Shanghai Stock Exchange Holds Seminar On Innovation And Development Of Fund Market

With the varieties of securities investment funds exceeding 1,000, the current fund industry in China has entered the "1,000 kinds of funds" era. Under the backdrop of the innovation and development of the Chinese capital market, the fund industry also faces the significant breakthrough from quantitative to qualitative changes. On June 13, the Shanghai Stock Exchange (SSE) held the seminar on "Innovation and Development of Fund Market" in a bid to further promote the innovation and development of the fund industry, give full play to the leading role of fund companies in guiding rational investment and creating healthy investment culture, as well as speed up the transformation of fund companies to modern wealth management institutions. The seminar attracted officials of over 20 fund management companies.

It was pointed out at this seminar that the environment conducive to the innovation and development of the fund industry is taking shape currently. Firstly, under the backdrop of the easy monetary policy, residents call for wealth management due to a considerable amount of bank savings, which is not only the huge capital resource but also the intrinsic dynamic for the industry's development. Secondly, thanks to the more easy law and policy environment and the forthcoming amendment to the "Securities Investment Fund Law", the business scope of fund companies will be effectively expanded and the restrictions on the investment and operation will be unbound. Moreover, the official establishment of the China Securities Investment Fund Commission aiming at strengthening industry self-regulation and driving industry reform and innovation will guide the industry to create an innovation and development way suitable for China's actual conditions. Last but not least, with the increasingly mature investment concept in the capital market as well as the deeply-ingrained value investing and rational investment, more and more investors desire to share earnings from the growth of the capital market by professional investment and management, which contributed to providing widespread investors for the industry's development.

According to the seminar, the market's overall valuation has been lingering at record low currently, which has fully revealed and discharged the risks and pressure in the process of structural transformation of China's economy, but has not reflected all the favorable opportunities and policies resulted from the economic transformation in the future. For the securities investment funds adhering to the concepts of value investing and long-term investment, it is a major strategic period for them to seek investment opportunities currently.

It was stressed at the seminar that currently and in the next period, fund companies should complete their fundamental innovation work by strengthening the study on the macro-economic situation. It is a must to remain the confidence in the macro economy, recognize the improvement of the growth quality caused by the national economic transformation and structural adjustment, and witness the growth potential behind the unbalanced industrial and regional development. Only the product design of fund companies based on the scientific market analysis and the accurate judgment on the macro-economic situation can coincide with the orientation of the market development and the trend of the macro economy and earn trust from investors. As a professional investor, the whole fund industry should enhance its occupational quality, see hopes in the current difficulties and seek opportunities from risks, as well as seize the historic opportunity of low market valuation, with an aim of realizing the sound and sustainable development of the industry and building itself into a leader in the guidance for rational investment and value investing.

Has always been attaching much importance to the innovation and development of the fund market, the SSE is sparing no efforts to build the fund market into a key hub radiating and connecting the stock, bonds, block commodities and derivatives markets. In the near future, the SSE will support the business innovation of fund companies from the three aspects as follows. Firstly, the SSE will standardize and simplify the procedures for innovation services for fund products. In addition to encouraging fund companies to conduct orderly competition in the existing areas like non-core index products in the openness and transparency principle, the SSE will also take proper measures to help fund companies carry out innovation businesses and develop innovative products such as currency, gold and bond ETF products. Secondly, the SSE will lift the supporting capacities of the trading systems and business platforms for the individualized and differentiated innovative products. Thirdly, for the purpose of consistently perfecting the trading system consistent with the traits of fund products, the SSE will optimize the trading mechanism, improve trading services, introduce liquidity service providers, expand the scope of margin trading and securities lending for ETFs and fuel the intra-day trading of ETF products.