The Stock Price Differences Between Domestic And Foreign Market For Chinese Listed Companies After The Equity Division Reform

With the mainland capital market openness and continuous improvement,the problems that the stock price differences between domestic market and foreign market are increasingly attracted attention by investors and scholars.The foreign research show that:the market segmentation lead to the stock price difference,and perform foreign capital shares premium,but it performs foreign capital shares discount from the domestic capital shares in China.The problem not only worth for scholars to deeply researched,can also provide investors some reference and provide relevant decision-makers the theoretical basis for decision-making.This article includes:stock price difference before and after the equity division reform;stock price difference between A-shares and H-shares;stock price difference between N-shares and H-shares;and the "inerted-premium" about the A+H shares.The study found that the discount ratio of foreign capital shares was declined after the equity division reform.Through A+H shares empirical research we found that:The greater difference between the IPO price of the company the greater the difference in trading prices;A-shares' more Liquidity,stronger volatility and higher market yield will cause the greater difference in trading prices;On the H-shares is just the opposite;The RMB appreciation has been made to reduce the price difference; Outbreak of the sub-prime mortgage crisis to expand the A + H shares on the secondary market price differences.The main factors of N+H shares price difference are:the differences in liquidity,volatility,the exchange rate fluctuations and the sub-prime mortgage crisis.The study also found that some companies have emerged in foreign capital shares "inerted-premium"(As an example to A+H shares),but not very serious,there is still overall foreign capital shares discount from the domestic capital shares.A-shares slump and non-tradable share can trade in the secondary market are the main factors about the price difference for the "inerted-premium" companies.