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Benedicte Gravrand, Opalesque Geneva:
Hedge funds have historically been the financial territory of the English speaking world, but they have spread in all the places which allow them enough freedom to conduct their investments. They started appearing in the People’s Republic of China in the early 1990s. However, they could never really be "proper" hedge funds as legislations did not allow them to conduct most of the transactions that are typical of hedge funds. So most operated in the freer spheres of Hong Kong. But the environment on the mainland became friendlier to hedge funds as off last year.
New tools for Chinese hedge funds
One thing to know about hedge fund companies based in China is that they are either backed up by the government (including brokers, trusts) or they are private (investment consulting companies, investment management companies).
Another important point to know is that China's central government approved the introduction of stock-index futures, short selling and margin trading of stocks early last year. This was announced by the China Securities Regulatory Commission (CSRC). Incidentally, CSRC’s English website does not seem to have been updated much since 2009.
The introduction of these new tools follows years of trial and errors, and so the country is being careful in its approach to the new project by making it hard to use the new tools. ...................... To view our full article Click here
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