Regulator Targets Margin-Trading Loophole Seen Aiding Bourse Volatility

(Beijing) – The securities regulator is tightening oversight of a financial information and service provider's trading system used for unsupervised trading involving borrowed money, activity widely seen as aiding recent wild fluctuations on the A-share market.

Hundsun Technology Inc. Ltd., whose subsidiary Hangzhou Hundsun Networks Technology Services Co. runs a trading system that has a loophole widely used by stock investors to borrow money outside regulatory oversight, said in a filing with the Shanghai bourse on July 16 that it would follow an order from the regulator to address illegal operations through its HOMS trading platform.