A-share market allows purchases of one share

Investors trading stocks or listed funds will be allowed to place orders of a minimum of one share or one unit, the Shanghai and Shenzhen bourses announced on Thursday. At present, each order must be in blocks of 100 shares or units in the A-share market.

This will be part of the exchanges' efforts to lower costs for investors, enable more efficient use of capital and help improve market liquidity, the bourses said.

The trading of a minimum one share is widely adopted in overseas markets. When the STAR Market was officially launched four years ago, the incremental part of an order is allowed to start from one share as long as it is more than 200 shares.

During a financial forum held in Beijing on Friday, Wu Xiaoqiu, former vice-president of the Renmin University of China and dean of the China Capital Market Research Institute, said that the green light given to the trading of one share or one unit of funds has posed new challenges to the existing trading mechanism and techniques. Companies specializing in financial technologies will thus embrace larger room of development.

Meanwhile, the exchanges said they are studying to introduce the after-hours fixed-price trading mechanism for exchange-traded funds. It means that investors can buy and sell stocks according to the closing price after the auction transaction ends. This trading mechanism is currently only at the technology-focused STAR Market and ChiNext.

The exchanges' announcements came after the Political Bureau of the Communist Party of China Central Committee's expressions, made on July 24, saying that more efforts should be made to invigorate the capital market and boost investor confidence. China Securities Regulatory Commission, the country's top securities watchdog, said on July 25 that policies should be implemented comprehensively to facilitate investment, financing and trading.

shijing@chinadaily.com.cn