Taiwan Regulator Eases 10% Single-Stock Cap for Equity Funds and Active ETFs

TSMC accounts for about 44% of Taiwan’s benchmark stock index by market capitalization, but domestic equity funds and active ETFs had been barred from investing more than 10% of their net assets in a single company, making it difficult to track the broader market’s performance. According to the Securities Investment Trust and Consulting Association, Taiwan equity funds managed about NT$1.0481 trillion at the end of March 2026, while active ETFs held about NT$231 billion, making the relaxation significant for the allocation of a vast pool of domestic capital.

Taiwan’s Financial Supervisory Commission issued an order on April 24, 2026, that took effect the same day. Equity funds and active ETFs investing exclusively in domestic stocks may exceed the previous 10% cap when a stock represents more than 10% of the benchmark index, but their holding cannot exceed that stock’s index weighting. A fund’s combined holdings of a company’s shares and bonds remain capped at 25% of net assets. Based on an estimated increase of 15 percentage points, the market calculates that the potential additional allocation to TSMC could approach NT$200 billion.