CBBAP, the largest privately held Chinese stocks trading on the mainland, said on Wednesday it would start recertifying its stock index after months of delay due to regulatory uncertainty.
The move comes amid fears that the government may revise the index’s capitalization to 10 billion yuan ($1.06 billion) in the coming months to accommodate the massive number of investors that had been waiting to cash in on a stock-market rally.
The stock index is China’s main benchmark for equities and has gained more than 30% since the start of the year.
Its main trading partner, the Shanghai Composite Index, gained about 13% in the same period.
It is now expected to increase by about 1% to 4,500 billion yuan before falling back to 3,500 yuan on Friday, according to a Reuters estimate.
CBBAPS’ stock index was the only major Chinese stock index that showed significant gains during the past two years, according an estimate by Thomson Reuters I/B/E/S.CBDAP is one of the world’s biggest mutual funds, with about $1.7 trillion under management.
CBAAP, a smaller Chinese investment fund, has a total assets under management of about $400 billion.
CBBAPS will be the second Chinese index to re-examine its indexing rules.
A week ago, CBBap’s market capitalization fell to 1.45 trillion yuan from 2.26 trillion yuan, after the government announced a plan to ease restrictions on foreign ownership of the index.CBBAP’s stock market re-index was announced in March, and its benchmark stock index rose by about 50% between April and June.
It is expected to reach its peak at the end of September.
Its latest listing will not affect the CBBaps own shares.
The CBBATS China Stock Index, which includes both stocks and mutual funds that buy and sell securities, was the most active of the three Chinese indexes last year.
It gained nearly 70% from July to September, as China has been pushing through a major economic transition.