<p>H-Shares, short for Hong Kong-Shares, are a category of stocks listed on the Hong Kong Stock Exchange (HKSE) that are denominated in Hong Kong Dollars (HKD) and settle trades in HKD. They are primarily issued by mainland Chinese companies seeking to list overseas.</p>

<h2>How It Works</h2>
<p>H-Shares are a component of the Hang Seng Index, Hong Kong's primary stock market index. They are subject to the same regulations and listing requirements as other stocks on the HKSE. However, they are distinguished by their mainland Chinese origin and their settlement currency. Here's a simplified breakdown:</p>
<ul>
  <li>Issuance: Mainland Chinese companies list H-Shares on the HKSE to raise capital and gain international exposure.</li>
  <li>Trading: H-Shares are traded in Hong Kong Dollars on the HKSE's Main Board or the Growth Enterprise Market (GEM).</li>
  <li>Settlement: Trades settle in Hong Kong Dollars, unlike A-Shares traded in mainland China, which settle in Renminbi (RMB).</li>
</ul>

<h2>Why It Matters</h2>
<p>H-Shares matter for several reasons, particularly for international investors. They provide access to mainland Chinese companies without the need to navigate the mainland's capital controls or its unique trading system. For instance, Tencent, one of the world's largest tech companies, is listed as an H-Share on the HKSE, making it accessible to international investors.</p>