(Writes through with confirmation from regulator)
SHANGHAI, June 6 (Reuters) - China's securities regulator approved the launch of six Chinese mutual funds on Wednesday, potentially channeling hundreds of billions of yuan from investors into domestic floatations of overseas-listed Chinese tech giants.
The six listed open-ended funds (LOF), with a lock-up period of three years, will be allowed to become "strategic investors" in upcoming listings of high-tech firms.
Like cornerstone investors in overseas markets, strategic investors in Chinese IPOs seek long-term gains from companies with growth potential, Shi Bo, vice general manager at China Southern Asset Management, said in a statement.
China is encouraging overseas-listed Chinese companies to launch secondary listings in the domestic market through the issuance of China Depositary Receipts (CDRs), modeled after the popular ADRs in the United States.
Firms planning China listings include Xiaomi, U.S.-listed Alibaba Group Holding Ltd and JD.com .
Domestic investors currently have limited access to some of China's most prominent tech giants.
The new funds will be managed by mutual fund houses including China Southern, China AMC, E Fund, Harvest, China Universal and China Merchants Fund, according to statements by the China Securities Regulatory Commission (CSRC).
The funds will raise money from retail investors as well as institutions, including China's National Social Security Fund, pension funds and annuity funds.
The six funds aim to raise up to 50 billion yuan ($7.8 billion) each from investors, the Shanghai Securities News reported on Wednesday.
The subscription period for retail investors will be from June 11 to June 15, while institutional investors can subscribe to the funds on June 19, the report said.
The management fee would be less than one-tenth of an ordinary mutual fund product during the lock-up period, according to E Fund Management Co.
$1 = 6.3932 Chinese yuan Reporting by Samuel Shen and John Ruwitch Editing by Jacqueline Wong and Darren Schuettler