Strictly prevent the risk of hot money entering and
exiting Zhou Lin
At present, we must be fully prepared to strictly guard against the risks of large inflows and outflows of hot money.
In terms of liquidity, it is necessary to rationally match supply-end categories such as stocks, funds, and bonds to effectively diversify financial asset risks.
Regarding the regulatory system and mechanism, it is necessary to improve the macro-prudential management system and the regulatory framework of systemically important financial institutions, and explore the development of macro-prudential management of cross-border capital flows.
Recently, with the hot commodity market and stock market trading, some hot money is ready to move.
Wind statistics show that as of June 3, the "northbound capital" under the interconnection mechanism in the past three months (generally speaking, the various types of capital mainly foreign capital that flow from Hong Kong stocks into the mainland stock market are collectively referred to as "Northbound funds"; funds flowing into Hong Kong stocks from the mainland are collectively referred to as "southbound funds") inflows amounted to more than 130 billion yuan, which is much higher than the same period last year and more than 48 billion yuan more than "southbound funds".
Even if the foreign capital inflows from the qualified foreign institutional investor (QFII) channel is not included, the current scale of “northbound funds” also shows to a large extent that the scale of foreign capital entering A-shares is different from usual.
The so-called hot money generally refers to highly speculative and liquid foreign capital that flows into a country's financial market in a short-term for the purpose of seeking the highest return.
Regulators have always been concerned about hot money disrupting the domestic market.
Liang Tao, vice chairman of the China Banking and Insurance Regulatory Commission, recently stated that it is necessary to improve the monitoring system for cross-border capital flows to prevent the large inflow and outflow of hot money from disrupting emerging markets.
This statement is consistent with the statement made by the Chairman of the China Securities Regulatory Commission Yi Huiman on hot money: “For the normal cross-border flow of capital, I am happy to see it, but the large inflow and outflow of hot money is a kind of harm to the healthy development of any market. , Must be strictly controlled."
The extent to which hot money will disrupt the market depends mainly on three factors: one is the level of corporate profitability from a fundamental perspective; the other is the level of interest rates from a liquidity perspective; and the third is the risk appetite from the perspective of investors.
A very important reason why foreign investors value China's financial market is that they are optimistic about China's stable capital market environment and the considerable profit prospects of Chinese companies.
After all, under the influence of the new crown pneumonia epidemic, China has coordinated the promotion of epidemic prevention and control and economic and social development, has withstood various risk pressures, and has taken the lead in realizing positive growth among the world's major economies.
Optimistic about China's development prospects has become the consensus of many foreign investors.
However, affected by market liquidity factors, there are also individuals and institutions that are highly speculative and arbitrage in foreign investment.
At present, overseas liquidity is relatively loose, and market concerns about inflation have triggered funds to pursue high-quality A-share stocks. Coupled with the recent appreciation of the renminbi, my country’s financial market has become more attractive to foreign investors. These have all become a rapid inflow of foreign capital into the market in the short term. Push hand.
Among the recent foreign capital inflows, there are both long-term funds that continue to "go long" in the Chinese economy, as well as hot money that intends to fast in and out.
Different types of funds should be treated differently.
To a certain extent, it is gratifying that foreign capital is optimistic about China's financial market. The international flow of certain short-term capital is also the result of the differentiated adjustment of monetary policies in compliance with market laws.
The core of the problem is that the hot money should be managed well and let the hot money "use me".
At present, we must be fully prepared to strictly guard against the risks of large inflows and outflows of hot money.
In terms of liquidity, if hot money is “water”, then stocks, funds, and bonds are “flour”. The supply-end categories such as stocks, funds, and bonds must be properly matched to achieve “water balance” and effectively diversify financial assets. Risks, trying to maintain market stability.
To this end, it is necessary to continue to steadily promote the reform of the registration system for new stock issuance, so that more domestic companies will issue securities in accordance with market-oriented principles, so that investors have more options for securities allocation.
At the same time, we will guide more domestic long-term funds into the market, improve the short-selling and short-selling mechanism, promote the return of stock value, enrich the "toolbox" of investors' hedging, and effectively give play to the market's self-correction function.
Regarding the regulatory system and mechanism, it is necessary to improve the macro-prudential management system and the regulatory framework of systemically important financial institutions, explore the development of macro-prudential management of cross-border capital flows, and deal with the overall situation in a timely manner in the face of macro-, counter-cyclical, and cross-market risks. , Actively "prevent and treat various financial diseases."
At the fundamental level, no matter how investors’ risk appetite factors and interest rate factors change, domestic companies should work hard, continuously improve the quality of listed companies, and do their best. This is the foundation for maintaining the sustainable and healthy development of my country’s capital market. Policy.
Zhou Lin