China to allow short selling
20 April 2015 Shanghai
Image: Shutterstock
China has decided to allow fund managers to lend shares for short selling, and also intends to expand the number of stocks investors can short sell, according to reports.
The country's shares also posted seven weeks of gains, reaching seven-year highs, as retail investors moved to borrow a record amount of money to buy shares.
Although investors can only currently short sell 900 classifications of stocks, the options will soon expand to 1,100.
Earlier in the year, the Shanghai Stock Exchange (SSE) released guidelines to promote the development of the bond market and increase the liquidity of various bonds and asset backed securities (ABSs).
The SSE’s existing collateralised repurchase of bonds adopts the trading settlement mechanism of auction and guaranteed delivery, and takes the standard bond system for accounting of the value of pledged bonds.
The SSE stated that this will further improve the market infrastructure, promote innovation in trading products and trading mechanisms of bonds, strengthen the investor protection mechanism, and promote the steady development of the bond market.
The country's shares also posted seven weeks of gains, reaching seven-year highs, as retail investors moved to borrow a record amount of money to buy shares.
Although investors can only currently short sell 900 classifications of stocks, the options will soon expand to 1,100.
Earlier in the year, the Shanghai Stock Exchange (SSE) released guidelines to promote the development of the bond market and increase the liquidity of various bonds and asset backed securities (ABSs).
The SSE’s existing collateralised repurchase of bonds adopts the trading settlement mechanism of auction and guaranteed delivery, and takes the standard bond system for accounting of the value of pledged bonds.
The SSE stated that this will further improve the market infrastructure, promote innovation in trading products and trading mechanisms of bonds, strengthen the investor protection mechanism, and promote the steady development of the bond market.
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