China's securities regulators are advising hedge funds to limit short selling in the stock index futures market to stabilize the plunging stock market. The China Securities Regulatory Commission (CSRC) and the China Financial Futures Exchange (CFFEX) have informally urged fund managers to avoid or unwind aggressive short positions, especially speculative 'naked' short selling. This comes as the Chinese stock market faces a downturn, with the blue-chip CSI300 Index at near five-year lows, and the government considers a $278 billion rescue package.