{
  "id": 636862,
  "title": "China’s quant funds have an edge on foreign rivals, even as Beijing curbs trading speed",
  "url": "https://urgent.news/2026/08/12/chinas-quant-funds-have-an-edge-on-foreign-rivals-even-as-beijing",
  "topic": "finance",
  "section": "Finance & Markets",
  "published": "2026-08-12T05:00:07.000Z",
  "source": {
    "name": "South China Morning Post",
    "slug": "south-china-morning-post",
    "url": "https://www.scmp.com/business/banking-finance/article/3363610/chinas-quant-funds-have-edge-foreign-rivals-even-beijing-curbs-trading-speed"
  },
  "original_language": "en",
  "account": "China’s quantitative funds possess a distinct advantage over their foreign counterparts, despite Beijing’s recent measures to curtail the speed of trading, according to Xia Chun, a respected economist. Xia contends that China's unique valuation approach for state-owned enterprises yields pricing dynamics that foreign models are unable to replicate. Beijing’s recent tightening of the quant trading sector is an effort to level the playing field, as Xia explains, but it may result in further speed reductions if deemed beneficial to market fairness. Chinese quant firms are not disheartened by the speed restrictions; instead, they are focusing on proximity to exchange servers and engaging in an \"arms race\" for reduced latency. Xia proposes the adoption of \"frequent batch auctions\" as a solution to the latency issue, a model already successful on cryptocurrency trading platforms. The regulatory crackdown comes amidst a challenging time for the quant hedge funds sector, with numerous funds experiencing significant losses and a corruption probe targeting a former CSRC vice-chairman who had advocated for greater quant fund access. Xia asserts that quant trading is more of a scapegoat for structural issues in the A-share market, with most quant capital being deployed in mid- or low-frequency strategies. He expects that as speed advantages dwindle, mid- and low-frequency quant strategies will gradually replace traditional discretionary fund managers. Despite potential limitations in strategy diversity due to administrative oversight, Xia believes that market competition should naturally eliminate underperforming funds. However, a technology gap exists between institutional and retail investors, and Xia urges investors to focus on trading strategies rather than individual stocks. He also cautions against a \"T+0\" trading rule, as it would only exacerbate retail losses.",
  "summary": "China’s quantitative funds have built trading strategies so closely tailored to the mainland market that foreign rivals cannot replicate them, even as a regulatory clampdown on trading speed reshapes the industry, according to a prominent economist. “If a top US quant team goes to Japan or India, they can beat virtually all the native quants,” Xia Chun, founder and chief economist at Chinese…",
  "key_points": [],
  "editors_take": null,
  "illustration": null,
  "coverage": {
    "outlets": 2,
    "also_reported_by": [
      {
        "outlet": "SCMP Business",
        "title": "China’s quant funds have an edge on foreign rivals, even as Beijing curbs trading speed",
        "url": "https://urgent.news/2026/08/12/chinas-quant-funds-have-an-edge-on-foreign-rivals-even-as-beijing-637772",
        "published": "2026-08-12T05:00:07.000Z"
      }
    ]
  },
  "ai_generated": true,
  "disclaimer": "Summaries, key points and the editor’s take are written by software from other outlets’ reporting and may contain errors — always check the linked original."
}