The full name of QFII is Qualified Foreign Institutional Investors. The QFII mechanism refers to the qualification certification system for foreign professional investment institutions to invest in China. QFII is a transitional system for a country to introduce foreign capital and open its capital market to a limited extent when the currency is not fully convertible and the capital account has not yet been opened. This system requires that if foreign investors want to enter a country’s securities market, they must meet certain conditions and remit a certain amount of foreign exchange funds after obtaining the approval of the relevant authorities of the country, and convert them into local currency, through a special account under strict supervision. Invest in the local securities market.
Through the QFII system, the management can impose necessary restrictions and guidance on the entry of foreign capital, adapt it to the country’s economic development and the development of the securities market, control the impact of foreign capital on the independence of the country’s economy, and curb the impact of overseas speculative hot money on the country’s economy The impact of the capital market promotes the internationalization of the capital market and promotes the healthy development of the capital market.
RQFII is a RMB foreign institutional investor with a smaller quota than QFII. It is also called a small QFII. It is a system for foreign institutions to use RMB for domestic investment. R stands for Renminbi, and the difference from QFII is the currency used. RQFII uses RMB and QFII uses US dollars. RQFII overseas RMB investment in A shares (through Hong Kong Chinese financial institutions). QFII overseas foreign currency investment in A shares (first converted into RMB).
What institutions does QFII have
According to the statistics of the top ten shareholders of tradable shares in the third quarterly report of listed companies published by Xinhua News Agency, QFII has overwhelmed securities firms with a market value of more than 24 billion yuan, becoming the second largest investment institution in the domestic A-share market after funds.
What institutions does QFII have
According to the China Securities Journal, statistics from the third quarterly reports of listed companies show that QFII appears among the top ten shareholders of tradable shares of 214 listed companies, with a cumulative market value of more than 24 billion yuan. In the mid-term report this year, these two figures were 194 and 20.1 billion yuan respectively. It can be seen that with the increase in the approved quota, QFII’s A-share holdings are also steadily increasing, and there is no sign of large-scale profit settlement in the third quarter.
Another important institution in the A-share market, the securities companies’ proprietary stocks totaled 20.5 billion yuan, appearing among the top ten shareholders of tradable shares of 267 stocks. At the time of the interim report, the securities firms’ stock market value was 220 among the top ten shareholders of tradable shares. 100 million yuan.
Currently, UBS and Citigroup are the two QFIIs with the highest investment quotas, at US$800 million and US$550 million respectively. According to the third quarter report of this year, UBS appeared in the top ten tradable shares of 44 listed companies with a cumulative market value of 4.2 billion yuan; Citigroup appeared in the top ten tradable shares of 25 listed companies with a cumulative market value of 3.3 billion yuan . Based on this calculation alone, the proportion of its positions has reached 67%, 77%. If you consider the stock positions that have not appeared in the top ten shareholders of tradable shares, the proportion of their positions will be higher.
According to the report, the biggest bottleneck restricting QFII is the limited quota. The currently approved quota of more than US$8.2 billion is close to the investment ceiling of US$10 billion, and the overall supply exceeds demand. However, the expansion of the QFII quota in the future will be logical, and QFII will have a greater influence on the A-share market.