The main measures are:
1) encourage insurance funds to increase their allocation to A-shares
2) encourage the national social security fund, and the basic pension insurance fund in qualified regions to invest in the market.
3) Improve enterprise (occupational) annuity funds acess to the market. Encourage enterprise annuity fund managers to carry out differentiated investments.
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4) Increase the scale and proportion of equity funds. Establish the development of investor-oriented fund managers. Promote the a robust regulatory framework to ensure sound companies are listed on the market.
5) Encourage listed companies to increase share repurchase efforts and implement the policy of raising dividends annually. Encourage public funds, commercial insurance funds, basic pension insurance funds, enterprise (occupation) annuity funds, bank wealth management, etc. to participate in the private placement of listed companies as strategic investors. Expand the scale of swap convenience operations of securities, funds and insurance companies.
Niki Wu, Senior Analyst, Manager, Research at Morningstar says: "These measures are expected to boost the assets of the public pensions, enhance their ability to preserve and increase value, consolidate the social financial reserves for addressing the aging population. The long-term performance assessment mechanism can mitigate the impact of short-term fluctuations, encourage long-term investment, and enhance investment stability."
Kai Wang, Asia Equity Market Strategist, Morningstar thinks CSRC’s measures could end up benefitting large-cap stocks such as Moutai or high dividend stocks.
