Abstract: The kernel problem of state-owned shares’reduction lies in how to price the shares, while the kernel problem of their circulation lies in the capital sustainability of a securities market. The reduction of state-owned shares is concerned with the steady development of the security market and the equity of the social resources reallocation. Based on market mechanism, a tactic is put forward for proportional sale of state-owned shares through floating pricing. The operational practicability of the state-owned shares’ reduction and circulation is analyzed, with some relevant suggestions given to the specific circulation mode of the state-owned shares that are allowed into the circulation market on the condition that the state gives up its shares-holding authority.