(Yicai) Dec. 6 -- China will allow its social security funds to be invested in new areas including stock index and treasury bond futures, but only for hedging and with strict risk control, the finance ministry said in a document.

The document, Measures for the Administration of Domestic Investment of the National Social Security Fund, was released today for public feedback. It says that corporate bonds, non-financial corporate debt financing instruments, and pension and other products will also be included in the new scope of investment.

The fund's custody fee rate will also be lowered to no more than 0.05 percent from up to 0.25 percent previously.

As much as 40 percent will be allowed to be invested in stocks and up to 30 percent in equities, thereby improving investment flexibility for the country’s social security funds, as well as boosting the growth of China’s capital market.

The management document published in 2001 did not classify investment options according to the aforementioned categories. It simply stated that, based on cost calculation, the share of securities investment funds and stock investments in the investments made by social security funds should not exceed 40 percent.

Editor: Tom Litting