Compiled from a report by China Daily on March 13.
China is strengthening regulatory oversight of its mutual fund industry by shifting disclosure requirements toward long-term investment performance, a move designed to encourage value-oriented investing and enhance investor protection.
New rules released by the China Securities Regulatory Commission will require fund management companies to report seven- and ten-year investment performance in periodic disclosures, replacing short-term metrics that have traditionally dominated industry reporting.
The revised disclosure framework, which will take effect on May 1, marks another step in China’s broader effort to promote the high-quality development of its asset management sector.
Moving Away from Short-Term Returns
Under the new rules, mutual fund managers will no longer be required to disclose one-month performance figures in their reports. Instead, annual, semiannual and quarterly disclosures will focus on longer investment horizons.
The updated reporting templates were also issued by the Asset Management Association of China, using standardized XBRL-based disclosure formats designed to improve transparency and data comparability.
Regulators say the shift aims to discourage short-term speculation and guide the industry toward more sustainable, value-driven investment strategies.
Greater Focus on Investor Outcomes
Another key feature of the reform is a new requirement for actively managed equity and hybrid funds to disclose the proportion of profitable investors over the past year.
This metric is intended to highlight actual investor returns, rather than focusing solely on fund-level performance benchmarks.
Annual and semiannual reports will also need to disclose stock turnover ratios, a measure that indicates how frequently a fund trades its holdings. By bringing greater attention to portfolio turnover, regulators hope to encourage more prudent and disciplined portfolio management.
Aligning With Global Practices
China’s securities regulator said the updated disclosure rules draw on practices used in mature international markets, while also streamlining repetitive reporting requirements across different disclosure periods.
By refining the structure of annual, semiannual and quarterly reports, regulators aim to improve information quality, transparency and investor accessibility.
Implications for Investors
For global asset managers and institutional investors monitoring China’s financial markets, the new disclosure regime signals a policy shift toward long-term capital formation and healthier market behavior.
The reform is expected to:
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Encourage longer investment horizons among retail and institutional investors
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Reduce excessive focus on short-term performance rankings
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Strengthen investor protection and transparency in the mutual fund sector
As China continues to expand its asset management industry, regulators appear increasingly focused on building a more stable and sustainable investment ecosystem, aligning market practices with international standards while guiding capital toward long-term economic growth.