Swap facility,
First, securities, fund, and insurance companies pledge their stock assets to the People's Bank of China (PBOC), which means these assets cannot be sold, reducing short-selling pressure;
Second, after pledging, PBOC provides them with government bonds and central bank bills, which they can only sell to obtain RMB, thus regulating the bond market;
Third, the liquidity from selling government bonds can only be used to purchase stock assets.
Therefore, this policy restricts selling, regulates the bond market, and boosts A-shares—killing three birds with one stone.
$Kweichow Moutai (SH600519)$
$Alibaba(BABA.US)
$Tencent Holdings (00700)$
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