China Bans High-Frequency Trader as Quant Crackdown Expands
- Hedge fund gets one-year ban for misuse of high-speed trading
- Chief regulator vows to enforce law, step up oversight
China earlier this month broadly took aim at quant funds, which relied on computer-driven trading to outperform the market for much of the last three years.
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China banned a top-performing quant fund from the stock-index futures market and vowed tighter oversight of high-speed trading, expanding a crackdown on computer-driven investment strategies that some have blamed for exacerbating market turmoil.
The China Financial Futures Exchange recently banned Shanghai Weiwan Fund Management from opening stock index futures positions for 12 months, while confiscating 8.9 million yuan ($1.2 million) in illegal gains, the bourse said in a statement late Wednesday.