China's securities regulator is seeking to set a high bar on allowing ordinary investors to trade the country's new financial instruments such as stock index futures, it revealed on Friday.
Though its economy is growing rapidly, China has lacked the more sophisticated financial tools of foreign markets that might help it manage unanticipated domestic stock price moves, often resulting in violent selloffs and sudden rises that can hurt ordinary investors.
"Index futures are a mature product on global markets but in our country's emerging market we must consider the reality and stick to the principle that only relevant investors should participate," a spokesman with the China Securities Regulatory Commission said.
The CSRC draft regulations stated only qualified futures firms can open accounts for retail and institutional investors to trade the index futures. Among the rules governing individuals wishing to trade index futures, investors must have 500,000 yuan ($73,250) to open a new account and must pass an examination on futures trading. The CSRC also said in a draft document on its website.
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