What does RQFII mean?
RQFII refers to qualified foreign investors in RMB, among which QFII is short for qualified foreign institutional investors. QFII mechanism refers to the qualification accreditation system for foreign professional investment institutions to invest in China.
R stands for RMB
RQFII overseas institutional investors can invest the foreign exchange settlement within the approved quota in the domestic securities market. RQFII's liberalization of stock market investment will accelerate the internationalization of RMB.
RQFII draws lessons from the experience of QFII system, and there are several changes:
First, the investment funds raised are RMB instead of foreign exchange; Second, RQFII institutions are limited to domestic fund management companies and Hong Kong subsidiaries of securities companies; Third, the scope of investors has expanded from RMB financial instruments in the exchange market to the inter-bank bond market; Fourth, on the premise of improving statistical monitoring, simplify and facilitate RQFII investment quota and cross-border fund revenue and expenditure management as much as possible.
What's the difference between qfii and rqfii?
QFII means that foreign-funded institutions raise US dollars and then convert them into RMB for direct investment in A shares after approval; Small QFII refers to overseas RMB investing in A shares through securities companies and fund companies in China and Hongkong.
Most of the overseas investors behind QFII are financial investors, who demand higher liquidity, and most of them are rational investors who attach importance to fundamentals. QFII mainly makes profits by buying and selling spreads in the secondary market. An important feature of QFII is that it does not participate in the governance of listed companies, and its behavior is only a passive buying and selling behavior of the voting results of the board of directors and shareholders' meeting, daily business behavior and environmental changes. Due to its own investment characteristics and policy restrictions, qualified investors must hold less than 10% of the total share capital of listed companies.