Shanghai Stock Exchange

The Shanghai Stock Exchange (SSE) is the largest stock exchange in mainland China. It is a nonprofit organization run by the China Securities Regulatory Commission (CSRC). Stocks, funds, bonds and derivatives are all traded on the exchange.

On the SSE, there are two main classes of stock for every listed company traded on the exchange: A-shares and B-shares. B-shares are quoted in U.S. dollars and are generally open to foreign investment. A-shares are quoted in yuan and are only available to foreign investment through a qualified program known as QFII.

Chinese equities are also traded on the Hong Kong Exchange, which has been trading H-shares in Chinese companies for many years. These equities are also open to foreign investment and are denominated in Hong Kong dollars (HKD).

Most of the total market cap of the SSE is made up of formerly state-run companies like major commercial banks and insurance companies. Many of these companies have only been trading on the exchange since 2001. The SSE ranked fourth in the world in 2016 in terms of total market cap for equity exchanges, behind only the NYSE, Nasdaq and Tokyo Stock Exchange.

A company hoping to be listed on the SSE must meet the following requirements:

1. The company must have gained the approval of the CSRC.
2. It must have a total share capital of more than RMB (renminbi) 50 million.
3. The amount of publicly-offered stock must be greater than 25 percent of total issued shares, unless a company's total share capital is more than RMB 400 million, in which case the percentage is reduced to only 10 percent.
4. The company must not have committed any major illegal acts or financial report falsehoods over the past three years.

The SSE requires that companies listed on the exchange prepare and disclose periodic reports within the time limit specified in laws, administrative regulations, and various applicable rules. The annual report should be disclosed within four months from the end of each financial year, the interim report within two months of the end of the first half of each financial year, and the quarterly report within one month from the end of the first three months and the end of the first nine months of the financial year. It is also required that the first-quarter report be disclosed no earlier than the annual report of the previous year. 

The company's annual report must be audited by a qualifying CPA firm in the securities- and futures-related business. The SSE generally exempts companies from having to audit their interim and quarterly reports.