Record 2 trillion yuan of locked up shares to become tradable this week
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Locked up shares worth about 11 percent of the combined value of the A-shares listed on the Shanghai and Shenzhen bourses will become tradable this week, a record level unlikely to be ever surpassed.
Shares in 29 companies worth about 2 trillion yuan (29.85 billion U.S. dollars), or 10.97 percent of the market capitalization of the A-shares listed on the two exchanges, will become tradable between Monday and Friday, raising concern about supply and volatility.
Some of the companies' closing share prices Friday were well above their initial public offering price, which may encourage investors to engage in profit-taking, Southwest Securities chief analyst Zhang Gang said.
About 162 billion shares in nine companies listed on the Shanghai Stock Exchange will become tradable while 998 million shares in 20 companies listed on the Shenzhen bourse will become tradable, according to Southwest Securities Co. data.
The expiration of lockup restrictions does not necessarily mean large shareholders will reduce their stakes, Zhang said.
Still, he added, ordinary investors should be aware of possible fluctuations in share prices as the market is flooded with newly-tradable equity.
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