Across The Border | Foreign investors pile into A-shares, ahead of stock connect scheme launch
2.7b yuan rise in the value of investments held by foreign institutions, bought via the QFII scheme, from end of September and earlier this week.
Foreign institutions appear to be stealing a march on their domestic counterparts after pocketing handsome profits on their A-share investments over the past two months, as many look ahead to the soon-to-be launched Shenzhen-Hong Kong Stock Connect.
According to a report in the state-owned Securities Daily, there has been a strong 2.7 billion yuan rise in the value of investments held by foreign institutions, bought via the Qualified Foreign Institutional Investor (QFII) scheme, between the end of September and earlier this week.
QFII allows limited access to overseas financial institutions, using a quota scheme to use offshore yuan to buy mainland shares (A-shares), including stocks, bonds and money market investments.
Securities Daily’s figure is based on the third-quarter earnings reports of mainland-listed firms and those QFIIs who have became among the largest 10 shareholders of any listed firm. Its offered full details of earnings, and the number of shares QFIIs own.
The keenly anticipated Shenzhen-Hong Kong stock trading link will be similar to the existing Shanghai-Hong Kong connect, launched in late 2014.
Investors in Hong Kong will be able to buy Shenzhen-listed stocks, including many prominent technology and consumer names in the mainland. In return, mainland Chinese investors will have access to shares listed in Hong Kong.