Market Overview

Millions of new investors piled into mainland Chinese stock markets in 2020

More Chinese investors are piling into the local stock market. In December, the mainland stock market recorded 1.62 million new investors — double the 809,300 reported a year ago, according to China Securities Depository and Clearing. The organization handles trades for the Shanghai and Shenzhen stock exchanges.

For all of 2020, new investors increased by 18.02 million to 177.77 million, the data showed. That’s about 1.5 million new accounts a month. The surge of interest comes as many people around the world turned to stock trading while being stuck at home due to the coronavirus pandemic. The new investor accounts in China come as mainland stocks soared last year, with some becoming the best performers in the world.

For example, the Shenzhen component climbed 38.7% and the CSI 300 rose 27.2% in 2020, compared to to gains of 16.26% for the S&P 500. The CSI 300 tracks the top 300 stocks on the Shanghai and Shenzhen exchanges. Investors also had more Chinese companies to choose from as new listings flooded the market. Mainland China and Hong Kong accounted for 40% of the world’s initial public offerings last year, according to Ernst & Young.

The Shanghai Stock Exchange, with its main board and Star market, ranked first in the world with 233 IPOs, the study said, adding that Shenzhen came in third, just after the Nasdaq in New York. Chinese investors were also eager to buy stocks in Hong Kong, where many of China’s biggest and most popular companies are listed, such as Tencent and Meituan. Others like JD.com held secondary listings in Hong Kong last year.

Millions of new investors piled into mainland Chinese stock markets in 2020, CNBC, Jan 21

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