BEIJING, May 6, 2011 (Xinhua News Agency) -- The China Securities Regulatory Commission on Friday issued a directive permitting qualified foreign institutional investors (QFIIs) to trade index futures in China.
According to the directive, QFIIs may only engage in hedging in trading index futures. They are not allowed to float derivatives abroad based on China's index futures.
QFIIs that plan to trade index futures should submit their new investment plans to the CSRC and the State Administration of Foreign Exchange (SAFE).
The China Financial Futures Exchange is in charge of the approval and administration of the amount of hedging by QFIIs. It reports to the CSRC and the SAFE, which set the rules for approval.
QFIIs could only choose one bank to deposit their futures margins. The alternative banks include Industrial and Commercial Bank of China (OOTC:BACHY) (OOTC:IDCBY) (OOTC:IDCBF) , Agricultural Bank of China (OOTC:ACGBY) , Bank of China, China Construction Bank (OOTC:CICHY) (OOTC:CICHF) , and the Bank of Communications. (Edited by Jiang Yujuan, jiangyj@xinhua.org)