AMENDMENT NO. 1 TO
FORM F-1
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933

Yintech Investment Holdings Limited
(Exact name of Registrant as specified in its charter)

12th Floor, Block B, Zhenhua Enterprise Plaza
No. 3261 Dongfang Road, Pudong District
Shanghai, 200125
People's Republic of China
+86-21-2028-9009
(Address, including zip code, and telephone number, including
area code, of Registrant's principal executive offices)

Law Debenture Corporate Services Inc.
400 Madison Avenue, Suite 4D
New York, NY 10017
+1 212 750 6474
(Name, address, including zip code, and telephone number,
including area code, of Agent for Service)

Approximate date of commencement of proposed sale to the public:
As soon as practicable after this Registration Statement becomes effective.

If any of the securities being registered on this Form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act, check the following box. o

If this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. o

If this Form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. o

If this Form is a post-effective amendment filed pursuant to Rule 462(d) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. o

The Registrant hereby amends this Registration Statement on such date or dates as may be necessary to delay its effective date until the Registrant shall file a further amendment which specifically states that this Registration Statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act or until the Registration Statement shall become effective on such date as the Commission, acting pursuant to said Section 8(a), may determine.

The information in this preliminary prospectus is not complete and may be changed. We may not sell these securities until the registration statement filed with the Securities and Exchange Commission is effective. This preliminary prospectus is not an offer to sell these securities and it is not soliciting an offer to buy these securities in any jurisdiction where such offer or sale is not permitted.

This is the initial public offering of American depositary shares, or ADSs, of Yintech Investment Holdings Limited. We are offering 7,500,000 ADSs. Each ADS represents 20 ordinary shares, par value US$0.00001 per share.

Prior to this offering, there has been no public market for the ADSs or our ordinary shares. We anticipate that the initial public offering price per ADS will be between US$12.50 and US$14.50. We have applied to list the ADSs on the NASDAQ Global Select Market, or NASDAQ, under the symbol "YIN."

We are an "emerging growth company," as defined in Section 2(a) of the Securities Act of 1933, as amended, or the Securities Act, and Section 3(a) of the Securities Exchange Act of 1934, as amended, or the Exchange Act.

Upon the completion of this offering and our sale of US$10 million of ordinary shares to MeMeStar Limited, a wholly-owned subsidiary of SINA Corporation (NASDAQ: SINA), in connection with a concurrent private placement, 1,164,814,815 ordinary shares of our company will be issued and outstanding, assuming that the underwriters do not exercise their over-allotment option to purchase additional ADSs and based on the assumed initial public offering price of US$13.50 per ADS, the midpoint of the estimated initial public offering price range set forth above. Each ordinary share will be entitled to one vote on all matters subject to shareholder vote.

Investing in the ADSs involves risks. See "Risk Factors" beginning on page 15 of this prospectus.

We have granted the underwriters the right to purchase up to an aggregate of 1,125,000 additional ADSs at the initial public offering price, less underwriting discounts and commissions, within 30 days from the date of this prospectus, to cover over-allotments.

Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities, or determined if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense.

The underwriters expect to deliver the ADSs against payment in U.S. dollars on , 2016.

We have not authorized anyone to provide any information other than that contained in this prospectus or in any free writing prospectus prepared by or on our behalf or to which we have referred you. We take no responsibility for, and can provide no assurance as to the reliability of, any other information that others may give you. We are offering to sell, and seeking offers to buy, the ADSs only in jurisdictions where such offers and sales are permitted. The information contained in this prospectus is accurate only as of the date of this prospectus, regardless of the time of delivery of this prospectus or the sale of any ADS.

Neither we nor any of the underwriters has taken any action to permit a public offering of the ADSs outside the United States or to permit the possession or distribution of this prospectus outside the United States. Persons outside the United States who came into possession of this prospectus must inform themselves about and observe any restrictions relating to the offering of the ADSs and the distribution of this prospectus outside of the United States.

Until , 2016 (the 25th day after the date of this prospectus), all dealers that buy, sell or trade ADSs, whether or not participating in this offering, may be required to deliver a prospectus. This is in addition to the obligation of dealers to deliver a prospectus when acting as underwriters and with respect to their unsold allotments or subscriptions

PROSPECTUS SUMMARY

This summary highlights information appearing elsewhere in this prospectus and does not contain all of the information that you should consider in making your investment decision. You should carefully read this entire prospectus, including the information set forth under the headings "Risk Factors" and "Management's Discussion and Analysis of Financial Condition and Results of Operations" and the financial statements and the related notes, before deciding whether to invest in our ADSs.

Our Business

We are the largest online provider of spot commodity trading services in China by customer trading volume in both 2014 and 2015, according to Euromonitor. We currently facilitate the trading by individual customers of silver, gold and other precious metals and commodities on three leading exchanges in China, namely the Shanghai Gold Exchange, the Tianjin Precious Metals Exchange and the Guangdong Precious Metals Exchange, which were the three largest exchanges for online spot commodity trading in China in terms of trading volume in 2015, respectively. We were the largest service provider by customer trading volume on the Tianjin Precious Metals Exchange from 2012 to 2015, and the largest service provider on the Guangdong Precious Metals Exchange in the fourth quarter of 2015. We commenced our operation on the Shanghai Gold Exchange in November 2015 and our customer trading volume has been growing rapidly since then.

Online spot commodity trading recently emerged as an alternative investment product in China, with aggregate trading volume growing at a CAGR of 35.4% from 2011 to 2015 and reaching RMB29.0 trillion (US$4.5 trillion) in 2015. We believe such growth is largely attributable to the distinctive features of online spot commodity trading. Its deposit-based leverage trading method offers relatively high volatility trading opportunities which appeal to a group of individual investors. Compared with other leveraged trading products such as futures, spot commodity trading enjoys the following benefits: (i) its underlying assets, primarily silver and gold, are more familiar to individual investors, (ii) the spot commodity contract is less complex, and (iii) its trading hours are longer and continuous. Compared with China's commodity futures markets, which had an aggregate trading volume of RMB136.5 trillion (US$21.1 trillion) in 2015, the spot commodity market is still small and we believe it has strong growth potential.

We focus on premier customers and generally require each customer to deposit at least RMB100,000 (US$15,437) for account activation. Based on our experience, the total invested amount of a customer is often significantly higher. We believe this strategy helps us focus our resources on providing better services and build a base of customers with greater sophistication and risk tolerance, who are more suited to leveraged spot commodity trading. As of December 31, 2015, there were more than 50,000 customers who opened and activated accounts with us, among which more than 24,000 executed trades during the year ended December 31, 2015, with an aggregate trading volume of RMB659.7 billion (US$101.8 billion).

We provide our customers with comprehensive services, including account opening, investor education, market information, research, live discussion boards and real-time customer support. Most services are delivered online through our proprietary client software and call center, and we do not operate physical branches. Our client software provides not only market information and analysis, but also interactive functions including live discussion boards and instant messaging with customer service representatives, which we believe enhance our customers' engagement. Internally, we collect and analyze customer behavior and communications data from our client software, customer relationship management system and the exchanges, which allow us to better understand, attract and serve our customers.

customers' trades. We entered into a risk and return transfer arrangement in 2015 to pass the risks and returns associated with such principal positions to a third party fund, which means we do not gain from our customers' losses or lose from their gains. On the Shanghai Gold Exchange, we serve as an agent and do not hold principal positions.

We have achieved substantial growth since our commencement of operation in July 2011. Our revenues increased significantly from RMB629.9 million in 2013 to RMB1,157.8 million in 2014 and RMB1,245.9 million (US$192.3 million) in 2015. We recorded net income of RMB106.8 million, RMB482.0 million and RMB403.0 million (US$62.2 million) in 2013, 2014 and 2015, respectively.

Our Industry

Online spot commodity trading has recently emerged as an alternative investment product in China, driven by supportive government measures and the increasing demand for new investment products by Chinese investors. The aggregate volume of online spot commodity trading grew at a CAGR of 35.4% from 2011 to 2015, reaching RMB29.0 trillion (US$4.5 trillion) in 2015, and is expected to grow with a CAGR of 26.9% from 2015 to 2020, according to Euromonitor. In general, Chinese individual investors have demonstrated strong appetite for volatility. Online spot commodity trading is often conducted based on deposits and with a leverage ratio of 5 to 20 times and allows for long and short trading directions. This offers relatively high volatility trading opportunities which appeal to certain Chinese individual investors. The growth of trading volume of individual investors outpaced the overall growth in online spot commodity trading market, with a CAGR of 42.3% from 2011 to 2015, reaching RMB16.3 trillion (US$2.5 trillion) in 2015, and is expected to grow with a CAGR of 30.2% from 2015 to 2020, according to Euromonitor.

In China, online spot commodity trading is primarily conducted through exchanges. By the end of 2015, there were approximately 350 exchanges for online spot commodity trading in China, which vary in scale and the types of commodities offered for trading. In terms of trading volume, the three exchanges we operate on are the top three online spot commodity exchanges in China in 2015, which in aggregate have a trading volume of RMB16.4 trillion (US$2.5 trillion) in 2015, accounting for 56.5% of the total trading volume of the online spot commodity trading market.

The online spot commodity trading market is highly competitive and fragmented for trading service providers like us. As of December 31, 2015, there were over 1,000 active trading service providers that operate on various exchanges nationwide. The commodity exchanges compete against each other for service providers and customers based on factors including reputation, scale, reliability and trading models and rules. The trading service providers compete with each other for customers and trading volumes based on factors including brand, technology, research and customer services.

According to Euromonitor, we were the largest online provider of spot commodity trading services in China by customer trading volume in 2015, with a market share of approximately 4.0% in terms of trading volume of individual investors. We had a market share, in terms of trading volume of individual investors, of approximately 15.5% on the Tianjin Precious Metals Exchange and approximately 10.4% on the Guangdong Precious Metals Exchange, in 2015. We believe our proprietary technology platform, our focus on premier customers, our comprehensive customer services and strong brand recognition in the industry, will enable us to compete effectively in the fast evolving online spot commodity trading industry in the PRC.

Our Strengths

We believe that our success to date is largely attributable to the following competitive strengths:

§: market leader with strong brand recognition;
§: proprietary technology enabling efficient operation;
§: comprehensive and interactive customer services;
§: prudent risk management system; and
§: experienced management team.

Our Strategies

We strive to build an investment service platform that is highly trusted by individual investors. To achieve this objective, we plan to implement the following strategies:

§: strengthen our brand and market position;
§: introduce new investment products;
§: explore mini-account business;
§: selectively explore acquisition opportunities; and
§: continue to attract, cultivate and retain talent.

Our Challenges

To achieve our goals and implement our strategies, we face risks and uncertainties, including the following:

§: our ability to cope with an evolving regulatory regime of online spot commodity trading industry;
§: our ability to adapt to changing rules of the exchanges we operate on;
§: our ability to effectively compete against other trading service providers and new entrants;
§: our ability to promote and maintain our reputation and brand; and
§: our ability to manage risks associated with operations and counterparties.

Please refer to "Risk Factors" and other information included in this prospectus for a discussion of these and other risks and uncertainties that we face.

History and Corporate Structure

We established Tianjin Rong Jin Hui Yin Precious Metal Management Co, Ltd., or Rong Jin Hui Yin, on May 18, 2011 and commenced operation in July 2011. Rong Jin Hui Yin focuses on providing commodity trading and other related services on the Tianjin Precious Metal Exchange. We established Guangdong Jin Xiang Yin Rui Precious Metal Management Co., Ltd., or Jin Xiang Yin Rui, another major PRC subsidiary of ours, on October 24, 2012 and commenced operation on the Guangdong Precious Metals Exchange in August 2013. Its primary focus is to provide commodity trading and other related services on the Guangdong Precious Metals Exchange. We also established a number of other subsidiaries in the PRC to provide technical and other support for our online commodity trading business, and to sell software application and provide supporting services to related parties and third parties.

Our company, Yintech, was incorporated on November 4, 2015 in the Cayman Islands. Yintech acquired all of the ordinary shares of Yintech Enterprise Company Limited (formerly known as Win Yin Gold Investment Company Limited), or Yintech Enterprise, from Win Yin Financial And Information Service Company Limited, or Win Yin Financial, on November 6, 2015 at par value. As a result, Yintech Enterprise's wholly owned PRC subsidiary, Shanghai Qian Zhong Su Investment Management Co., Ltd., or Qian Zhong Su, became Yintech's wholly owned PRC subsidiary. In November 2015, Qian Zhong Su initiated a series of transactions to acquire from our ultimate shareholders, Rong Jin Hui Yin, Jin Xiang Yin Rui and Shanghai Yin Tian Xia Technology Co., Ltd., or Yin Tian Xia Technology, and their subsidiaries, as its wholly owned PRC subsidiaries. The acquisitions were completed on November 18, 2015. On November 16, 2015, Qian Zhong Su acquired from third parties, Guangdong Sheng Ding Precious Metal Management Co., Ltd., or Sheng Ding, which commenced operation on the Guangdong Precious Metals Exchange in October 2015, to further expand our business on that exchange.

In November and December 2015, we established Shanghai Jin Dou Information Technology Co., Ltd., or Jin Dou, and Shanghai Jin Yi Information Technology Co., Ltd., or Jin Yi, respectively, to carry out business on the Shanghai Gold Exchange. We established a PRC subsidiary, Shanghai Zu Ding Culture Communication Co., Ltd., or Zu Ding, in January 2016, to manage our advertising activities. In March 2016, we acquired 70% equity interest in Shanghai Da Xiang Ping Tai Financial Information

Services Co., Ltd., or Da Xiang, which will serve as a platform for our mini-account business. We have also established additional BVI and Hong Kong subsidiaries under Yintech as shown in the chart below for future business activities.

The following diagram illustrates our corporate structure, the places of incorporation and the ownership interests of our subsidiaries as of the date of this prospectus.

Corporate Information

Our corporate headquarters is located at 12th Floor, Block B, Zhenhua Enterprise Plaza, No. 3261 Dongfang Road, Pudong District, Shanghai, 200125, China. Our telephone number at this address is +86-21-2028-9009. Our registered office in the Cayman Islands is located at Floor 4, Willow House, Cricket Square, PO Box 2804, Grand Cayman KYI-1112, Cayman Islands. Our agent for service of process in the United States is Law Debenture Corporate Services Inc., located at 400 Madison Avenue, Suite 4D, New York, NY 10017.

Our website can be found at www.yintech.net. The information contained on our website is not a part of this prospectus.

Implications of Being an Emerging Growth Company

As a company with less than US$1.0 billion in revenue for our last fiscal year, we qualify as an "emerging growth company" pursuant to the Jumpstart Our Business Startups Act of 2012, or the JOBS Act. An emerging growth company may take advantage of specified reduced reporting and other requirements compared to those that are otherwise applicable generally to public companies. These provisions include exemption from the auditor attestation requirement under Section 404 of the Sarbanes-Oxley Act of 2002, or the Sarbanes-Oxley Act, in the assessment of the emerging growth company's internal control over financial reporting. The JOBS Act also provides that an emerging growth company does not need to comply with any new or revised financial accounting standards until such date that a private company is otherwise required to comply with such new or revised accounting standards. However, we have elected to "opt out" of this provision and, as a result, we will comply with new or revised accounting standards as required when they are adopted for public companies. This decision to opt out of the extended transition period under the JOBS Act is irrevocable.

We will remain an emerging growth company until the earliest of (a) the last day of our fiscal year during which we have total annual gross revenues of at least US$1.0 billion; (b) the last day of our fiscal year following the fifth anniversary of the completion of this offering; (c) the date on which we have, during the

previous three-year period, issued more than US$1.0 billion in non-convertible debt; or (d) the date on which we are deemed to be a "large accelerated filer" under the Exchange Act, which would occur if the market value of our ADSs that are held by non-affiliates exceeds US$700.0 million as of the last business day of our most recently completed second fiscal quarter. Once we cease to be an emerging growth company, we will not be entitled to the exemptions provided in the JOBS Act discussed above.

Conventions that Apply to this Prospectus

Except where the context otherwise indicates and for the purpose of this prospectus only:

§: "active account" refers to a tradable account that executed at least one trade through us in a given period;
§: "ADSs" refers to our American depositary shares, each of which represents 20 ordinary shares, and "ADRs" refers to the American depositary receipts that evidence our ADSs;
§: "spread fee" refers to the difference, as set by the exchanges, between customers' buying and selling prices quoted by the exchanges, which can be expressed either as a fixed amount per weight unit or a fixed percentage of the notional transaction value;
§: "BVI" refers to the British Virgin Islands;
§: "China" or "PRC" refers to the People's Republic of China, excluding, for purposes of this prospectus, Hong Kong, Macau and Taiwan;
§: "equity" refers to, with respect to online spot commodity trading, the value of a trading participant's account, which is the net aggregate of its deposits, withdrawals, closed positions and open positions;
§: "Euromonitor" refers to Euromonitor International Limited;
§: "hedge" refers to economic hedging transaction we enter into with various counterparties to manage our market risk exposure;
§: "liquidation" refers to, with respect to online spot commodity trading, the mandatory termination and settlement of a trading participant's positions by the exchanges;
§: "maximum leverage ratio" refers to, with respect to online spot commodity trading, the maximum ratio set by exchanges for the notional value of a position divided by the deposit required for such a position;
§: "ordinary shares" or "shares" refers to our ordinary shares, par value US$0.00001 per share;
§: "our company," "we," "us," "our," or "Yintech" refers to Yintech Investment Holdings Limited, a Cayman Islands company, and except where the context otherwise requires, all of its subsidiaries or where the context refers to any time prior to its incorporation, the business which its predecessors or the predecessors of its present subsidiaries were engaged in and which was subsequently assumed by it;
§: "principal position" refers to the trading positions we have by serving as counterparty to our customers' trades;
§: "risk ratio" refers to the real time equity of a member of the exchanges divided by its ending equity of the previous trading day;
§: "RMB" or "Renminbi" refers to the legal currency of China;
§: "tradable account" refers to a customer account that has been activated and has remained tradable as of the end of a given period; and
§: "U.S. dollars," "US$" or "dollars" refers to the legal currency of the United States.

This prospectus contains translations of certain RMB amounts into U.S. dollars at specified rates. For amounts not recorded in our combined and consolidated financial statements included elsewhere in this prospectus, unless otherwise stated, all translation of financial data has been made at RMB6.4778 to US$1.00, the noon buying rate in effect on December 31, 2015, as set forth in the H.10 Statistical Release of the Federal Reserve Board. We make no representation that the RMB or U.S. dollar amounts referred to in this prospectus could have been or could be converted into U.S. dollars or RMB, as the case may be, at any particular rate or at all. On April 15, 2016, the noon buying rate was RMB6.4730 to US$1.00.

Recent Developments

The following is a summary of certain operating data and an estimate of certain selected unaudited financial data for the three months ended March 31, 2016. The selected unaudited financial data presented below are subject to the completion of the closing procedures of our quarterly financial results. Therefore, these data may change and the changes may be material.

Our business continues to grow in 2016. As of March 31, 2016, there were more than 55,000 customers (excluding mini-account customers) who opened and activated accounts with us, among which more than 14,000 executed trades during the quarter ended March 31, 2016. For the first quarter of 2016, we recorded an aggregate customer trading volume of RMB309.4 billion (US$47.8 billion), which represented a 69.6% growth compared to the first quarter of 2015 and a 103.6% growth compared to the fourth quarter of 2015, and was the highest trading volume we have generated in any single quarter. Among the total trading volume recorded for the first quarter of 2016, RMB120.2 billion (US$18.6 billion) was generated from our operation on the Tianjin Precious Metals Exchange, RMB142.0 billion (US$21.9 billion) was generated from our operation on the Guangdong Precious Metals Exchange, RMB29.6 billion (US$4.6 billion) was generated from our operation on the Shanghai Gold Exchange, and RMB17.5 billion (US$2.7 billion) was contributed by Da Xiang in March 2016. We were the largest service provider by customer trading volume on both the Tianjin Precious Metals Exchange and the Guangdong Precious Metals Exchange in the first quarter of 2016. In March 2016, we acquired 70% equity interest in Da Xiang, which focuses on providing online spot commodity trading services to mini-account customers for a total consideration of RMB7.0 million (US$1.1 million). As a result, as of March 31, 2016, there were more than 87,000 mini-account customers who opened and activated accounts with Da Xiang, among which more than 42,000 executed trades in March 2016. The significant increase in our trading volume for the first quarter of 2016 was largely attributable to (i) increased operational efficiency resulting from various operational adjustments made in the second half of 2015 (e.g., migration from telephone communication to online communication with customers), (ii) increased trading activities by our customers due to increased volatility in the commodities market in the first quarter of 2016 compared with the fourth quarter of 2015, (iii) the fast growth of our customer trading volume on the Shanghai Gold Exchange where we commenced operations in November 2015, and (iv) the trading volume contributed by Da Xiang in March 2016.

In line with our business growth, our results of operations also increased significantly. We estimate that our total revenues for the three months ended March 31, 2016 were between RMB400.0 million to RMB410.0 million, compared to RMB255.3 million for the same period in 2015. Our estimated net income attributable to our shareholders for the three months ended March 31, 2016 was between RMB145.0 million to RMB155.0 million, compared to RMB82.9 million for the same period in 2015.

Our estimated financial and operating data for the three months ended March 31, 2016 may not be indicative of our results for future periods. Our quarterly financial and operating data have fluctuated, including a decrease in revenues on a quarter-to-quarter basis in the past, and may continue to fluctuate in the future. Please refer to "Management's Discussion and Analysis of Financial Condition and Results of Operations — Selected Quarterly Results of Operations" and "Risk Factors — Risks Related to Our Business and Industry — Our customer trading volume is influenced by the general trading activities in the online spot commodity trading market, which may be impacted by competing investment products, economic and market conditions and other factors that are beyond our control," for information regarding trends and other factors that may affect our results of operations.

In addition, to reward our employees for their service and contribution to our Company and further align their interests with ours, we plan to grant options to purchase a maximum of 50,000,000 ordinary shares under the Third Amended and Restated 2014 Share Option Scheme to our management and key employees upon the completion of this offering, at an exercise price per share equal to the initial public offering price of our ADSs adjusted to reflect the ADS-to-ordinary share ratio, which will vest in three roughly equal installments upon the first, second and third anniversary of the completion of this offering.

THE OFFERING


Offering price		We currently estimate that the initial public offering price will be between US$12.50 and US$14.50 per ADS.
ADSs offered by us		7,500,000 ADSs, representing 150,000,000 ordinary shares.
Concurrent Private Placement		Concurrently with, and subject to, the completion of this offering, MeMeStar Limited, a limited liability company incorporated in the BVI, and a wholly-owned subsidiary of SINA Corporation (NASDAQ: SINA), a leading online media company serving China and global Chinese communities, has agreed to purchase from us US$10 million of our ordinary shares at a per share price equal to the initial public offering price of our ADSs adjusted to reflect the ADS-to-ordinary share ratio, or the Concurrent Private Placement. Assuming an offering price of US$13.50 per ADS, being the midpoint of the estimated initial public offering price range set forth on the front cover of this prospectus, MeMeStar Limited will purchase 14,814,815 ordinary shares from us. This Concurrent Private Placement is being made pursuant to an exemption from registration with the U.S. Securities and Exchange Commission under Regulation S of the Securities Act. Under the subscription agreement between the Company and MeMeStar Limited dated March 24, 2016, the completion of this offering is the only substantive closing condition in this Concurrent Private Placement. MeMeStar Limited has agreed with us and the underwriters not to, directly or indirectly, sell, transfer or dispose of any ordinary shares acquired in the Concurrent Private Placement for a period of 180 days after the date of this prospectus, subject to certain exceptions.
Ordinary shares outstanding immediately after this offering		1,164,814,815 ordinary shares (or 1,187,314,815 ordinary shares if the underwriters exercise their over-allotment option in full), including a total of 14,814,815 ordinary shares we will issue in the Concurrent Private Placement, which number of shares has been calculated based on an assumed initial public offering price of US$13.50 per ADS, the midpoint of the estimated initial public offering price range set forth on the front cover of this prospectus.
ADSs outstanding immediately after this offering		7,500,000 ADSs (or 8,625,000 ADSs if the underwriters exercise their over-allotment option in full).
The ADSs		Each ADS represents 20 ordinary shares, par value US$0.00001 per share.


		The depositary will hold the ordinary shares underlying your ADSs. You will have rights as provided in the deposit agreement, the form of which is filed as an exhibit to the registration statement that includes this prospectus.
		If we declare dividends on our ordinary shares, the depositary will pay you the cash dividends and other distributions it receives on our ordinary shares, after deducting its fees and expenses.
		You may turn in your ADSs to the depositary in exchange for ordinary shares. The depositary will charge you fees for any exchange.
		We may amend or terminate the deposit agreement without your consent. If you continue to hold your ADSs, you agree to be bound by the deposit agreement, as amended.
		To better understand the terms of the ADSs, you should carefully read the "Description of American Depositary Shares" section of this prospectus. You should also read the deposit agreement, the form of which is filed as an exhibit to the registration statement that includes this prospectus.
Over-allotment option		We have granted to the underwriters an option, which is exercisable within 30 days from the date of this prospectus, to purchase up to an additional 1,125,000 ADSs.
Use of proceeds		We estimate our net proceeds from this offering will be approximately US$90.2 million (or US$104.3 million if the underwriters exercise their option to purchase additional ADSs in full), after deducting the underwriting discounts, commissions and estimated offering expenses payable by us and assuming an initial public offering price per ADS of US$13.50, the midpoint of the estimated public offering price range shown on the front cover of this prospectus. In addition, we expect to receive net proceeds of approximately US$10 million from the Concurrent Private Placement.
		The primary purposes of this offering are to create a public market for our shares for the benefit of all shareholders, retain and attract talented employees by providing them with equity incentives and obtain additional capital. We plan to use the net proceeds from this offering and the Concurrent Private Placement as follows: (i) US$30 million to invest in information technology infrastructure and proprietary software; (ii) US$30 million to develop new businesses, including our trading service business on the Shanghai Gold Exchange and trading service for other commodities; (iii) US$20 million to promote our brand and services; and (iv) the remaining amount for general corporate purposes, including our working capital needs and potential acquisitions.
		See "Use of Proceeds" for additional information.


