2012-07-31

China changes junk shares regulation

New rules will only allow a 1% price increase on the day and a 5% price decline for shares marked for Special Treatment (ST). What qualifies a share for special treatment? One major cause is two straight years of losses. Three years of losses can lead to delisting.
Junk shares plunge after Shanghai bourse announces new proposal

This Chinese article 上交所:细则明年初实施 不排除调整风险股涨跌幅比例 states that there are 62 firms with 1-year of losses (FY 2011), 15 companies with two years of losses, and 1 firm with three years of losses and facing delisting.

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