Price Gap Between A, B Shares Narrows Rapidly

The price gap between A and B shares of a same listed company is narrowing rapidly and with it is also a comparatively sluggish A share market after a four-days' deal on B share market.

The gap had actually started narrowing even earlier since the growth for B share was much higher than that of A share last year.

According to China Economic Times, Shanghai B increased in 2000 by 136.22 percent, from 37.91 points to 89.55 points. At the same time Shenzhen Sub B grew 67.58 percent, from 559.96 to 938.36. Obviously, the growth of both Shanghai B and Shenzhen B was much higher than that of Shanghai and Shenzhen Sub of the same year, being 51.73 and 41.05 percent respectively. The rise of B share was much higher than A share, indicating that their price gap was shrinking.

With B share's open to domestic investors late last February, the price gap has become narrower.

Now A share market is still weak and the gap will get still narrower in early March, foretelling more risks in current hot B share investment, expert says.

By PD Online Staff Member Li Heng

People's Daily Online --- http://english.peopledaily.com.cn/