Lock-up		We, our officers and directors, all of our shareholders and certain holders of our options have agreed, for a period of 180 days from the date of this prospectus, not to, without the prior written consent of the representative of the underwriters, dispose of or hedge any of our ordinary shares, ADSs, or any securities convertible into or exchangeable for our ordinary shares or ADSs. MeMeStar Limited has also agreed to enter into a similar lock-up agreement relating to the ordinary shares to be purchased pursuant to the Concurrent Private Placement. In addition, we have instructed the Bank of New York Mellon, as depositary, not to accept any deposit of any ordinary shares or issue any ADSs for 180 days after the date of this prospectus (other than in connection with this offering), unless we instruct the depositary with the prior written consent of the representative of the underwriters. See "Underwriting" for more information.
Reserved ADSs		At our request, the underwriters have reserved for sale, at the initial public offering price, up to an aggregate of 375,000 ADSs, to our employees and their related persons, and people that have business relationships with us, through a directed share program.
Listing		We intend to have the ADSs listed on the NASDAQ under the symbol "YIN." Our ADSs and ordinary shares will not be listed on any other stock exchange or traded on any automated quotation system.
Payment and settlement		The underwriters expect to deliver the ADSs against payment therefor through the facilities of The Depository Trust Company on , 2016.
Depositary		The Bank of New York Mellon.
Risk factors		See "Risk Factors" and other information included in this prospectus for a discussion of risks that you should carefully consider before investing in our ADSs.

SUMMARY COMBINED AND CONSOLIDATED FINANCIAL AND OPERATING DATA

Yintech is a holding company with no substantial operation and completed its reorganization on November 18, 2015. Prior to the reorganization, the combined financial statements include the financial statements of the combined entities since the date of incorporation and were prepared on a combined basis in a manner similar to pooling of interest, as the founding shareholders' respective equity interest in Yintech is identical to their respective equity interest in each of the combined entities prior to and following the reorganization. Following the reorganization, the consolidated financial statements include the accounts of Yintech and its subsidiaries. We present below our summary combined and consolidated financial data for the periods indicated. The following summary combined and consolidated statements of comprehensive income data for the years ended December 31, 2013, 2014 and 2015 and the summary combined and consolidated balance sheet data as of December 31, 2014 and 2015 have been derived from our audited combined and consolidated financial statements included elsewhere in this prospectus.

The summary combined and consolidated financial and operating data should be read in conjunction with the combined and consolidated financial statements and related notes and "Management's Discussion and Analysis of Financial Condition and Results of Operations" included elsewhere in this prospectus. The combined and consolidated financial statements are prepared and presented in accordance with the United States generally accepted accounting principles, or U.S. GAAP. Our historical results are not necessarily indicative of our results for any future periods.

Combined and Consolidated Statements of Comprehensive Income Data

	For the Year Ended December 31,

	2013			2014			2015
(in thousands, except per share data)	RMB			RMB			RMB			US$
	Combined			Combined			Combined and Consolidated			Combined and Consolidated (unaudited)
Revenues
Commissions and fees, net		413,258			860,819			990,698			152,937
Trading gains/(losses), net		214,861			268,850			166,428			25,692
Interest and investment income		365			445			4,443			686
Other revenues		1,436			27,693			84,305			13,014

Total revenues		629,920			1,157,807			1,245,874			192,329

Expenses
Employee compensation and benefits		(82,876	)		(214,431	)		(388,168	)		(59,923	)
Advertising and promotion		(256,092	)		(285,732	)		(221,859	)		(34,249	)
Research services from a related party		(106,050	)		—			—			—
Information technology and communications		(11,603	)		(21,238	)		(32,803	)		(5,064	)
Occupancy and equipment rental		(21,377	)		(39,487	)		(41,950	)		(6,476	)
Taxes and surcharges		(5,200	)		(18,884	)		(21,711	)		(3,352	)
Other expenses		(34,569	)		(58,688	)		(54,164	)		(8,361	)

Total expenses		(517,767	)		(638,460	)		(760,655	)		(117,425	)

Income before income taxes		112,153			519,347			485,219			74,904
Income taxes		(5,321	)		(37,390	)		(82,204	)		(12,690	)

Net income		106,832			481,957			403,015			62,214



Earnings per share⁽¹⁾
Basic		0.11			0.48			0.40			0.06
Diluted		0.11			0.48			0.38			0.06

(1): Basic and diluted earnings per share for the years ended December 31, 2013, 2014 and 2015, for which the basic average number of common shares are based on the 1,000,000,000 common shares issued by our company upon the consummation of the reorganization on November 18, 2015, as if those shares were issued as of the earliest date presented.

Combined and Consolidated Balance Sheet Data

	As of December 31,

	2014		2015
(in thousands)	RMB		RMB		US$
	Combined		Consolidated		Consolidated (unaudited)
Assets
Cash		83,534		362,461		55,954
Derivative assets		—		445		69
Available-for-sale investments		354,000		75,670		11,681
Deposits with clearing organizations		234,869		239,904		37,035
Amount due from related parties		8,800		—		—
Equipment and leasehold improvements		23,652		18,315		2,827
Deferred tax assets		1,794		3,782		584
Other assets		56,609		79,180		12,223

Total assets		763,258		779,757		120,373

Liabilities
Derivative liabilities		—		14,336		2,213
Amount due to related parties		—		118,880		18,352
Income tax payable		26,582		23,385		3,610
Accounts payable		23,156		3,645		563
Accrued employee benefits		48,530		76,503		11,810
Dividend payable		—		126,876		19,586
Other liabilities		51,804		52,535		8,109

Total liabilities		150,072		416,160		64,243

Shareholders' Equity
Ordinary shares, USD 0.00001 par value.
Authorized 3,000,000,000 shares; issued and outstanding 1,000,000,000 shares as of December 31, 2015		—		65		10
Paid-in capital		125,000		—		—
Additional paid-in capital		7,560		257,098		39,689
Retained earnings		480,626		105,193		16,239
Accumulated other comprehensive income		—		1,241		192

Total shareholders' equity		613,186		363,597		56,130

Total liabilities and shareholders' equity		763,258		779,757		120,373

Non-GAAP Financial Measures

To supplement our combined and consolidated financial statements which are presented in accordance with U.S. GAAP, we use adjusted revenues, adjusted net income and adjusted net income margin as additional non-GAAP financial measures. We present these non-GAAP financial measures because they are used by our management to evaluate our core operating performance. We also believe that these non-GAAP financial measures provide useful information to investors and others in understanding and evaluating our combined and consolidated results of operations in the same manner as our management and in comparing financial results across accounting periods.

Adjusted revenues represent revenues that excludes (i) amounts paid to related parties under our historical risk sharing agreements, as mentioned in "Related Party Transactions — Transactions with Certain Directors, Shareholders and Affiliates and Key Management Personnel," (ii) net trading gains and losses resulting from our principal positions under spot commodity contracts when we serve as counterparty to our customers' trades on the Tianjin Precious Metals Exchange and the Guangdong Precious Metals Exchange, and (iii) the amounts we paid or received under the risk and return transfer arrangement with a third party fund. Our management focuses on our core business that generates commissions and had historically adopted different hedging strategies to reduce our exposure to market risks. In 2015, we entered into a risk and return transfer arrangement with a third party fund, pursuant to which any gains and losses resulting from our principal positions on these two exchanges are transferred to such fund. The arrangement took effect on August 23, 2015 and as long as it remains in force, our net trading gains or losses on spot commodity contracts will be offset by the amount we pay or receive under the risk and return transfer arrangement. If such arrangement were in place since 2013, we would not have generated any net gains or losses from spot commodity contracts, and would not have entered into risk sharing agreements with related parties. Therefore, our management believes that by eliminating the effects of these items, the adjusted revenues fairly present the historical performance of our core business operation and are more comparable to our future performance.

Adjusted net income represents net income that excludes (i) amounts paid to related parties under our historical risk sharing agreements, (ii) net trading gains and losses resulting from our principal positions when we serve as counterparty to our customers' trades on the Tianjin Precious Metals Exchange and the Guangdong Precious Metals Exchange, and (iii) the amounts we paid or received under the risk and return transfer arrangement, and adds back (iv) change of tax to reflect the accurate tax burden due to adjustment of revenues.

Adjusted net income margin reflects the ratio of adjusted net income as a percentage of adjusted revenues. Our management believes this margin fairly presents the historical performance of our core business operation and is more comparable to our future performance.

We compensate for these limitations by reconciling the non-GAAP financial measures to the nearest U.S. GAAP performance measures, all of which should be considered when evaluating our performance. The following table reconciles our adjusted revenues and adjusted net income in the years presented to the most directly comparable financial measures calculated and presented in accordance with U.S. GAAP.

	For the Year Ended December 31,

	2013			2014			2015
(in thousands, except percentages)	RMB			RMB			RMB			US$
Non-GAAP Calculation
Revenues		629,920			1,157,807			1,245,874			192,329
Amount shared with related parties⁽¹⁾		244,305			—			—			—
Net trading gains on spot commodity contracts⁽²⁾		(342,445	)		(263,649	)		(166,015	)		(25,628	)
Risk and return transfer arrangement⁽³⁾		—			—			9,301			1,436

Adjusted revenues		531,780			894,158			1,089,160			168,137

Net income		106,832			481,957			403,015			62,214
Amount shared with related parties⁽¹⁾		244,305			—			—			—
Net trading gains on spot commodity contracts⁽²⁾		(342,445	)		(263,649	)		(166,015	)		(25,628	)
Risk and return transfer arrangement⁽³⁾		—			—			9,301			1,436
Change of tax⁽⁴⁾		24,535			65,912			39,179			6,048

Adjusted net income		33,227			284,220			285,480			44,070

Adjusted net income margin⁽⁵⁾		6.2	%		31.8	%		26.2	%		26.2	%

(1): The amount of spread fees and net trading gains on spot commodity contracts that were shared under our historical risk sharing agreements.
(2): The amount of net trading gains from our principal positions as a result of serving as counterparty to our customers' spot commodity contracts on the Tianjin Precious Metals Exchange and the Guangdong Precious Metals Exchange.
(3): The amounts we pay or receive under the risk and return transfer arrangement with the third party fund. ln 2015, we entered into a risk and return transfer arrangement with a third party fund, pursuant to which all our trading gains and losses on these two exchanges are transferred to such fund. The arrangement took effect on August 23, 2015 and as long as it remains in force, our net trading gains or losses on spot commodity contracts will be offset by the amount we pay or receive under the risk and return transfer arrangement.
(4): Change of tax is calculated as the sum of amount shared with related parties and trading gains and losses on spot commodity contracts and risk and return transfer arrangement, times the applicable tax rate of 25% for that particular subsidiary.
(5): Adjusted net income margin is adjusted net income divided by adjusted revenues.

In light of the foregoing limitations for these non-GAAP financial measures, when assessing our operating and financial performance, you should not consider adjusted revenues, adjusted net income or adjusted net income margin in isolation or as a substitute for our operating or financial performance measures that are calculated in accordance with U.S. GAAP. In addition, because these non-GAAP measures may not be calculated in the same manner by all companies, they may not be comparable to other similar titled measures used by other companies.

Investing in our ADSs involves significant risks. You should carefully consider the risks described below with all of the other information included in this prospectus before deciding to invest in our ADSs. The risks and uncertainties described below are not the only ones that we may face. If any of the following risks actually occur, they may harm our business, financial condition, results of operations and prospects. In this event, the market price of our ADSs could decline and you could lose some or all of your investment.

We operate in a highly regulated industry and any regulatory change may result in changes in trading models and trading rules of the exchanges we operate on, which could adversely affect our business and prospects.

As a relatively new industry, online spot commodity trading industry in China has undergone and continues to undergo significant changes in its regulatory regime. Among the three exchanges we operate on, the Shanghai Gold Exchange is established by the People's Bank of China, or the PBOC, with the approval of the State Council of the PRC, or the State Council, and is the only national exchange for spot commodity trading in China. The Tianjin Precious Metals Exchange and the Guangdong Precious Metals Exchange are established with approval from and regulated by the provincial governments in Tianjin and Guangdong, respectively. On November 11, 2011, the State Council issued Decision of the State Council on Straightening Out and Rectifying Various Types of Trading Venues to Effectively Prevent Financial Risks, or Circular 38. On July 12, 2012, the general office of the State Council issued the Implementation Opinions on Straightening Out and Rectifying Various Types of Trading Venues, or Circular 37, to further regulate various trading exchanges established with approval from provincial or other local governments. Pursuant to Circular 37, each of the provincial governments shall conduct inspection of trading exchanges within its jurisdiction based on the guidance of Circulars 38 and 37. Exchanges that are not in compliance may be banned from launching new products, be ordered to make rectification or even be shut down.

The Shanghai Gold Exchange, as a national exchange, is not subject to such provincial inspection. As of the date of this prospectus, Guangdong province has completed its inspection of exchanges in Guangdong, and the Guangdong Precious Metals Exchange has passed the inspection. However, since the Tianjin municipality has not yet completed such inspection, there are uncertainties relating to the compliance of Circulars 38 and 37 by the Tianjin Precious Metals Exchange. Although the Guangdong Precious Metals Exchange has passed such inspection, there is no guarantee that it will pass future inspections or comply with government regulations. In addition, different provincial governments and different departments of the central government may have different interpretations and implementation practices of Circulars 38 and 37. If the Tianjin Precious Metals Exchange or the Guangdong Precious Metals Exchange were to be found non-compliant under Circulars 38 and 37, and were to be required to change or adjust its trading models or rules accordingly, our operation on that exchange may become less profitable or even infeasible. We may have to transfer our business and customers to other exchanges, which may result in extra expenses and adversely affect our customers' trading experience as well as our results of operations and financial condition. If we decide to continue to operate on that exchange, we may need to adjust our business model or our business on that exchange may become less profitable both in the short term and in the long term.

Apart from Circulars 38 and 37, the State Council and provincial governments may adopt new or revise current laws and regulations, and the interpretation and implementation of such laws and regulations may vary from one locality to another. For example, the government may impose restrictions on the commodities available for trading, limit the maximum leverage ratios or trading frequencies for certain commodities, impose qualification requirements on individual investors who can trade certain commodities, or require physical settlement of spot commodity transactions. The government may even prohibit online spot trading of certain commodities. Complying with these regulations and rules could potentially make it not feasible for us to continue with certain businesses that we currently engage in or reduce our customer trading volume or customer base, thus materially and adversely affecting our revenue and business prospects.

We operate on exchanges, which provide trading platform and set trading model and rules, and any change in such trading model or rules or any adverse development on the exchanges could adversely affect our revenue and profitability.

We operate on the exchanges, which provide trading platform and set trading model and rules for all participants on the exchanges. Among the three exchanges we operate on, the Shanghai Gold Exchange adopts an order-driven trading model, while the Tianjin Precious Metals Exchange and the Guangdong Precious Metals Exchange adopt a quote-driven trading model. For a more detailed description of the trading models and rules for the three exchanges, please see "Business — The Commodity Exchange Systems We Operate on." If, for example, the exchanges we operate on were to change their trading models from one to another, or change the features associated with their current trading models, we may need to adjust our business model accordingly.

In addition, the exchanges formulate their respective trading rules covering various aspects of spot commodity trading, including but not limited to, commission and fee standards, leverage ratio, trade settlement procedures, membership qualifications, risk control mechanism, as well as information management. Our commissions and fees consist of trading commissions, spread fees and overnight fees, the maximum levels of which are all set by the exchanges. If the exchanges we operate on were to reduce such fee levels, for one purpose or another, our revenue and profit may suffer. If the exchanges we operate on were to lower the maximum leverage ratio, it would reduce the maximum notional value of transaction a customer can conduct with a given amount of trading deposit, which may negatively affect our customers' trading volume, thus negatively impact our commissions and fees as they are earned based on our customers' trading volume. For example, on October 1, 2015, Guangdong Precious Metals Exchange lowered the maximum leverage ratio for silver and other commodities from 33:1 to 12.5:1. While on January 4, 2016, Guangdong Precious Metals Exchange restored the maximum leverage ratio to 33:1 for certain qualified customers, a lower maximum leverage ratio still applies to a majority of our customers. In addition, the Tianjin Precious Metals Exchange lowered the maximum leverage ratio for commodities except nickel from 20:1 to 12.5:1, on April 18, 2016. A lower maximum leverage ratio may negatively impact our customers' trading volume and our commissions and fees. Any material changes in the trading models or rules of spot commodity exchanges may affect our business model, revenue composition, expenses associated with our operation, as well as costs to comply with new rules, which may adversely affect our results of operations and business. In addition, we also receive cash awards from the exchanges based on our customer trading volume, which may not continue in the future.

In addition, the exchanges we operate on are subject to certain risks of their own, including customer default risks, risks of IT system failures or malfunctions and other operational risks. For instance, since all trading orders from us and our customers are executed through the exchanges' trading systems, we are highly dependent on the IT system of the exchanges, and any interruption, malfunction or failure of the exchanges' systems could prevent individual customers from placing their orders timely, or result in erroneous execution of the customer's trading orders. Any adverse change to the operations of the exchanges we operate on may adversely affect our results of operations and business prospects.

Our customer trading volume is influenced by the general trading activities in the online spot commodity trading market, which may be impacted by competing investment products, economic and market conditions and other factors that are beyond our control.

Our revenue depends in part on our customer trading volume, which is influenced by the general trading activities in the online spot commodity trading market. Online spot commodity trading, as a relatively new investment product, faces competition from other traditional investment products, including but not limited to, stock, futures, wealth management products, as well as online finance products such as peer-to-peer lending and other investment products. These alternative investment products may divert investors from or reduce their activity levels in online spot commodity trading, which may adversely affect our trading volume, revenue and business.

In addition, the general trading activities in the online spot commodity trading market may be impacted by movements and trends in the world's commodity markets. Customer trading activities are to some extent

influenced by the changes in commodity prices in international and domestic commodity markets. For instance, our customer trading volume experienced a slight decrease in the third quarter of 2015 compared with the same period of 2014, largely due to the sharp correction in A-share market from June to August 2015, which adversely affected investor's liquidity and confidence in trading. Periods of increased fluctuations of commodity prices often coincide with larger amount of trading volume by our customers. As a result, period to period comparison of our results of operations may not be meaningful and our future operating results may be subject to significant fluctuations. The general trading activities in our industry are also directly affected by factors such as economic and political conditions, macro trends in business and finance, investors' interest level in commodity trading and legislative and regulatory changes. Any one or more of these factors, or other factors, may reduce the trading activity level in online spot commodity trading industry and adversely affect our business and results of operations and cash flows.

We may be subject to customer claims and litigation risk which could adversely affect our reputation, business, financial condition and results of operations.

Our operation requires our employees to frequently interact with our customers and potential customers. Although we have prudent internal procedures and policies in place and we monitor employees' interaction with customers and potential customers through our CRM system, it is difficult to detect and deter misconducts and inappropriate behaviors of all of our employees and the precautions we take to prevent and detect such behaviors may not be effective in all cases. Our employees could wrongly execute transaction orders placed by our customers via telephone, misappropriate customer information, conduct improper activities on behalf of our customers, make false or misleading statements, promise investment returns to attract customers to trade, misrecord or otherwise try to hide improper activities from us.

Misconducts by our employees or former employees could give rise to customer claims against us, including claims for negligence, fraud, failure to supervise, breach of fiduciary duty, transactions and intentional misconduct. These customer claims, regardless of their merits, could subject us to substantial losses and seriously harm our reputation. In addition, such customer claims may escalate into litigation. The outcome of any arbitration or litigation is inherently uncertain, and defending against these claims could be both costly and time-consuming, and could significantly divert the efforts and resources of our management and other personnel. A judgment against us in any such litigation could incur financial and reputation damage on our business. Even if we prevail in such litigation, we could incur significant legal expenses. In addition, the exchanges we operate on could impose certain penalties on us including suspension of trades or even termination of our membership or agent role, if we are proven to have engaged in misconduct.

We face intense competition, and if we do not compete effectively, our results of operations and our business prospects may be adversely affected.

The online spot commodity trading industry is highly fragmented and competitive with relatively low entry barriers. We compete primarily on the basis of our technology, comprehensive customer service and brand recognition. Our competitors may compete with us in the following ways:

Although we do not compete against other trading service providers solely based on prices, if our competitors offer their services at lower prices, we may be forced to provide more aggressive rebates to our customers and our commission and fees may decrease. Reduction in commissions and fees without a commensurate reduction in expenses would lower our profitability.

In addition, there are over 20 commercial banks operating as financial members on the Shanghai Gold Exchange, through which individual customers can open accounts and trade gold and other precious metals on that exchange. Recently, certain Internet companies also launched spot commodity trading service. Some

of these competitors may have greater financial resources or a larger customer base than we do, and if we fail to compete effectively, our market position, business prospects and results of operations would be adversely affected.

Our reputation is critically important to our business. If our reputation is harmed, or the reputation of the industry as a whole is damaged, our business, financial condition, results of operations or prospects may be materially and adversely affected.

Our ability to attract and retain customers may be adversely affected if our reputation is damaged. If we fail, or appear to fail, to deal with issues that may give rise to reputational risk, our business and prospects may be harmed. These issues include, but are not limited to, mishandling customer complaints, potential conflicts of interest, privacy breaches, customer data leak, improper sales practices, as well as failure to identify legal, credit, liquidity, and market risks inherent in our business. Failure to appropriately address these issues could reduce customer confidence in us or increase customer attrition rate, which may adversely affect our reputation and business.

In addition, our ability to attract and retain customers may be adversely affected if the reputation of the industry as a whole is damaged. In recent years, certain illegal trading platforms have caused reputational damage to the entire online spot commodity trading industry. There have been news reports on alleged misappropriation of customer funds and other fraudulent activities by certain exchanges and exchange members. The perception of insufficient regulation and unfavorable reputation within the industry could materially and adversely affect our ability to attract and retain customers.

Any fraudulent or allegedly fraudulent activities in the online spot commodity trading industry, which is beyond our control, may damage the reputation of the entire industry and may adversely affect our business operations and reputation.

We have a limited operating history upon which investors could evaluate our performance and prospects.

We commenced our operation on the Tianjin Precious Metals Exchange in July 2011, on the Guangdong Precious Metals Exchange in August 2013 and on the Shanghai Gold Exchange in November 2015, when we had our first customer on the relevant exchange. Besides our relatively limited track record, two of the three exchanges we operate on have limited history. The Tianjin Precious Metals Exchange started operation in 2010 and the Guangdong Precious Metals Exchange commenced operation in 2012. Accordingly, we have a limited operating history upon which you can evaluate our performance and prospects. Our performance and prospects may be materially and adversely affected by the risks, expenses and difficulties frequently encountered in a new business in a new and rapidly evolving industry characterized by intense competition and evolving regulatory oversight and rules.

Our management team lacks experience in managing a U.S. public company and complying with laws applicable to such company, the failure of which may adversely affect our business, financial conditions and results of operations.

Our current management team lacks experience in managing a U.S. publicly traded company, interacting with public company investors and complying with the increasingly complex laws pertaining to U.S. public companies. Prior to the completion of this offering, we mainly operate our businesses as a private company in the PRC. As a result of this offering, our company will become subject to significant regulatory oversight and reporting obligations under the federal securities laws and the scrutiny of securities analysts and investors, and our management currently has no experience in complying with such laws, regulations and obligations. Our management team may not successfully or efficiently manage our transition to becoming a U.S. public company. These new obligations and constituents will require significant attention from our senior management and could divert their attention away from the day-to-day management of our business, which could adversely affect our business, financial conditions and results of operations.

Although we have transferred our trading gains and losses to third parties through a risk and return transfer arrangement, we may still be exposed to market risks if such arrangements cannot be satisfactorily executed.

Under the current trading model of the Tianjin Precious Metals Exchange and the Guangdong Precious Metals Exchange, we must unconditionally accept all trading orders from our customers and serve as counterparty to their trades. As a result, we passively take principal positions opposite to those of our customers. Historically, we have incurred net losses from such positions on the Tianjin Precious Metals Exchange and the Guangdong Precious Metals Exchange for certain months or quarters.

In 2015, we entered into a risk and return transfer arrangement with a third party fund, under which any trading gains and losses resulting from our principal positions on these two exchanges are transferred to such fund, reducing our market risk exposure to commodity price movements. Such arrangement has taken effect since August 23, 2015 and has an initial term of five years. To guarantee the execution of such arrangement, the fund shall maintain a net asset value of no less than 100% of the aggregate minimum deposits required from us by these two exchanges. The fund has placed capital in a bank account under its name. Pursuant to the agreement, any withdrawal or transfer from the fund's bank account requires approval from both the fund and us, providing us the ability to block any withdrawal or transfer outside of the agreed scope. As of December 31, 2015, the net asset value of such fund was RMB245.5 million (US$37.9 million) which met the minimum deposit requirement as of such date. For more details of the risk and return transfer arrangement, please see "Business — Risk Management — Trading Related Risks — Market Risks." If the net asset value of the fund falls below 70% of the aggregate minimum deposits required from us by the two exchanges, the fund is contractually obligated to request its investors to contribute additional capital. However, investors of the fund are not obligated to contribute any additional capital and if they shall decline to do so, our counterparty risk exposure to the fund would increase. In addition, if sudden adverse market movements result in substantial losses which immediately render the fund's net assets insufficient, the fund may not be able to replenish such account as required under the risk and return transfer arrangement, and thus expose us to counterparty risk. Furthermore, if the risk and return transfer arrangement were to cease to be effective, we will be exposed to market risks on these two exchanges and may incur substantial financial losses caused by adverse market conditions.

We are exposed to credit risks of our trading counterparties, and any default by them may adversely impact our financials, results of operations and business.

We serve as counterparty to our customers' trades on the Tianjin Precious Metals Exchange and the Guangdong Precious Metals Exchange, exposing us to the risk of default by our customers. In the event of a sudden, large market price movement against a customer's position, his or her equity may drop to below zero instantly before the exchange is able to liquidate his or her position. As a result, we are subject to default risks if the customer with a deficit in his or her account refuses to pay us back. Historically, there was one incident of deficit incurred by 153 customers simultaneously. On December 1, 2014, the trading price of spot silver had a low-jump opening, immediately rendering the equity of 153 customers negative. Although under the rules of the exchanges, we, as counterparty, are entitled to claim for damages against these customers, we chose to waive such entitlements and suffered an aggregate loss of revenue of approximately RMB4.4 million.

We entered into a risk and return transfer arrangement with a third party fund in 2015 for a term of five years. According to this arrangement, in the event of customer default, we only need to transfer the part of the gains we are able to collect from such customers to the fund, and not the part under default. However, if the risk and return transfer arrangement were to cease to be effective, we would again be exposed to credit risks of our customers.

Attrition of customer accounts and failure to attract new accounts could have a material adverse effect on our business, financial conditions and results of operations.

Similar to other providers of online spot commodity trading services, our customer base comprises of individual customers who tend to trade in the online spot commodity market only for short periods of time.

Although we offer services designed to educate, support and retain our customers, our efforts to attract new customers or reduce the attrition rate of our existing customers may not be successful. If we were unable to maintain or increase our customer retention rates or generate new customers in a cost-effective manner, our business, financial condition and results of operations would likely be adversely affected. Historically, we incurred RMB256.1 million, RMB285.7 million and RMB221.9 million (US$34.2 million) in advertising and promotion expenses, representing 40.7%, 24.7% and 17.8% of our revenues in the year of 2013, 2014 and 2015, respectively. Although we have spent significant financial resources on advertising and marketing expenses and plan to continue doing so, these efforts may not be cost-effective to attract new customers. If we are unable to develop new customers in a cost-effective way, our profitability and growth may be adversely affected.

