Two stock funds to make their debuts to thaw fund freeze
Updated: 2008-02-18 11:20
China's sliding stock market is expected to receive a boost on Monday with the opening of two new limited stock funds.
CCB Principal Asset Management's Jianxin fund and the Nanfangshengyuan funds run by China Southern Fund Management Co received regulatory approval on February 1.
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The initial debut is expected to raise six to eight billion yuan ($857.1 million to $1.14 billion).
With an expected acquisition of four billion to six billion yuan on its first issue day, Jianxin stock fund can be subscribed through its direct sales center, China Construction Bank, the Bank of Communications and other qualified branches of the Shenzhen Stock Exchange.
Chen Jian, manager of Nangfangshengyuan stock fund, said government regulation and supervision of the stock market had proved effective, and the company had great confidence in China's exchanges.
"Share prices had been as much as 38 times that of the earning ratio, and the figure has fallen to 25 times, which is a good sign that the market is operating well," said Xu Jie, top manager of Jianxin stock fund. "Our fund may benefit from a promising market."
The regulator has formally approved another two funds on February 15.
The openings mark an end to a five-month freeze on new funds, a signal that the government is to boost the falling domestic equity market.
China's securities watchdog suspended the launch of new funds late last year in reaction to the surging domestic stock market. The Shanghai Composite Index nearly doubled last year.
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