China’s securities regulator said on Friday it would let mainland mutual funds invest in Hong Kong shares via the Shanghai-Hong Kong Stock Connect.
The move may gave some support to the cross-border trading scheme, which has seen dwindling interest from investors.
Up until now, Chinese mutual funds have been able to invest in overseas markets only through the Qualified Domestic Institutional Investor (QDII) program, which requires regulatory approval.
Giving mainland funds access to Hong Kong shares via the Shanghai-Hong Kong Stock Connect will promote product and business innovation, and be good for steady development of the connect scheme, Deng Ge, spokesman for the China Securities Regulatory Commission (CSRC), told a news conference in Beijing.
The scheme, launched late last year, allows Hong Kong and mainland investors to invest in each other’s markets up to a daily quota.
Interest in the scheme has been waning. On Friday, mainland investors used only 5 percent of their quota for Hong Kong shares, while those in Hong Kong utilized only 2 percent of what they could buy on the mainland.
via Reuters