen Kuan-ting said Democratic Progressive Party (DPP) Legislator Chen Kuan-ting (陳冠廷) has proposed amending national security legislation amid a spate of espionage cases. Potential gaps in security vetting procedures for personnel with access to sensitive information prompted him to propose the amendments, which would introduce changes to Article 14 of the Classified National Security Information Protection Act (國家機密保護法), Chen said yesterday. The proposal, which aims to enhance interagency vetting procedures and reduce the risk of classified information leaks, would establish a comprehensive security clearance system in Taiwan, he said. The amendment would require character and loyalty checks for civil servants and intelligence personnel prior to
RSS