China Raises Margin Financing Ratio To 100% To Curb Risks

China has raised the minimum margin requirement for financing securities purchases on its stock exchanges to 100% in its latest effort to curb risks. 

Under the new rule, investors must now provide margin equal to the full value of the securities they buy on credit, up from the previous 80% threshold, according to a Shenzhen Stock Exchange statement. The move, which applies to Shenzhen, Shanghai and Beijing bourses, underscores regulators’ efforts to tighten risk controls in the capital markets.