But the prospect of generous inflows inspired by this significant milestone in the growth of Mainland China’s capital markets isn’t the only reason why global investors should be investing in A-shares. Moreover, the 11 times 2018 earnings at which the 234 A-shares trade is also markedly lower than the 17 times earnings commanded by U.S. stocks. Additionally, the A-share market provides a very broad universe of stocks for investors to capture China’s growth and economic trends. The level is more than double the 35% retail investor participation rate for the Hong Kong stock market. Low participation by institutional investors and even lower participation by quant investors mean there is greater mispricing in the A-share market compared to more mature markets.

Source: Forbes May 28, 2018 10:30 UTC