Ahead of the launch of the Shanghai-London Stock Connect, which is set to be launched today, the Financial Conduct Authority (FCA) and the China Securities Regulatory Commission (CSRC) have jointly announced their approval of the scheme this Monday.
The scheme, which will launch today at a ceremony at the London Stock Exchange (LSE), is an arrangement between the LSE and Shanghai Stock Exchange (SSE) to encourage cross-border investments.
Via the stock connect, companies will sell shares through dual listings on the exchanges, providing firms in the United Kingdom and China with mutual access to each other's capital markets.
The Shanghai-London Stock Connect will allow companies listed on the SSE to apply to be admitted to trading on a newly formed Shanghai Segment of LSE’s Main Market. For the UK, companies with a premium listing will be able to apply for admission to the Main Board of the SSE.
For both the UK and China, the securities traded will be in the form of depositary receipts, a common way of facilitating overseas companies access to institutional investors. While this structure is not new for British investors, it is new to China, giving Chinese investors exposure to international securities via an Exchange
Exchange
An exchange is known as a marketplace that supports the trading of derivatives, commodities, securities, and other financial instruments.Generally, an exchange is accessible through a digital platform or sometimes at a tangible address where investors organize to perform trading. Among the chief responsibilities of an exchange would be to uphold honest and fair-trading practices. These are instrumental in making sure that the distribution of supported security rates on that exchange are effectively relevant with real-time pricing.Depending upon where you reside, an exchange may be referred to as a bourse or a share exchange while, as a whole, exchanges are present within the majority of countries. Who is Listed on an Exchange?As trading continues to transition more to electronic exchanges, transactions become more dispersed through varying exchanges. This in turn has caused a surge in the implementation of trading algorithms and high-frequency trading applications. In order for a company to be listed on a stock exchange for example, a company must divulge information such as minimum capital requirements, audited earnings reports, and financial reports.Not all exchanges are created equally, with some outperforming other exchanges significantly. The most high-profile exchanges to date include the New York Stock Exchange (NYSE), the Tokyo Stock Exchange (TSE), the London Stock Exchange (LSE), and the Nasdaq. Outside of trading, a stock exchange may be used by companies aiming to raise capital, this is most commonly seen in the form of initial public offerings (IPOs).Exchanges can now handle other asset classes, given the rise of cryptocurrencies as a more popularized form of trading.
An exchange is known as a marketplace that supports the trading of derivatives, commodities, securities, and other financial instruments.Generally, an exchange is accessible through a digital platform or sometimes at a tangible address where investors organize to perform trading. Among the chief responsibilities of an exchange would be to uphold honest and fair-trading practices. These are instrumental in making sure that the distribution of supported security rates on that exchange are effectively relevant with real-time pricing.Depending upon where you reside, an exchange may be referred to as a bourse or a share exchange while, as a whole, exchanges are present within the majority of countries. Who is Listed on an Exchange?As trading continues to transition more to electronic exchanges, transactions become more dispersed through varying exchanges. This in turn has caused a surge in the implementation of trading algorithms and high-frequency trading applications. In order for a company to be listed on a stock exchange for example, a company must divulge information such as minimum capital requirements, audited earnings reports, and financial reports.Not all exchanges are created equally, with some outperforming other exchanges significantly. The most high-profile exchanges to date include the New York Stock Exchange (NYSE), the Tokyo Stock Exchange (TSE), the London Stock Exchange (LSE), and the Nasdaq. Outside of trading, a stock exchange may be used by companies aiming to raise capital, this is most commonly seen in the form of initial public offerings (IPOs).Exchanges can now handle other asset classes, given the rise of cryptocurrencies as a more popularized form of trading.
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For investors located in the UK, the scheme offers them larger opportunities to access the Chinese A-share market. Historically, this has been restricted to western institutions which had a ‘Qualified Foreign Institutional Investor’ status.
FCA and CSRC Sign MoU to Support Scheme In order to further support the scheme, the British and Chinese regulators have signed a Memorandum of Understanding (MOU)
Memorandum of Understanding (MOU)
A memorandum of understanding (MOU) is defined as a nonbinding agreement between two or more parties that outlines the terms and details of an understanding. This includes each parties’ overall requirements and responsibilities. An MOU is seen as the first stage in the formation of a formal contract between two or more parties. These contracts are used throughout many industries, between companies, authorities, regulators, and individuals.At its core, an MOU is not legally binding though is viewed as a serious document in the eyes of most authorities.An MOU is seen as an important step in any process given the level of time, energy and resources needed to draft an effective and fair document. This step forces participating parties to reach a semblance of a mutual understanding. An MOU helps all sides naturally mediate and figure out what is most important in moving toward an eventual future agreement that benefits both sides.Memorandums of Understanding (MOU) ExplainedIt is best to think of an MOU as a formal letter of intent, which is a nonbinding agreement stating a binding agreement will soon follow.MOUs are commonly used as part of international relations because, unlike treaties, they can be quickly crafted or signed, while also escaping public attention or scrutiny MOUs can also be used domestically and as a tool to modify existing treaties.These agreements do share some common similarities. As mentioned above, MOUs are not legally binding.While they do vary in complexity, each of these agreements ultimately reflect represents mutually accepted expectations between people, organizations or governments.Of note, MOUs do not involve the exchange of money or finances.
