China's Stock Exchanges to Tighten Scrutiny on Market Data Feeds

The Shanghai and Shenzhen stock exchanges are considering suspending certain value-added market data feeds to computer-driven quant funds. This move aims to address market volatility issues. The data in question includes tick-by-tick transaction details, crucial for high-frequency trading strategies. Regulatory bodies have yet to comment on this potential action.

The Shanghai and Shenzhen stock exchanges are considering suspending certain value-added market data feeds to institutions such as computer-driven quant funds, two sources said in an effort by Chinese regulators to tighten scrutiny of a sector blamed for contributing to market volatility. The bourses may suspend providing granular transaction details including so-called tick-by-tick data, one of the sources said.

Such data is essential for quant funds, especially those using high-frequency trading (HFT) strategies that use computers programs to profit from tiny and fleeting market fluctuations. The China Securities Regulatory Commission (CSRC), Shanghai Stock Exchange and Shenzhen Stock Exchange did not immediately respond to Reuters' requests for comment.