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China Quant Fund Apologises After Dumping Local Stocks – SCMP

China’s third largest quant fund has said sorry after being hit with a trading ban for computer-generated sell orders that sparked a rapid market decline on Monday

Markets fell broadly across Asia on Friday as investors waited for a speech by Fed chair Jay Powell on upcoming policy moves.
This image shows a man walking past a brokerage house in Jiujiang, Jiangxi province, China. Photo: Reuters.


Ningbo Lingjun Investment Management, the third biggest quant fund in China, has apologized to investors and market authorities after it was hit with a three-day trading ban on Tuesday by Shanghai and Shenzhen stock exchanges for dumping stocks on local markets and “disrupting normal market trading”, according to a report by the South China Morning Post, which said this was “the first known case” since the market regulator focused on “trading activities that have perpetuated a three-year market rout”.

Quantitative trading uses computer algorithms and programming to identify and capitalise on trading opportunities, which offer speed advantages of small and medium-sized investors, the paper said.

The Lingjun fund, which has assets of about 60 billion yuan ($8.3 billion), said in a note on its website it was “deeply sorry” for the impact caused by its trading – with computer-generated sell orders – when markets reopened on Monday – and fell as much as 0.9% in the opening hour. It vowed to bolster supervision and “maintain a ‘zero tolerance’ approach towards illegal activities that disrupt normal trading order.”

Read the full report: South China Morning Post.




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Jim Pollard

Jim Pollard is an Australian journalist based in Thailand since 1999. He worked for News Ltd papers in Sydney, Perth, London and Melbourne before travelling through SE Asia in the late 90s. He was a senior editor at The Nation for 17+ years.


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