Lessons to learn from Chinese IPO boom in US
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The year 2010 may bring about many good tidings for the Chinese economy despite global gloom.
Ideally, Chinese shareholders would have jumped on the economic bandwagon and be joyfully awaiting the coming New Year. In reality, the volatility that has swept Chinese stock markets this year has not allowed this to materialize.
However, Chinese stocks listed in the US have fared a bit better.
According to a report by the Wall Street Journal Sunday, this year Wall Street saw record listings by Chinese companies getting listed, raising $4 billion. Their initial public offerings (IPO) have attracted investors, under assurances that China's economy will bring lucrative returns.
Over the years, more than 200 of China's most innovative and promising companies, including Baidu, Netease, China Mobile, and 2010 rookie Youku, have joined the trench warfare of New York finance.
One question must be answered: Why did they choose not to be listed in domestic markets?
According to some financial pundits, China's protracted regulatory review for IPOs, which is known for its lack of transparency, puts off firms looking for a quick buck. The alternative, going down the US route, is an equally arduous task but the results are more predictable.
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