Overview
- The Shanghai, Shenzhen and Beijing stock exchanges announced the change on January 14 with approval from the China Securities Regulatory Commission.
- The 100% minimum applies only to new margin-buy contracts, while existing positions and their extensions remain under previous rules.
- The rule effectively requires investors entering new margin trades to fully fund stock purchases without borrowing.
- The exchanges described the step as a counter-cyclical adjustment in response to surging financing activity and elevated market liquidity.
- The decision reverses a 2023 easing of margin rules and signals a stronger emphasis on financial stability, with near-term market impact expected to be limited by the exemption for existing positions.