We may fail to protect our proprietary information or our customers' information, which may adversely affect our reputation, customer base and business.

Despite our efforts to safeguard the information of our customers, information leakage due to system malfunction, employee error, misconduct or other factors may still occur. Our computer system, the networks we use, the networks and online trading platforms of the exchanges and other third parties with whom we interact, are potentially vulnerable to physical or electronic computer break-ins, viruses and similar disruptive problems and security breaches. A party that is able to circumvent our security measures could misappropriate proprietary information or customer information, jeopardize the confidential nature of the information we transmit over the Internet or cause interruptions in our operations. Concerns over the security of Internet transactions and the safeguarding of confidential personal information could also adversely affect our customers' intention to trade. We or our service providers may be required to invest significant resources to protect against the threat of security breaches or to alleviate problems caused by any breaches. To the extent that our activities involve the storage and transmission of proprietary information and personal financial information, security breaches could expose us to risks of financial loss, litigation and other liabilities. Any of these events, particularly if they result in a loss of confidence in our services, could have a material adverse effect on our reputation, business, financial condition and results of operations.

Our proprietary technology is critical to our business and if we fail to keep our technology updated as the industry evolves, our growth, revenue and business prospects may be materially and adversely affected.

Our proprietary client software and client relationship management system are critical to our business operation. In order to remain competitive, our proprietary technology is under continuous development and upgrade. If we fail to keep our technology updated as needed or as fast as our competitors or in a cost-effective manner, we may not be able to compete with our competitors. Failure to compete may limit our service quality, lower customer confidence in us or otherwise adversely affect our business and prospects.

We are required to maintain certain levels of deposits with exchanges, which could constrain our growth.

Under the trading rules of the Tianjin Precious Metals Exchange and the Guangdong Precious Metals Exchange, we are required to maintain minimum deposits with exchanges as a comprehensive member. Exchanges continue to evaluate and modify their minimum deposit requirement in response to regulatory change and to improve the stability and liquidity of the exchanges. In addition, since the exchanges mandatorily liquidate a member's position when its equity to minimum deposit ratio falls under certain level, we generally maintain a higher level of minimum deposit than required by the exchanges to avoid being liquidated due to large and rapid price movement against us. We maintained an amount of RMB234.9 million and RMB239.9 million (US$37.0 million) of deposits with exchanges as of December 31, 2014 and 2015, respectively. As the deposits with exchanges need to be set aside in our trading deposit account with the exchanges, this may reduce our disposable cash for other business activities and therefore constrain our growth.

We may fail to update our risk-management policies and procedures as needed and such policies and procedures may otherwise be ineffective, which may expose us to unidentified or unexpected risks.

Although we adopt an integrated risk-management system, we may fail to update our risk management system as needed and the system may fail to effectively function, thus exposing us to unidentified or

unexpected risks. We are dependent on our risk-management policies and procedures and the adherence to such policies and procedures by our risk management and other staff to manage the risks inherent in our business. Our policies, procedures and practices used to identify, monitor and control a variety of risks are carried out by the corresponding departments. However, some of our methods for managing risks are discretionary by nature and are based on internally developed controls and observed historical market behavior, and also involve reliance on standard industry practices. These methods may not adequately prevent losses, particularly as they relate to extreme market movements, which may be significantly greater than historical fluctuations in the market. In addition, we may fail to update our risk management system as needed or as fast as the industry evolves, weakening our ability to identify, monitor and control new risks.

A failure in our IT systems could cause interruptions in our services or decreases in the responsiveness of our services, disrupt our business, damage our reputation and cause losses.

Our IT systems support all phases of our operation, including marketing, customer development and the provision of customer services, and are an essential part of our technology infrastructure. If our systems fail to perform, we could experience disruptions in operations, slower response times or decreased customer satisfaction. Our systems also are vulnerable to damage or interruption from human error, natural disasters, telecommunication failures, break-ins, sabotage, computer viruses and similar events. While we currently maintain an emergency backup plan, which is intended to minimize service interruptions and secure data integrity, our backup plan may not work effectively during an emergency. Any such systems failure could impair our reputation, damage our brand name, subject us to claims and materially and adversely affect our business, financial condition, operating results or prospects.

We provide market information, research reports and live market commentaries to our individual customers, which may expose us to reputational and business risks.

We provide market information, research reports and live market commentaries to our customers. Although these materials and commentaries contain prominent disclaimers, our customers may seek to hold us responsible when they use such information to make trading decisions and suffer financial losses on their trades, or if their trades are not as profitable as they have expected, which might adversely affect our reputation, business and results of operations.

From time to time, we may implement new lines of business or offer new services within existing lines of business. We commenced our operation on the Shanghai Gold Exchange in November 2015, and we may expand our businesses into other areas. There are substantial risks and uncertainties associated with these efforts, particularly in instances where the markets are not fully developed. In developing and marketing new lines of business and/or new services, we may invest significant time and resources. Initial timetables for the introduction and development of new lines of business and/or new services may not be achieved and profitability targets may not prove feasible. External factors, such as compliance with regulations, competition and shifting market preferences, may also impact the successful implementation of a new line of business or a new service. Our personnel and technology systems may fail to adapt to the changes in such new areas or we may fail to effectively integrate new services into our existing operation. In addition, we may be unable to compete effectively due to different competitive landscape in these new areas. Furthermore, any new line of business and/or new service could have a significant impact on the effectiveness of our internal control system. Failure to successfully manage these risks in the development and implementation of new lines of business or new services could have a material adverse effect on our business, results of operations and financial condition.

We depend on key management as well as experienced and capable personnel, and our business may be adversely affected if we are unable to hire and retain qualified employees.

Our key management includes our Chairman and Chief Executive Officer, Mr. Wenbin Chen, our Vice Presidents, Mr. Xu Gang, Mr. Dikuo Bo, Mr. Jigeng Chen, Mr. Qi Feng and Mr. Sheng Zhao, and our Chief Financial Officer, Mr. Jingbo Wang. Our continued success is dependent upon the retention of these key management members, as well as a number of other key managerial, marketing, sales, research, technical and operations personnel. We do not have key man insurance and the loss of such key personnel could have a material adverse effect on our business. In addition, our ability to grow our business is dependent, to a large degree, on our ability to retain such key management members and experienced personnel.

We may not be able to protect our intellectual property rights or may be subject to intellectual property claims from others.

We rely on a combination of trademark, copyright, trade secret and fair business practice laws in the PRC to protect our proprietary technology, intellectual property rights and brand. Although we have entered into confidentiality and invention assignment agreements with certain of our employees and/or relevant third parties and also rigorously control access to proprietary technology, it is possible that third parties may copy or otherwise obtain and use our proprietary technology without authorization of the company or otherwise infringe on our rights. We may also face claims of infringement that could interfere with our ability to use technology that is material to our business operation.

In the future, we may have to rely on litigation to enforce our intellectual property rights, protect our trade secrets, determine the validity and scope of the proprietary rights of others or defend against claims of infringement or invalidity. Any such litigation, whether successful or unsuccessful, could result in substantial costs and the diversion of resources and the attention of management, any of which could adversely affect our business.

We may be unable to obtain and maintain necessary license, permits or approvals for our business, which may adversely affect our operations and business prospects.

Many aspects of our businesses depend on obtaining and maintaining the necessary approvals, licenses or permits from the exchanges we operate on and from government authorities. If we fail to continuously comply with the regulatory requirements in certain aspects, we may encounter the risks of being disqualified for our existing businesses or being rejected for renewal of our qualifications upon expiry by the regulatory authorities. In addition, in respect of any new business that we contemplate, we may not be able to obtain the relevant approvals for developing such new business, if we fail to fully comply with the relevant regulations and regulatory requirements. As a result, we may fail to develop new business as planned, or we may fall behind our competitors in such businesses.

If our internal control over financial reporting or our disclosure controls and procedures are not effective, we may not be able to accurately report our financial results, prevent fraud or file our periodic reports in a timely manner.

When we become a public company, we will be subject to reporting obligations under Section 404 of the Sarbanes-Oxley Act of 2002, or the Sarbanes-Oxley Act, that will require us to include a management report on our internal control over financial reporting in our annual report, which contains management's assessment of the effectiveness of our internal control over financial reporting. Our management may conclude that our internal control over our financial reporting is not effective. Moreover, when we are no longer an emerging growth company under the federal securities laws, our independent registered public accounting firm will be required to issue an attestation report on the effectiveness of our internal control over financial reporting. Even if our management concludes that our internal control over financial reporting is effective, our independent registered public accounting firm may conclude that there are material weaknesses or significant deficiencies with respect to our controls or the level at which our controls are documented, designed, operated or reviewed. Material weaknesses may be identified during the audit process or at other times.

In connection with the audit of our combined and consolidated financial statements for 2015, one material weakness was identified in our internal control over financial reporting. A "material weakness" is a deficiency, or a combination of deficiencies, in internal control over financial reporting such that there is a reasonable possibility that a material misstatement of our annual or interim financial statements will not be prevented or detected on a timely basis. The material weakness that was identified related to our lack of sufficient financial reporting and accounting personnel with appropriate experience of U.S. GAAP and SEC reporting requirements and failure to establish and clearly communicate acceptable policies regarding U.S. GAAP financial reporting, which contributed to inadequate controls in the application of accounting

policies in the United States. While we have implemented plans to remediate this material weakness, there is no assurance that we will not have material weaknesses or significant deficiencies in the future.

Our reporting obligations as a public company will place a strain on our management, operational and financial resources and systems for the foreseeable future. If we fail to timely achieve and maintain the adequacy of our internal control over financial reporting, we may not be able to produce reliable financial reports and will be less able to detect and prevent fraud. In addition, our failure to achieve and maintain effective internal control over financial reporting could prevent us from filing our periodic reports on a timely basis which could result in the loss of investor confidence in the reliability of our financial statements, impair our ability to access the capital markets, harm our business, and negatively impact the trading price of our ADSs.

The rapid growth of our business during our limited operation history has placed significant demands on our management and other resources.

As we grow, we may also need to expand and upgrade the reliability and scalability of our proprietary technology, network infrastructure and other aspects of our IT system. We may need to hire additional sales and marketing representatives, customer service, risk management as well as other personnel to serve the enlarged customer base. Implementation of new business arrangements, expansion of technology infrastructure and increase in employee numbers may further increase our operational complexity and impose higher standards on every aspect of our operation. Our management team may fail to effectively cope with the increased operational complexity, and we may fail to integrate new resources into our existing operation system. Therefore, we may not be able to maintain current growth rate or manage our growth effectively.

Our physical commodity trading and product sales are influenced by the market condition of the commodities, suppliers and other factors that are often beyond our control.

Our physical commodity trading and product sales business is influenced by market conditions, suppliers and other factors. We currently engage in the physical trading and product sales of precious metals, which is influenced by the supply and demand of such precious metals in the PRC, general financial and economic conditions of the PRC, regulations by relevant authorities as well as other factors that are beyond our control. In addition, for silver products sales, any shortage, delay or quality deterioration in the supply of silver products by our suppliers could adversely affect our silver trading business and results of operations.

We may pursue acquisitions or joint ventures that could present unforeseen integration obstacles, incur unpredicted costs or may not enhance our business as we expected.

Although our growth strategy historically has not focused on acquisitions, we may in the future selectively pursue acquisitions and joint ventures. Any future acquisitions or joint venture may result in significant transaction costs and present new risks associated with entering additional markets or offering new products and integrating the acquired companies or newly established joint ventures. Because acquisitions and joint ventures historically have not been a core part of our growth strategy, we do not have significant experience in successfully completing acquisitions or joint ventures. In addition, we may not have sufficient management, financial and other resources to integrate companies we acquire or to successfully operate joint ventures and we may be unable to profitably operate our expanded company. Additionally, any new businesses that we may acquire or joint ventures we may form, once integrated with our existing operations, may not produce expected or intended results.

We face risks related to natural disasters, health epidemics, terrorist attacks and other outbreaks, which could significantly disrupt our operations.

The occurrence of unforeseen or catastrophic events, including the emergence of a pandemic or other widespread health emergency, terrorist attacks or natural disasters, could create economic and financial disruptions, lead to operational difficulties that could impair our ability to manage our businesses, and expose our business activities to significant losses. On August 12, 2015, there were a series of explosions that killed over one hundred people which occurred at a hazardous chemical container storage station at the Port of Tianjin. Although our subsidiary located in Tianjin did not suffer any loss or experience any significant increase in costs resulting from such incident, any similar future incidents could materially affect our operations due to loss of personnel, damages to property, including our inventory and technology system. Our operations could also be severely disrupted if the exchanges we operate on were affected by natural disasters, health epidemics or man-caused disasters.

Our insurance coverage may be inadequate to cover risks related to our business and operation.

While we maintain certain insurance, such as employee commercial insurance, traffic compulsory insurance, vehicle commercial insurance, there is no assurance that our insurance coverage will be adequate to cover potential losses. Under PRC laws and regulations, we are not required to, and we do not, maintain any insurance in relation to our business operations, such as business interruption insurance, or liability insurance against liabilities arising from customer complaints and litigation or other aspects of our business. Our current insurance policies may not protect us against such losses and liabilities.

Although we believe that our insurance coverage is in line with industry practice in the PRC, if any of the incidents mentioned above occur and we have insufficient insurance to cover the liabilities associated with such incidents, it could have a material adverse effect on our financial condition, results of operations and business prospects.

We principally rely on dividends and other distributions on equity paid by our PRC subsidiaries to fund any cash and financing requirements we may have, and any limitation on the ability of our PRC subsidiaries to make payments to us, or the tax implications of making payments to us, could have a material adverse effect on our ability to conduct our business or our financial condition.

We are a holding company, and we rely principally on dividends and other distributions on equity from our wholly owned subsidiaries in China for our cash requirements, including the funds necessary to pay dividends to our shareholders and service any debt we may incur. Current PRC regulations permit our subsidiaries in China to pay dividends to us only out of their respective accumulated profits, if any, determined in accordance with PRC accounting standards and regulations. In addition, each of our PRC subsidiaries is required to set aside at least 10% of its respective after-tax profits each year, if any, to fund certain statutory reserve funds until the aggregate amount of such reserve funds reaches 50% of its registered capital. At its discretion, each of our PRC subsidiaries may allocate a discretionary portion of its respective after-tax profits to staff welfare and bonus funds. These reserves may not be distributable as cash dividends. Furthermore, if any of our PRC subsidiaries incurs debt on its own behalf in the future, the instruments governing the debt may restrict its ability to pay dividends or make other payments to us. Most of our assets are held by, and substantially all of our earnings and cash flows are attributable to, our PRC subsidiaries. Our cash flows are principally derived from dividends paid to us by our PRC subsidiaries. As a result, our ability to distribute dividends largely depends on earnings from our PRC subsidiaries and their ability to pay dividends out of their earnings. If operating losses from our PRC subsidiaries were to continue to grow, our operating results and cash flows would be further materially and adversely affected. Our PRC subsidiaries so far have not paid us any dividends. We cannot assure you that our PRC subsidiaries will generate sufficient earnings and cash flows in the near future to pay dividends or otherwise distribute sufficient funds to enable us to meet our obligations, pay interest and expenses or declare dividends.

PRC regulation of loans and direct investment by offshore holding companies to PRC entities may delay or prevent us from using proceeds we receive from this offering and the Concurrent Private Placement to make loans or additional capital contributions to our PRC subsidiaries.

We are an offshore holding company conducting our operations in China through our PRC subsidiaries. Any capital contributions or loans that we, as an offshore entity, make to our PRC subsidiaries that are foreign-invested enterprises, including the proceeds of this offering and the Concurrent Private Placement, are subject to PRC regulations. Loans made by us to our PRC subsidiaries to finance their activities cannot exceed statutory limits and must be registered with the local counterpart of the State Administration of Foreign Exchange, or SAFE. The statutory limit for the total amount of foreign debts a foreign-invested company may incur is the difference between the amount of total investment as approved by the Ministry of Commerce of the PRC, or MOFCOM, or its local counterpart and the amount of registered capital of such foreign-invested company.

We may also decide to finance our PRC subsidiaries by means of capital contributions. These capital contributions must be approved by the MOFCOM or its local counterpart. In addition, SAFE issued the Circular on the Relevant Operating Issues Concerning the Improvement of the Administration of Payment and Settlement of Foreign Currency Capital of Foreign Invested Enterprises, or the SAFE Circular 142, on August 29, 2008. Pursuant to SAFE Circular 142, the registered capital of a foreign-invested enterprise settled in RMB that is converted from foreign currencies may only be used for purposes within the business scope approved by the applicable governmental authority and may not be used for equity investments within the PRC.

In 2015, the SAFE has published the Circular of the State Administration of Foreign Exchange on Reforming the Management Approach regarding the Settlement of Foreign Exchange Capital of Foreign-invested Enterprises, or Circular 19, which has come into effect since June 1, 2015, and the SAFE Circular 142 was repealed simultaneously. According to Circular 19, foreign-invested enterprises are now allowed to convert their registered capital from foreign exchange to RMB and apply such funds to equity investment within the PRC, conditioned upon the investment target's duly registration with local bank of such reinvestment and open a corresponding special account pending for foreign exchange settlement payment. Further, such conversion will be handled at the bank level and does not need to be approved by SAFE. However, Circular 19 continues to prohibit foreign-invested enterprises from, among other things, using an RMB fund converted from its foreign exchange capital for expenditure beyond its business scope, investment in securities, providing entrusted loans or repaying loans between nonfinancial enterprises or purchasing real estate not for self-use.

If we fail to comply with such regulations, our ability to capitalize the relevant PRC subsidiaries or fund our operations or utilize the proceeds of this offering and the Concurrent Private Placement in the manner described in the section entitled "Use of Proceeds" may be negatively affected, which could materially and adversely affect the liquidity of our relevant PRC subsidiaries or our business, financial condition, results of operations and growth prospects.

We may be subject to penalties, including restrictions on our ability to inject capital into our PRC subsidiaries and our PRC subsidiaries' ability to distribute profits to us, if our PRC resident shareholders or beneficial owners fail to comply with relevant PRC foreign exchange regulations.

On July 4, 2014, SAFE issued the Circular on Several Issues Concerning Foreign Exchange Administration of Domestic Residents Engaging in Overseas Investment, Financing and Round-Trip Investment via Special Purpose Vehicles, or SAFE Circular 37, which replaced the previous Notice on Relevant Issues Concerning Foreign Exchange Administration for Domestic Residents' Financing and Roundtrip Investment Through Offshore Special Purpose Vehicles, effective on November 1, 2005, or Circular 75. SAFE Circular 37 requires PRC individuals, institutions and foreign individuals who have a habitual residence in the PRC due to economic interests, or collectively referred as the PRC residents, to register with SAFE or its local branches in connection with their direct establishment or indirect control of an offshore entity, for the

purpose of overseas investment and financing, with such PRC residents' legally owned assets or equity interests in domestic enterprises or offshore assets or interests. Such offshore entity is referred to as an offshore special purpose vehicle. In addition, such PRC residents must update their foreign exchange registrations with SAFE when the offshore special purpose vehicle undergoes material events relating to any change of basic information (including change of such PRC residents, name and operation term), increases or decreases in investment amount, share transfers or exchanges, or mergers or divisions.

If any shareholder holding interest in an offshore special purpose vehicle, who is a PRC resident as determined by Circular 37, fails to fulfill the required foreign exchange registration with the local SAFE branches, the PRC subsidiaries of that offshore special purpose vehicle may be prohibited from distributing their profits and dividends to their offshore parent company or from carrying out other subsequent cross-border foreign exchange activities, and the offshore special purpose vehicle may be restricted in its ability to contribute additional capital to its PRC subsidiaries. Moreover, failure to comply with the SAFE registration described above could result in liability under PRC laws for evasion of applicable foreign exchange restrictions.

We have requested all of our current shareholders and/or beneficial owners to disclose whether they or their shareholders or beneficial owners fall within the ambit of the SAFE Circular 37 and will urge relevant shareholders, upon learning that they are PRC residents, to register with the local SAFE branch as required under the SAFE Circular 37. However, we may not be fully informed of the identities of all our shareholders or beneficial owners who are PRC residents, and we cannot provide any assurance that all of our shareholders and beneficial owners who are PRC residents will comply with our request to make, obtain or update any applicable registrations or comply with other requirements required by the SAFE Circular 37 or other related rules in a timely manner.

Yin Tian Xia Technology. Jin Xiang Yin Rui and Rong Jin Hui Yin were indirectly controlled by our ultimate individual beneficial owners, Mr. Wenbin Chen, Mr. Ming Yan and Ms. Ningfeng Chen, through nominee shareholders arrangements before these companies became wholly owned subsidiaries of offshore holding companies. After a series of restructurings in the following years, Qian Zhong Su acquired these three companies and now they are indirectly owned by our ultimate individual beneficial owners through an offshore holding company. Our ultimate individual beneficial owners have contacted local SAFE to make the applications under SAFE Circular 37 and other related rules, but were informed that their application would not be accepted in practice due to the previous nominee shareholder arrangements, based upon which our PRC counsel advises us that the possibility of SAFE restrictions and penalties is remote as the failure to register was not intended by our shareholders but due to legal impracticality. Although our ultimate individual beneficial owners have undertaken to complete such registration as soon as the local SAFE would accept such applications, the timeframe for such registration remains unknown until new policies or practical guidelines explicitly allow or waive registrations made by companies with historical nominee shareholder arrangements. Although we are not currently prohibited from or limited in distributing dividends or profits to offshore entities, we may be so prohibited or limited in the future, which may negatively affect our financial conditions and results of operations, as well as our ability to distribute dividends to our investors.

PRC economic, political and social conditions as well as government policies could adversely affect our business and prospects.

We conduct businesses in the PRC, and therefore our financial conditions and results of operations are subject to influences from PRC's economic, political and social conditions to a great extent. The PRC economy differs from the economies of most developed countries in many aspects, including, but not limited to, the degree of government involvement, control level of corruption, control of capital investment, reinvestment control of foreign exchange, allocation of resources, growth rate and development level.

For approximately three decades, the PRC government has implemented economic reform measures to utilize market forces in the development of the PRC economy. We cannot predict whether changes in the PRC's economic, political and social conditions and in its laws, regulations and policies will have any adverse effect on our current or future business, financial condition or results of operations. In addition, many of the economic reforms carried out by the PRC government are unprecedented or experimental and are expected to be refined and improved over time. This refining and improving process may not necessarily have a positive effect on our operations and business development. For example, the PRC government has in the past implemented a number of measures intended to slow down certain segments of the economy, including the property industry, which the government believed to be overheating. These actions, as well as other actions and policies of the PRC government, could cause a decrease in the overall level of economic activity in the PRC and, in turn, have an adverse impact on our business and financial condition.

The legal system of the PRC is not fully developed and there are inherent uncertainties that may affect the protection afforded to us.

Our business and operations in China are governed by the PRC laws and regulations. The PRC legal system is generally based on written statutes. Prior court decisions may be cited for reference but have limited precedential value. Since 1979, PRC legislation and regulations have significantly enhanced the protections afforded to various industries in China. However, as these laws and regulations are relatively new and continue to evolve, interpretation and enforcement of these laws and regulations involve significant uncertainties and different degrees of inconsistency. Some of the laws and regulations are still in the developmental stage and are therefore subject to policy changes. Many laws, regulations, policies and legal requirements have only been recently adopted by PRC central or local government agencies, and their implementation, interpretation and enforcement may involve uncertainty due to the lack of established practice available for reference. We cannot predict the effect of future legal developments in China, including the promulgation of new laws, changes in existing laws or their interpretation or enforcement, or the preemption of local regulations by national laws. As a result, there is substantial uncertainty as to the legal protection available to us. Furthermore, due to the limited volume of published cases and the nonbinding nature of prior court decisions, the outcome of dispute resolution may not be as consistent or predictable as in other more developed jurisdictions, which may limit the legal protection available to us.

The enforcement of the Labor Contract Law of the People's Republic of China, or the PRC Labor Contract Law, and other labor-related regulations in the PRC may increase our labor costs, impose limitations on our labor practices and adversely affect our business and our results of operations.

On June 29, 2007, the Standing Committee of the National People's Congress of China enacted the PRC Labor Contract Law, which became effective on January 1, 2008 and was amended on December 28, 2012. The PRC Labor Contract Law introduces specific provisions related to fixed-term employment contracts, part-time employment, probation, consultation with labor unions and employee assemblies, employment without a written contract, dismissal of employees, severance, and collective bargaining, which together represent enhanced enforcement of labor laws and regulations. According to the PRC Labor Contract Law, an employer is obliged to sign an unfixed-term labor contract with any employee who has worked for the employer for 10 consecutive years. Further, if an employee requests or agrees to renew a fixed-term labor contract that has already been entered into twice consecutively, the resulting contract must have an unfixed term, with certain exceptions. The employer must pay economic compensation to an employee where a labor contract is terminated or expires in accordance with the PRC Labor Contract Law, except for certain situations which are specifically regulated. In addition, the government has issued various labor-related regulations to further protect the rights of employees. According to such laws and regulations, employees are entitled to annual leave ranging from 5 to 15 days and are able to be compensated for any untaken annual leave days in the amount of three times their daily salary, subject to certain exceptions.

As a result of these regulations, which are designed to enhance labor protection, we expect our labor costs to increase, as the continued success of our business depends significantly on our ability to attract and

retain qualified personnel. In the event that we decide to change our employment or labor practices, the PRC Labor Contract Law and its implementation rules may also limit our ability to effect those changes in a manner that we believe to be cost-effective. In addition, as the interpretation and implementation of these new regulations are still evolving, our employment practices may not be at all times deemed in compliance with the new regulations. If we are subject to severe penalties or incur significant liabilities in connection with labor disputes or investigations, our business and financial conditions may be adversely affected.

In addition, on December 28, 2012, the PRC Labor Contract Law was amended to impose more stringent requirements on labor dispatches, and such amendments became effective on July 1, 2013. For example, the number of dispatched contract workers that an employer hires may not exceed a certain percentage of our total number of employees to be decided by the Ministry of Human Resources and Social Security, and the dispatched contract workers can only engage in temporary, auxiliary or substitute work. According to the Interim Provisions on Labor Dispatch, or the Interim Provisions, promulgated by the Ministry of Human Resources and Social Security on January 24, 2014, which became effective on March 1, 2014, the number of dispatched contract workers hired by an employer shall not exceed 10% of the total number of its employees (including both directly hired employees and dispatched contract workers). The Interim Provisions further require the employer that is not in compliance with the above provisions to formulate a plan to reduce the number of its dispatched contract workers to below 10% of the total number of its employees prior to March 1, 2016. However, if any labor contract or labor dispatch agreement legally executed prior to December 28, 2012 will expire within two years after the date of implementation hereof, such contracts or agreements may continue to be performed until the expiry thereof in accordance with the applicable law. In addition, an employer is not permitted to hire any new dispatched contract worker until the number of its dispatched contract workers has been reduced below 10% of the total number of its employees. Such limitations on use of dispatched labor may increase our labor costs and impose limitations on our employment practices, which may adversely affect our business and profitability.

