Characteristics of Different Styles and Sectors in China’s Stock Market

Abstract

As the market develops, the characteristics and patterns of China’s stock market have changed greatly. Likewise, the performance of different types of stocks has varied widely. In order to distinguish one type of stock from another, stocks are classified into sectors by region, country, style, industry, and so on. This chapter studies how the stock market works and changes at the meso-level from the perspective of style and sector. It then observes the development of the entire stock market. The first part examines the conditions and performances of typical large-cap, mid-cap and small-cap stocks, growth stocks and value stocks according to their styles, and explores the characteristics of investor behavior. The second part studies the past and present of representative sectors, as well as the opportunities and challenges they face, according to their industries, to provide further clues for decision-making. The third part, based on the previous analysis, improves the existing schemes for selecting stocks and optimizes sector indices to enable passive investors to make more informed decisions.