The insurance authority of mainland China has given permission for insurers to invest in Hong Kong shares through the Shenzhen-Hong Kong Stock Connect.
The China Insurance Regulatory Commission (
CIRC) issued an online statement that insurers under its jurisdiction are now allowed to allocate their securities investment funds, which are supervised by qualified fund managers, to purchase stocks of publicly traded Hong Kong companies.
According to the regulator, access to the neighbouring market’s stocks will help insurers improve their asset structures, minimise risks, and higher investment yields.
The stock connect between Shenzhen and Hong Kong was launched in December last year, allowing investors to cross markets and invest in each other’s bourses. In 2014, a similar arrangement was created between the Shanghai and Hong Kong stock exchanges.
Creating links between Hong Kong and mainland Chinese cities has been seen by experts as a significant positive step in allowing foreign investors to buy A-shares with fewer restrictions than before.
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