Weekly Letter · 3 Oct – 9 Oct 2026
Market overview
Many Chinese companies have two kinds of shares: an A share traded in Shanghai or Shenzhen and an H share traded in Hong Kong. Both represent the same company, yet they rarely cost exactly the same. On 9 Oct, H shares in Hong Kong became about 2% cheaper on average relative to their A shares in Shanghai and Shenzhen. Most of these shares moved in the same direction.
Many foreign companies can also be traded in the US, often outside the major exchanges on the so-called OTC market. On 8 Oct, US-traded shares of companies with a home listing in Canada (Cboe Canada) became about 2% more expensive on average relative to their home exchange. Almost all of these shares moved in the same direction.
Some companies have two share classes, such as ordinary and preference shares. Both represent the same company but differ, for example, in voting rights or dividends. On 8 Oct, for companies with two share classes in Seoul, the second class became about 1% cheaper on average relative to the first. Most of these shares moved in the same direction.
Observations
China: H shares vs. A shares
- Shanghai: On 9 Oct, H shares in Hong Kong cost on average 36% less than the same companies’ A shares in Shanghai (33% on 30 Sep, 32% on 19 Aug).
- Shenzhen: On 9 Oct, H shares in Hong Kong cost on average 42% less than the same companies’ A shares in Shenzhen (40% on 30 Sep, 37% on 19 Aug).
Preference vs. ordinary shares
- São Paulo: On 9 Oct, preference shares traded on average roughly level with the ordinary shares of the same company, as they did on 2 Oct.
- Germany: On 9 Oct, preference shares traded on average 13% above the ordinary shares of the same company (12% on 2 Oct).
- Seoul: On 6 Oct, preference shares traded on average 40% below the ordinary shares of the same company (39% on 2 Oct).
