Shanghai Stock Exchange History


The Shanghai Stock Exchange (SSE) is one of the largest stock exchanges in the world and has a long history. It dates back to 1866 when it was founded in Shanghai, China. Over the years, it has grown and evolved in size and scope.

In this article, we will look at the history of the SSE and how it has changed over time.

Overview of the Shanghai Stock Exchange

The Shanghai Stock Exchange is the world’s fourth-largest stock exchange. It is located in Shanghai, China, and began operations in 1891. The main business at the exchange includes trading electronic equities and derivatives, mediated by a network of brokers and market makers.

Before its establishment as the Shanghai Stock Exchange in 1891, several different exchanges were operating within Shanghai, including the Bourse Commerciale, formed in 1869. However, during this early period, businesses conducted their commercial works mainly on a businessman-to-businessman basis; it was not until the early 20th Century that modern financial institutions, such as banks and insurance companies, began operating within China.

In 1984, after seven years of trading activities without regulations, a stock exchange supervisory agency (the SSEA) was set up to prosecute illegal infractions of financial rules and ensure fairness when trading at the stock exchange. In 1992, the SSEA was dissolved, with responsibility for supervision transferred to the People’s Bank of China. Huatai International Securities Company Limited was also established to manage equitable registration. Since then, regulations have essentially been tightened upon securities transactions allowing for more excellent protection for shareholders by law.

Today, on any given day, around 1 million shares are traded on the Shanghai Stock Exchange, with daily transactions reaching around US$5 billion; over 700 entities have been listed so far on its bourses resulting in an estimated market capitalization valued at US$960 billion as of May 2011 making it one of the most important venues for securities trading worldwide.


The Shanghai Stock Exchange (SSE) is one of the world’s oldest stock exchanges and has been a cornerstone of the financial market in China for over 150 years. Founded in 1866, the SSE was a small exchange from a tea shop. However, in the decades since, it has become the largest financial center in Asia and a major trading hub in the global economy.

Let’s take a closer look at the history of the Shanghai Stock Exchange.

Established in 1891

The Shanghai Stock Exchange (SSE) is China’s world’s oldest stock exchange and the leading stock market. The SSE was established on November 26, 1891, and is located on the banks of the Huangpu River in Shanghai’s financial district. The original trading floor, housed in the prestigious building known as “The Bund,” was one of Asia’s most dynamic markets. However, the city rapidly advanced to become a center for finance and investment after its opening and created many opportunities for private businesses to thrive.

The SSE initially started with four members who were all shareholders of the company: William M Carruthers, Robert Hart & Company; Kenneth A Cooper; John Jardine Matheson & Company; and Paul Chater & Company. Together, they formed an informal association known as “The Premiers.” The Shanghai Stock Exchange has had multiple expansions and contractions throughout its history due to different political and economic changes affecting China and other global markets.

Throughout much of its early history, shares at the SSE were denominated in Mexican dollars or Tael silver, with few restrictions placed on foreign investments by foreign investors during this period. In 1905, new regulations were introduced that limited foreign participation though this merely shifted trading activity from open exchange to over-the-counter activities. The SSE was shut down during World War I but reopened nine years later under different regulations allowing for increased foreign investments under special rules established by foreign governments such as Japan and the United States aimed at regulating stock transfer activities until 1949, when it was again closed following China’s civil war period ending in 1949 when it became controlled by Mao Zedong’s Communist Party of China (CPC).

Growth and Expansion in the 20th Century

In the 20th Century, the Shanghai Stock Exchange saw dramatic growth and expansion. In 1913, China’s first modern stock exchange was established in Shanghai following a merger between two competing exchanges. 1903 also saw the initiation of an open-ended call loan system, allowing members to borrow money or shares from each other directly.

For much of the 20th Century, the Shanghai Stock Exchange served as one of China’s main markets for local and international trading. From 1925 to 1945, it was restructured several times, with stock commissions being organized and dissolved in 1927 and 1933 when it was officially established as The East China Stock Exchange.

After World War II ended in 1945, it was merged with not just The East China Stock Exchange but five other exchanges into The Chinese Shares Market located on Nanjing Road and formed legally as The Shanghai Stock Exchange (SSE) in 1990 – becoming China’s first and only securities exchange. Later that year, nine state-owned enterprises (SOEs) went public on SSE, which caused a large influx of investors buying stocks from these firms due to their newfound stability and profitability—revenue from these listed companies now totaling some RMB 60 billion (USD 8.8 billion).

