A compliance training session aimed at helping China’s quant hedge fund firms understand the current regulatory mindset and work requirements as part of a bid to prevent market risk has been held by the Shenzhen and Shanghai stock exchanges, according to a report by Reuters.
The report cites a statement by the Shenzhen exchange as confirming that managers from 28 funds attended the session, which highlighted typical cases of abnormal trading and the need for managers to strengthen their internal risk control management to ensure stable market operations.
Chinese quant funds, which use derivatives and data-driven computer models, are facing tighter regulatory scrutiny as authorities look to promote stability and investor confidence in the country’s ailing stock markets.
Last month, both Shanghai Weiwan Private Fund Management and Lingjun Investment were censured for ‘abnormal’ high frequency trading.
In addition, the China Securities Regulatory Commission also suspended brokerages from borrowing shares for lending to short-sellers and banned investors from short selling stocks bought on the same day, as part of a raft of measures to revive the market.
