The China Securities Regulatory Commission (CSRC) announced that it is preparing a three‑year action plan to reform the private fund sector, in line with new State Council guidelines.
The reform is part of a broader “1+N+X” regulatory framework that will address market entry, supervision, risk management, and industry development.
Key objectives are to improve long‑term returns for investors, lower fund management fees, standardise performance benchmarks, and enhance the evaluation systems used for fund managers.
Algorithmic trading is a specific focus: the CSRC highlighted the growing use of quantitative strategies by domestic and foreign investors and announced tighter oversight, including mandatory trade‑reporting, enhanced market surveillance, and stricter action against manipulation and disorderly trading.
Additional steps are being considered to improve market fairness and curb illegal practices.
The fund industry has expanded rapidly: stock investments held by funds have risen 41 % over the past five years to 13.4 trillion yuan (approximately US$2 trillion).
Fund holdings now represent 13.7 % of the free‑float market value of China’s A‑share market, indicating a growing influence of institutional investors.
The reforms aim to attract more long‑term capital, strengthen confidence in domestic financial markets, and deepen overall capital‑market development.
