SHANGHAIHONG KONG, Feb 20 Reuters China39;s stock exchanges on Tuesday said major quant fund Lingjun Investment had broken rules on orderly trading and barred it from buying and selling for three days, as part of wider regulatory efforts to revive market confidence.

Orders from Lingjun to dump stocks in early trade on Monday coincided with rapid declines in the benchmark indexes, the Shenzhen and Shanghai stock exchanges said, adding they would restrict the hedge fund39;s trading until Feb. 22.

One of China39;s biggest quant funds, Lingjun manages more than 60 billion yuan, the company says on its website.

Lingjun apologised for the negative impact in a statement on its website on Wednesday. The firm said it holds longterm bullish views on Chinese stocks and will stick to long positions, adding it will review the problems existing in transactions.

Chinese quant funds, which use derivatives and datadriven computer models, have already suffered from a steep market selloff this year and government curbs on shortselling.

China39;s bluechip index dropped to fiveyear lows early this month.

Regulators are sending a clear signal that money should be handed to managers who profit from longterm investment, rather than swift trades, Yang Tingwu, vice general manager of Tongheng Investment, said.

He said the punishment could accelerate redemptions in quant funds as investors would ask Who39;s next?

A hedge fund manager who declined to be named said a threeday trading halt…