China, Taiwan Province, South Korea, India, Brazil and other countries and regions established and implemented this system in the early 1990s. QFII system is a transitional system widely implemented in many countries and regions, especially in emerging market economies. Under the circumstances that the currency is not fully convertible and the capital account is not yet open, foreign capital is introduced to a limited extent and the capital market is opened. It allows qualified foreign institutional investors (QFII) to remit a certain amount of foreign exchange funds under certain regulations and restrictions, and convert them into local currency. Under strict supervision and management, they can invest in the local securities market through special accounts, and their capital gains and dividends can be converted into foreign exchange after examination.

The QFII system is essentially to restrict foreign capital from entering the domestic securities market.

QDII (Qualified Financial Institutional Investor) is a mechanism for local investors to invest overseas in countries (regions) where the capital account is not fully open. Investors can only buy and sell through this mechanism, so that the state can supervise the flow and scale of funds. QDII can set up a closed-end fund (that is, after the fund expires, the principal and income can be recovered in one lump sum, and the period cannot be traded), and the upper limit of the term and investment amount can be set for investors to subscribe, and the fund manager is responsible for the investment. The above form allows SAFE to monitor the flow of funds and ensure that funds return to China.