Planning to invest in overseas assets such as U.S. stocks? Use QDII funds or the Hong Kong Stock Connect program — don’t open accounts with foreign brokers, and don’t use your annual foreign exchange quota for buying foreign stocks.

There’s no direct cost — you can purchase QDII funds via your own bank or brokerage app in just a few minutes. The trade-off is that the selection of available funds is more limited than at foreign brokers.

On May 22, 2026, eight Chinese authorities — including the China Securities Regulatory Commission, Ministry of Industry and Information Technology, Ministry of Public Security, People’s Bank of China, State Administration for Market Regulation, National Financial Regulatory Administration, Cyberspace Administration of China, and State Administration of Foreign Exchange — jointly issued a plan to comprehensively curb illegal cross-border securities, futures, and fund activities. The goal is to fully eliminate such activities within two years. Foreign firms may no longer market or solicit clients in China, nor provide services such as account opening, trade execution, or fund transfers. For current account holders, only one-way sales and withdrawals are permitted; after two years, all related websites, trading apps, and servers must be shut down. On the same day, the CSRC announced it would confiscate all illegal earnings of Tiger Brokers, Futu, and LongBridge and impose severe penalties. Official guidance stresses using legal channels such as the Hong Kong Stock Connect, QDII funds, and Cross‑Border Wealth Management Link for overseas investing. Meanwhile, the State Administration of Foreign Exchange explicitly states that personal foreign exchange may not be used for overseas real estate, securities investment, life insurance, or similar unapproved capital‑account purposes. Violators are placed on a “watch list,” lose their annual foreign‑exchange allowance for three years, face administrative penalties, possible anti‑money‑laundering investigations, and negative entries in their credit records (effective May 2026).

中国证监会 (2026-05-22). 中国证监会等八部门联合印发《综合整治非法跨境证券期货基金经营活动实施方案》. https://www.csrc.gov.cn/csrc/c100028/c7634324/content.shtml；中国证监会 (2026-05-22). 中国证监会有关部门负责人就《综合整治非法跨境证券期货基金经营活动实施方案》答记者问. https://www.csrc.gov.cn/csrc/c100028/c7634328/content.shtml；中国证监会 (2026-05-22). 证监会严肃查处老虎等机构非法跨境展业案件. https://www.csrc.gov.cn/csrc/c100028/c7634330/content.shtml；国家外汇管理局 (2021). 个人购汇申请书（附件 1）. https://www.safe.gov.cn/safe/file/file/20210402/30fab7a9646f417ca9d2f67ff4c1e5f0.pdf

These regulations target foreign brokerage firms rather than individual investors; no penalties are specified for investors themselves. Those already holding accounts abroad need only sell and withdraw funds within two years. Each of the three legal channels has its own eligibility criteria — be sure to check with your bank or broker. Past strong performance of U.S. stocks does not guarantee future returns. When investing via QDII funds, follow the same principles outlined in items 17 (broad‑based index funds) and 19 (don’t concentrate assets in a single stock, platform, or market) — opt for diversified index funds rather than betting on one market. Separate limits apply to overseas cash withdrawals; see item 21.6 for details. This information is not investment advice.