(Image source: Visual China)
Blue Whale News, 10 19: (Reporter Chen Xiaojuan) Recently, the Shanghai Securities Regulatory Bureau announced an administrative penalty decision against a certain insurance asset management company researcher, Yun, for trading on undisclosed information (commonly known as "rat trading").
The case spanned 3 years and 8 months. The convergence trading strategy ultimately resulted in losses, and the analyst not only lost money but also faced penalties. Notably, although Yun's role was that of an analyst, they were deemed responsible for investment decisions on the portfolio involved in the case. Typically, investment decision-making authority rests with fund managers, while analysts provide research support. However, in some smaller asset management firms, analysts do participate in investment decisions.
The decision letter indicates that Yun, female, born in 197X, is the holder of an insurance license for a certain asset management company (hereinafter referred to as "the Company"). Yun served as a researcher in the Company's Research Department, responsible for investment decisions and other duties related to the portfolio in question. She had access to non-public information regarding the portfolio, including holdings and transaction details.
From 2022 to 2025, between month 1 and month 9 (hereinafter referred to as the "Relevant Convergent Trading Period"), Yun controlled securities trading accounts under the names of Huang X J and Zhu X X at China Everbright Securities. The account under the name of Huang X J was opened at the Shanghai Century Avenue Business Department of China Everbright Securities Co., Ltd., while the account under the name of Zhu X X was opened at the Jinhua Binhong Road Business Department of China Everbright Securities Co., Ltd. The primary sources and destinations of funds in these securities accounts were Yun and their spouse.
During the period of the implicated convergent trading, Yun used non-public information about the involved portfolio obtained through his position, violated regulations, and either personally directed or instructed others to operate securities transactions in the "Huang Mouju" and "Zhu Mouxiang" Everbright Securities accounts. These actions resulted in convergent trading with the involved portfolio, leading to losses from such trades.
Based on the facts, nature, circumstances, and social harm of the party's illegal conduct, in accordance with relevant regulations, the Shanghai Securities Regulatory Bureau has decided to: order Yun to dispose of the illegally held securities in accordance with the law and impose a fine of 50 ten thousand yuan.
