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TAIPEI, Feb 21 (Reuters) - China is revising rules to allow its qualified domestic institutional investor (QDII) funds to invest in derivatives traded on Taiwan's stock and futures exchanges, Taiwan's body in charge of relations with mainland China said on Friday.
The Straits Exchange Foundation (SEF) said that the move comes after it met with its Chinese counterpart, the Association for Relations Across the Taiwan Straits.
Financial ties across the Taiwan Strait have gathered steam, with both sides signing a yuan clearing agreement and allowing banks to invest in each other in the past couple of years.
The QDII scheme is a quota system for allowing Chinese investors to buy overseas financial assets. Currently QDII funds may purchase shares in Taiwanese companies, but not derivatives linked to them.
Reporting by Lin Miao-jung; Writing by Faith Hung; Editing by Jason Subler