China's new NASDAQ-style tech board - the Science and Technology Innovation Board, or STAR Market - opened for trading on Monday with a resounding start, but most overseas investors missed the windfall.

Foreign institutions stayed on the sidelines as they are cautious toward the STAR Market, said Wu Xiaoping, a financial researcher, on Sunday. Out of the 645 institutions that subscribed to the IPOs that made their debut on the market, only 77 were overseas institutions, the China Business News reported earlier this month.

On Monday, all 25 debutants on the STAR Market finished the first day's trading with gains of at least 84 percent. However, the majority of foreign investors missed the opportunity to make money.

It is understandable that most foreign institutional investors kept cautious about the start of trading on China's NASDAQ-style tech board, but we believe the situation will change. China is likely to encourage more foreign capital to participate in STAR trading and give such investors greater access to the bourse.

Currently, overseas investors can invest in the STAR Market via the Qualified Foreign Institutional Investors, a channel broadly used by large and well-known overseas institutions to invest onshore. Those institutions are usually more prudent than domestic investors about IPOs, because the shares of companies listed overseas sometimes trade below their IPO prices, but this rarely happens in the Chinese mainland. 

Foreign institutions' enthusiasm for IPOs on the STAR Market is not as strong as those of Chinese investors, but this doesn't mean they don't have any interest at all.

The development of the new board needs the participation of foreign capital. China will continue to accelerate its financial reforms, giving the market more say in how companies will be listed and how they will be valued. The new board will become a gathering place of new and high-technology companies in fields such as new energy, new materials, information and 5G technology. China is second only to the US in developing cutting-edge technologies, so the country's start-ups are attractive for foreign capital. It will just take a bit more effort to make the new board an important channel for both domestic and foreign investment that will power China's technology rise.

The author is a reporter with the Global Times. bizopinion@globaltimes.com.cn