Failure to make adequate contributions to various employee benefit plans as required by PRC regulations may subject us to penalties.

Companies operating in China are required to participate in various government-sponsored employee benefit plans, including certain social insurance, housing funds and other welfare-oriented payment obligations, and contribute to the plans in amounts equal to certain percentages of salaries, including bonuses and allowances, of our employees up to a maximum amount specified by the local government from time to time at locations where we operate our businesses. The requirement of employee benefit plans has not been implemented consistently by the local governments in China given the different levels of economic development in different locations. Our PRC operating entities incorporated in various locations in China have not made adequate employee benefit payments and we have recorded accruals for estimated underpaid amounts in our financial statements. We may be required to make up the contributions for these plans as well as to pay late fees and fines.

In December 2012, the PRC Labor Contract Law was amended to impose more stringent requirements on the use of employees of temporary staffing agencies, who are known in China as "dispatched workers." Historically, we had engaged certain employment agencies to dispatch contract workers to work for us and terminated such arrangements in early 2014. Under such arrangements, these workers were employed by the employment agent companies, and therefore such agent companies were responsible for paying contribution of social insurance and housing funds for the workers correspondingly. During the period that we had such arrangements with the third party employment agencies, they had shortfalls in making such contributions for the workers working for several of our subsidiaries. We have recorded accruals for estimated underpaid amounts in our financial statements. There is a risk that under the PRC law, we may be held by the labor authorities as jointly responsible together with third party employee agencies to make up the shortfall in the contribution of social insurance in relation to those workers dispatched to work for us and may be subject to additional penalties.

Regulators may impose penalties and fines with respect to shortfall in social insurance payment. A late payment fee at the rate of 0.05% per day of the outstanding amount from the due date may be imposed, and if such amounts remain outstanding beyond a prescribed time limit, a fine of one to three times the outstanding amount may be imposed. While there are no explicit quantitative statutory fines or penalties on late payments of housing funds as advised by our PRC counsel, the housing accumulation fund management center may order us to pay any housing fund shortfalls immediately. Although based on the opinion of our PRC counsel, the possibility that we will be subject to any fine or penalty is remote, if we become subject to such fines or penalties in relation to the underpaid employee benefits, our financial condition and results of operations may be adversely affected.

Any failure to comply with PRC regulations regarding the registration requirements for employee share incentive plans may subject the PRC plan participants or us to fines and other legal or administrative sanctions.

Pursuant to the Notice on Issues Concerning the Foreign Exchange Administration for Domestic Individuals Participating in Stock Incentive Plan of Overseas Publicly Listed Company, issued by SAFE in February 2012, employees, directors, supervisors and other senior management participating in any stock incentive plan of an overseas publicly listed company who are PRC citizens or who are non-PRC citizens residing in China for a continuous period of not less than one year, subject to a few exceptions, are required to register with SAFE through a domestic qualified agent, which could be a PRC subsidiary of such overseas listed company, and complete certain other procedures. We and our directors, executive officers and other employees who are PRC citizens or who reside in the PRC for a continuous period of not less than one year and who have been granted restricted shares, restricted share units or options will be subject to these regulations if those employees exercise such restricted shares, restricted share units or options when our company becomes an overseas listed company upon the completion of this offering. Separately, SAFE Circular 37 also requires certain registration procedures to be completed if those employees exercise restricted shares, restricted share units or options before listing. Failure to complete the SAFE registrations may subject them to fines and legal sanctions and may also limit our ability to contribute additional capital into our wholly foreign-owned subsidiaries in China and limit these subsidiaries' ability to distribute dividends to us. We also face regulatory uncertainties that could restrict our ability to adopt additional incentive plans for our directors and employees under PRC law.

In addition, the State Administration of Taxation, or the SAT has issued certain circulars concerning employee share options or restricted shares. Under these circulars, the employees working in the PRC who exercise share options or are granted restricted share units will be subject to PRC individual income tax. The PRC subsidiaries of such an overseas listed company have obligations to file documents related to employee share options or restricted shares with relevant tax authorities and to withhold individual income taxes of those employees who exercise their share options. If the employees fail to pay or the PRC subsidiaries fail to withhold their income taxes according to relevant laws and regulations, the PRC subsidiaries may face sanctions imposed by the tax authorities or other PRC government authorities.

We may be deemed to be a PRC resident enterprise under the Enterprise Income Tax Law, or the EIT Law, and be subject to PRC tax on our worldwide income, which may significantly increase our income tax expenses and materially decrease our profitability or otherwise adversely affect the value of your investment.

Under the EIT Law that took effect on January 1, 2008, enterprises established outside of China whose "de facto management bodies" are located in China are considered to be "resident enterprises" and will generally be subject to a uniform 25% corporate income tax on their global income (excluding dividends received from "resident enterprises"). In addition, a circular issued by SAT on April 22, 2009 and amended on January 29, 2014 sets out certain standards for determining whether the "de facto management body" of an offshore enterprise funded by Chinese enterprises as controlling shareholders is located in China. Although this circular applies only to offshore enterprises funded by Chinese enterprises as controlling shareholders, rather than those funded by Chinese or foreign individuals or foreign enterprises as controlling

shareholders (such as our Company), the determining criteria set forth in the circular may reflect SAT's general position on how the "de facto management body" test should be applied in determining the tax resident status of offshore enterprises, regardless of how they are funded. Although our Company is not funded by Chinese enterprises as controlling shareholders, substantial uncertainty remains as to whether our Company or any of our other non-PRC entities will be deemed a PRC resident enterprise for EIT purposes. If we or any of our subsidiaries registered outside the PRC are deemed a "resident enterprise" under the EIT Law, our income tax expenses may increase significantly, and our profitability could decrease materially.

You may be subject to PRC income tax on dividends from us or on any gain realized on the transfer of our ADSs.

Under the EIT Law and its implementation rules, subject to any applicable tax treaty or similar arrangement between the PRC and your jurisdiction of residence that provides for a different income tax arrangement, PRC withholding tax at the rate of 10% is normally applicable to dividends from PRC sources payable to investors that are non-PRC resident enterprises, which do not have an establishment or place of business in the PRC, or which have such establishment or place of business if the relevant income is not effectively connected with the establishment or place of business. Any gain realized on the transfer of American depositary shares or shares by such non-PRC resident enterprise investors is also subject to a 10% PRC income tax if such gain is regarded as income derived from sources within the PRC unless a treaty or similar arrangement otherwise provides. Under the PRC Individual Income Tax Law and its implementation rules, dividends from sources within the PRC paid to foreign individual investors who are not PRC residents are generally subject to a PRC withholding tax at a rate of 20% and gains from PRC sources realized by such investors on the transfer of American depositary shares or shares are generally subject to a 20% PRC income tax, in each case, subject to any reduction or exemption set forth in applicable tax treaties and PRC laws. Although substantially all of our business operations are in China, it is unclear whether dividends we pay with respect to our ADSs, or the gain realized from the transfer of our ADSs, would be treated as income derived from sources within the PRC and as a result be subject to PRC income tax if we were considered a PRC resident enterprise, as described above. If PRC income tax were imposed on gains realized through the transfer of our ADSs or on dividends paid to our non-resident investors, the value of your investment in our ADSs may be materially and adversely affected. Furthermore, our ADS holders whose jurisdictions of residence have tax treaties or arrangements with China may not qualify for benefits under such tax treaties or arrangements.

The heightened scrutiny over acquisition transactions by the PRC tax authorities may have a negative impact on our business operations, our acquisition or restructuring strategy or the value of your investment in us.

In connection with the EIT Law, the Ministry of Finance and SAT jointly issued, on April 30, 2009, the Notice on Issues Concerning Process of Enterprise Income Tax in Enterprise Restructuring Business, or Circular 59. On February 3, 2015, SAT issued the Announcement of the State Administration of Taxation on Several Issues concerning the Enterprise Income Tax on the Indirect Transfers of Properties by Non-Resident Enterprises, or the SAT Announcement 7. By promulgating and implementing the above, the PRC tax authorities have strengthened their scrutiny over the direct or indirect transfer of equity interest in a PRC resident enterprise by a non-PRC resident enterprise. Pursuant to SAT Announcement 7, if a non-resident enterprise, or referred as a transferor, transfers its equity in an offshore enterprise which directly or indirectly owns PRC taxable assets, including ownership interest in PRC resident companies, or the Taxable Properties, without a reasonable commercial purpose, such transfer shall be deemed as a direct transfer of such Taxable Properties. The payer, or referred as a transferee, in such transfer shall be the withholding agent, and is obligated to withhold and remit the enterprise income tax to the relevant PRC tax authority. Factors that may be taken into consideration when determining whether there is a "reasonable commercial purpose" include, among other factors, the value constitution of the transferred equity, offshore taxable situation of the transaction, the offshore structure's economic essence and duration and trading fungibility.

If an equity transfer transaction satisfies all the requirements mentioned above, such transaction will be considered an arrangement with "reasonable commercial purpose."

We may conduct acquisitions and restructuring. We believe, as advised by our PRC legal advisor, that these historical transactions do not constitute "direct or indirect transfer of the Taxable Properties," and therefore are not subject to SAT Announcement 7. We cannot assure you that the PRC tax authorities will share this view. As a result, the PRC tax authorities may, at their discretion, impose additional PRC taxes or penalties on capital gains we generated from such historical transactions, which would incur additional costs on us.

Certain preferential tax treatments currently offered to some of our PRC subsidiaries may be discontinued, and such discontinuation or imposition of any additional taxes could adversely affect our business, financial condition and results of operations.

Yin Tian Xia Technology, our PRC subsidiary, received the "certified software enterprise and certified software products" qualification, from Shanghai Municipal Commission of Economy and Informatization in April 2013 and November 2012. Under the relevant PRC laws, regulations and rules, Yin Tian Xia Technology enjoys certain preferential tax treatments, under which its income tax rate is 0% in 2013 and 2014 and 12.5% from 2015 to 2017. The preferential period runs from 2013 to December 31, 2017. Furthermore, it may be qualified to receive a refund on value added tax, or VAT, from its sale of self-developed and self-produced software products. The refund-upon-collection policy shall be applied to the portion of actual VAT burden in excess of 3% after VAT has been collected at a tax rate of 17%. If it fails to maintain its qualification or if the preferential period expires without being renewed, it may lose the tax preferential treatments, which could have a material adverse effect on our business, financial condition and results of operations.

Fluctuations in exchange rates could have a material and adverse effect on our results of operations and the value of your investment.

The value of the RMB against the U.S. dollar and other currencies is affected by changes in China's political and economic conditions and China's foreign exchange policies, among other things. On July 21, 2005, the PRC government changed its decades-old policy of pegging the value of the RMB to the U.S. dollar, and the RMB appreciated more than 20% against the U.S. dollar over the following three years. Between July 2008 and June 2010, this appreciation halted and the exchange rate between the RMB and the U.S. dollar remained within a narrow band. The PRC government has allowed the RMB to appreciate slowly against the U.S. dollar again, and it has appreciated more than 10% since June 2010. On August 11, 2015, the PBOC allowed the RMB to depreciate by approximately 2% against the U.S. dollar. It is difficult to predict how long such depreciation of RMB against the U.S. dollar may last and when and how the relationship between the RMB and the U.S. dollar may change again.

Significant revaluation of the RMB may have a material and adverse effect on your investment. For example, to the extent that we need to convert U.S. dollars we receive from this initial public offering into RMB for our operations, appreciation of the RMB against the U.S. dollar would have an adverse effect on the RMB amount we would receive from the conversion. Conversely, if we decide to convert our RMB into U.S. dollars for the purpose of making payments for dividends on our ordinary shares or ADSs or for other business purposes, appreciation of the U.S. dollar against the RMB would have a negative effect on the U.S. dollar amount available to us. In addition, appreciation or depreciation in the value of the RMB relative to U.S. dollars would affect our financial results reported in U.S. dollar terms regardless of any underlying change in our business or results of operations.

Very limited hedging options are available in China to reduce our exposure to exchange rate fluctuations. To date, we have not entered into any hedging transactions in an effort to reduce our exposure to foreign currency exchange risk. While we may decide to enter into hedging transactions in the future, the availability and effectiveness of these hedges may be limited and we may not be able to adequately hedge

our exposure or at all. In addition, our currency exchange losses may be magnified by PRC exchange control regulations that restrict our ability to convert RMB into foreign currency.

Restrictions on the remittance of RMB into and out of the PRC and governmental control of currency conversion may limit our ability to pay dividends and other obligations, and affect the value of your investment.

The PRC government imposes controls on the convertibility of RMB into foreign currencies and the remittance of currency out of China. We receive all of our revenues in RMB and all of our cash inflows and outflows are denominated in RMB. Under our current corporate structure, our income is primarily derived from dividend payments from our PRC operating subsidiaries. We may convert a portion of our revenues into other currencies to meet our foreign currency obligations, such as payments of dividends declared in respect of our shares, if any. Shortages in the availability of foreign currency may restrict the ability of our PRC subsidiaries to remit sufficient foreign currency to pay dividends or other payments, or otherwise satisfy its foreign currency-denominated obligations.

Under existing PRC foreign exchange regulations, payments of current account items, including profit distributions, interest payments and trade and service-related foreign exchange transactions, can be made in foreign currencies without prior SAFE approval by complying with certain procedural requirements. However, approval from or registration with competent government authorities is required where the RMB is to be converted into foreign currency and remitted out of China to pay capital expenses such as the repayment of loans denominated in foreign currencies. The PRC government may at its discretion restrict access to foreign currencies for current account transactions in the future. If the foreign exchange control system prevents us from obtaining sufficient foreign currencies to satisfy our foreign currency demands, we may not be able to pay dividends in foreign currencies to our shareholders, including holders of our ADSs and ordinary shares. Further, there is no assurance that new regulations will not be promulgated in the future that would have the effect of further restricting the remittance of RMB into or out of PRC.

Certain of our leased property interests may be defective and our right to lease the properties affected by such defects may be challenged, which could cause significant disruption to our business.

We have entered into leases with various enterprises and individuals for our office space, warehouse, training centers and other purposes. Some of our leases have deficiencies. As of the date of this prospectus, in respect of our lease for Shanghai Zhenhua Enterprise Square, with an aggregate of approximately 9,071 square meters, the registered uses for such building and its underlying land do not include use by an industrial or commercial company like ours. Therefore, the lease of such a property to us shall be subject to approval by the competent government authorities and may be subject to payment of premium fees to the government by the lessor. We cannot ensure that the lessor has completed all or any of the necessary formalities with the relevant governmental authorities.

In respect of our lease for Shanghai Shangbo Park with an aggregate of approximately 5,310 square meters, and Fenghua Park with an aggregate of approximately 1,624 square meters, the temporary lease is longer than two years, in violation of relevant land reservation regulation, which subjects us to the risk of lease termination and relocation.

In addition, we have not registered any of our lease agreements with relevant PRC governmental authorities as required by PRC law, and although failure to do so does not in itself invalidate the leases, we may not be able to defend these leases against bona fide third parties.

As of the date of this prospectus, we are not aware of any actions, claims or investigations being contemplated by government authorities with respect to the defects in our leased real properties or any challenges by third parties to our use of these properties. However, if third parties who purport to be property owners or beneficiaries of the mortgaged properties challenge our right to lease these properties, we may not be able to protect our leasehold interest and may be ordered to vacate the affected premises, which could in turn materially and adversely affect our business and operating results.

The approval of relevant government authorities may be required in connection with this offering under PRC law, and if required, we cannot assure you that we will be able to obtain such approval.

On August 8, 2006, six PRC regulatory agencies, including the MOFCOM, the State Assets Supervision and Administration Commission, or SASAC, the SAT, State Administration for Industry and Commerce, or the SAIC, the China Securities Regulatory Commission, or CSRC, and the SAFE, jointly adopted the Regulations on Mergers and Acquisitions of Domestic Enterprises by Foreign Investors, or the M&A Rules, which became effective on September 8, 2006, and were amended on June 22, 2009 by MOFCOM. The M&A Rules, among other things, purport to require offshore special purpose vehicles that are controlled directly or indirectly by PRC companies or individuals and that have been formed for the purpose of seeking a public listing of the interest in PRC companies on an overseas stock exchange through acquisitions to obtain CSRC approval prior to publicly listing their securities on an overseas stock exchange. On September 21, 2006, the CSRC clarified the procedures and required materials regarding its approval of overseas listings by special purpose vehicles. However, substantial uncertainty remains as to the scope and applicability of the M&A Rules to offshore special purpose vehicles. The interpretation and application of the regulations remain unclear, and this offering may ultimately require approval from CSRC, and if it does, it is uncertain how long it will take us to obtain the approval. If CSRC approval is required for this offering, our failure to obtain or delay in obtaining CSRC approval for this offering would subject us to sanctions imposed by CSRC and other PRC regulatory agencies, which could include fines and penalties on our operations in China, restrictions or limitations on our ability to pay dividends outside of China, and other forms of sanctions that may materially and adversely affect our business, results of operations and financial condition.

Our PRC legal advisor has advised us that, based on its understanding of the current PRC laws and regulations, prior approval from the MOFCOM is not required under the M&A Rules for our Hong Kong subsidiaries to acquire our domestic entities through Qian Zhong Su, its wholly foreign owned entity, given that none of Mr. Wenbin Chen, Mr. Ming Yan and Ms. Ningfeng Chen is considered as a domestic natural person for the purposes of the M&A Rules as they had obtained Hong Kong identity cards and documents of identity for visa purposes or Canadian citizenship prior to the establishment of the offshore companies. Our PRC legal advisor also advised us that we will not be required to submit an application to CSRC for the approval of this offering because (i) CSRC currently has not issued any definitive rule or interpretation concerning whether offerings like ours under this prospectus are subject to this regulation, and (ii) as Mr. Wenbin Chen and Mr. Ming Yan had obtained Hong Kong identity cards and documents of identity for visa purposes and Ms. Ningfeng Chen had obtained a Canadian passport when they established the Company, the Company will not be determined to be an offshore special purpose vehicle directly or indirectly controlled by a domestic company or a natural person under the M&A Rules, and it is not aware of any public record indicating that any of the issuers having similar offshore and onshore corporate structures and already listed on an offshore stock exchange has been required by CSRC to procure the approval of CSRC prior to its listing.

However, our PRC legal advisor further advised us that since there has been no official interpretation or clarification of the M&A Rules, there remains some uncertainty as to how the M&A Rules will be interpreted or implemented in the context of an overseas offering and the opinions summarized above are subject to any new laws and regulations or further implementations and interpretations of competent government authorities in any form relating to the M&A Rules. Further, we cannot assure you that PRC government authorities, including the CSRC, will reach the same conclusion as our PRC legal advisor. If the CSRC or other PRC government authorities determine that prior CSRC approval is required, any future registered offering will be delayed until we obtain the approval from the CSRC. If prior approval from the CSRC is required but not obtained, we may face regulatory actions or other sanctions from the CSRC or other PRC regulatory authorities.

The audit report included in this prospectus is prepared by an auditor that is not inspected by the Public Company Accounting Oversight Board and, as such, you are deprived of the benefits of such inspection.

Auditors of companies that are registered with the United States Securities and Exchange Commission, and traded publicly in the United States, including our independent registered public accounting firm, must be registered with the Public Company Accounting Oversight Board, or the PCAOB, and are required by the laws of the United States to undergo regular inspections by the PCAOB to assess their compliance with the laws of the United States and professional standards. Because we have substantial operations within the PRC and the PCAOB is currently unable to conduct inspections of the work of our auditors as it relates to those operations without the approval of the Chinese authorities, our auditor's work related to our operations in China is not currently inspected by the PCAOB.

This lack of PCAOB inspections of audit work performed in China prevents the PCAOB from regularly evaluating audit work of any auditors that was performed in China, including that performed by our independent registered public accounting firm. As a result, investors may be deprived of the full benefits of PCAOB inspections.

The inability of the PCAOB to conduct inspections of audit work performed in China makes it more difficult to evaluate the effectiveness of our auditor's audit procedures as compared to auditors in other jurisdictions that are subject to PCAOB inspections on all of their work. Investors may lose confidence in our reported financial information and procedures and the quality of our financial statements.

An active trading market for our shares or our ADSs may not develop and the trading price for our ADSs may fluctuate significantly.

We have applied to list our ADSs on the NASDAQ. Prior to the completion of this offering, there has been no public market for our ADSs or our ordinary shares underlying the ADSs, and we cannot assure you that a liquid public market for our ADSs will develop. If an active public market for our ADSs does not develop following the completion of this offering, the market price and liquidity of our ADSs may be materially and adversely affected. Even if an active public market for our ordinary shares or ADSs develops, we cannot assure you that it will continue. The initial public offering price for our ADSs will be determined by negotiations between us and the underwriters based upon several factors, and we can provide no assurance that the trading price of our ADSs after this offering will not decline below the initial public offering price. As a result, investors in our securities may experience a significant decrease in the value of their ADSs.

The trading prices of our ADSs are likely to be volatile, which could result in substantial losses to investors.

The trading prices of our ADSs are likely to be volatile and could fluctuate widely due to factors beyond our control. This may happen because of broad market and industry factors, like the performance and fluctuation in the market prices or the underperformance or deteriorating financial results of other similarly situated companies that have listed their securities in the United States in recent years. The securities of some of these companies have experienced significant volatility since their initial public offerings, including, in some cases, substantial price declines in the trading prices of their securities. The trading performances of these companies' securities after their offerings may affect the attitudes of investors toward such companies listed in the United States, which consequently may affect the trading performance of our ADSs, regardless of our actual operating performance. In addition, securities markets may from time to time experience significant price and volume fluctuations that are not related to our operating performance, such as the large decline in share prices in the United States and other jurisdictions.

In addition to market and industry factors, the price and trading volume for our ADSs may be highly volatile for factors specific to our own operations, including the following:

Any of these factors may result in large and sudden changes in the volume and price at which our ADSs will trade.

In the past, shareholders of a public company often brought securities class action suits against the company following periods of instability in the market price of that company's securities. If we were involved in a class action suit, it could divert a significant amount of our management's attention and other resources from our business and operations, which could harm our results of operations and require us to incur significant expenses to defend the suit. Any such class action suit, whether or not successful, could harm our reputation and restrict our ability to raise capital in the future. In addition, if a claim is successfully made against us, we may be required to pay significant damages, which could have a material adverse effect on our financial condition and results of operations.

We may grant employee share options and other share-based awards in the future. We will recognize share-based compensation expenses in our combined and consolidated statements of comprehensive income and other comprehensive income in accordance with U.S. GAAP. Any additional grant of employee share options and other share-based awards in the future may have a material adverse effect on our results of operations.

We have adopted and may adopt employee share option plans for the purpose of granting share-based compensation awards to our employees, officers and directors to incentivize their performance and align their interests with ours. As of the date of this prospectus, restricted share units and options to purchase 95,901,118 ordinary shares are issued and outstanding under the Amended and Restated 2013 and 2014 Share Scheme and the Pre-IPO RSU Scheme. As a result of the grants, we incurred share-based compensation of RMB7.0 million in 2014 and RMB31.0 million (US$4.8 million) in 2015. For more information on these share incentive plans, see "Management — Share Incentive Plans." We also plan to grant options to purchase a maximum of 50,000,000 ordinary shares to our management and key employees upon the completion of this offering, at an exercise price per share equal to the initial public offering price of our ADSs adjusted to reflect the ADS-to-ordinary share ratio, which will vest in three equal installments upon the first, second and third anniversary of the completion of this offering. As a result of these grants and potential future grants, we expect to continue to incur significant share-based compensation expenses in the future. The amount of these expenses is based on the fair value of the share-based awards. We account for compensation costs for all share options using a fair-value-based method and recognize expenses in our combined and consolidated statements of comprehensive income and other

comprehensive income in accordance with U.S. GAAP. The expenses associated with share-based compensation will decrease our profitability, perhaps materially, and the additional awards issued under share-based compensation plans will dilute the ownership interests of our shareholders, including holders of our ADSs. However, if we limit the scope of our share-based compensation plan, we may not be able to attract or retain key personnel who expect to be compensated by share-based awards.

We are an emerging growth company within the meaning of the Securities Act and may take advantage of certain reduced reporting requirements.

We are an "emerging growth company," as defined in the JOBS Act, and we may take advantage of certain exemptions from various requirements applicable to other public companies that are not emerging growth companies, including, most significantly, not being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act for so long as we are an emerging growth company. As a result, if we elect not to comply with such auditor attestation requirements, our investors may not have access to certain information they may deem important.

The JOBS Act also provides that an emerging growth company does not need to comply with any new or revised financial accounting standards until such date that a private company is otherwise required to comply with such new or revised accounting standards. However, we have elected to "opt out" of this provision and, as a result, we will comply with new or revised accounting standards as required when they are adopted for public companies. This decision to opt out of the extended transition period under the JOBS Act is irrevocable.

We cannot predict if investors will find our ADSs less attractive because we may rely on these exemptions. If some investors find our ADSs less attractive as a result, there may be a less active trading market for our ADSs and our ADS price may be more volatile.

We will incur increased costs as a result of being a public company, particularly after we cease to qualify as an "emerging growth company."

Upon completion of this offering, we will become a public company and expect to incur significant legal, accounting and other expenses that we did not incur as a private company. The Sarbanes-Oxley Act of 2002, as well as rules subsequently implemented by the SEC and NASDAQ, impose various requirements on the corporate governance practices of public companies. We expect these rules and regulations to increase our legal and financial compliance costs and to make some corporate activities more time-consuming and costly. After we are no longer an "emerging growth company," we expect to incur significant expenses and devote substantial management effort toward ensuring compliance with the requirements of Section 404 of the Sarbanes-Oxley Act of 2002 and the other rules and regulations of the SEC. For example, as a result of becoming a public company, we will need to increase the number of independent directors and adopt policies regarding internal controls and disclosure controls and procedures. We also expect that operating as a public company will make it more difficult and more expensive for us to obtain director and officer liability insurance, and we may be required to accept reduced policy limits and coverage or incur substantially higher costs to obtain the same or similar coverage. In addition, we will incur additional costs associated with our public company reporting requirements. It may also be more difficult for us to find qualified persons to serve on our board of directors or as executive officers. We are currently evaluating and monitoring developments with respect to these rules and regulations, and we cannot predict or estimate with any degree of certainty the amount of additional costs we may incur or the timing of such costs.

