Be optimistic about Chinese assets and increase foreign investment. According to the latest data from the China Securities Regulatory Commission, as of the end of July, the number of Qualified Foreign Investors (QFII) has reached 900, with an increase of 40 since the beginning of this year. The China Securities Regulatory Commission stated that more reform measures will be introduced to optimize the qualified overseas investor system in the future, effectively promoting high-level institutional opening of the capital market. According to market analysts, based on the policy signals revealed at the recent "15th Five Year Plan" Capital Market Planning Expert and Scholar Symposium held by the China Securities Regulatory Commission, a new round of capital market reform and opening up is expected to accelerate. Further improving the convenience of cross-border investment and financing, optimizing access management, investment operations, and other measures are worth looking forward to. Foreign institutions are expected to cast more "votes of confidence" in the Chinese market. Recently, multiple data indicate that foreign investment is increasing its willingness to allocate Chinese assets. According to Wind data from A-share listed companies' semi annual reports for 2025, as of the end of June, QFII has entered the top ten shareholders of 1145 companies, with a total market value of 143.464 billion yuan, an increase of 21.29 billion yuan from the end of the first quarter. The State Administration of Foreign Exchange recently released data showing that foreign capital increased its net holdings of domestic stocks and funds by 10.1 billion US dollars in the first half of the year, reversing the overall net reduction trend of the past two years. Especially in May and June, the net increase in holdings reached $18.8 billion, indicating an increased willingness of global capital to allocate to the Chinese domestic stock market. The data released by foreign institutions also confirms this trend. The latest report released by Goldman Sachs shows that from August 21 to August 27, mainland Chinese stock funds received a net inflow of $4.076 billion, leading the way in emerging markets. Since the beginning of this year, investors' overall confidence in investing in China has continued to increase. ”Landlord Ming, the head of UBS Global Financial Markets in China, said that especially in the global trend of diversified asset allocation, overseas investors' willingness to allocate non US dollar assets and Chinese assets is gradually increasing. Multiple foreign institutions frequently appear on the research list of A-share listed companies. According to Wind data, as of September 3rd, 715 foreign institutions have completed over 6500 surveys on A-share listed companies since the beginning of this year, with multiple institutions conducting over 100 surveys in total. Multiple factors boost investment confidence as foreign investors' "real gold and silver" go long in Chinese assets, supported by multiple factors such as policy support and reasonable market valuations. From the perspective of economic fundamentals, the fundamentals of the Chinese economy remain stable. At present, China's industrial upgrading is accelerating, and new quality productive forces such as new energy, artificial intelligence, and biomedicine are rising strongly, continuously injecting new momentum into the growth of the real economy. KPMG stated in its "2025 Macro Economic Trends Outlook" that China's enormous market potential and its key position in the global supply chain still attract a large amount of foreign investment to maintain and deepen its layout in the Chinese market. The positive growth in profits and the potential for improvement in valuation levels are also important reasons why foreign investors are optimistic about Chinese assets. Liu Jinjin, Chief China Equity Strategy Analyst at Goldman Sachs, believes that the current valuation of the Chinese stock market is at a moderate level, and the fund positions of various investors are far from reaching excessively high levels. Supported by multiple factors, there is still room for the current upward trend to continue. Lianbo Fund proposed in the "Equity Market Outlook for the Third Quarter of 2025" that on the one hand, the improvement of profitability and dividend levels of high-quality listed companies will continue to enhance the attractiveness of the stock market; On the other hand, in the context of improved profitability, there is still room for market valuation to increase. Overall, investors' interest in the A-share market has significantly increased. ”Meng Lei, a China stock strategy analyst at UBS Securities, said that investors generally hold an optimistic attitude in the context of the market's upward trend. The improvement in investment sentiment is partly due to the rapid rebound of the stock market itself, partly due to the confidence boost stimulated by loose policies, and the expectation of residents' wealth management funds moving. Meng Lei further analyzed that there is still ample room for overseas investors to increase their holdings in A-shares in the future. With the further recovery of the Chinese economy, the innovative practices of Chinese enterprises will help them achieve profitability growth based on their fundamentals. Coupled with the implementation of "anti involution" measures, global investors may further enhance their confidence in the A-share market. The promotion of high-level institutional opening-up and increased foreign investment in Chinese assets cannot be achieved without the sustained release of policy dividends. The China Securities Regulatory Commission recently stated that it will accelerate the implementation of a package of key measures for the opening up of the capital market to the outside world by 2025, including the release of the QFII system optimization plan, further optimization of access management, investment operations, and other arrangements. Guan Tao, Global Chief Economist of Bank of China Securities, stated that efforts can be made to relax QFII related restrictions by expanding investment scope and increasing the proportion of foreign ownership. To avoid the potential surge in capital inflows and transfer of ownership and control of listed companies caused by the relaxation of foreign ownership restrictions, it is recommended to make moderate adjustments based on the actual situation using the principle of small and multiple adjustments. In addition, it is necessary to simplify the access management of QFII in different markets, improve investment convenience, and timely increase QDII investment quotas. ”Guan Tao stated that efforts can be made to optimize the interconnection mechanism by enriching cross-border financial products and expanding cooperation with other international exchanges. The convenience of cross-border investment is expected to be further improved. The regulatory authorities have clearly stated that they will further improve the convenience of cross-border investment and financing, and better achieve the goal of promoting reform and development through opening up. Liu Xiangdong, Deputy Director of the Research and Information Department of the China International Economic Exchange Center, stated that more cross-border ETF products should be launched, the interconnection of depositary receipts should be expanded, and more high-quality foreign investment should be guided to invest in Chinese listed companies in the long term; We can explore and optimize the existing market access mechanism, including upgrading the operation rules of "Bond Connect" and "swap link", so as to promote foreign capital to participate in transactions in various fields of China's capital market more smoothly. While promoting institutional openness, the improvement of external resource allocation capabilities is also crucial. Tian Xuan, Dean of the National Institute of Finance at Tsinghua University, suggested setting up a pilot program for cross-border asset management, allowing foreign institutions to issue RMB denominated green bonds and science and technology innovation funds, attracting more long-term capital through channels such as the Shanghai Hong Kong Stock Connect and the Shenzhen Hong Kong Stock Connect, forming an international open pattern of "rule connectivity market connectivity capital activity". In the process of promoting openness, it is equally important to prevent external shocks and risks. Guan Tao suggests improving macro prudential management policies for cross-border capital flows, strengthening monitoring, early warning, and evaluation systems, drawing on mature international experience, researching and introducing price based management tools such as financial transaction taxes, such as setting differential tax rates for different types of cross-border capital, regulating the total amount and structure of cross-border capital flows, and determining the conditions for the activation and withdrawal of macro prudential measures based on the principle of "non intervention is the principle, intervention is the exception". (New Society)