Individual investors will be limited to contributing RMB 20 billion ($3.1 billion) to each of the six equity funds launched last week aimed at raising capital to buy Chinese depository receipts for tech firms, sources told Caixin.
The closed-end funds were approved last week to raise up to RMB 50 billion each, but China’s securities regulator has issued a warning to fund managers to “do their best to control the scale of funds raised,” keeping an eye on individual investors despite being previously instructed to prioritise them.
The CDR pilot program, designed to help channel funds towards Chinese tech firms issuing stock on the mainland, has received a lot of attention from individual investors since they went on sale on Saturday. Authorities are worried that sellers, which include banks and brokerages, are facilitating speculation.
“These funds were already controversial and it’s all got too heated,” one of the sources said. By hyping up the “unicorns” and the CDRs as part of a “national strategy”, sellers may be raising funds at too quick a pace, he added.