The sale or availability for sale, or perceived sale or availability for sale, of substantial amounts of our ADSs could adversely affect their market price.

Sales of substantial amounts of our ADSs in the public market after the completion of this offering, or the perception that these sales could occur, could adversely affect the market price of our ADSs and could materially impair our ability to raise capital through equity offerings in the future. There will be 7,500,000 ADSs (equivalent to 150,000,000 ordinary shares) outstanding immediately after this offering, or 8,625,000 ADSs (equivalent to 172,500,000 ordinary shares) if the underwriters exercise their options to purchase additional ADSs in full. The ADSs sold in this offering will be freely tradable without restriction or further registration under the Securities Act of 1933, as amended, or the Securities Act, and shares held by our existing shareholders may also be sold in the public market in the future subject to the restrictions in Rule 144 and Rule 701 under the Securities Act and the applicable lock-up agreements. In connection with this offering, we and our officers, directors and all of our shareholders have agreed, and we have agreed to cause all our option holders, not to sell any shares or ADSs for 180 days after the date of this prospectus without the prior written consent of the underwriters. However, the underwriters may release the securities subject to lock-up agreements from the lock-up restrictions at any time, subject to applicable regulations of the Financial Industry Regulatory Authority, Inc. In addition, ordinary shares subject to our outstanding options as of the closing of this offering will become eligible for sale in the public market to the extent permitted by the provisions of various vesting agreements, the lock-up agreements and Rule 144 and Rule 701 under the Securities Act. We may also issue additional options in the future that may be exercised for additional ordinary shares. We cannot predict what effect, if any, market sales of securities held by our significant shareholders or any other shareholder or the availability of these securities for future sale will have on the market price of our ADSs. See "Underwriting" and "Shares Eligible for Future Sale" for a more detailed description of the restrictions on selling our securities after this offering.

If the initial public offering price is substantially higher than the pro forma net tangible book value per share, you will experience immediate and substantial dilution.

If you invest in our ADSs, your interest will be diluted to the extent of the difference between the initial public offering price per ADS and our net tangible book value per ADS after this offering. Without taking into account any other changes in such net tangible book value after December 31, 2015, other than to give effect to our issuance and sale of 7,500,000 ADSs in this offering and our issuance and sale of 14,814,815 ordinary shares to MeMeStar Limited in connection with the Concurrent Private Placement, at an assumed initial public offering price of US$13.50 per ADS, the mid-point of the estimated public offering price range set forth on the cover page of this prospectus, and after deduction of underwriting discounts and commissions and estimated offering expenses payable by us (assuming the over-allotment option is not exercised), new investors in ADSs in this offering would be diluted by US$10.83, or 80.2%. This number is determined by subtracting net tangible book value per ordinary share, after giving effect to the net proceeds we will receive from this offering and the Concurrent Private Placement, from the assumed initial public offering price of US$13.5 per ADS, which is the mid-point of the estimated initial public offering price range per ADS set forth on the front cover of this prospectus, and after deducting underwriting discounts and commissions and estimated offering expenses payable by us. See "Dilution" for a more complete description of how the value of your investment in our ADSs will be diluted upon the completion of this offering.

You may face difficulties in protecting your interests, and your ability to protect your rights through U.S. courts may be limited, because we are registered under Cayman Islands law.

We are an exempted company limited by shares incorporated under the laws of the Cayman Islands. Our corporate affairs are governed by our memorandum and articles of association, the Companies Law of the Cayman Islands and the common law of the Cayman Islands. The rights of shareholders to take action against the directors, actions by minority shareholders and the fiduciary responsibilities of our directors to

us under Cayman Islands law are to a large extent governed by the common law of the Cayman Islands. The common law of the Cayman Islands is derived in part from comparatively limited judicial precedent in the Cayman Islands as well as from the common law of England, the decisions of whose courts are of persuasive authority, but are not binding, on a court in the Cayman Islands. The rights of our shareholders and the fiduciary responsibilities of our directors under Cayman Islands law are not as clearly established as they would be under statutes or judicial precedent in some jurisdictions in the United States. In particular, the Cayman Islands has a less developed body of securities laws than the United States. Some U.S. states, such as Delaware, have more fully developed and judicially interpreted bodies of corporate law than the Cayman Islands. In addition, Cayman Islands companies may not have standing to initiate a shareholder derivative action in a federal court of the United States.

Shareholders of Cayman Islands exempted companies like ours have no general rights under Cayman Islands law to inspect corporate records or to obtain copies of lists of shareholders of these companies. Our directors have discretion under our existing articles of association to determine whether or not, and under what conditions, our corporate records may be inspected by our shareholders, but are not obliged to make them available to our shareholders. This may make it more difficult for you to obtain the information needed to establish any facts necessary for a shareholder motion or to solicit proxies from other shareholders in connection with a proxy contest.

Certain corporate governance practices in the Cayman Islands differ significantly from requirements for companies incorporated in other jurisdictions such as the United States. Currently, we do not plan to rely on home country practice with respect to any corporate governance matter. However, if we choose to follow home country practice in the future, our shareholders may be afforded less protection than they otherwise would have under rules and regulations applicable to U.S. domestic issuers.

As a result of all of the above, public shareholders may have more difficulty in protecting their interests in the face of actions taken by management, members of the board of directors or controlling shareholders than they would have as public shareholders of a company incorporated in the United States. For a discussion of significant differences between the provisions of the Companies Law of the Cayman Islands and the laws applicable to companies incorporated in the United States and their shareholders, see "Description of Share Capital — Differences in Corporate Law."

You may not be able to participate in rights offerings and may experience dilution of your holdings as a result.

We may from time to time distribute rights to our shareholders, including rights to acquire our securities. Under the deposit agreement for the ADSs, the depositary will not offer those rights to ADS holders unless both the rights and the underlying securities to be distributed to ADS holders are either registered under the Securities Act, or exempt from registration under the Securities Act with respect to all holders of ADSs. We are under no obligation to file a registration statement with respect to any such rights or underlying securities or to endeavor to cause such a registration statement to be declared effective. In addition, we may not be able to take advantage of any exemptions from registration under the Securities Act. Accordingly, holders of the ADSs may be unable to participate in our rights offerings and may experience dilution in their holdings as a result.

Judgments obtained against us by our shareholders may not be enforceable in our home jurisdiction.

We are a Cayman Islands company and a substantial majority of our assets are located outside of the United States. A significant percentage of our current operations are conducted in China. In addition, a significant majority of our current directors and officers are nationals and residents of countries other than the United States. As a result, it may be difficult or impossible for you to bring an action against us or against these individuals in the United States in the event that you believe that your rights have been infringed under the United States federal securities laws or otherwise. Even if you are successful in bringing

an action of this kind, the laws of the Cayman Islands, China and other jurisdictions where we operate may render you unable to enforce a judgment against our assets or the assets of our directors and officers.

There is no statutory recognition in the Cayman Islands of judgments obtained in the United States, although the courts of the Cayman Islands will under certain circumstances recognize and enforce a non-penal judgment of a foreign court of competent jurisdiction without retrial on the merits.

The depositary for our ADSs will give us a discretionary proxy to vote our ordinary shares underlying your ADSs if you do not vote at shareholders' meetings, except under limited circumstances, which could adversely affect your interests.

Under the deposit agreement for the ADSs, if you do not give instructions for voting the ordinary shares underlying your ADSs, the depositary will give us a discretionary proxy to vote those ordinary shares at the shareholders' meeting unless:

The effect of this discretionary proxy is that you cannot prevent our ordinary shares underlying your ADSs from being voted at the shareholder meeting, except under the circumstances described above. This may make it more difficult for shareholders to influence the management of our company. Holders of our ordinary shares are not subject to this discretionary proxy.

If we do not pay dividends in the future, you must rely on price appreciation of our ADSs for return on your investment.

We do not expect to pay any cash dividends in the foreseeable future. Therefore, you should not rely on an investment in our ADSs as a source for any future dividend income.

Our board of directors may from time to time declare dividends or authorize other distributions to our shareholders. Even if our board of directors decides to declare and pay dividends, the timing, amount and form of future dividends, if any, will depend on, among other things, our future results of operations and cash flow, our capital requirements and surplus, the amount of distributions, if any, received by us from our subsidiary, our financial condition, contractual restrictions and other factors deemed relevant by our board of directors. Accordingly, the return on your investment in our ADSs will likely depend entirely upon any future price appreciation of our ADSs. There is no guarantee that our ADSs will appreciate in value after this offering or even maintain the price at which you purchased the ADSs. You may not realize a return on your investment in our ADSs and you may even lose your entire investment in our ADSs.

You may not receive dividends or other distributions on our ordinary shares and you may not receive any value for them, if it is illegal or impractical to make them available to you.

To the extent that we decide to pay a dividend or make other distributions in the future, the depositary of our ADSs has agreed to pay to you such cash dividends or other distributions it or the custodian receives on ordinary shares or other deposited securities underlying our ADSs, after deducting its fees and expenses. You will receive these distributions in proportion to the number of ordinary shares your ADSs represent. However, the depositary is not responsible if it decides that it is unlawful or impractical to make a distribution available to any holders of ADSs. For example, it would be unlawful to make a distribution to a holder of ADSs if it consists of securities that require registration under the Securities Act but that are not properly registered or distributed under an applicable exemption from registration. The depositary may also determine that it is not feasible to distribute certain property through the mail. Additionally, the value of certain distributions may be less than the cost of mailing them. In these cases, the depositary may determine not to distribute such property. We have no obligation to register under U.S. securities laws any ADSs, ordinary shares, rights or other securities received through such distributions. We also have no obligation to take any other action to permit the distribution of ADSs, ordinary shares, rights or anything else to holders of ADSs. This means that you may not receive distributions we make on our ordinary shares or any value for them if it is illegal or impractical for us to make them available to you. These restrictions may cause a material decline in the value of our ADSs.

Your ADSs are transferable on the books of the depositary. However, the depositary may close its books at any time or from time to time when it deems expedient in connection with the performance of its duties. The depositary may close its books from time to time for a number of reasons, including in connection with corporate events such as a rights offering, during which time the depositary needs to maintain an exact number of ADS holders on its books for a specified period. The depositary may also close its books in emergencies, and on weekends and public holidays in the United States. The depositary may refuse to deliver, transfer or register the transfers of our ADSs generally when our share register or the books of the depositary are closed, or at any time if we or the depositary think that it is advisable to do so because of any requirement of law or of any government or governmental body, or under any provision of the deposit agreement, or for any other reason in accordance with the terms of the deposit agreement. As a result, you may be unable to transfer your ADSs when you wish to.

Our management will have considerable discretion as to the use of the net proceeds from this offer and you may not agree with our management on these uses.

We intend to use the net proceeds of this offering for brand promotion and targeted marketing, developing new businesses, enhancing IT infrastructure, supplementing working capital and general corporate purposes. However, our management will have considerable discretion in the application of the net proceeds received by us. You will not have the opportunity, as part of your investment decision, to assess whether proceeds are being used appropriately. You must rely on the judgment of our management regarding the application of the net proceeds of this offering. The net proceeds may be used for corporate purposes that do not improve our efforts to maintain profitability or increase our share price. The net proceeds from this offering may be placed in investments that do not produce income or that lose value.

Our existing shareholders may exert substantial influence over us and may not act in the best interests of our independent shareholders.

Immediately upon the completion of this offering (without taking into account any shares which may be issued upon the exercise of the over-allotment option) and the issuance and sale of ordinary shares to MeMeStar Limited in connection with the Concurrent Private Placement, our existing shareholders, including Mr. Wenbin Chen, Mr. Ming Yan and Ms. Ningfeng Chen, will own, in the aggregate, approximately

85.85% of our issued shares. Although such arrangement will be terminated upon our listing, the three founders will be in a position to exert significant influence over the affairs of our company and will be able to influence the outcome of any ordinary shareholders' resolutions, irrespective of how other shareholders vote. The interests of these three shareholders may not necessarily be aligned with the interests of our shareholders as a whole, and this concentration of ownership may also have the effect of delaying, deferring or preventing a change in control of our company.

There can be no assurance that the company will not be a passive foreign investment company, or a PFIC, for U.S. federal income tax purposes for any taxable year, which could result in adverse U.S. federal income tax consequences to U.S. Holders (as defined in "Taxation") of ADSs or ordinary shares.

In general, a non-U.S. corporation will be a PFIC for any taxable year in which (i) 75% or more of its gross income consists of passive income or (ii) 50% or more of the average quarterly value of its assets consists of assets that produce, or are held for the production of, passive income. For purposes of the above calculations, a non-U.S. corporation that directly or indirectly owns at least 25% by value of the shares of another corporation is treated as if it held its proportionate share of the assets of the other corporation and received directly its proportionate share of the income of the other corporation. Passive income generally includes interest, rents, dividends, royalties and net gains from transactions relating to commodities (other than certain active business income, including gains derived by certain dealers in property).

Based upon the manner in which we currently operate our business, the present composition of our income and assets (including the expected proceeds from this offering) and the estimated value of our assets, including goodwill, which is based on the expected price of our ADSs in this offering, we do not expect to be a PFIC for our current taxable year or in the foreseeable future. However, our PFIC status is a factual determination that is made on an annual basis. Because our PFIC status for any taxable year will depend on the manner in which we operate our business (including the manner and extent to which we hedge our positions with customers) and on the composition of our income and assets and the value of our assets from time to time (the value of which may be determined, in part, by reference to the market price of our ADSs, which is likely to fluctuate significantly), there can be no assurance that we will not be a PFIC for any taxable year.

See "Taxation — United States Federal Income Tax — Passive Foreign Investment Company Rules" for more information. Potential U.S. investors are urged to consult their tax advisers regarding the determination of whether we are a PFIC for any taxable year and the potential application of the PFIC rules.

This prospectus contains forward-looking statements that are based on our management's beliefs and assumptions and on information currently available to us. All statements other than statements of historical facts are forward-looking statements. The forward-looking statements are contained principally in, but not limited to, the sections entitled "Prospectus Summary," "Risk Factors," "Management's Discussion and Analysis of Financial Condition and Results of Operations" and "Business." These statements relate to future events or to our future financial performance and involve known and unknown risks, uncertainties and other factors that may cause our or our industry's actual results, levels of activity, performance or achievements to be materially different from any future results, levels of activity, performance or achievements expressed or implied by these forward-looking statements. Forward-looking statements include, but are not limited to, statements about:

In some cases, you can identify forward-looking statements by terms such as "may," "could," "will," "should," "would," "expect," "plan," "intend," "anticipate," "believe," "estimate," "predict," "potential," "project" or "continue" or the negative of these terms or other comparable terminology. These statements are only predictions. You should not place undue reliance on forward-looking statements because they involve known and unknown risks, uncertainties and other factors, which are, in some cases, beyond our control and which could materially affect results. Factors that may cause actual results to differ materially from current expectations include, among other things, those listed under the heading "Risk Factors" and elsewhere in this prospectus. If one or more of these risks or uncertainties occur, or if our underlying assumptions prove to be incorrect, actual events or results may vary significantly from those implied or projected by the forward-looking statements. No forward-looking statement is a guarantee of future performance.

The forward-looking statements made in this prospectus relate only to events or information as of the date on which the statements are made in this prospectus. Although we will become a public company after this offering and have ongoing disclosure obligations under United States federal securities laws, we do not intend to update or otherwise revise the forward-looking statements in this prospectus, whether as a result of new information, future events or otherwise.

This prospectus contains estimates and information concerning our industry, including market position, market size, and growth rates of the markets in which we participate, that are based on industry publications and reports. This prospectus contains statistical data and estimates published by Euromonitor, the National Bureau of Statistics of China and other sources. This information involves a number of assumptions and limitations, and you are cautioned not to place undue reliance on these forward-looking statements. Research by Euromonitor is prepared primarily as a market research tool and should not be considered as the opinion of Euromonitor as to the value of any security or the advisability of investing in our company. The industry in which we operate is subject to a high degree of uncertainty and risk due to a variety of factors, which could cause actual results to differ materially from those expressed in these publications and reports.

Based upon an assumed initial offering price of US$13.50 per ADS (the mid-point of the estimated public offering price range shown on the front cover of this prospectus), we estimate that we will receive net proceeds from this offering of approximately US$90.2 million if the over-allotment option is not exercised, and US$104.3 million if the over-allotment option is exercised, after deducting underwriting discounts and commissions and the estimated offering expenses payable by us. A US$1.00 increase (decrease) in the assumed initial public offering price of US$13.50 per ADS would increase (decrease) the net proceeds to us from this offering by US$7.0 million, after deducting the underwriting discounts and commissions and estimated offering expenses payable by us. In addition, we expect to receive net proceeds of approximately US$10 million from the Concurrent Private Placement.

The primary purposes of this offering are to create a public market for our shares for the benefit of all shareholders, retain and attract talented employees by providing them with equity incentives and obtain additional capital. We plan to use the net proceeds of this offering and the Concurrent Private Placement as follows:

The foregoing represents our current intentions with respect of the use and allocation of the net proceeds of this offering and the Concurrent Private Placement based upon our present plans and business conditions, but our management will have significant flexibility and discretion in applying the net proceeds of this offering and the Concurrent Private Placement. The occurrence of unforeseen events or changed business conditions may result in application of the net proceeds of this offering and the Concurrent Private Placement in a manner other than as described in this prospectus. You must rely on the judgment of our management as to the use of the net proceeds from this offering and the Concurrent Private Placement, and such use may not produce income or increase our ADS price.

In utilizing the proceeds from this offering and the Concurrent Private Placement, we are permitted under PRC laws and regulations to provide funding to our PRC subsidiaries only through loans or capital contributions, and only if we satisfy the applicable government registration and approval requirements. We cannot assure you that we will be able to meet these requirements on a timely basis, if at all. See "Risk factors — Risks related to our corporate structure — PRC regulation of loans and direct investment by offshore holding companies to PRC entities may delay or prevent us from using proceeds we receive from this offering and the Concurrent Private Placement to make loans or additional capital contributions to our PRC subsidiaries."

Pending any use described above, we plan to invest our net proceeds in short-term interest-bearing, debt instruments or demand deposits.

Our company has not declared or paid any dividends to its ordinary shareholders since its incorporation in the Cayman Islands on November 4, 2015. However, our wholly owned PRC subsidiaries, prior to the reorganization completed on November 18, 2015, have paid significant dividends to our founders or companies controlled by our founders, including RMB100.0 million in 2014 and RMB705.0 million (US$108.8 million) in 2015. Going forward, we intend to pay dividends of an amount that is no less than 40% of our company's consolidated net profit to our ordinary shareholders. However, the timing, amount and form of future dividends, will depend on, among other things, our future results of operations and cash flow, our capital requirements and surplus, the amount of distributions, if any, received by us from our subsidiaries, our financial condition, contractual restrictions and other factors deemed relevant by our board of directors.

Our board of directors may from time to time declare dividends or authorize other distributions to our shareholders. In addition, our shareholders may by ordinary resolution declare a dividend, but no dividend may exceed the amount recommended by our directors. Under Cayman Islands law, a Cayman Islands company may pay a dividend on its shares out of either profit or share premium amount, provided that under no circumstances may a dividend be paid if this would result in the company being unable to pay its debts due in the ordinary course of business.

If we pay any dividends, our ADS holders will be entitled to such dividends to the same extent as holders of our ordinary shares, subject to the terms of the deposit agreement, including the fees and expenses payable thereunder. See "Description of American Depositary Shares." Cash dividends on our ordinary shares, if any, will be paid in U.S. dollars.

We are a holding company with no material operations of our own. As a result, we rely on dividends paid by our subsidiary in China for our cash needs, including the funds necessary to pay dividends and other cash distributions to our shareholders, service any debt we may incur and pay our expenses. PRC regulations may restrict the ability of our PRC subsidiaries to pay dividends to us. Under PRC law, each of our affiliates in China is required to set aside at least 10% of its accumulated after-tax profits each year, if any, to fund a statutory reserve until such reserve reached 50% of its registered capital, and to further set aside a portion of its after-tax profits to fund the discretionary fund at the discretion of the shareholders of our affiliates. Although the statutory reserves can be used, among other ways, to increase the registered capital and eliminate future losses in excess of retained earnings of the respective companies, the reserve funds are not distributable as cash dividends except in the event of liquidation of the companies. See "Risk Factors — Risks Related to Our Corporate Structure — We principally rely on dividends and other distributions on equity paid by our PRC subsidiaries to fund any cash and financing requirements we may have, and any limitation on the ability of our PRC subsidiaries to make payments to us, or the tax implications of making payments to us, could have a material adverse effect on our ability to conduct our business or our financial condition." In addition, if our existing subsidiaries or any newly formed subsidiaries incur debt on their own behalf in the future, the instruments governing their debt may restrict their ability to pay dividends to us.

The following table sets forth our total capitalization as of December 31, 2015:

You should read this table, together with our combined and consolidated financial statements, the related notes included elsewhere in this prospectus and the information under "Management's Discussion and Analysis of Financial Condition and Results of Operations."

If you invest in our ADSs, your interest will be diluted to the extent of the difference between the initial public offering price per ADS and our net tangible book value per ADS after this offering. Dilution results from the fact that the assumed initial public offering price per ordinary share is substantially in excess of the net tangible book value per ordinary share attributable to the existing shareholders for our presently outstanding ordinary shares.

Our net tangible book value as of December 31, 2015 was RMB358.71 million (US$55.38 million), or RMB0.359 (US$0.055) per ordinary share and US$1.11 per ADS. Net tangible book value represents the amount of our total consolidated assets, less the amount of acquired software, goodwill and our total consolidated liabilities. Dilution is determined by subtracting the pro forma net tangible book value per ordinary share, after giving effect to (i) our issuance and sale of 7,500,000 ADSs in this offering, at an assumed initial public offering price of US$13.50 per ADS, which is the midpoint of the estimated initial public offering price range set forth on the front cover page of this prospectus, after deducting underwriting discounts and commissions and estimated offering expenses payable by us and assuming no exercise of the underwriters' option to purchase additional ADSs, and (ii) the issuance and sale of 14,814,815 ordinary shares in the Concurrent Private Placement at an assumed initial public offering price of US$13.50 per ADS, the midpoint of the estimated initial public offering price range set forth on the front cover page of this prospectus.

Without taking into account any other changes in net tangible book value after December 31, 2015, other than to give effect to (i) our sale of the ADSs offered in this offering, at an assumed initial public offering price of US$13.50 per ADS, the midpoint of the estimated range of the initial public offering price, after deducting estimated underwriting discounts and commissions and estimated offering expenses payable by us and assuming no exercise of the underwriters' option to purchase additional ADSs, and (ii) the issuance and sale of 14,814,815 ordinary shares in the Concurrent Private Placement, at an assumed initial public offering price of US$13.50 per ADS, the midpoint of the estimated initial public offering price range set forth on the front cover page of this prospectus. our pro forma net tangible book value as of December 31, 2015 would have been US$155.58 million, or US$0.134 per outstanding ordinary share, and US$2.67 per ADS. This represents an immediate increase in net tangible book value of US$0.079 per ordinary share and US$1.56 per ADS, to the existing shareholders and an immediate dilution in net tangible book value of US$0.541 per ordinary share and US$10.83 per ADS, to investors purchasing ADSs in this offering.


	Per Ordinary Share		Per ADS
Assumed initial public offering price	US$	0.675		US$	13.50
Net tangible book value as of December 31, 2015	US$	0.055		US$	1.11
Pro forma net tangible book value	US$	0.134		US$	2.67
Increase in pro forma net tangible book value	US$	0.079		US$	1.56
Dilution in net tangible book value to new investors in this offering	US$	0.541		US$	10.83

A US$1.00 increase (decrease) in the assumed public offering price of US$13.50 per ADS would increase (decrease) our pro forma net tangible book value after giving effect to the offering by US$6.98 million, the pro forma net tangible book value per ordinary share and per ADS after giving effect to this offering by US$0.006 per ordinary share and US$0.12 per ADS and the dilution in pro forma net tangible book value per ordinary share and per ADS to new investors in this offering by US$0.044 per ordinary share and US$0.88 per ADS, assuming no change to the number of ADSs offered by us as set forth on the cover page of this prospectus, and after deducting underwriting discounts and commissions and other offering expenses. The pro forma information discussed above is illustrative only. Our net tangible book value following the completion of this offering is subject to adjustment based on the actual initial public offering price of our ADSs and other terms of this offering determined at pricing.

The following table summarizes on the pro forma as adjusted basis described above as of December 31, 2015, the differences between existing shareholders and the new investors with respect to the number of ordinary shares (in the form of ADSs or shares) purchased from us, the total consideration paid and the average price per ordinary share/ADS paid before deducting estimated underwriting discounts and commissions and the estimated offering expenses. The total number of ordinary shares does not include ordinary shares underlying the ADSs issuable upon the exercise of the over-allotment option granted to the underwriters.

A US$1.00 increase (decrease) in the assumed public offering price of US$13.50 per ADS would increase (decrease) total consideration paid by new investors, total consideration paid by all shareholders, average price per ordinary share and average price per ADS paid by all shareholders by US$7.50 million, US$7.50 million, US$0.007 and US$0.13, respectively, assuming the sale of 7,500,000 ADSs at US$13.50, the mid-point of the range set forth on the cover page of this prospectus, and after deducting underwriting discounts and commissions and other offering expenses payable by us.

The pro forma information discussed above is illustrative only. Our net tangible book value following the completion of this offering is subject to adjustment based on the actual initial public offering price of our ADSs and other terms of this offering determined at pricing.

The discussion and tables above also assume no exercise of any outstanding stock options as of the date of this prospectus. As of the date of this prospectus, there were 84,347,614 ordinary shares issuable upon exercise of outstanding stock options at a weighted average exercise price of US$0.163 per ordinary share and 11,553,504 ordinary shares issuable upon exercise of outstanding RSUs.

We plan to grant options to purchase a maximum of 50,000,000 ordinary shares under the Third Amended and Restated 2014 Share Option Scheme to our management and key employees upon the completion of this offering, at an exercise price per share equal to the initial public offering price of our ADSs adjusted to reflect the ADS-to-ordinary share ratio, which will vest in three equal installments upon the first, second and third anniversary of the completion of this offering. To the extent that these options, or any of our previously granted options, are exercised, there will be further dilution to new investors.

We conduct substantially all of our operations in China. All of our revenue, costs and expenses are denominated in RMB. This prospectus contains translations of certain RMB amounts into U.S. dollars at specified rates. Unless otherwise stated, all translation of financial data has been made at RMB6.4778 to US$1.00, the noon buying rate in effect on December 31, 2015, as set forth in the H.10 Statistical Release of the Federal Reserve Board. We make no representation that any RMB or U.S. dollar amounts could have been, or could be, converted into U.S. dollars or RMB, as the case may be, at any particular rate, the rates stated below, or at all. The PRC government imposes controls over its foreign currency reserves in part through direct regulation of the conversion of RMB into foreign exchange and through restrictions on foreign trade. On April 15, 2016, the noon buying rate was RMB6.4730 to US$1.00.