A memorandum of understanding (MOU) is defined as a nonbinding agreement between two or more parties that outlines the terms and details of an understanding. This includes each parties’ overall requirements and responsibilities. An MOU is seen as the first stage in the formation of a formal contract between two or more parties. These contracts are used throughout many industries, between companies, authorities, regulators, and individuals.At its core, an MOU is not legally binding though is viewed as a serious document in the eyes of most authorities.An MOU is seen as an important step in any process given the level of time, energy and resources needed to draft an effective and fair document. This step forces participating parties to reach a semblance of a mutual understanding. An MOU helps all sides naturally mediate and figure out what is most important in moving toward an eventual future agreement that benefits both sides.Memorandums of Understanding (MOU) ExplainedIt is best to think of an MOU as a formal letter of intent, which is a nonbinding agreement stating a binding agreement will soon follow.MOUs are commonly used as part of international relations because, unlike treaties, they can be quickly crafted or signed, while also escaping public attention or scrutiny MOUs can also be used domestically and as a tool to modify existing treaties.These agreements do share some common similarities. As mentioned above, MOUs are not legally binding.While they do vary in complexity, each of these agreements ultimately reflect represents mutually accepted expectations between people, organizations or governments.Of note, MOUs do not involve the exchange of money or finances.
Read this Term
One of the key aims of the MoU is to protect investors as well as combat cross-border market abuse and other serious misconduct, among other things, the joint statement released today said.
Commenting on the announcement, Andrew Bailey, FCA’s Chief Executive, said: “This new scheme will deepen and strengthen connectivity between UK and China capital markets to the advantage of both countries. We both believe in the positive contribution regulators can make in international capital markets, and the new co-operation we’re announcing today will be an important contributor to the success of the scheme.”
Ahead of the launch of the Shanghai-London Stock Connect, which is set to be launched today, the Financial Conduct Authority (FCA) and the China Securities Regulatory Commission (CSRC) have jointly announced their approval of the scheme this Monday.
The scheme, which will launch today at a ceremony at the London Stock Exchange (LSE), is an arrangement between the LSE and Shanghai Stock Exchange (SSE) to encourage cross-border investments.
Via the stock connect, companies will sell shares through dual listings on the exchanges, providing firms in the United Kingdom and China with mutual access to each other's capital markets.
The Shanghai-London Stock Connect will allow companies listed on the SSE to apply to be admitted to trading on a newly formed Shanghai Segment of LSE’s Main Market. For the UK, companies with a premium listing will be able to apply for admission to the Main Board of the SSE.
For both the UK and China, the securities traded will be in the form of depositary receipts, a common way of facilitating overseas companies access to institutional investors. While this structure is not new for British investors, it is new to China, giving Chinese investors exposure to international securities via an Exchange
Exchange
An exchange is known as a marketplace that supports the trading of derivatives, commodities, securities, and other financial instruments.Generally, an exchange is accessible through a digital platform or sometimes at a tangible address where investors organize to perform trading. Among the chief responsibilities of an exchange would be to uphold honest and fair-trading practices. These are instrumental in making sure that the distribution of supported security rates on that exchange are effectively relevant with real-time pricing.Depending upon where you reside, an exchange may be referred to as a bourse or a share exchange while, as a whole, exchanges are present within the majority of countries. Who is Listed on an Exchange?As trading continues to transition more to electronic exchanges, transactions become more dispersed through varying exchanges. This in turn has caused a surge in the implementation of trading algorithms and high-frequency trading applications. In order for a company to be listed on a stock exchange for example, a company must divulge information such as minimum capital requirements, audited earnings reports, and financial reports.Not all exchanges are created equally, with some outperforming other exchanges significantly. The most high-profile exchanges to date include the New York Stock Exchange (NYSE), the Tokyo Stock Exchange (TSE), the London Stock Exchange (LSE), and the Nasdaq. Outside of trading, a stock exchange may be used by companies aiming to raise capital, this is most commonly seen in the form of initial public offerings (IPOs).Exchanges can now handle other asset classes, given the rise of cryptocurrencies as a more popularized form of trading.