SSE made further strides for modernization within its reforms by introducing new mechanisms such as index futures trading in 1996, fueling rapid market growth throughout this period and beyond — becoming one of Asia’s primary financial hubs today with over 1,400 publicly listed companies; over 10 trillion Renminbi traded in 2018 alone; three key stock indices (The SSE Composite Index); hundreds of mutual funds; several bond market indices; ETF prices, etc., continuing its role at a pivotal gateway to foreign capital investment across Eastern Asia into 2020.

Major Events in the 21st Century

The Shanghai Stock Exchange (SSE) has experienced dramatic changes since its establishment in 1990. Though the SSE had a relatively slow start, it quickly gained significant traction within China’s equity markets, eventually surpassing its main competitor, the Shenzhen Stock Exchange, in terms of total market capitalization and liquidity. It has since grown to become one of the largest stock exchanges in the world.

Here are some major events that have shaped the Shanghai Stock Exchange in the 21st Century:

  • In 2006, SSE merged with The Shanghai Futures Exchange (SFCE) to form the first-ever “comprehensive financial center” in mainland China.
  • In 2007, international investors were given access to trade on SSE through qualified foreign institutional investor (QFII) programs that allowed foreign entities to invest directly in Chinese equities markets.
  • In 2008, SSE launched its proprietary trading platform, ‘ Shanghai Connect,’ which facilitated cross-border trading between Chinese and global investors.
  • In 2014, SSE began allowing companies from across China’s provinces and municipalities to list on its exchange, paving the way for full inclusion of Mainland China corporations onto domestic equities markets.
  • In 2016, Shanghai Stock Exchange launched its index futures products allowing investors access to futures contracts based on various indices such as CSI 300 Index and SSE 50 Index, among others.
  • 2019 saw SSE launch several initiatives, such as margin trading & short selling services and the SME board (Small & Medium Enterprises Board), providing entrepreneurship support services to local firms.


Trading on the Shanghai Stock Exchange dates back to 1891 when the first shares were traded on the Chinese stock exchange. Since then, trading has grown exponentially. Today, the Shanghai Stock Exchange is the largest in mainland China, with a market capitalization of over 3 trillion dollars.

This section will look at the history of trading on the Shanghai Stock Exchange and how it has evolved over the years.

Types of Instruments Traded

The Shanghai Stock Exchange (SSE) is China’s largest and most active stock exchange. It is located in the financial hub of Shanghai, China, and trades stocks, derivatives, bonds, and ETFs. The SSE punches above its size with a market of over two trillion dollars. Some of its most notable constituents include ICBC (Industrial & Commercial Bank of China), China Petroleum & Chemical Corp., and the Agricultural Bank of China.

The SSE provides a wide variety of services to both institutional and retail investors. All financial instruments are available on the exchange, including equities, bonds, futures/options contracts, warrants/rights issues/convertibles, and Structured Products (including Commodity-related Derivatives). Trading is done through a central order book, and bilateral deals are off-market.

It also offers margin trading for individual or corporate clients with appropriate collateral held at CITIC Securities or approved custodians. Additionally, it allows for flexible collateral combinations whereby investors can use debt instruments (such as bonds) and equity securities as risk management tools for margin trading purposes.

Trading Hours and Fees

Trading hours on the Shanghai Stock Exchange are from 9:30 a.m. to 11:30 a.m. and 1:00 p.m. to 3:00 p.m., Monday through Friday (local time). The Shanghai Stock Exchange does not have fixed or permanent fees, instead applying costs based on share quantity, market capitalization, and other factors related to the transaction being made at the time of purchase or sale.

The trading schedule consists of two pre-open phases and four regular trading session phases for each trading day:

  • Pre-opening call auction session
  • Opening session
  • Continuous trading session
  • Closing call auction session
  • Pre-closing call auction session

During the continuous trade phase from 9:30 a.m.-11 a.m. and 1 p.m.-3 p.m., investors may place buy/sell orders at market price or limit price in multiple markets, including stocks, corporate bonds, and ETFs concurrently via SSE system-designated securities companies or brokers who are members of the SSE system, A shares through equity transfer departments of authorized securities companies at stock exchanges online trading platforms as well as other designated methods determined by SSE such as phone Trading Services provided by some member firms/agencies; they may also modify orders placed previously (clients only).


