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China Tells Quant Funds To Phase Out Strategy Blamed For Turmoil (BBG)

CHINA STOCKS

BBG sources have suggested that “some quantitative funds were told to stop taking new investments from clients and phase out existing products for “Direct Market Access,” a strategy that is often highly leveraged. The gradual exit would help prevent drastic selloffs.”

  • The products received some of the blame for the recent Chinese stock tumult.
  • This isn’t the first round of restrictions placed on quant funds, with various trading restrictions outlined/touted in recent weeks.
  • We have previously highlighted that the change atop the CSRC has resulted in more forceful measures/a change in perception re: equity market support, allowing Chinese equities to rebound from multi-year lows.
MNI London Bureau | +44 0203-865-3809 | anthony.barton@marketnews.com

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