Bypassing China’s barriers: 4 channels for offshore investors navigating capital controls
As Beijing tightens its grip on unlicensed stock platforms, mainland China’s retail players utilise these state-sanctioned options to diversify globally
Despite a more hawkish regulatory environment, mainland retail investors still have several regulated channels to gain exposure to foreign markets.
Each investment vehicle comes with different eligibility requirements, investment restrictions and product offerings:
The Stock Connect route
Launched in 2014 with the Shanghai-Hong Kong link and expanded to Shenzhen in 2016, Stock Connect links the Shanghai, Shenzhen and Hong Kong stock exchanges. Acting as a “bridge”, it allows mainland investors to buy eligible Hong Kong-listed shares directly through existing brokerage accounts without opening a separate overseas account.
The scheme currently covers more than 2,800 Hong Kong-listed securities, including stocks and exchange-traded funds (ETFs). Southbound net purchases hit a full-year record in 2025, with Goldman Sachs estimating total inflows of around US$160 billion.
Investors generally need at least 500,000 yuan (US$69,500) in combined account assets to qualify.
Qualified Domestic Institutional Investor (QDII) funds
Introduced in 2006, the QDII scheme allows domestic institutions to invest overseas using foreign-exchange quotas approved by regulators.