Business
19:18, 22-Jun-2017
China to categorize securities investor and products to assess risk
[]
Share
Copied
Investors in China's securities market will be categorized into professionals and non-professionals and the latter subjected to greater scrutiny by regulators, under plans announced by the China Securities Regulatory Commission on Thursday.
Two types of investors in the A-share market will be defined as professionals under rules taking effect on July 1. The first group includes investors with at least five million yuan (730,000 US dollars) in financial assets, or with an annual income in the latest three years of at least 500,000 yuan.
Assets and income are key factors in the classification of investors. /CGTN Screenshot
Assets and income are key factors in the classification of investors. /CGTN Screenshot
The second group includes investors with more than two years of experience in the investment or design of securities products or in risk management. Professionals such as senior managers, accountants and lawyers belong to this group.
The rest investors are to be defined as non-professionals.
The Securities Association subsequently released a guideline that classifies investors into five types under their risk tolerance – conservative, cautious, steady, active and radical. Securities products and services were also divided based on the level of risk.
Risk tolerance is a key factor in the classification of investors. /VCG Photo
Risk tolerance is a key factor in the classification of investors. /VCG Photo
A and B shares and the innovation layer of the New Third Board are included in the medium-risk level. Those shares can be traded by steady, active and radical investors.