BIZCHINA / Center
New QDII measure takes effect
By Shangguan Zhoudong (chinadaily.com.cn)
Updated: 2007-07-05 18:18
A trial management measure on qualified domestic institutional investors'
(QDII) overseas investment in securities took effect today, China
Securities News reported.
Regulators will start receiving and approving new QDII investment schemes
from domestic fund management companies and securities companies as of
today.
Currently, QDII investment products are difficult to sell because they
are less attractive than funds, which performed better in the first half
of this year.
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Statistics show that from January to June this year, the average net
worth of equity funds and index funds increased by more than 60 percent,
far higher than the returns on some investment products under the QDII
scheme.
More investors still believe the bullish stock market will continue and
they are not very willing to invest in overseas markets, with exchange
rate risks that must be taken into account.
Insiders said that although some fund companies want to dive into the
QDII business, there may not be a massive launch of QDII products in the
near future due to risks of overseas markets being uncontrollable and
most fund companies having no experience in overseas markets.
Currently, QDIIs are allowed to invest in stocks, options, mutual funds
and derivatives in markets whose regulators have signed memorandums of
understanding with the China Securities Regulatory Commission.
It's helpful to dilute risks by investing money in these markets and
products with little association with the A-share market, insiders said.
(For more biz stories, please visit Industry Updates)
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