China’s pension fund, which has over 2 trillion yuan ($327 billion) of cash that it can deploy for various investments, will hire professionals to help in its plan to engage in the country’s equities market, according to Xinhua news agency.
The Ministry of Human Resources and Social Security (MOHRSS) and the Ministry of Finance have drafted a rule allowing the pension fund to invest up to 30% of its total net assets in Chinese stocks, bonds, among others. The draft has been posted on the MOHRSS website and is awaiting feedback from the public.
The MOHRSS is responsible for China’s national labor policy standards, regulations, as well as in managing the national social security system
The 30% cap won’t be reached in a short period of time, Xinhua said, citing MOHRSS spokesman Li Zhong at a news conference.
The report did not give details on how many professionals will be hired to help in the planned securities investment and when it will take place.
Reports that the pension fund would be allowed to invest in Chinese equities for the first time ever surfaced Tuesday just as the country’s stock market was falling as investors panicked after Greece failed to secure an agreement with creditors on its debts. The unwinding of margin trades and current tight liquidity in the financial market exacerbated the fall in stocks.
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