A-Shares ETFs Gain Ground as China Curbs Foreing Investment Limits

China is relaxing foreign investment limits, potentially paving the way for more Chinese A-shares exchange traded funds.

China’s State Council said it will increase reforms to improve access to the country’s equities, fixed-income and commodities markets, Bloomberg reports.

The reforms will seek to “stimulate market activities, expand market depth, open the markets for mutual access,” the State Council said in the statement.

Chinese President Xi Jinping is going forward with sweeping changes to loosen government controls. For instance, Beijing recently announced it will connect the Shanghai stock exchange to Hong Kong in an attempt to bolster trading volume and the use of the yuan currency. [A-Shares ETFs Could Benefit From Cross-Market Plans]

Under the new China Securities Regulatory Commission guidelines, a single overseas investors is allowed to hold as much as 10% of a mainland-listed company, and overseas investors can together own as much as 30% of a China-listed company.