China's social-security fund has had the value of its yuan-backed shares post a bigger drop than the benchmark stock index in the past month, indicating it might step up action to slash positions.

The combined value of yuan shares that the fund held by Tuesday amounted to 25.64 billion yuan (US$3.46 billion), down 17 percent or 4.37 billion yuan from October 15, according to data unveiled by the Securities Daily yesterday.

The value drop compared with a 12.2-percent decline on the Shanghai Composite Index during the same period, showing that the fund might have been accelerating its pace to reduce stock investments, the newspaper said.

The social-security fund held yuan shares worth 29.43 billion yuan as of the end of the third quarter, down 10.95 percent from 33.05 billion yuan as of June 30. But the Shanghai index jumped 41.9 percent in the third quarter.

The fund had owned 1.23 billion shares by the end of September, down 29.7 percent from 1.76 billion shares as of the end of the second quarter.

(Shanghai Daily November 23, 2007)