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China regulators approve more STAR Market funds - Shanghai Securities News

Published 12/14/2019, 06:33 AM
Updated 12/14/2019, 06:36 AM
© Reuters.  China regulators approve more STAR Market funds - Shanghai Securities News

SHANGHAI (Reuters) - Chinese regulators have recently approved four funds focused on China's new Nasdaq-style STAR Market, the official Shanghai Securities News reported on Saturday, as fund managers seek to capitalize on China's push to nurture home-grown tech firms.

The four funds approved at the beginning of December brings the total number of such funds to 23, the paper reported, adding that nearly 100 more were currently awaiting approval.

The approved funds do not exclusively invest in companies listed on Shanghai's STAR Market, the paper said, but are more broadly STAR Market "themed", also investing in high-tech companies on other domestic boards.

The STAR Market launched in July to a stellar reception that saw some shares rocket as much as 520%. It now comprises more than 50 companies.

Designed to allow pre-profit companies to list and for venture capitalists to exit investments in loss-making start-ups, it was also meant to boost China's search for tech self-sufficiency amid the country's trade war with the United States.

But valuations of some listed firms have since succumbed to gravity, dropping below their initial public offering prices as a rapidly slowing economy has forced investors to reassess their initial starry-eyed enthusiasm.

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