The following table sets forth information concerning the rates of exchange of US$1.00 into RMB for the periods indicated. These rates are provided solely for your convenience and are not necessarily the exchange rates that we used in this prospectus or will use in the preparation of our periodic reports or any other information to be provided to you.

	Noon Buying Rate

Period	Period End		Average(1)		Low		High
	(RMB per US$1.00)
2011		6.2939		6.4475		6.6364		6.2939
2012		6.2301		6.2990		6.3879		6.2221
2013		6.0537		6.1412		6.2438		6.0537
2014		6.2046		6.1704		6.2591		6.0402
2015		6.4778		6.2869		6.4896		6.1870
October		6.3180		6.3505		6.3591		6.3180
November		6.3883		6.3640		6.3945		6.3180
December		6.4778		6.4491		6.4896		6.3883
2016
January		6.5752		6.5726		6.5932		6.5219
February		6.5525		6.5501		6.5795		6.5154
March		6.4480		6.5027		6.5500		6.4480
April (through April 15, 2016)		6.4730		6.4713		6.4810		6.4580

We are incorporated in the Cayman Islands to take advantage of certain benefits associated with being a Cayman Islands exempted company, such as political and economic stability; an effective judicial system; a favorable tax system; the absence of exchange control or currency restrictions; and the availability of professional and support services. However, certain disadvantages accompany incorporation in the Cayman Islands. These disadvantages include, but are not limited to: the Cayman Islands has a less developed body of securities laws as compared to that of the United States and these securities laws provide significantly less protection to investors; and the potential lack of standing by Cayman Islands companies to sue before the federal courts of the United States.

Our organizational documents do not contain provisions requiring that disputes, including those arising under the securities laws of the United States, between us, our officers, directors and shareholders, be subject to arbitration.

All of our operations are conducted outside the United States, and substantially all of our assets are located outside the United States. A majority of our directors and officers are nationals or residents of jurisdictions other than the United States and a substantial portion of their assets are located outside the United States. As a result, it may be difficult for investors to effect service of process on us or those persons in the United States or to enforce in the United States judgments obtained in United States courts against us or those persons based on the civil liability or other provisions of the United States securities laws or other laws.

We have appointed Law Debenture Corporate Services Inc., as our agent upon whom process may be served in any action brought against us under the securities laws of the United States.

Walkers, our counsel as to Cayman Islands law, has advised us that there is uncertainty as to whether the courts of the Cayman Islands would:

Walkers has further advised us that although there is no statutory enforcement in the Cayman Islands of judgments obtained in the federal or state courts of the United States (and the Cayman Islands are not a party to any treaties for the reciprocal enforcement or recognition of such judgments), a judgment obtained in such jurisdiction will be recognized and enforced in the courts of the Cayman Islands at common law, without any re-examination of the merits of the underlying dispute, by an action commenced on the foreign judgment debt in the Grand Court of the Cayman Islands, provided that such judgment: (a) is one in respect of which the foreign court had jurisdiction over the defendant according to Cayman Islands conflicts of laws rules; (b) is either for a liquidated sum not in respect of penalties or taxes or a fine or similar fiscal or revenue obligations or, in certain circumstances, for in personam non-money relief; (c) is final and conclusive; (d) and was not obtained in a manner and is not of a kind the enforcement of which is contrary to natural justice or the public policy of the Cayman Islands. However, the Cayman Islands courts are unlikely to enforce a punitive judgment of a United States court predicated upon the liabilities provision of the federal securities laws in the United States without retrial on the merits if such judgment gives rise to obligations to make payments that may be regarded as fines, penalties or similar charges. Our shareholders can, under certain circumstances, originate actions against us. See "Description of Share Capital — Differences in Corporate Law — Shareholders' Suits."

We have been advised by King & Wood Mallesons, our PRC counsel, that there is uncertainty as to whether the courts of the PRC would enforce judgments of United States courts or Cayman courts obtained against us or these persons predicated upon the civil liability provisions of the United States federal and state securities laws. Our PRC counsel has further advised us that PRC courts may recognize and enforce foreign judgments in accordance with the requirements of the PRC Civil Procedures Law based either on treaties between the PRC and the jurisdiction where the judgment is made or on reciprocity arrangements between jurisdictions. If there are no treaties or reciprocity arrangements between the PRC and a foreign jurisdiction where a judgment is rendered, according to the PRC Civil Procedures Law, matters relating to the recognition and enforcement of the foreign judgment in the PRC may be resolved through diplomatic channels. The PRC does not have any treaties or other arrangements with the United States or the Cayman Islands that provide for the reciprocal recognition and enforcement of foreign civil judgments. In addition, according to the PRC Civil Procedures Law, courts in the PRC will not enforce a foreign judgment against us or our directors and officers if they decide that the judgment violates the basic principles of PRC law or national sovereignty, security or public interest. As a result, it is generally difficult to enforce in the PRC a judgment rendered by a U.S. or Cayman Islands court.

In addition, although U.S. shareholders may be able to originate actions against us in China in accordance with PRC law, it will be difficult for U.S. shareholders to do so, because we are incorporated under the laws of the Cayman Islands and it is difficult for U.S. shareholders, by virtue only of holding our ADSs or ordinary shares, to establish a connection to the PRC for a PRC court to have subject matter jurisdiction as required by the PRC Civil Procedures Law. U.S. shareholders may be able to originate actions against us in the Cayman Islands based upon Cayman Islands law. However, we do not have any substantial assets other than certain corporate documents and records in the Cayman Islands and it may be difficult for a shareholder to enforce a judgment obtained in a Cayman Islands court in China, where substantially all of our operations are conducted.

We established Rong Jin Hui Yin on May 18, 2011 and commenced operation in July 2011. Rong Jin Hui Yin focuses on providing commodity trading and other related services. Jin Xiang Yin Rui, another major subsidiary of ours, was incorporated in the PRC by our founders on October 24, 2012 and commenced operation on the Guangdong Precious Metals Exchange in August 2013. Its primary focus is to provide commodity trading and other related services on the Guangdong Precious Metals Exchange. We also established a number of other subsidiaries in the PRC to provide technical and other support for our online spot commodity trading business, and to sell software application and provide supporting services to related parties and third parties.

In 2013 and 2014, we completed a series of restructuring to consolidate Rong Jin Hui Yin, Jin Xiang Yin Rui and various other PRC subsidiaries as wholly owned PRC subsidiaries of Win Yin Financial and Information Service Company Limited, or Win Yin Financial, a company incorporated in the Cayman Islands by our founders. Mr. Wenbin Chen, Mr. Ming Yan and Ms. Ningfeng Chen, through their respective wholly owned holding companies, held 40%, 30% and 30% of the equity interest in Win Yin Financial, respectively.

Our company, Yintech, was incorporated on November 4, 2015 in the Cayman Islands. Yintech acquired all of the ordinary shares of Yintech Enterprise from Win Yin Financial on November 6, 2015 at par value. As a result, Qian Zhong Su, Yintech Enterprise's wholly owned PRC subsidiary, became Yintech's wholly owned subsidiary. In November 2015, Qian Zhong Su initiated a series of transactions to acquire from our ultimate shareholders, Rong Jin Hui Yin, Jin Xiang Yin, Rui, Yin Tian Xia Technology, and their subsidiaries, as its wholly owned PRC subsidiaries. The acquisitions were completed on November 18, 2015. On November 16, 2015, Qian Zhong Su acquired from third parties Sheng Ding, which commenced operation on the Guangdong Precious Metals Exchange in October 2015, to further expand our business on that exchange.

In November and December 2015, we established Jin Dou and Jin Yi to carry out business on the Shanghai Gold Exchange. We established a PRC subsidiary, Zu Ding, in January 2016, to manage our advertising activities. In March 2016, we acquired 70% equity interest in Da Xiang, which will serve as a platform for our mini-account business. We have also established additional BVI and Hong Kong subsidiaries under Yintech as shown in the chart below for future business activities.

The following diagram illustrates our corporate structure, the places of incorporation and the ownership interests of our subsidiaries as of the date of this prospectus.

As Yintech is a holding company with no substantial operation, these financial statements were prepared as predecessor financial statements by combining and consolidating all of the operating entities which were subsequently transferred to Yintech in connection with the reorganization that was completed on November 18, 2015. Prior to and following the reorganization, the operating entities are subject to identical ultimate ownership and we presented the combined and consolidated financial statements of the operating entities in a manner similar to pooling of interests. We present below our selected combined and consolidated financial and operating data for the periods indicated. The following selected combined and consolidated statements of comprehensive income data for the years ended December 31, 2013, 2014 and 2015 and the selected combined and consolidated balance sheet data as of December 31, 2014 and 2015 have been derived from our audited combined and consolidated financial statements included elsewhere in this prospectus.

The selected combined and consolidated financial and operating data should be read in conjunction with our combined and consolidated financial statements and related notes and "Management's Discussion and Analysis of Financial Condition and Results of Operations" included elsewhere in this prospectus. The combined and consolidated financial statements are prepared and presented in accordance with U.S. GAAP. Our historical results are not necessarily indicative of our results for any future periods.

	For the Year Ended December 31,

	2013			2014			2015
(in thousands, except per share data)	RMB			RMB			RMB			US$
	Combined			Combined			Combined and Consolidated			Combined and Consolidated (unaudited)
Revenues
Commissions and fees, net		413,258			860,819			990,698			152,937
Trading gains/(losses), net		214,861			268,850			166,428			25,692
Interest and investment income		365			445			4,443			686
Other revenues		1,436			27,693			84,305			13,014

Total revenues		629,920			1,157,807			1,245,874			192,329

Expenses
Employee compensation and benefits		(82,876	)		(214,431	)		(388,168	)		(59,923	)
Advertising and promotion		(256,092	)		(285,732	)		(221,859	)		(34,249	)
Research services from a related party		(106,050	)		—			—			—
Information technology and communications		(11,603	)		(21,238	)		(32,803	)		(5,064	)
Occupancy and equipment rental		(21,377	)		(39,487	)		(41,950	)		(6,476	)
Taxes and surcharges		(5,200	)		(18,884	)		(21,711	)		(3,352	)
Other expenses		(34,569	)		(58,688	)		(54,164	)		(8,361	)

Total expenses		(517,767	)		(638,460	)		(760,655	)		(117,425	)

Income before income taxes		112,153			519,347			485,219			74,904
Income taxes		(5,321	)		(37,390	)		(82,204	)		(12,690	)

Net income		106,832			481,957			403,015			62,214



Earnings per share⁽¹⁾
Basic		0.11			0.48			0.40			0.06
Diluted		0.11			0.48			0.38			0.06

	As of December 31,

	2014		2015
(in thousands)	RMB		RMB		US$
	Combined		Consolidated		Consolidated (unaudited)
Assets
Cash		83,534		362,461		55,954
Derivative assets		—		445		69
Available-for-sale investments		354,000		75,670		11,681
Deposits with clearing organizations		234,869		239,904		37,035
Amount due from related parties		8,800		—		—
Equipment and leasehold improvements		23,652		18,315		2,827
Deferred tax assets		1,794		3,782		584
Other assets		56,609		79,180		12,223

Total assets		763,258		779,757		120,373

Liabilities
Derivative liabilities		—		14,336		2,213
Amount due to related parties		—		118,880		18,352
Income tax payable		26,582		23,385		3,610
Accounts payable		23,156		3,645		563
Accrued employee benefits		48,530		76,503		11,810
Dividend payable		—		126,876		19,586
Other liabilities		51,804		52,535		8,109

Total liabilities		150,072		416,160		64,243

Shareholders' Equity
Ordinary shares, USD 0.00001 par value.
Authorized 3,000,000,000 shares; issued and outstanding 1,000,000,000 shares as of December 31, 2015		—		65		10
Paid-in capital		125,000		—		—
Additional paid-in capital		7,560		257,098		39,689
Retained earnings		480,626		105,193		16,239
Accumulated other comprehensive income		—		1,241		192

Total shareholders' equity		613,186		363,597		56,130

Total liabilities and shareholders' equity		763,258		779,757		120,373

Adjusted revenues represent revenues that excludes (i) amounts paid to related parties under our historical risk sharing agreements, as mentioned in "Related Party Transactions — Transactions with Certain Directors, Shareholders and Affiliates and Key Management Personnel," (ii) net trading gains and losses resulting from our principal positions under spot commodity contracts when we serve as counterparty to our customers' trades on the Tianjin Precious Metals Exchange and the Guangdong Precious Metals Exchange, and (iii) the amounts we paid or received under the risk and return transfer arrangement with a third party fund. Our management focuses on our core business that generates commissions and had historically adopted different hedging strategies to reduce our exposure to market risks. In 2015, we entered into a risk and return transfer arrangement with a third party fund, pursuant to which any gains and losses resulting from our principal positions on these two exchanges are transferred to such fund. The arrangement took effect on August 23, 2015 and as long as it remains in force, our net trading gains or losses on spot commodity contracts will be offset by the amounts we pay or receive under the risk and return transfer arrangement. If such arrangements were in place since 2013, we would not have generated any net gains or losses from spot commodity contracts, and would not have entered into risk sharing agreements with related parties. Therefore, our management believes that by eliminating the effects of these items, the adjusted revenues fairly present the historical performance of our core business operation and are more comparable to our future performance.

We compensate for these limitations by reconciling the non-GAAP financial measures to the nearest U.S. GAAP performance measure, all of which should be considered when evaluating our performance. The following table reconciles our adjusted revenues and adjusted net income in the years presented to the most directly comparable financial measure calculated and presented in accordance with U.S. GAAP.

	For the Year Ended December 31,

	2013			2014			2015
(in thousands, except percentages)	RMB			RMB			RMB			US$
Non-GAAP Calculation
Revenues		629,920			1,157,807			1,245,874			192,329
Amount shared with related parties⁽¹⁾		244,305			—			—			—
Net trading gains on spot commodity contracts⁽²⁾		(342,445	)		(263,649	)		(166,015	)		(25,628	)
Risk and return transfer arrangement⁽³⁾		—			—			9,301			1,436

Adjusted revenues		531,780			894,158			1,089,160			168,137

Net income		106,832			481,957			403,015			62,214
Amount shared with related parties⁽¹⁾		244,305			—			—			—
Net trading gains on spot commodity contracts⁽²⁾		(342,445	)		(263,649	)		(166,015	)		(25,628	)
Risk and return transfer arrangement⁽³⁾		—			—			9,301			1,436
Change of tax⁽⁴⁾		24,535			65,912			39,179			6,048

Adjusted net income		33,227			284,220			285,480			44,070

Adjusted net income margin⁽⁵⁾		6.2	%		31.8	%		26.2	%		26.2	%

In light of the foregoing limitations for these non-GAAP financial measures, when assessing our operating and financial performance, you should not consider adjusted revenues, adjusted net income or adjusted net income margin in isolation or as a substitute for our operating or financial performance measures that are calculated in accordance with U.S. GAAP. In addition, because these non-GAAP measures may not be calculated in the same manner by all companies, it may not be comparable to other similar titled measures used by other companies.

The following table presents our summary operating data for the periods indicated:

Our business continues to grow in 2016. As of March 31, 2016, there were more than 55,000 customers (excluding mini-account customers) who opened and activated accounts with us, among which more than 14,000 executed trades during the quarter ended March 31, 2016. For the first quarter of 2016, we recorded an aggregate customer trading volume of RMB309.4 billion (US$47.8 billion), which represented a 69.6% growth compared to the first quarter of 2015 and a 103.6% growth compared to the fourth quarter of 2015, and was the highest trading volume we have generated in any single quarter. Among the total trading volume recorded for the first quarter of 2016, RMB120.2 billion (US$18.6 billion) was generated from our operation on the Tianjin Precious Metals Exchange, RMB142.0 billion (US$21.9 billion) was generated from our operation on the Guangdong Precious Metals Exchange, RMB29.6 billion (US$4.6 billion) was generated from our operation on the Shanghai Gold Exchange, and RMB17.5 billion (US$2.7 billion) was contributed by Da Xiang in March 2016. We were the largest service provider by customer trading volume on both the Tianjin Precious Metals Exchange and the Guangdong Precious Metals Exchange in the first quarter of 2016. In March 2016, we acquired 70% equity interest in Da Xiang, which focuses on providing online spot commodity trading services to mini-account customers for a total consideration of RMB7.0 million (US$1.1 million). As a result, as of March 31, 2016, there were more than 87,000 mini-account customers who opened and activated accounts with Da Xiang, among which more than 42,000 executed trades in March 2016. The significant increase in our trading volume for the first quarter of 2016 was largely attributable to (i) increased operational efficiency resulting from various operational adjustments made in the second half of 2015 (e.g., migration from telephone communications to online communication with customers), (ii) increased trading activities by our customers due to increased volatility in the commodities market in the first quarter of 2016 compared with the fourth quarter of 2015, (iii) the fast growth of our customer trading volume on the Shanghai Gold Exchange where we commenced operations in November 2015, and (iv) the trading volume contributed by Da Xiang in March 2016.

Our estimated financial and operating data for the three months ended March 31, 2016 may not be indicative of our results for future periods. Our quarterly financial and operating data have fluctuated, including a decrease in revenues on a quarter-to-quarter basis in the past, and may continue to fluctuate in the future. Please refer to "Management's Discussion and Analysis of Financial Condition and Results of Operations — Selected Quarterly Results of Operations" and "Risk Factors — Risks Related to Our Business and Industry — Our customer trading volume is influenced by the general trading activities in the online spot commodity trading market, which may be impacted by competing investment products, economic and market conditions and other factors that are beyond our control", for information regarding trends and other factors that may affect our results of operations.

MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS

You should read the following discussion of our financial condition and results of operations in conjunction with the combined and consolidated financial statements and the notes to those statements included elsewhere in this prospectus. The discussion in this prospectus contains forward-looking statements that involve risks and uncertainties, such as statements of our plans, objectives, expectations and intentions. The cautionary statements made in this prospectus should be read as applying to all related forward-looking statements wherever they appear in this prospectus. Our actual results could differ materially from those discussed here. Factors that could cause or contribute to these differences include those discussed in "Risk Factors," as well as those discussed elsewhere. See "Risk Factors" and "Special Note Regarding Forward-looking Statements."

We are the largest online provider of spot commodity trading services in China by customer trading volume in both 2014 and 2015, according to Euromonitor. We currently facilitate the trading by individual customers of silver, gold and other precious metals and commodities on three leading exchanges, namely the Shanghai Gold Exchange, the Tianjin Precious Metals Exchange and the Guangdong Precious Metals Exchange, which were the three largest exchanges for online spot commodity trading in China in terms of trading volume in 2015, respectively. We were the largest service provider by customer trading volume on the Tianjin Precious Metals Exchange from 2012 to 2015, and the largest service provider on the Guangdong Precious Metals Exchange in the fourth quarter of 2015. We commenced our operation on the Shanghai Gold Exchange in November 2015 and our customer trading volume has been growing rapidly since then.

We focus on premier customers and generally require each customer to deposit at least RMB100,000 (US$15,437) for account activation. Based on our experience, the total invested amount of a customer is often significantly higher. We believe this strategy helps us focus our resources on providing better services and build a base of customers with greater sophistication and risk tolerance, who are more suited to leveraged spot commodity trading. The growing customer base has contributed to the significant growth of our customer trading volume. As of December 31, 2015, there were more than 50,000 customers who had opened and activated accounts with us, among which more than 24,000 had executed trades with an aggregate customer trading volume of RMB659.7 billion (US$101.8 billion) for the year ended December 31, 2015.

We provide our customers with comprehensive services, including account opening, investor education, market information, research, live discussion boards and real-time customer support. Most services are delivered online through our proprietary client software and call center and we do not operate physical branches. Our client software provides not only market information and analysis, but also interactive functions including live discussion boards and instant messaging with customer service representatives, which we believe enhance our customers' engagement. Internally, we collect and analyze customer behavior and communication data from our client software, customer relationship management system and the exchanges, which allow us to better understand, attract and serve our customers.

We strive to minimize conflicts of interest with our customers, which we believe is essential for our long-term success. Under the trading rules of the three exchanges we operate on, we do not set, quote or influence the trading prices, and cannot access our customers' money. On the Tianjin Precious Metals Exchange and the Guangdong Precious Metals Exchange, we are required to serve as counterparty to our customers' trades. We entered into a risk and return transfer arrangement in 2015 to pass the risks and returns associated with such principal positions to a third party fund, which means we do not gain from our

customers' losses or lose from their gains. On the Shanghai Gold Exchange, we serve as an agent and do not hold principal positions.

We have achieved substantial growth since our commencement of operation in July 2011. Our revenues increased significantly from RMB629.9 million in 2013 to RMB1,157.8 million in 2014, and further to RMB1,245.9 million (US$192.3 million) in 2015. We recorded net income of RMB106.8 million, RMB482.0 million and RMB403.0 million (US$62.2 million) in 2013, 2014 and 2015, respectively.

Our revenues consist of net commissions and fees, net trading gains and losses, interest and investment income and other revenues. Other revenues primarily consist of revenue from sales of application services, sales of silver products, awards from the exchanges and government grants and others.

Net Commissions and fees are the largest component of our revenues and represented 65.6%, 74.3% and 79.5% of our total revenues for the years ended December 31, 2013, 2014 and 2015, respectively. The components of our net commissions and fees are set out below:

Spread fees: Spread fees are set by the exchanges as the differences between customers' buying and selling prices quoted by the exchanges, expressed either as a fixed amount per weight unit or a fixed percentage of the notional transaction value. We earn spread fees either at the opening or closing of a position.

Net trading commissions: The standard trading commission rate is set by the relevant exchange and generally ranges from 0.03% to 0.05% of the notional transaction value and charged at the opening and closing of a position. We offer rebates on trading commissions to certain customers on an individual basis based on expected trading volume and equity level of each individual customer. Our net trading commissions are net of such rebates.

Net overnight fees: Overnight fees are generated from customers who hold a long or short position overnight to the next trading day. The standard overnight fee rate is set by the exchanges and generally ranges from 0.01% to 0.02% of the notional value of the position. We offer rebates on overnight fees to certain customers based on expected trading volume and equity level of each individual customer. Our net overnight fees are net of such rebates.

We earn trading commissions, spread fees and overnight fees from our operation on the Tianjin Precious Metals Exchange and the Guangdong Precious Metals Exchange, which are settled on a daily basis. We earn trading commissions from our operation on the Shanghai Gold Exchange, which are settled on a monthly basis.

Our net commissions and fees largely depend on our customers' trading volume, which is the aggregate notional value of their transactions. Our customers' trading volume is directly influenced by the demand for spot commodity trading by individual investors, which is affected by the general social and economic conditions in the PRC, as well as individual investors' preference on the choice of investment products. In addition, customers' trading activities are to some extent influenced by the trading price volatility of the relevant commodities. The periods of increased fluctuations of commodity trading prices often coincide with higher levels of trading volumes by our customers.

Our net commissions and fees are also affected by the effective fee rate, which is our net commissions and fees divided by the total customer trading volume for the period indicated. A higher effective fee rate would generate more net commissions and fees for us, when the customer trading volume is constant. Our

effective fee rate is primarily influenced by the standard fee rates for trading commissions, spread fees and overnight fees stipulated by the exchanges we operate on, as well as the rebates we offer to our customers.

The following table sets forth the breakdown of our customer trading volume, active accounts net commissions and fees and effective fee rate by commodity exchange for the periods indicated.

	For the Year Ended December 31,

	2013			2014			2015
(except active accounts and effective fee rate)	RMB			RMB			RMB		US$
Customer trading volume *(in million)*
Tianjin Precious Metals Exchange		367,969			563,737			412,591		63,693
Guangdong Precious Metals Exchange		5,820			59,677			244,433		37,734
Shanghai Gold Exchange		—			—			2,685		414

Total		373,789			623,414			659,709		101,842



Active accounts
Tianjin Precious Metals Exchange		13,700			17,339			15,679
Guangdong Precious Metals Exchange		635			2,991			8,405
Shanghai Gold Exchange		—			—			369

Total		14,335			20,330			24,453

Commissions and fees, net *(in thousands)*
Tianjin Precious Metals Exchange		520,656			773,483			659,034		101,737
Guangdong Precious Metals Exchange		8,849			87,335			330,764		51,061
Shanghai Gold Exchange		—			—			900		139
Net of spread fees shared with related parties (discontinued)⁽¹⁾		(116,247	)		—			—		—

Total		413,258			860,818			990,698		152,937



Effective fee rate
Tianjin Precious Metals Exchange⁽²⁾		0.141	%		0.137	%		0.160%
Guangdong Precious Metals Exchange⁽²⁾		0.152	%		0.146	%		0.135%
Shanghai Gold Exchange		—			—			0.034%
Average effective fee rate⁽³⁾		0.142	%		0.138	%		0.150%

As we gradually diversify our business, our active accounts and total customer trading volume on the Guangdong Precious Metals Exchange and the Shanghai Gold Exchange have grown substantially. On the Tianjin Precious Metals Exchange and the Guangdong Precious Metals Exchange, we act as counterparty to our customers' trades as required by the exchanges' trading rules, which enables us to earn spread fees and overnight fees, in addition to trading commissions. We act as an agent on the Shanghai Gold Exchange and earn trading commissions only. Although our trading commission rate on the Shanghai Gold Exchange is similar to that on the other two exchanges, the absence of spread fees and overnight fees means that our overall effective fee rate on the Shanghai Gold Exchange is significantly lower than on the other two exchanges.

We recorded net trading gains, representing 34.1%, 23.2% and 13.4% of our revenues for the years ended December 31, 2013, 2014 and 2015, respectively. The following table sets forth the breakdown of our net trading gains for the periods indicated:

Our net trading gains from spot commodity contracts represent the gains from (i) our principal positions as a result of serving as counterparty to our customers' trades and (ii) our hedging position with special members of the exchanges in the relevant periods. Prior to November 2013, we shared a portion of such gains and losses with related parties as a means to reduce our exposure to market risks. From November 2013 to August 22, 2015, we hedged our principal positions by entering into spot commodity contracts with special members of the exchanges when certain thresholds were triggered. Commencing on August 23, 2015, our gains and losses arising from exchange-traded spot commodity contracts with customers are transferred to, and absorbed by a third party fund pursuant to our risk and return transfer arrangement. Amounts transferred to or from the fund are recorded under the line item risk and return transfer arrangement, which offset against our net trading gains and losses. As long as the risk and return transfer arrangement remains in force, our net trading gains or losses on spot commodity contracts will be offset by the amount we pay or receive under the risk and return transfer agreement.

