Country limits are still in place after the recent reform of the RQFII quota rules, says a source close to China's foreign exchange regulator.
Beijing has relaxed the renminbi qualified institutional investor (RQFII) quota rules, as it did for the QFII scheme in February. It is hoped the move will address capital-repatriation hurdles to MSCI inclusion.
It is not clear how fund firms should proceed with their QFII or RQFII quota, says Manraj Sekhon, CEO and CIO of Singapore’s Fullerton Fund Management.
The deputy CEO of Hong Kong’s securities regulator said asset managers in the city should make use of offshore quota, as the city awaits an increase in its RQFII limit.
But optimism remains that the country will succeed in obtaining North America's first RQFII quota, despite allegations of Chinese hacking and spying.
China's foreign exchange regulator is to change from awarding quotas for specific products to quotas for firms, which should help to cut down on unutilised quota and be more efficient.
London getting more RQFII quota than Singapore was to be expected, says Gerard Lee, CEO of Lion Global Investors, who has various plans for any forthcoming quota.
There is fear about a mooted 10% tax being applied retrospectively to gains made by QFII investors trading A-shares. Regulators are tipped to unveil answers in the next six months.
The Malaysian sovereign wealth fund waits just a month for its $250 million QFII quota. It is one of five foreign institutions to get a new batch of allowances totalling $700 million.
The asset manager has just fulfilled its initial $200 million QFII quota and is already mulling its options for a second bite of the cherry, its Asia chief confirms.
Anticipating the introduction of a second bourse and futures market, foreign fund managers are upbeat about the long-term outlook for the A-share market.