QFII is short for qualified foreign institutional investors. Under the QFII system, qualified foreign institutional investors (QFII) will be allowed to remit a certain amount of foreign exchange funds and convert them into local currency, and invest in the local securities market through special accounts under strict supervision and management. All kinds of capital gains, including dividends and bid-ask spreads, can be converted into foreign exchange remittance after examination, which is actually to open the domestic securities market to foreign investors to a limited extent.

According to the Interim Measures for the Administration of Domestic Securities Investment of Qualified Foreign Institutional Investors jointly issued by the People's Bank of China and the China Securities Regulatory Commission, QFII's investment scope includes: A-share stocks, treasury bonds, convertible bonds, corporate bonds and other financial instruments approved by the China Securities Regulatory Commission.

As a system, it refers to that the relevant administrative departments of our country allow the approved foreign institutional investors to convert foreign currencies into RMB under certain supervision and restrictions, and pass it. Investors' capital gains and dividends can only be remitted out of China after approval. QFII, as a transitional and low-risk model, is playing a unique role in the gradual opening of China's securities market.

in some countries and regions (especially emerging market economy countries), the money market has not been fully opened, and the capital account has not been fully opened. The intervention of foreign capital is likely to bring negative impact on the country's securities market. It can be said that this system came into being just to prevent such risks. Through this system, the management department of a country can supervise and guide the entry of foreign capital, make it adapt to the development of its economy and securities market, restrain the impact of speculative hot money from abroad on the economy, promote the internationalization and healthy development of its capital market, and protect its independence. In fact, China, Taiwan Province, South Korea, India, Brazil and other countries and regions established and implemented this system in the 199s. China also promulgated the Interim Measures for the Administration of Domestic Securities Investment by Qualified Foreign Institutional Investors in November 22. Compared with other countries and regions, China's mainland QFII system is more active and innovative in the design of specific systems, especially in the process of opening up to the outside world, and more attractive to overseas institutional investors. China's QFII system has the following characteristics.

First, the QFII system has been introduced into the country by leaps and bounds. According to the general international experience, the opening of the capital market will go through two stages. In the first stage, an "overseas fund" (Taiwan Province's model) or an "open international trust fund" (Korean model) can be established first; It took Taiwan Province 7 years and South Korea 11 years. China has bypassed the first stage and reached the goal in one step, and its advantage of being a latecomer is immeasurable.

Second, the scope of QFII access has been expanded and the requirements have been raised. In order to strengthen supervision and control, countries and regions in emerging capital markets generally specify by listing what types of foreign institutional investors can enter their own countries or regions. In addition, there are strict requirements on QFII's registered capital, financial status, operating period and so on. On the contrary, China's identification of QFII's subject scope is relatively broad, and it gives foreign investors more autonomy. However, in order to ensure the stable and healthy development of the domestic securities market, China has further improved the requirements for the amount of registered capital, financial status, operating period and other indicators.