Our net trading gains from commodity futures contracts represent the net gains from hedging, through the Shanghai Futures Exchange, of (i) our principal positions of spot commodity contracts and (ii) market risks associated with our physical sales of commodities, mostly raw silver. As long as the risk and return transfer arrangement remains in force, we will not hedge our principal positions of spot commodity contracts through the Shanghai Futures Exchange. However, we will continue to hedge the market risks associated with physical trading of commodities. We expect gains or losses from such hedging transactions will roughly offset the losses or gains from our trading of physical commodities, and the combined gains or losses of the two transactions will be non-substantial.

We also generate realized gains or losses from the sale of available-for-sale investments, most of which are from wealth management products issued by banks.

Our interest and investment income consists of interest income from our cash deposits and available-for-sale investments, most of which are money market funds. As of December 31, 2014 and 2015, our cash deposits and money market funds totaled RMB181.5 million and RMB362.5 million (US$56.0 million), respectively.

Our other revenues include revenue from sales of application services and sales of silver products, awards from the exchanges, government grants and others. The following table sets forth the breakdown of other revenues for the periods indicated:

Sales of application services consist of the sales of a license subscription bundled with customer support service during the license period. In 2014, we had an increase in sales of application services. However, we expect revenue from the sales of application services to be non-substantial in the future. The sales of silver products include sales of silver accessories, decorations and other products. Awards from the exchanges are cash awards we received from the Tianjin Precious Metals Exchange and the Guangdong Precious Metals Exchange for our contribution to the exchanges' overall trading volume, which began in 2015 and are determined based on negotiations between the exchanges and us. Government grants and others primarily include government subsidies we receive from Tianjin and other non-recurring non-operating income.

The following table sets forth the breakdown of our expenses for the periods indicated:

Employee compensation and benefits include (i) salaries, wages, bonuses and other benefits, (ii) training and employee activities expenses, (iii) contributions to defined employee contribution plans, and (iv) share-based compensation expenses for our employees. Employee compensation and benefits represented 13.2%, 18.5% and 31.2% of our revenues for the years ended December 31, 2013, 2014 and 2015, respectively.

Our advertising and promotion expenses consist of advertising expenses and sales agent expenses.

Our advertising expenses represent expenses for placing advertisements on television, radio and newspaper, as well as on Internet websites, search engines and application stores. Our advertising expenses represented 19.8%, 15.5% and 17.8% of our revenues for the years ended December 31, 2013, 2014 and 2015, respectively. Our advertising costs increased generally due to the growth of our business scale.

Our sales agent expenses relate to fees that we paid to external sales agent companies for their customer development services from 2013 to the end of June 2014 to develop our operations on the Tianjin Precious Metals Exchange. Since we decided to develop customers through our in-house sales team, we ceased cooperation with sales agent companies and will no longer incur such expenses in the future. Our sales agent expenses represent 20.8%, 9.1% and 0% of our revenues for the years ended December 31, 2013, 2014 and 2015, respectively.

The following table sets forth the breakdown of our advertising and sales agent expenses for the periods indicated:

From January to November 2013, we paid service fees to a research company related to us for the research and other services it provided to us. For more detailed information of the arrangement, please see "Related Party Transactions — Transactions with Certain Directors, Shareholders and Affiliates and Key management Personnel." We terminated such research agreement in 2013 and moved the research function in house. We have not incurred such expenses since then and will no longer incur such expenses in the future.

Our information technology and communication expenses are primarily related to the expenses we paid for telecommunication network, servers and bandwidth, as well as data center services for hosting our servers.

Our occupancy and equipment rental fees are primarily office rental fees and server rental fees.

Taxes and surcharges consist primarily of business tax and surcharges on business tax and VAT.

Our other expenses consist of other miscellaneous expenses, which include consultant fees, travel and meeting expenses and other expenses.

We are incorporated in the Cayman Islands. Under the current laws of the Cayman Islands, we are not subject to income or capital gains tax. In addition, dividend payments are not subject to withholding tax in the Cayman Islands.

Our wholly owned Hong Kong subsidiaries are subject to Hong Kong profit tax on their activities conducted in Hong Kong. Dividends from our Hong Kong subsidiaries to us are exempt from Hong Kong withholding tax.

In March 2007, the PRC government enacted the EIT Law, and promulgated the related regulation Implementation Regulations for the PRC Enterprise Income Tax Law. The law and regulation came into effect on January 1, 2008. The EIT Law applies a uniform EIT rate of 25% on all domestic enterprises and foreign-invested enterprises and defines new tax incentives for qualifying entities.

As of the date of this prospectus, one of our subsidiaries, Yin Tian Xia Technology, was granted the "certified software enterprise and registered software products" qualification in 2013 and is eligible for an income tax exemption for the first two years from the year in which it starts making profit and is entitled to a 50% reduction of income tax for the third year to the fifth year, rendering its actual income tax rate 0% in 2013 and 2014 and 12.5% from 2015 to 2017. Our other PRC subsidiaries are subject to an income tax rate of 25%.

In addition, the EIT Law treats enterprises established outside of China that have "de facto management bodies" located in China as a PRC resident enterprise for tax purposes. A "de facto management body" is defined as a management body that has material and overall management and control over the manufacturing and business operations, personnel and human resources, finances and treasury, and acquisition and disposition of properties and other assets of an enterprise. We currently do not believe that we or our Hong Kong subsidiaries are PRC resident enterprises but there is no assurance in this regard. If we are considered a "PRC resident enterprise" for PRC tax purposes, we would be subject to the PRC enterprise income tax on our global income. See "Risk Factors — Risks Related to Doing Business in China — We may be deemed to be a PRC resident enterprise under the EIT Law and be subject to PRC tax on our worldwide income, which may significantly increase our income tax expenses and materially decrease our profitability or otherwise adversely affect the value of your investment" and "Risk Factors — Risks Related to Doing Business in China — You may be subject to PRC income tax on dividends from us or on any gain realized on the transfer of our ADSs."

Pursuant to the EIT law and its implementation rules, dividends paid to non-PRC resident enterprise investors that are considered PRC-source are subject to a 10% withholding tax. Under the Arrangement between Mainland China and the Hong Kong Special Administrative Region on the Avoidance of Double Taxation and Prevention of Fiscal Evasion on Income, a qualified Hong Kong tax resident which is determined by the competent PRC tax authority to have satisfied relevant requirements under the Arrangement between Mainland China and the Hong Kong Special Administrative Region on the Avoidance of Double Taxation and Prevention of Fiscal Evasion on Income and other applicable PRC laws is entitled to a reduced withholding tax rate of 5%.

We prepare our financial statements in conformity with U.S. GAAP, which requires us to make judgments, estimates and assumptions. We continually evaluate these estimates and assumptions based on the most recently available information, our own historical experience and various other assumptions that we believe to be reasonable under the circumstances. Since the use of estimates is an integral component of the

financial reporting process, actual results could differ from our expectations as a result of changes in our estimates.

An accounting policy is considered critical if it requires an accounting estimate to be made based on assumptions about matters that are highly uncertain at the time such estimate is made, and if different accounting estimates that reasonably could have been used, or changes in the accounting estimates that are reasonably likely to occur, could materially impact the combined and consolidated financial statements. We believe that the following accounting policies involve a higher degree of judgment and complexity in their application and require us to make significant accounting estimates. The following description of critical accounting policies, judgments and estimates should be read in conjunction with our combined and consolidated financial statements and other disclosures included in this prospectus.

Revenue is recognized when all of the following conditions are met: persuasive evidence of an arrangement exists, delivery has occurred or services have been rendered, the price is fixed or determinable and collectability is reasonably assured. These criteria as they relate to each of the following major revenue generating activities are described below.

Commissions and fees from trading business are recorded on a trade-date basis. We earn trading commissions, spread fees and overnight fees from our operation on the Tianjin Precious Metals Exchange and the Guangdong Precious Metals Exchange, which are settled on a daily basis. We earn trading commissions from our operation on the Shanghai Gold Exchange, which are settled on a monthly basis. Cash rebates on trading commissions and overnight fees offered by us to our customers are recorded as a reduction of revenue.

Trading gains/(losses) consist of realized and unrealized gains and losses from exchange-traded spot commodity contracts and commodity futures contracts, the realized gains from trading of physical commodities, and realized gains and losses from the sale of available-for-sale investments, all presented on a net basis. Changes in fair value in relation to spot commodity contract are recorded in trading gains/losses, net on a daily basis as disclosed in the accounting policy of derivative financial instruments. Trading gains/(losses) on physical commodities are recognized when title passes and measured by the difference between the acquisition cost of the commodity and the cash received or receivable.

Interest income is recognized at the effective interest rate. Investment income is recognized when earned.

Other revenues primarily consist of net income from sales of application services, sales of silver products, awards from the exchanges and government grants and others.

Sales of application services mainly comprise of the sale of a license subscription bundled with customer support service during the license period. Revenue from the sale of application services is recognized ratably over the term of the subscription which is generally 1 year. During the period of the arrangement, the customer does not have the contractual right to take possession of the software at any time.

Sales of silver products are recognized when goods are delivered at the customers' premises which are taken to be the point in time when the customer has accepted the goods and the related risks and rewards of ownership. Revenue excludes VAT.

Government grants are recognized when there is reasonable assurance that they will be received and that we will comply with the conditions attaching to them. Grants that compensate us for expenses incurred are deducted in reporting the related expenses on a systematic basis in the same periods in which the expenses are incurred.

Awards from the exchanges are recognized when there is reasonable assurance that they will be received and amounts can be reasonably estimated.

We recognize all derivative instruments as either assets or liabilities in the balance sheet at their respective fair values.

In the normal course of business and as a comprehensive member of the exchanges, we enter into transactions in derivative financial instruments with customers. As a comprehensive member on the Tianjin Precious Metals Exchange and the Guangdong Precious Metals Exchange, we are required to serve as the counterparty of the customer trading of precious metals through exchange-traded spot commodity contracts. The two exchanges quote trading prices of the spot commodity contracts with reference to the prices from relevant international and domestic spot commodities markets. We do not apply hedge accounting, as all derivative financial instruments are held for trading purposes and therefore recorded at fair value with changes reflected in earnings. Contracts with customers are traded either as long or short positions and the notional amount and fair values of the contracts in a loss position are not offset against notional amount and the fair value of contracts in a gain position. Gains and losses (realized and unrealized) on all derivative financial instruments are shown as a component of trading gains/(losses), net.

In accordance with the exchanges' requirements, our customers must meet, at a minimum, the deposit requirements established by the exchanges at which the spot commodity contracts are traded. Therefore, exchange traded spot commodity contracts generally do not give rise to significant counterparty exposure due to the cash settlement procedures for daily market movements, or the variation margin, and the deposit requirements of the exchanges. The variation margin payments represent the daily settlement of the outstanding exposure of the derivative contract. Likewise, as the counterparty to the customer trades, we are also required to place deposits with custodian banks of the exchanges to meet the minimum deposit requirements. Such amount placed at banks to meet the deposit requirements is included in deposits with clearing organizations and restricted from withdrawal.

In 2013, 2014 and 2015, we entered into commodity futures contracts on the Shanghai Futures Exchange to manage our exposure on spot commodity contracts and physical trading of raw silver. Commodity futures contracts are recorded at fair value with changes reflected in earnings. Gains and losses from these contracts are recorded in trading gains/(losses), net. As at December 31, 2014 and 2015, we had no commodity futures contracts outstanding.

In 2013, we entered into risk sharing agreements with entities controlled by our founders. Under the risk sharing agreements, certain percentages of the spread fees are shared with these companies in compensation for them to take certain percentages of the trading gains or losses arising from exchange-traded spot commodity contracts with customers by us. The shared spread fees are recorded in commissions and fees, net. The shared trading gains and losses are recorded in trading gains/(losses), net.

In 2015, we entered into a risk and return transfer arrangement with a third party fund, pursuant to which our gains and losses arising from exchange-traded spot commodity contracts with customers are transferred to such fund. The gains and losses transferred are recorded in trading gains/(losses), net.

We classify wealth management products issued by banks and money market funds issued by fund management companies as available-for-sale investments. Available-for-sale investments are recorded at fair value. Unrealized holding gains and losses, net of the related tax effect, on available-for-sale investments are excluded from earnings and are reported as a separate component of accumulated other comprehensive income until realized. Realized gains and losses from the sale of available-for-sale securities are determined on a specific-identification basis and are recorded as trading gains and losses. Interest and investment income are recognized when earned.

Income taxes are accounted for under the asset and liability method. Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases and operating loss and tax credit carry forwards. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date. A valuation allowance is provided to reduce the carrying amount of deferred income tax assets if it is considered more likely than not that some portion or all of the deferred income tax assets will not be realized. We recognize the effect of income tax positions only if those positions are more likely than not of being sustained. Recognized income tax positions are measured at the largest amount that is greater than 50% likely of being realized. Changes in recognition or measurement are reflected in the period in which the change in judgment occurs. We elect to accrue any interest or penalties related to an underpayment of income taxes as part of its income tax expense.

Win Yin Financial granted stock options and restricted share units on its shares to its employees pursuant to its 2013 Share Option Scheme, 2014 Share Option Scheme and Pre-IPO Restricted Share Unit Scheme, or the Share Incentive Plans. Pursuant to the group reorganization completed on November 18, 2015, our Company became the holding company of the group and the majority of the operating PRC subsidiaries under Win Yin Financial became our wholly owned PRC subsidiaries. In connection with the reorganization, we assumed the Share Incentive Plans from Win Yin Financial and adopted the Share Incentive Plans. We issued stock options and RSUs to our employees to replace the stock options and RSUs issued by Win Yin Financial. The terms and conditions of the stock options and RSUs with respect to vesting and exercisability remain the same.

We apply ASC 718 to account for our employee share-based payments. In accordance with ASC 718, we determine whether an award should be classified and accounted for as a liability award or equity award. All grants of share-based awards to employees classified as equity awards are recognized in the financial statements based on their fair value on the grant dates. We have elected to recognize compensation expense using a straight-line method for all employee equity awards granted with graded vesting based on service conditions provided that the amount of compensation cost recognized at any date is at least equal to the portion of the grant-date value of the equity awards that are vested at that date. To the extent the required vesting conditions are not met resulting in the forfeiture of the share-based awards, previously recognized compensation expense relating to those awards are reversed. ASC 718 requires forfeitures to be estimated at the time of grant and revised, if necessary, in the subsequent period if actual forfeitures differ from initial estimates.

Forfeiture rates are estimated based on historical and future expectations of employee turnover rates and are adjusted to reflect future changes in circumstances and facts, if any. Share-based compensation expense is recorded net of estimated forfeitures such that expense is recorded only for those share-based awards that are expected to vest. To the extent we revise these estimates in the future, the share-based payments could be materially impacted in the period of revision, as well as in following periods. We, with the assistance of an independent third party valuation firm, determined the fair value of the stock options and RSUs granted to employees.

The fair value of options and RSUs granted to employees and nonemployees is determined based on a number of factors including valuations. In determining the fair value of our equity instruments, we referred to valuation reports prepared by an independent third-party appraisal firm, based on data we provided. The valuation reports provided us with guidelines in determining the fair value of the equity instruments, but we are ultimately responsible for the determination of all amounts related to share-based compensation recorded in the financial statements.

The binomial option pricing model was applied in determining the estimated fair value of the options granted to employees. The Black-Scholes option pricing model was applied in determining the estimated fair value of the RSUs granted to employees. A change in any of the terms or conditions of the stock options or RSUs is accounted for as a modification of the plan. Incremental compensation cost is measured as the excess, if any, of the fair value of the modified option over the fair value of the original option or RSU immediately before its terms are modified, measured based on the fair value of the ordinary shares and other pertinent factors at the modification date. For vested stock options or RSUs, we recognize incremental compensation cost in the period the modification occurs. For unvested stock options or RSUs, we recognize over the remaining requisite service period, the sum of the incremental compensation cost and the remaining unrecognized compensation cost for the original award on the modification date. If the fair value of the modified option or RSU is lower than the fair value of the original option or RSU immediately before modification, the minimum compensation cost we recognize is the cost of the original award.

The following table presents the assumptions used to estimate the fair values of the share options and RSUs granted in the periods presented:

If any of the assumptions used in the binomial option pricing model or Black-Scholes option pricing model changes significantly, share-based compensation expense for future awards may differ materially compared with the awards granted previously.

The following table sets forth the options and RSUs granted under the share option plans from 2013 to the prospectus date:

We believe that the increase in the fair value of underlying ordinary shares for the period from US$0.106 per ordinary share as of December 3, 2013 to US$0.325 per ordinary shares as of December 15, 2014 and January 15, 2015 was primarily attributable to the following factors:

We believe that the increase in the fair value of ordinary shares for the period from US$0.325 per ordinary share as of December 15, 2014 to US$0.406 per ordinary share as of January 13, 2016 was primarily attributable to the following factors:

Prior to this offering, we have been a private company with limited accounting personnel and other resources to address our internal control over financial reporting. In connection with the preparation and external audit of our combined and consolidated financial statements, we and our independent registered public accounting firm identified one material weakness and other control deficiencies in our internal control over financial reporting as of December 31, 2015. Neither we nor our independent registered public accounting firm undertook a comprehensive assessment of our internal control under the Sarbanes-Oxley Act for purposes of identifying and reporting any weakness or significant deficiency in our internal control over financial reporting, as they will be required to do once we become a public company and our independent registered public accounting firm will be required to do once we cease to be an emerging growth company. Had we performed a formal assessment of our internal control over financial reporting or had our independent registered public accounting firm performed an audit of our internal control over financial reporting, additional control deficiencies may have been identified.

One material weakness identified relates to our lack of sufficient accounting personnel with appropriate knowledge of U.S. GAAP and SEC reporting requirements and failure to establish and clearly communicate acceptable policies regarding U.S. GAAP financial reporting, which contributed to inadequate controls in the application of accounting policies in the United States.

To address the material weakness and control deficiencies identified and to improve our internal control over financial reporting and disclosure controls, we have taken initiatives to implement and plan to implement further measures. We are in the process of hiring additional competent accounting staff with appropriate knowledge and experience of U.S. GAAP and SEC reporting requirements, and engage external advisors such as our independent registered public accounting firm to provide trainings on U.S. GAAP and SEC regulations for our accounting personnel. We will also develop and implement a full set of U.S. GAAP accounting policies and financial reporting procedures as well as related internal control policies, including implementing a comprehensive accounting manual to guide day-to-day accounting operations and reporting work. We expect to complete these measures as soon as practicable. We expect that we will incur significant costs in the implementation of such measures. However, the implementation of these measures may not fully address the deficiencies in our internal control over financial reporting. We are not able to estimate with reasonable certainty the costs that we will need to incur to implement these and other measures designed to improve our internal control over financial reporting.

The following table sets forth a summary of our combined and consolidated results of operations, both in absolute amounts and as a percentage of our net revenues for the periods indicated. This information should be read together with our combined and consolidated financial statements and related notes included elsewhere in this prospectus. The results of operations in any period are not necessarily indicative of the results that may be expected for any future period.

	For the Year Ended December 31,

	2013			2014			2015
(in thousands, except per share data)	RMB			RMB			RMB			US$
	Combined			Combined			Combined and Consolidated			Combined and Consolidated (unaudited)
Revenues
Commissions and fees, net		413,258			860,819			990,698			152,937
Trading gains/(losses), net		214,861			268,850			166,428			25,692
Interest and investment income		365			445			4,443			686
Other revenues		1,436			27,693			84,305			13,014

Total revenues		629,920			1,157,807			1,245,874			192,329

Expenses
Employee compensation and benefits		(82,876	)		(214,431	)		(388,168	)		(59,923	)
Advertising and promotion		(256,092	)		(285,732	)		(221,859	)		(34,249	)
Research services from a related party		(106,050	)		—			—			—
Information technology and communications		(11,603	)		(21,238	)		(32,803	)		(5,064	)
Occupancy and equipment rental		(21,377	)		(39,487	)		(41,950	)		(6,476	)
Taxes and surcharges		(5,200	)		(18,884	)		(21,711	)		(3,352	)
Other expenses		(34,569	)		(58,688	)		(54,164	)		(8,361	)

Total expenses		(517,767	)		(638,460	)		(760,655	)		(117,425	)

Income before income taxes		112,153			519,347			485,219			74,904
Income taxes		(5,321	)		(37,390	)		(82,204	)		(12,690	)

Net income		106,832			481,957			403,015			62,214



Earnings per share⁽¹⁾
Basic		0.11			0.48			0.40			0.06
Diluted		0.11			0.48			0.38			0.06

Our revenues increased by 7.6% from RMB1,157.8 million in 2014 to RMB1,245.9 million (US$192.3 million) in 2015, primarily due to an increase in our net commissions and fees and other revenues.

Our net commissions and fees increased by 15.1% from RMB860.8 million in 2014 to RMB990.7 million (US$152.9 million) in 2015, primarily due to the growth of our customer trading volume and increase in our average effective fee rate.

Our customer trading volume increased by 5.8% from RMB623.4 billion in 2014 to RMB659.7 billion (US$101.8 billion) in 2015, in line with our growing customer base and overall scale of operation. The relatively modest growth of our customer trading volume in 2015 was primarily due to challenging market conditions in the second half of 2015, including the sharp correction in A-share market from June to August 2015, which adversely affected investor's liquidity and confidence in trading.

Our average effective fee rate increased from 0.138% in 2014 to 0.150% in 2015. This was mainly due to the increase in spread fee rate in the same period from our operation on the Tianjin Precious Metals Exchange. The spread fee rate is calculated as the spread fee, which is the difference between the bid and offer prices, divided by the trading price. The daily average closing price of silver, the main commodity traded on that exchange, decreased by 16.6% from RMB3,768 per kilo in 2014 to RMB3,141 per kilo in 2015, while the spread fee set by the exchange remained at RMB8 per kilo, resulting in an increased spread fee rate.

Our net trading gains decreased by 38.1% from RMB268.9 million in 2014 to RMB166.4 million (US$25.7 million) in 2015. The net trading gains in 2014 included primarily the net realized gains from spot commodity contracts of RMB263.6 million, which was the result of our customers' trading activities and our corresponding hedging activities. Our net trading gains from January 1, 2015 to August 22, 2015 were RMB156.7 million from spot commodity contracts. Our net trading gains on spot commodity contracts from August 23, 2015 to December 31, 2015 were RMB9.3 million and were transferred to a third party fund pursuant to our risk and return transfer arrangement that took effect on August 23, 2015. As long as the risk and return transfer arrangement remains in force, we will not incur net gains or losses from spot commodity contracts, and we expect our net trading gains and losses in the future to be non-substantial.

Our interest and investment income increased from RMB0.4 million in 2014 to RMB4.4 million (US$0.7 million) in 2015, primarily due to an increase in our available-for-sale investments that we held during the relevant period.

Our other revenues increased from RMB27.7 million in 2014 to RMB84.3 million (US$13.0 million) in 2015, primarily due to (i) awards of RMB38.0 million (US$5.9 million) from the Tianjin Precious Metals Exchange and the Guangdong Precious Metals Exchange for our contribution to the exchanges' overall trading volume in 2015, (ii) an increase in government grants of RMB35.7 million (US$5.5 million) due to increase in tax refund and government subsidies, and (iii) an increase in sales of silver products, which were partly offset by a decrease in sales of application services, due to a non-recurring sale transaction of our application services to a commodity trading service provider in 2014.

Our expenses increased by 19.1% from RMB638.5 million in 2014 to RMB760.7 million (US$117.4 million) in 2015, primarily due to growth of our business.

Our employee compensation and benefits increased from RMB214.4 million in 2014 to RMB388.2 million (US$59.9 million) in 2015, due to increase in both share-based compensation and other compensation and benefits. Our share-based compensation increased from RMB7.0 million in 2014 to RMB31.0 million (US$4.8 million) in 2015, due to costs associated with RSUs issued in January 2015 and the increased recognized costs associated with options issued in December 2014. Our other employee compensation and benefits increased from RMB207.4 million in 2014 to RMB357.2 million (US$55.1 million) in 2015,

largely resulting from the increase in our sales personnel when we hired approximately 800 employees from third party sales agent companies in July 2014, after we terminated customer development arrangements with such companies.

Our advertising and promotion expenses consist of advertising expenses and sales agent expenses. Our advertising expenses increased by 23.3% from RMB180.0 million in 2014 to RMB221.9 million (US$34.2 million) in 2015 due to the growth of our business. Our sales agent expenses decreased from RMB105.8 million for 2014 to nil for 2015, due to the termination of arrangements with sales agent companies on Tianjin Precious Metals Exchange in June 2014.

Our information technology and communication expenses increased by 54.5% to RMB32.8 million (US$5.1 million) in 2015 compared to RMB21.2 million in 2014, primarily due to the growth of our business.

Our occupancy and equipment rental expenses increased slightly by 6.2% from RMB39.5 million in 2014 to RMB42.0 million (US$6.5 million) in 2015, primarily due to the increase of our office rental fees due to the growth in our operational scale.

Our taxes and surcharges increased from RMB18.9 million in 2014 to RMB21.7 million (US$3.4 million) in 2015, primarily due to increase in trading commissions in the Tianjin Precious Metals Exchange which are subject to business tax and surcharges on business tax, and an increase in trading commissions on Guangdong Precious Metals Exchange and an increase in revenue of Yin Tian Xia Technology from intra-group sale of application services, both of which are subject to VAT surcharges.

Other expenses decreased by 7.7% to RMB54.2 million (US$8.4 million) in 2015 from RMB58.7 million in 2014, which is primarily due to the non-recurring miscellaneous expenses in 2014.

Our income tax expenses significantly increased to RMB82.2 million (US$12.7 million) in 2015 from RMB37.4 million in 2014, primarily due to the increase of our effective tax rate from 7% for 2014 to 17% for 2015. The increase in effective tax rate was mainly because the income tax rate of our subsidiary, Yin Tian Xia Technology, increased from 0% in 2014 to 12.5% in 2015 which will remain 12.5% through 2017. Except for Yin Tian Xia Technology, our other PRC subsidiaries are subject to an income tax rate of 25%.

As a result of the foregoing, our net income decreased to RMB403.0 million (US$62.2 million) in 2015 from RMB482.0 million in 2014.

Our revenues increased by 83.8% from RMB629.9 million in 2013 to RMB1,157.8 million in 2014, primarily due to an increase in our net commissions and fees, as well as an increase in net trading gains and other revenues.

Our net commissions and fees increased by 108.3% from RMB413.3 million in 2013 to RMB860.8 million in 2014. Excluding amounts shared with related parties of RMB116.2 million in 2013, our net commissions and fees increased by 62.6% from RMB529.5 million in 2013 to RMB860.8 million in 2014, primarily due to a 66.8% increase in our customer trading volume from RMB373.8 billion in 2013 to RMB623.4 billion in 2014, which is slightly offset by the decrease of our average effective fee rate from

0.142% in 2013 to 0.138% in 2014. The decrease in average effective fee rate is mainly due to our increased rebates on trading commissions as a result of increased competition. We shared RMB116.2 million of spread fees with related parties in 2013 pursuant to our historical risk sharing agreements.

