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Ten Problems to Be Solved for Development of Fund Industry
Ten problems should be tackled for the healthy development of China's fund industry, such as lack of law, implementation of law, effective surveillance, and law and order and market orientation, said Hu Ruyin, director of Shanghai Stock Exchange (SSE) Research Center.
Up to November 6, China has set up 33 funds with a total value of 55.177 billion yuan. Of the 33 funds, 12 are of vigorous growth type and 7 are of moderate growth type. According to Hu, to ensure a healthy development of the fund industry, the following problems should be solved: lack of laws; implementation of laws; effective regulation, law and order and market orientation; undergrowth of stock right market, bond market and currency market; human resources and lack of operation experience; practice integrity; how to coordinate fund governance and self-discipline mechanism; standardization of fund speculative actions and the supporting investment environment; commercial culture of fund industry and the securities market as a whole; unadvanced service support system for the operation of fund industry; and internationalization and globalization.
By the end of this March, the assets of US mutual funds totaled US$ 12.2 trillion, far above the capital and deposits of commercial banks for the same period, and 50% of American families invested in mutual funds. The reason, according to Hu, lies in capital increment of composite securities; emergence of new type of funds and services; and creation of a new distribution channel. What is more importantly, the public has confidence on the well-regulated mutual fund industry. The other reasons include well-enacted law framework, self-discipline mechanism and market environment, high-level implementation standards and perfect support system; mature stock right market, bond market and currency market; and perfect protection of investors, etc.(Panorama)
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