The China Securities Regulatory Commission (CSRC) has drafted new rules aimed at dampening market hype surrounding the new tech-focused stock board launched late last year, sources told Caixin.
“The high-tech board is a government-backed project that may spark speculative trading by investors,” one source said. “Regulators are concerned that it will in turn hurt investors.”
The new rules, issued alongside the Shanghai Stock Exchange, will set a minimum capital requirement for traders investing in listed companies of RMB 500,000 ($74,035). There will also be stricter delisting rules for participants.
However, some fear that the new measures will prevent large groups of retail investors from investing in the board, which was established to reinvigorate China’s flagging domestic markets. Some sources talking to Caixin also suggested that a shorter, same-day stock settlement cycle would improve market liquidity and reduce price fluctuation.