An exchange is known as a marketplace that supports the trading of derivatives, commodities, securities, and other financial instruments.Generally, an exchange is accessible through a digital platform or sometimes at a tangible address where investors organize to perform trading. Among the chief responsibilities of an exchange would be to uphold honest and fair-trading practices. These are instrumental in making sure that the distribution of supported security rates on that exchange are effectively relevant with real-time pricing.Depending upon where you reside, an exchange may be referred to as a bourse or a share exchange while, as a whole, exchanges are present within the majority of countries. Who is Listed on an Exchange?As trading continues to transition more to electronic exchanges, transactions become more dispersed through varying exchanges. This in turn has caused a surge in the implementation of trading algorithms and high-frequency trading applications. In order for a company to be listed on a stock exchange for example, a company must divulge information such as minimum capital requirements, audited earnings reports, and financial reports.Not all exchanges are created equally, with some outperforming other exchanges significantly. The most high-profile exchanges to date include the New York Stock Exchange (NYSE), the Tokyo Stock Exchange (TSE), the London Stock Exchange (LSE), and the Nasdaq. Outside of trading, a stock exchange may be used by companies aiming to raise capital, this is most commonly seen in the form of initial public offerings (IPOs).Exchanges can now handle other asset classes, given the rise of cryptocurrencies as a more popularized form of trading.
Read this Term
For investors located in the UK, the scheme offers them larger opportunities to access the Chinese A-share market. Historically, this has been restricted to western institutions which had a ‘Qualified Foreign Institutional Investor’ status.
FCA and CSRC Sign MoU to Support Scheme In order to further support the scheme, the British and Chinese regulators have signed a Memorandum of Understanding (MOU)
Memorandum of Understanding (MOU)
A memorandum of understanding (MOU) is defined as a nonbinding agreement between two or more parties that outlines the terms and details of an understanding. This includes each parties’ overall requirements and responsibilities. An MOU is seen as the first stage in the formation of a formal contract between two or more parties. These contracts are used throughout many industries, between companies, authorities, regulators, and individuals.At its core, an MOU is not legally binding though is viewed as a serious document in the eyes of most authorities.An MOU is seen as an important step in any process given the level of time, energy and resources needed to draft an effective and fair document. This step forces participating parties to reach a semblance of a mutual understanding. An MOU helps all sides naturally mediate and figure out what is most important in moving toward an eventual future agreement that benefits both sides.Memorandums of Understanding (MOU) ExplainedIt is best to think of an MOU as a formal letter of intent, which is a nonbinding agreement stating a binding agreement will soon follow.MOUs are commonly used as part of international relations because, unlike treaties, they can be quickly crafted or signed, while also escaping public attention or scrutiny MOUs can also be used domestically and as a tool to modify existing treaties.These agreements do share some common similarities. As mentioned above, MOUs are not legally binding.While they do vary in complexity, each of these agreements ultimately reflect represents mutually accepted expectations between people, organizations or governments.Of note, MOUs do not involve the exchange of money or finances.
A memorandum of understanding (MOU) is defined as a nonbinding agreement between two or more parties that outlines the terms and details of an understanding. This includes each parties’ overall requirements and responsibilities. An MOU is seen as the first stage in the formation of a formal contract between two or more parties. These contracts are used throughout many industries, between companies, authorities, regulators, and individuals.At its core, an MOU is not legally binding though is viewed as a serious document in the eyes of most authorities.An MOU is seen as an important step in any process given the level of time, energy and resources needed to draft an effective and fair document. This step forces participating parties to reach a semblance of a mutual understanding. An MOU helps all sides naturally mediate and figure out what is most important in moving toward an eventual future agreement that benefits both sides.Memorandums of Understanding (MOU) ExplainedIt is best to think of an MOU as a formal letter of intent, which is a nonbinding agreement stating a binding agreement will soon follow.MOUs are commonly used as part of international relations because, unlike treaties, they can be quickly crafted or signed, while also escaping public attention or scrutiny MOUs can also be used domestically and as a tool to modify existing treaties.These agreements do share some common similarities. As mentioned above, MOUs are not legally binding.While they do vary in complexity, each of these agreements ultimately reflect represents mutually accepted expectations between people, organizations or governments.Of note, MOUs do not involve the exchange of money or finances.
Read this Term
One of the key aims of the MoU is to protect investors as well as combat cross-border market abuse and other serious misconduct, among other things, the joint statement released today said.
Commenting on the announcement, Andrew Bailey, FCA’s Chief Executive, said: “This new scheme will deepen and strengthen connectivity between UK and China capital markets to the advantage of both countries. We both believe in the positive contribution regulators can make in international capital markets, and the new co-operation we’re announcing today will be an important contributor to the success of the scheme.”
