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H-Shares vs. A-Shares: An Overview
When a Chinese company goes public, it can choose to list its shares on any of the stock exchanges in mainland China, or it can choose the Hong Kong Stock Exchange (HKG). Some companies choose both. H-shares are shares that trade in Hong Kong and A-shares are traded on the mainland.
H-shares trade on Hong Kong’s exchanges and are regulated by Chinese law, although it has a separate financial system. These securities are priced in Hong Kong dollars and are freely traded by anyone, including foreign investors.
A-shares, on the other hand, represent publicly listed Chinese companies that trade on Chinese stock exchanges such as the Shenzhen Stock Exchange (SZSE) and Shanghai Stock Exchange (SSE). These stocks trade in Chinese yuan renminbi (CNY). Chinese law makes it very difficult for foreign investors to buy and sell A-shares.
Key Takeaways
- H-shares of Chinese companies listed on the Hong Kong Stock Exchange are quoted and traded with a face value of Hong Kong dollars.
- H-shares are open for trading to all investors.
- A-shares are shares of companies based in mainland China that are listed on either the Shanghai or Shenzhen stock exchanges.
- A-shares are generally not available to foreigners, aside from a select group of institutional investors.
H-Shares
H-shares represent the shares of public companies from mainland China that are listed on the HKG. As such, these shares are issued in China under Chinese law but are subject to the HKG’s listing requirements. The rules state that:
- A company’s annual accounts must follow Hong Kong or international accounting standards.
- A company’s articles of incorporation must also include sections clarifying the varying nature of domestic and foreign shares, including H-shares, as well as the rights given to each purchaser.
H-shares trade with a face value of Hong Kong dollars. These shares are also open for all investors to trade, including international investors. For instance, people in the U.S. who are interested in buying and selling H-shares can do so through the international trading platform of their brokerage firm. This is unlike A-shares, which are generally not open to foreign investment.
There are usually price discrepancies between a company’s A-shares and H-shares. A-shares generally trade at a premium to H-shares.
Fast Fact
There is a third class of Chinese shares. B-shares are also made up of incorporated Chinese companies. They are quoted in foreign currencies such as the U.S. dollar and the HKD, depending on the listing exchange. These shares are more widely available to foreign investors.
A-Shares
A-shares are the shares of incorporated companies based in mainland China that are listed on either the Shanghai or Shenzhen stock exchanges. These shares are issued in China under Chinese law and are quoted in Chinese yuan or renminbi.
After 2007, China let mainland Chinese investors purchase either A-shares or H-shares of companies listed on the Shanghai Stock Exchange. Before that, Chinese mainland investors could purchase only A-shares, even though H-shares were also offered.
A-shares are generally only available to citizens of mainland China, which makes it difficult for the average foreign investor to get into the market. The country’s laws do allow foreign investment through a regulated structure. Some institutional investors may qualify as Qualified Foreign Institutional Investors (QFIIs) or other strict trading programs. Only a select group of institutional investors have qualified for QFII status and can buy and sell Chinese A-shares.
Since foreign investors may trade H-shares, the shares are more liquid than A-shares. For American investors who are not QFII qualified, the only way to access these shares may be through an emerging market fund or by investing in American depositary receipts (ADRs).
MSCI Emerging Markets Index
There has been a great deal of effort to give individual foreign investors a greater opportunity to put their money into A-shares. One way investors can do so is by looking at different investment opportunities that may include A-shares like exchange-traded funds (ETFs) and other funds.
In 2019, the MSCI Emerging Markets Index announced that it was increasing its weight of large-cap A-shares from 15% to 20% by November 2019—a move it said was well-received by investors. By the end of the move, the firm said it would have 253 large-cap and 168 midcap A-shares in the index.
As of April 2025, the index had 29.6% of its portfolio invested in China.
Important
In January 2024, India’s stock market surpassed Hong Kong’s, becoming the world’s fourth-largest stock market with a value of $4.33 trillion. Stocks trading in Hong Kong were valued at $4.29 trillion.
Special Considerations
Buying shares of public Chinese companies isn’t as simple as buying shares in the United States. While shares traded on public markets in the U.S. are generally available to anyone, the Chinese stock markets have strict restrictions on who can buy and what is available to them for purchase. The distinctions are important to know if you want to start trading or investing there.
One way to invest in China is through an American depositary receipt (ADR). These certificates, which represent a certain number of shares of foreign companies, trade on the U.S. market. ADRs remove any restriction for investors who cannot otherwise invest in a foreign entity. And since they trade on American exchanges, they’re valued in U.S. dollars, so there are no pricing, currency value, or exchange issues.
Investors can also use the Shanghai-Hong Kong Stock Connect, a system designed to give investors mutual market access. It links the stock exchanges in Shanghai and Hong Kong and lets investors trade shares in each market using their brokers. Established in 2014, it allows foreigners to buy A-shares without the typical restrictions. All transactions are conducted in Chinese currency, not in Hong Kong dollars.
Explain Like I’m Five
China has two separate stock markets, with different financial regulations and currencies. Shares on the Hong Kong stock exchange are called H-shares, and shares on the mainland market are called A-shares. Chinese companies can issue shares on either or both markets.
H-shares are priced in Hong Kong dollars and are available to foreign investors, while A-shares are priced in Chinese yuan and are only accessible to Chinese investors. However, you can buy A-shares through an ETF or similar vehicle.
What’s the Easiest Way to Invest in China?
Foreign investors have several options of investing in Chinese companies and the country’s economy. Interested individuals can purchase shares of ETFs, mutual funds, and index funds that hold Chinese companies in their portfolios. Other options include buying American depositary receipts, which represent a number of shares in Chinese companies. These securities trade on U.S. exchanges in U.S. dollars. Another option is to invest directly in Chinese companies that trade on the Hong Kong Stock Exchange by executing trades on an international trading platform through a brokerage firm.
How Many Stock Exchanges Are There in Mainland China?
There are three stock exchanges that operate in mainland China. The largest is the Shanghai Stock Exchange, followed by the Shenzhen Stock Exchange and the Beijing Stock Exchange.
What Is the World’s Largest Stock Exchange?
The New York Stock Exchange (NYSE) is the world’s largest stock exchange. As of January 2024, it had a market cap of $25.56 trillion and 2,272 listed companies.
The Bottom Line
H-shares and A-shares are two types of shares of public companies from mainland China. While A-shares trade on Chinese stock exchanges and are typically reserved for citizens of mainland China, international investors can access A-shares. These shares are for public Chinese companies that trade on the Hong Kong Stock Exchange.
Talk to a brokerage firm if you’re interested in investing in A-shares. As with any investment, make sure you do your due diligence and research before diving into this market.
