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Open-end Funds to Revive Stock Market
China's securities authorities are considering plans to allow open-end investment funds to trade on its stock market in the near future to boost business.
"We are preparing for the launch of open-end investment funds because they would be more efficient at activating the stock market and more attractive to investors," the English-language paper quoted Tu Guangshao, secretary-general of the China Securities Regulatory Commission (CSRC), as saying.
"But a concrete date for such a launch depends on the development of the market," Tu said.
Open-end investment funds will allow more people to get involved in the market, as opposed to close-end funds which restrict involvement.
Tu's words were echoed by Anthony Francis Neoh, the chief adviser of CSRC, who confirmed the watchdog for China's securities industry was now drafting the detailed rules for the launch of such funds.
He said that the establishment of the funds would help improve market transparency and the structure of China's stock market.
Open-end funds, which have already dominated the world's fund market, have not yet arrived on the Chinese market, which is controlled by more than 20 nascent close-end funds.
Tu also said that the commission would allow experienced foreign fund management firms to form partnerships and joint ventures with their Chinese counterparts.
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