Today, A-shares suddenly surged with increased trading volume, and many people are speculating whether it’s due to foreign capital returning or speculative trading by hot money. But insiders have already spotted the real trigger—the regulatory restrictions on insurance funds have been loosened.

The official policy wording is convoluted, so here’s the plain language: regulators have adjusted two risk coefficient rules. First, for stocks in the CSI 300 and CSI Dividend Low Volatility 100 indexes held for more than three years, the risk factor is reduced from 0.3 to 0.27 ( calculated as the weighted average holding period over the past six years ). Second, for STAR Market common stocks held for over two years, the risk factor drops from 0.4 to 0.36 ( calculated as the weighted average holding period over the past four years ).

What does this mean? For every 1 million invested by insurance companies in these high-quality stocks, they previously had to set aside 300,000 ( or 400,000 ) as "risk reserves" that were locked up. Now, they only need 270,000 ( or 360,000 ). The freed-up funds? They become immediately available for investment and can be used to buy more stocks right away.

Let’s break down the numbers for more clarity. As of the end of Q3 2025, life and property insurance companies’ total allocation to stocks and funds was 5.59 trillion, and after excluding funds, pure stock holdings were about 3.62 trillion. Under the old rules, 1.08 trillion had to be locked up as risk reserves; under the new rules, only 0.98 trillion is needed—this single adjustment releases more than a hundred billion in incremental funds, and this money is not just circulating on paper, but is real cash that can actually be used to buy stocks.

What’s more interesting is the potential follow-up effects. Now that insurance funds have moved first, will social security funds, pension funds, and bank wealth management products also adopt similar risk measurement methods? If this spreads, the incremental funds in the future won’t just be in the hundreds of billions.

As for why this timing? Just look at how much trading volume has shrunk recently. What the market lacks is incremental capital to provide support, and as a long-term force in A-share allocations, the loosening of insurance fund restrictions is a precise liquidity injection—that’s the core logic behind today’s strong rebound in trading volume.