However, the China Stock Exchange was conservatively questioned by the financial fraud incident of Ruixin Coffee this year. Jay, chairman of the US Securities and Exchange Commission? Jay Clayton even publicly issued a warning to investors not to invest in China Stock Exchange. The US President's Working Group on Financial Markets recently released a report saying that if China enterprises want to continue trading in the US financial market, they must comply with the US audit requirements, otherwise they will be forced to withdraw from the market. However, this has not stopped China investors from listing in the US. The number of China stocks listed in the United States this year is the highest in the past decade.
Then the question is coming. If China Stock Exchange is delisted, will it consume foreign exchange reserves?
To answer this question, we must first understand the delisting rules of Nasdaq in the United States. What are the general delisting points? Take the initiative to delist? And then what? Forced delisting? . The former is decided by the listed company itself, usually when the listing cost is greater than the financing income. For example, Qihoo 360 decided to withdraw from the market because it thought its market value was undervalued by the US capital market. The latter includes three situations. The first is that listed companies have illegal acts, violating supervision and trading rules; The second type of enterprise's operating performance is not up to standard, resulting in the market performance not meeting the requirements of the exchange, and delisting after rectification is invalid; The third is the bankruptcy liquidation of enterprises.
Listing is for financing. After an enterprise is delisted in the United States, this does not mean that all the shares in the hands of shareholders are invalid, but they are still valid. After delisting, it only withdraws from the secondary market, and stocks can still be traded, mainly in OTC BB (Over the Counter Bullitin Board) counter baby market and powder single and small powder single trading market. The supervision of these two markets will be much less, but the risks will be greater. Whether China's capital withdrawal will consume foreign exchange reserves depends on two situations:
If the company still has prospects and good performance, it will be privatized, and the major shareholders will buy back the relevant stocks with domestic funds or American funds. In this process, foreign exchange reserves will be consumed and the absorbed funds will be spit out. As for how much, it depends on the value of the enterprise. This situation is more common in active delisting. If the enterprise goes bankrupt and is insolvent, then the shares in the hands of Midea shareholders are worthless. This part of the loss needs to be borne by investors themselves, but they only bear limited liability and do not have to bear corporate debts. For an enterprise, delisting is mostly negative. The healthy operation of the capital market depends on a perfect legal supervision system which is free, open and transparent. The financial market in the United States is only attractive, which is the key. Only by abiding by laws and trading rules can we survive in the American capital market.
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