Regulations have played an integral part in the history of the Shanghai Stock Exchange (SSE). The China Securities Regulatory Commission (CSRC) is the main regulatory body for the SSE. The CSRC was established in 1992 and has implemented various regulations governing the trading and listing activities in the SSE since then.

In this section, we will take a closer look at the regulations set by the CSRC and how they have shaped the history of the Shanghai Stock Exchange.

Listing Requirements

The Shanghai Stock Exchange (SSE) was founded in 1990 as a joint-stock company and is the main stock exchange in China. It is a non-profit organization directly administered by the China Securities Regulatory Commission (CSRC). Listing with the SSE can bring investors affiliations, visibility, and access to capital, but only after meeting all listing requirements set forth by the SSE.

Listing Requirements:

  1. Minimum share issue size of RMB 200 million;
  2. A minimum trading unit of 100 shares;
  3. A minimum shareholders float of 15%;
  4. The issuer must have a regularized net profit for at least one out of the past three consecutive years before listing application; and
  5. A paid-up capital more significant than or equal to registered capital plus premium as shown in the balance sheet on the day before the issued registration confirmation document when applying for a full registration or available list transfer system operations.

Market Surveillance

The Shanghai Stock Exchange (SSE) has a Market Surveillance Department (MSD) responsible for upholding the integrity of its listed companies and monitoring market orderliness and stability.

The MSD monitors securities trading activities and corporates’ compliance with laws, regulations, and internal rules. The MSD also works closely with the relevant government authorities to prevent illegal or malicious market activities, protect investor interests, and promote proper information disclosure and corporate governance.

The MSD takes various measures to ensure trading orderliness:

  • It monitors unusual stock price movement and trading activities to establish compliance information systems.
  • It strengthens the real-time monitoring of transactions.
  • It collaborates with other departments to prevent canvassing, insider trading, and false transactions.
  • It collects evidence for civil litigation if necessary.
  • It works closely with the relevant law enforcement authorities in criminal prosecution.

Moreover, the MSD also provides advisory services related to investor protection schemes such as dispute resolution techniques and securities offerings and listings in SSE.

Investor Protection

The Shanghai Stock Exchange (SSE) has long worked to protect investors in various ways, such as providing fair and smooth markets for the public to participate in stock trading, managing market operations fairly, disclosing information timely and accurately, guarding investors’ interests strictly and punishing insider trading, etc. In addition, the SSE has adopted a series of regulations focusing on investor protection from time to time since its founding.

The SSE established the Investor Protection Fund in 1992 with a subscribed capital of 100 million yuan to strengthen investor protection. The fund is used to compensate damages caused by violation of laws or rules by listed companies or intermediaries, which results in losses to investors. Furthermore, in 2000, the SSE introduced the China Securities Regulatory Commission (CSRC) issued “Investor Compensation Rules,” which set up a unified financial compensation system and declared that the Investor Protection Fund is used solely for compensating investors due to violations like insider trading and other forms of securities market manipulation.

Over the years, the SSE has also adopted multiple rules regarding transparency disclosure and strengthened supervision of intermediaries, services, providers, etc., such as:

  • The Administrative Measures for Disclosure Information Providers (2008)
  • The Interim Measures on Investment Consulting Service Activities (2009)
  • The Measures for Assessment Examination of Securities Service Providers (2012).

These measures are designed to ensure reliable disclosure of information, increase discipline among intermediaries service providers and establish more effective control systems over them. Besides these regulations mentioned above, there are also more regulations focused on investor protection drafted by SSE according to the actual condition of markets.


The history of the Shanghai Stock Exchange is one of growth and evolution. From its humble beginnings, the exchange has become one of Asia’s most important marketplaces for stocks and other investments. Its success over time reflects both the changing economic needs of China as well as China’s increased economic activity in recent years. Despite some bumps along the way, the exchange continues to grow and develop new products to meet the evolving needs of its investors.

As China develops further, so too does its financial infrastructure, and with it, greater participation from institutional investors worldwide. It signals an exciting future for all those involved in Shanghai Stock Exchange transactions.

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