Equity houses are impatiently awaiting additional quotas for China's 'A' share market, amid growing interest following the recent yuan revaluation. "This has reignited people's interest in this market," said Justin Kennedy, managing director in Asia-Pacific equity derivatives at Citigroup in Hong Kong. Although firms have seen a surge in inquiries, most houses have already tapped out their existing investment quotas for the mainland market.
Earlier this year regulators announced the quotas for the Qualified Institutional Investor scheme would be increased from USD4 billion to USD10 billion (DW, 5/6) but firms are still awaiting word for the timing of the move. Some equity professionals expect additional quotas to be allocated in the next few months due to the recent request from the Chinese government for firms to re-send their strategies. "The regulators have asked everyone to resubmit plans," said an equity head in Hong Kong, noting that QFII holders are required to disclose their investment strategies such as establishing funds, facilitating client trades or holding positions for their own books.
