Legal basis: People's Republic of China (PRC) Securities Investment Fund Law.
Article 73 The fund property shall be used for the following investments: (1) stocks and bonds listed and traded; (2) Other securities and their derivatives as stipulated by the the State Council Securities Regulatory Authority.
Article 74 Fund assets shall not be used for the following investments or activities: (1) underwriting securities; (two) in violation of the provisions of the loan or guarantee to others; (three) engaged in unlimited liability investment; (4) buying and selling other fund shares, except as otherwise provided by the the State Council Securities Regulatory Authority. (5) making capital contributions to fund managers and fund custodians; (six) engaged in insider trading, manipulation of securities trading prices and other improper securities trading activities. (seven) other activities prohibited by laws, administrative regulations and the provisions of the the State Council securities regulatory authority. Fund managers, fund custodians, their controlling shareholders, actual controllers or other companies with significant interests in them who buy or sell securities issued or underwritten during the underwriting period, or engage in other major related transactions, shall follow the principle of giving priority to the interests of fund share holders, guard against conflicts of interest, abide by the provisions of the the State Council Securities Regulatory Authority and fulfill the obligation of information disclosure.