Investors finally abandon "junk stocks" in face of regulatory crackdown

SHANGHAI: Chinese investors are finally dumping shares in loss-making companies after years of speculation on them in a sign that punters are at last taking seriously tighter regulations and new delisting rules that make holding their stock a huge risk.

The struggling firms have often been market outperformers in China as they were almost never delisted, providing an implicit floor on downside risk that speculators have exploited to their advantage.