Stock Market Management Lessons from China
Transparency and economy are prime aims in China. It is a great formula for stock investing. There was a time when the China stock market scene was unknown. Investors viewed it with suspicion. Regulations continue to be very different here. Premier Wen Jiabao is directly involved. He is not concerned with interest rates alone either.
The most significant step is to regulate block deals in stocks. All such transactions are channeled through a single window. This measure protects the interests of all genuine stakeholders. It is also an important security measure in the national interest.
China has reduced the total cost of every stock transaction. Any stock exchange in the country is now more competitive than before. Everyone gains from a reduction in transaction tax. It fosters higher volumes. New stock market entrants will also be encouraged by this measure.
Such measures show China in new light. Active regulation helps stock investors. It proves that the administration is honest and responsible. Investment benefits are spread fairly for the good of all people. This approach to governance scores over unbridled free enterprise. It fosters private initiative while preventing abuse of freedom at the same time. It is also better for the poor and for small business.
Count on China for your enterprise and for personal finances as well. The country has a vibrant stock market. It serves the booming economy well. Many of the world’s best run companies have business links with China. Top domestic companies from China have ADRs available for investment in the US.