What is the current situation and trends in the Chinese securities market?
China's markets are divided into foreign-currency-denominated B shares and RMB-denominated A shares; A shares account for most of the market's value and remain technically off-limits to foreign investors. China's markets also feature a mix of lock-up provisions for strategic investors that prevents quick profit-taking following initial public offerings (IPOs), and a closed capital account that prevents repatriation of RMB profits. But the fact that a significant portion of the almost US$ 900 billion in RMB savings deposits held by Chinese citizens will gradually shift to securities investments has foreign companies trying to establish themselves in China as early as possible. Foreign-invested enterprise mutual funds, via domestic brokers, will be able to accept RMB upon establishment and invest in A shares.
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