Our net trading gains increased by 25.1% from RMB214.9 million in 2013 to RMB 268.9 million in 2014. The net trading gains in 2013 included primarily the net realized gains from spot commodity contracts of RMB 342.4 million, which was the result of our customers' trading activities, offset by RMB128.1 million shared with related parties pursuant to our historical risk sharing agreements. The net trading gains in 2014 included primarily the net realized gains from spot commodity contracts of RMB 263.6 million, which was a result of our customers' trading activities and our corresponding hedging activities.

Our interest income increased by 21.9% from RMB0.4 million in 2013 to RMB0.5 million in 2014, primarily due to an increase in the available-for-sale investments we held, which usually bear higher interest rates than cash deposits with banks.

Our other revenue significantly increased from RMB1.4 million in 2013 to RMB27.7 million in 2014, primarily due to (i) an increase of sales of application services from RMB0.8 million in 2013 to RMB19.2 million in 2014, resulting from the sales of our client software license and related services to a commodity trading service provider, (ii) an increase of sales of silver products, and (iii) local government grants of RMB4.6 million we received in Shanghai in 2014.

Our expenses increased by 23.3% from RMB517.8 million to RMB638.5 million in 2014, primarily due to the growth of our business.

Our employee compensation and benefits increased by 158.7% from RMB82.9 million in 2013 to RMB214.4 million in 2014. The number of our employees increased significantly from 1,002 as of December 31, 2013 to 1,970 as of December 31, 2014, primarily due to (i) our recruitment of certain sales and research staff who were employees of the sales agent companies and the research company after we terminated cooperation with them, and (ii) the increase in our employees in line with our business growth.

We incurred share-based compensation expenses of RMB7.0 million in 2014 compared to RMB0.4 million in 2013, mainly because our share-based compensation in 2014 reflected (i) the expenses associated with the share options granted in December 2013 for which we incurred for the full year of 2014, and (ii) the expenses associated with the share options granted in December 2014.

Our advertising and promotion expenses increased by 11.6% from RMB256.1 million in 2013 to RMB285.7 million in 2014, primarily due to the increase in our advertising expenses, which was partly offset by a decrease in our sales agent expenses.

Our advertising expenses increased by 44.2% from RMB124.8 million in 2013 to RMB179.9 million in 2014, which was in line with the growth of our customer base.

From January 2013 to June 2014, we hired sales agents to develop customers on the Tianjian Precious Metals Exchange, while we developed customers on our own on the Guangdong Precious Metals Exchange. We paid these sales agents fees as a percentage of the trading volume generated by the customers they developed. We terminated cooperation with all sales agent companies in June 2014 and moved the customer development function on the Tianjin Precious Metals Exchange in house. The sales agent expenses incurred was RMB131.3 million in 2013 and RMB105.8 million in 2014.

Research service represented the fees we paid to a related external research company for the research other services it provided to us. We had research service expenses of RMB106.1 million in 2013. We did not incur research service expenses in 2014 because we terminated such arrangement in November 2013 and moved research function in-house.

Our information technology and communication expenses increased significantly from RMB11.6 million in 2013 to RMB21.2 million in 2014, primarily due to the growth of our business.

Our occupancy and equipment rental expenses increased by 84.7% from RMB21.4 million in 2013 to RMB39.5 million in 2014, primarily due to the increase of our office space, servers and other equipments in line with our business expansion.

Our taxes and surcharges increased significantly from RMB5.2 million in 2013 to RMB18.9 million in 2014, primarily due to increase in trading commissions on the Tianjin Precious Metals Exchange which are subject to business tax and surcharges on business tax, and an increase in trading commissions on Guangdong Precious Metals Exchange and an increase in revenue of Yin Tian Xia Technology from intra-group sale of application services, both of which are subject to VAT surcharges.

Other expenses increased from RMB34.6 million in 2013 to RMB58.7 million in 2014, which is in line with our business growth.

Our income tax expenses significantly increased from RMB5.3 million in 2013 to RMB37.4 million in 2014, primarily due to the increase in our profit before taxation from RMB112.2 million to RMB519.3 million, and the increase of our effective tax rate from 5.0% in 2013 to 7.0% in 2014.

As a result of the foregoing, our net income increased from RMB106.8 million in 2013 to RMB482.0 million in 2014.

The following table sets forth our historical unaudited selected quarterly results of operations for the eight quarters in the period from January 1, 2014 to December 31, 2015. You should read the following table in conjunction with our audited combined and consolidated financial statements and related notes thereto included elsewhere in this prospectus. The unaudited combined and consolidated quarterly results of operation include all adjustments that we consider necessary for a fair presentation of our operating results for the periods presented. Quarter-to-quarter comparison of operating results should not be relied upon as being indicative of future performance.

	For the Three Months Ended

(in RMB thousands)	March 31, 2014			June 30, 2014			September 30, 2014			December 31, 2014			March 31, 2015			June 30, 2015			September 30, 2015			December 31, 2015
Revenues
Commissions and fees, net		200,366			187,267			209,150			264,036			267,159			285,736			216,363			221,440
Trading gains/(losses), net		(18,022	)		(30,027	)		169,622			147,277			(17,675	)		47,127			135,846			1,130
Interest and investment income		24			77			20			324			990			1,643			1,534			276
Other revenues		4,750			5,207			8,559			9,177			4,856			15,488			25,253			38,708

Total revenues		187,118			162,524			387,351			420,814			255,330			349,994			378,996			261,554

Expenses
Employee compensation and benefits		(25,300	)		(36,882	)		(75,683	)		(76,566	)		(73,164	)		(102,392	)		(104,387	)		(108,225	)
Advertising and promotion		(66,773	)		(79,308	)		(90,918	)		(48,733	)		(48,380	)		(57,208	)		(62,010	)		(54,261	)
Information technology and communications		(7,921	)		(3,066	)		(5,988	)		(4,263	)		(6,998	)		(8,100	)		(6,935	)		(10,770	)
Occupancy and equipment rental		(10,427	)		(9,462	)		(9,440	)		(10,158	)		(10,899	)		(10,080	)		(9,970	)		(11,001	)
Taxes and surcharges		(2,659	)		(2,332	)		(5,773	)		(8,120	)		(5,353	)		(6,057	)		(4,763	)		(5,538	)
Other expenses		(11,319	)		(8,131	)		(6,098	)		(33,140	)		(15,066	)		(10,805	)		(11,114	)		(17,179	)

Total expenses		(124,399	)		(139,181	)		(193,900	)		(180,980	)		(159,860	)		(194,642	)		(199,179	)		(206,974	)

Income before income taxes		62,719			23,343			193,451			239,834			95,470			155,352			179,817			54,580
Income taxes		9,082			2,700			(37,439	)		(11,733	)		(12,545	)		(26,241	)		(36,976	)		(6,442	)

Net income		71,801			26,043			156,012			228,101			82,925			129,111			142,841			48,138

Our quarterly total revenues have fluctuated during the eight-quarter period, largely due to the volatility of our trading gains and losses, which was primarily the result of our customers' trading activities. We present quarterly non-GAAP financial measures because they are used by our management to evaluate our core operating performance. We exclude from our adjusted revenues and adjusted net income (i) the net trading gains and losses resulting from our principal positions on the exchanges and (ii) the amounts we paid or received under the risk and return transfer arrangement, because we focus on our core business of generating trading commissions from our customers' trades and have been striving to reduce our exposure to market risks associated with principal positions. Our management believes the adjusted net income margin fairly presents useful information regarding the historical performance of our core business operation and is more comparable to our performance. However, due to the historical fluctuations of our quarterly financial

results, we believe that quarter-to-quarter comparisons of our financial results, on an adjusted or non-adjusted basis, should not be relied upon to predict our future performance.

	For the Three Months Ended

(in RMB thousands, except percentages)	March 31, 2014			June 30, 2014			September 30, 2014			December 31, 2014			March 31, 2015			June 30, 2015			September 30, 2015			December 31, 2015
Non-GAAP Calculation
Revenues		187,118			162,524			387,351			420,814			255,330			349,994			378,996			261,554
Net trading gains on spot commodity contracts(1)		18,453			30,690			(169,191	)		(143,601	)		19,445			(43,586	)		(148,418	)		6,544
Risk and return transfer arrangement(2)		—			—			—			—			—			—			15,845			(6,544	)

Adjusted revenues		205,571			193,214			218,160			277,213			274,775			306,408			246,423			261,554

Net income		71,801			26,043			156,012			228,101			82,925			129,111			142,841			48,138
Net trading gains on spot commodity contracts(1)		18,453			30,690			(169,191	)		(143,601	)		19,445			(43,586	)		(148,418	)		6,544
Risk and return transfer arrangement(2)		—			—			—			—			—			—			15,845			(6,544	)
Change of tax(3)		(4,613	)		(7,673	)		42,298			35,900			(4,861	)		10,897			33,143			—
Statutory tax rate		25%			25%			25%			25%			25%			25%			25%			25%

Adjusted net income		85,641			49,060			29,119			120,400			97,509			96,422			43,411			48,138

Adjusted net income margin(4)		41.7%			25.4%			13.3%			43.4%			35.5%			31.5%			17.6%			18.4%

The tables below set forth our major quarterly operating data on customer trading volume, tradable accounts and active accounts as of and for the periods indicated:

Our quarterly adjusted total revenues show a general trend of growth in the six-quarter period from January 1, 2014 to June 30, 2015, as a result of the growth of our quarterly total trading volume. Our quarterly total revenues slightly decreased in the third quarter of 2015, although it modestly increased in the fourth quarter of 2015, which was primarily due to the decreased trading activities of our customers resulting from the sharp correction of A-share market from June to August 2015 that adversely affected investor's liquidity and confidence in trading. Our quarterly total expenses generally grew in line with the growth of our business, except for periods where we made business arrangement adjustments. For example, in the third quarter of 2014, we incurred substantially higher advertising and promotion expenses because we terminated the contracts with our sales agent companies and paid a non-recurring termination fee. We recorded net income and adjusted net income in each of the eight quarters.

We recorded a customer trading volume of RMB49.8 billion, RMB68.8 billion, RMB129.3 billion and RMB125.8 billion for the first, second, third and fourth quarter of 2013, respectively. Our average quarterly trading volume increased from RMB93.5 billion in 2013 to RMB155.9 billion in 2014 and further to RMB164.9 billion (US$25.5 billion) in 2015.

In light of the foregoing limitations for these non-GAAP financial measures, when assessing our operating and financial performance, you should not consider adjusted revenues, adjusted net income or adjusted net income margin in isolation or as a substitute for our operating or financial performance measures that are calculated in accordance with U.S. GAAP. In addition, because these non-GAAP measures may not be calculated in the same manner by all companies, it may not be comparable to other similar titled measures used by other companies.

Our principal sources of liquidity were cash generated from our operations and capital injections by our shareholders. We plan to finance our future operating liquidity primarily from cash generated from our operations and cash on hand. As of December 31, 2014 and 2015, we had RMB83.5 million and RMB362.5 million (US$56.0 million), respectively, in cash and cash equivalents which consisted of cash on hand and cash deposited with banks. We also held available-for-sale investments that can be redeemed on demand of RMB354.0 million and RMB75.7 million (US$11.7 million) as of December 31, 2014 and 2015. The available-for-sale investments we held are mainly wealth management products issued by banks and money market funds issued by fund management companies. We have been able to meet our working capital needs in the past, and we believe that we will be able to meet our working capital needs in the foreseeable future, with the estimated net proceeds from this offering, our internal financial resources and cash flow from our operations.

The following table sets forth a summary of our cash flows for the periods indicated:

We had net cash generated from operating activities of RMB430.8 million (US$66.5 million) in 2015, primarily attributable to our net income of RMB403.0 million (US$62.2 million), as adjusted for non-cash items and the effect of changes in working capital including: (i) a decrease in deposits with exchanges, which serve as clearing organizations, in the amount of RMB17.3 million (US$2.7 million) as a result of fluctuation in trading activities by our customers and our risk management decision on deposit level on the last day of the relevant periods (ii) non-cash share-based compensation expenses of RMB31.0 million (US$4.8 million), (iii) unrealized gain from derivatives in the amount of RMB13.9 million (US$2.1 million), (iv) an increase in accrued employee benefits of RMB28.0 million (US$4.3 million) due to our increased payroll size and (v) depreciation of RMB11.9 million (US$1.8 million). These were partially offset by (i) a decrease in other liabilities arising from operating activities of RMB21.7 million (US$3.4 million), (ii) an increase in other assets of RMB21.2 million (US$3.3 million) and (iii) a decrease in accounts payable of RMB19.5 million (US$3.0 million).

We had net cash generated from operating activities of RMB431.5 million in 2014, primarily attributable to our net income of RMB482.0 million, as adjusted for non-cash items and the effect of changes in working capital including: (i) an increase in accrued employee benefits of RMB28.5 million due to our increased payroll size, (ii) an increase in other liabilities arising from operating activities of RMB33.9 million due to our business growth, and (iii) an increase in income tax payable of RMB20.8 million due to our increase in profit before taxes and income taxes. These were partially offset by (i) an increase in deposits with exchanges, which serve as clearing organizations, in the amount of RMB109.7 million as a result of fluctuation in trading activities by our customers and our risk management decision on deposit level on the last day of the relevant periods, (ii) a decrease in other assets of RMB24.8 million due to our business growth, (iii) a decrease in amounts due to related parties of RMB7.7 million, and (iv) a decrease in accounts payable in the amount of RMB7.4 million.

We had net cash used in operating activities of RMB22.0 million in 2013, attributable to our net income of RMB 106.8 million, as adjusted for non-cash items and effect of changes in working capital including (i) an increase in accrued employee benefits of RMB13.3 million due to our increased payroll size, and (ii) an increase in other liabilities arising from operating activities of RMB14.8 million due to our business growth. These were offset by (i) an increase in deposits with exchanges, which serve as clearing organizations, in the amount of RMB50.0 million due to increase in our customers' trading activities and our risk management decision on deposit level on the last day of the relevant periods, (ii) a decrease of RMB59.1 million in amount due to related parties, (iii) a decrease in accounts payables of RMB33.1 million, and (iv) an increase in other assets of RMB23.6 million due to our business growth.

We had net cash generated by investing activities of RMB179.9 million (US$27.8 million) in 2015, primarily attributable to cash received from (i) sale of available-for-sale investments in the amount of RMB5,148.7 million (US$794.8 million) and (ii) repayment of loans from related parties in the amount of RMB47.0 million (US$7.3 million), which was offset by cash paid for (i) purchase of available-for-sale investments of RMB4,862.2 million (US$750.6 million), (ii) payment for the acquisition of our subsidiaries pursuant to the reorganization in the amount of RMB107.3 million (US$16.6 million), (iii) issuance of loans to related parties of RMB40.0 million (US$6.2 million), and (iv) purchases of equipment and leasehold improvements of RMB8.6 million (US$1.3 million) primarily associated with the addition of office space and equipment to support our business growth.

We had net cash used in investing activities of RMB327.7 million in 2014, primarily attributable to cash used in (i) purchase of available-for-sale investments of RMB2,218.0 million, (ii) purchase of equipment and leasehold improvements of RMB13.3 million, and (iii) issuance of loans to related parties in the amount of RMB28.0 million, which was partly offset by (i) cash received from sale of available-for-sale investments in the amount of RMB1,896.9 million, (ii) cash received from loan repayments from related

parties of RMB21.5 million and (iii) cash received from loan repayments from third parties of RMB13.0 million.

We had net cash provided by investing activities of RMB31.6 million in 2013, primarily attributable to (i) cash received from sale of available-for-sale investments of RMB428.4 million, and (ii) cash received from repayment of loans from related parties in the amount of RMB189.4 million, which was offset by (i) cash paid for purchase of equipment and leasehold improvements in the amount of RMB20.6 million, (ii) cash paid for purchase of available-for-sale investments of RMB458.0 million, (iii) issuance of loans of RMB99.8 million to related parties, and (iv) issuance of loans of RMB13.0 million to third parties.

We had net cash used in financing activities of RMB331.8 million (US$51.2 million) in 2015, primarily attributable to dividends of RMB705.0 million (US$108.8 million) paid by our PRC subsidiaries to a holding company wholly owned by our shareholders prior to our reorganization, which was partially offset by (i) proceeds from capital contribution by our shareholders in the amount of RMB254.3 million (US$39.3 million) and (ii) proceeds from borrowings from related parties in the amount of RMB118.9 million (US$18.4 million).

We had net cash used in financing activities of RMB129.5 million in 2014, primarily attributable to (i) dividends of RMB100.0 million to a holding company wholly owned by our shareholders and (ii) repayments of borrowings from related and third parties, which was slightly offset by proceeds from capital contribution by our shareholders in the amount of RMB16.0 million.

We had net cash generated from financing activities of RMB33.2 million in 2013, primarily attributable to proceeds from borrowings from related parties in the amount of RMB50.7 million and from third parties in the amount of RMB13.0 million, which was partly offset by repayment of borrowings of RMB20.5 million from related parties and repayment of borrowings from third parties of RMB10.0 million.

Our capital expenditures consist primarily of expenditures for the purchase of fixed assets and intangible assets. Our capital expenditures amounted to RMB21.5 million, RMB15.1 million and RMB11.9 million (US$1.8 million) in 2013, 2014 and 2015, respectively, primarily due to purchases of electronic and office equipment and leasehold improvements for our office space as a result of our business growth.

The table below sets forth our contractual obligations and commitments as of December 31, 2015.

Total rental expenses for all operating leases were RMB11.2 million, RMB20.5 million and RMB24.4 million (US$3.8 million) for the year ended December 31, 2013, 2014 and 2015, respectively. We did not have any significant capital and other commitments, long-term obligations or guarantees as of December 31, 2015.

We have not entered into any financial guarantees or other commitments to guarantee the payment obligations of any third parties. In addition, we have not entered into any derivative contracts that are indexed to our shares and classified as shareholders' equity or that are not reflected in our combined and

consolidated financial statements. Furthermore, we do not have any retained or contingent interest in assets transferred to an unconsolidated entity that serves as credit, liquidity or market risk support to such entity. Moreover, we do not have any variable interest in any unconsolidated entity that provides financing, liquidity, market risk or credit support to us or engages in leasing, hedging or research and development services with us.

Since our inception, inflation in China has not materially impacted our results of operations. According to the National Bureau of Statistics of China, the year-over-year percent changes in the consumer price index for December 2013 and December 2014 were increases of 2.6% and 2.0%. Although we have not in the past been materially affected by inflation since our inception, we can provide no assurance that we will not be affected in the future by higher rates of inflation in China.

We are a holding company with no material operations of our own. We conduct our operations through our subsidiaries in China. As a result, our ability to pay dividends and to finance any debt we may incur depends upon dividends paid by our subsidiaries. Our PRC subsidiaries may purchase foreign exchange from relevant banks and make distributions to offshore companies after completing relevant foreign exchange registration with the SAFE. Our offshore companies may inject capital into or provide loans to our PRC subsidiaries through capital contributions or foreign debts, subject to applicable PRC regulations. If our subsidiaries or any newly formed subsidiaries incur debt on their own behalf in the future, the instruments governing their debt may restrict their ability to pay dividends to us. In addition, our subsidiaries are permitted to pay dividends to us only out of its retained earnings, if any, as determined in accordance with PRC accounting standards and regulations. As of December 31, 2015, our PRC subsidiaries had an aggregate retained earnings of RMB71.3 million (US$11.0 million) under PRC GAAP. Under PRC law, each of our affiliates in China is required to set aside at least 10% of its after-tax profits each year, if any, to fund a statutory reserve until such reserve reached 50% of its registered capital, after which any mandatory appropriation stops. Our PRC subsidiaries had an aggregate statutory reserves in the amount of RMB35.4 million (US$5.5 million) as of December 31, 2015. Yin Tian Xia Technology has reached its maximum reserve amount and it has stopped appropriation, while other PRC entities have not yet reached their respective maximum reserve amounts. Although the statutory reserves can be used, among other ways, to increase the registered capital and eliminate future losses in excess of retained earnings of the respective companies, the reserve funds are not distributable as cash dividends except in the event of liquidation of the companies. At the discretion of our PRC subsidiaries, they may allocate a portion of their after-tax profits to discretionary funds for staff welfare and bonus. Such discretionary funds, similar to statutory reserves, are not distributable as cash dividends.

All of our revenues and substantially all of our expenses are denominated in RMB. In our combined and consolidated financial statements, our financial information that uses RMB as the functional currency has been translated into U.S. dollars. Currently our exposure to foreign exchange risk primarily relates to our cash and cash equivalents denominated in U.S. dollars as a result of the proceeds from this offering. We do not believe that we currently have any significant direct foreign exchange risk and have not used any derivative financial instruments to hedge exposure to such risk. Although in general our exposure to foreign exchange risks should be limited, the value of your investment in our ADSs will be affected by the exchange rate between U.S. dollar and RMB because the value of our business is effectively denominated in RMB, while our ADSs will be traded in U.S. dollars.

The conversion of RMB into foreign currencies, including U.S. dollars, is based on rates set by the PBOC. The PRC government allowed the RMB to appreciate by more than 20% against the U.S. dollar between July 2005 and July 2008. Between July 2008 and June 2010, the exchange rate between the RMB and the U.S. dollar had been stable and traded within a narrow band. Since June 2010, the PRC government has allowed the RMB to appreciate slowly against the U.S. dollar, though there have been periods when the RMB has depreciated against the U.S. dollar. In particular, on August 11, 2015, the PBOC allowed the RMB to depreciate by approximately 2% against the U.S. dollar. It is difficult to predict how long the current situation may last and when and how the relationship between the RMB and the U.S. dollar may change again.

To the extent that we need to convert U.S. dollars into RMB for our operations, appreciation of the RMB against the U.S. dollar would have an adverse effect on the RMB amount we receive from the conversion. Conversely, if we decide to convert RMB into U.S. dollars for the purpose of making payments for dividends on our ordinary shares or ADSs or for other business purposes, appreciation of the U.S. dollar against the RMB would have a negative effect on the U.S. dollar amounts available to us.

We estimate that we will receive net proceeds of approximately US$90.2 million from this offering if the underwriters do not exercise their option to purchase additional ADSs, after deducting underwriting discounts and commissions and the estimated offering expenses payable by us, based on the initial offering price of US$13.50 per ADS, the midpoint of the estimated initial public offering price range shown on the cover page of this prospectus. Assuming that we convert the full amount of the net proceeds from this offering into RMB, a 10% appreciation of the U.S. dollar against the RMB, from the exchange rate of RMB6.4778 for US$1.00 as of December 31, 2015 to a rate of RMB7.1256 to US$1.00, will result in an increase of RMB58.4 million in our net proceeds from this offering. Conversely, a 10% depreciation of the U.S. dollar against the RMB, from the exchange rate of RMB6.4778 for US$1.00 as of December 31, 2015 to a rate of RMB5.8300 to US$1.00, will result in a decrease of RMB58.4 million in our net proceeds from this offering.

Our exposure to interest rate risk primarily relates to the floating interest rates for our own cash deposited with banks.

We have not been exposed to material risks due to changes in market interest rates, and we have not used any derivative financial instruments to manage our interest risk exposure. However, we cannot provide assurance that we will not be exposed to material risks due to changes in market interest rate in the future. To the extent we decide to do so in the future, we cannot be assured that any future hedging activities will protect us from fluctuations in interest rates.

Price risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in market prices (other than those arising from interest rate risk or currency risk), whether those changes are caused by factors specific to the individual financial instrument or factors affecting all similar financial instruments traded in the market.

Our price risk exposure mainly comes from (i) spot commodity contracts we enter into when we serve as counterparty to our customers' trades, (ii) spot commodity contracts with special members for hedging the price risks identified in (i), (iii) trading of physical commodities (mostly silver) and commodity futures contracts we enter into for hedging the risks related to physical commodity trading. The values of these contracts will fluctuate as a result of changes in market price of commodities, exposing us to price risks. In 2015, we entered into a risk and return transfer arrangement with a third party fund, pursuant to which, although we still act as counterparty to our customers' trades, our gains and losses from our principal trading positions on the Tianjin Precious Metals Exchange and the Guangdong Precious Metals Exchange will be transferred to the fund. As long as such arrangement remains in force, we will no longer be exposed

to price risks in relation to spot commodity contracts on these two exchanges. We do not hold principal positions and therefore, are not exposed to price risks from our operation on the Shanghai Gold Exchange.

The following table indicates the effect on our profit after tax and retained profits that would happen if at the period end as indicated, it is estimated that an increase or decrease in the relevant commodity prices, as applicable, with all other variables held constant. However, there are inherent limitations of sensitivity analysis and you should review the following information together with other sections under "Management's Discussion and Analysis of Financial Condition and Results of Operations."

Credit risk is the risk that counterparties may fail to honor their obligations.

We are exposed to credit risks of the third party fund that has entered into a risk and return transfer arrangement with us. Pursuant to the arrangements which took effect on August 23, 2015 with an initial term of five years, the fund will assume all the gains and losses resulting from our principal positions on the Tianjin Precious Metals Exchange and the Guangdong Precious Metals Exchange. To manage the credit risks of the fund, we require the fund to maintain a net asset value of not less than 100% of the aggregate minimum deposits we need to place with the two exchanges. The fund has placed capital in a bank account under its name and under joint administration of the fund and us, and the fund cannot withdraw or make transfer from the bank account without our approval. For more details of the risk and return transfer arrangement, please see "Business — Risk Management — Trading Reloaded Risks." As of December 31, 2015, the net asset of value of such fund was RMB245.5 million (US$37.9 million).

We are also exposed to the credit risks of banks with respect to our cash deposit, wealth management products and deposits with the exchanges. Substantially all of our cash at banks and wealth management products are deposited in state-owned or state-controlled PRC banks. Our deposits with the exchanges are deposited in depositary banks which are generally national commercial banks designated by commodity exchanges.

In May 2014, the Financial Accounting Standards Board, or FASB, issued ASU No. 2014-09, Revenue from Contracts with Customers, which outlines a comprehensive new revenue recognition model designed to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. The accounting standard is effective for annual reporting periods (including interim reporting periods within those periods) beginning

after December 15, 2016. Early adoption is not permitted. We are in the process of evaluating the impact of adoption of this guidance on our combined and consolidated financial statements.

In January 2016, the FASB issued ASU No. 2016-01, Financial Instruments. Overall, the amendments in ASU 2016-01 include, but are not limited to, the following: (i) requiring equity investments (except those accounted for under the equity method of accounting or those that result in consolidation of the investee) to be measured at fair value with changes in fair value recognized in net income; however, an entity may choose to measure equity investments that do not have readily determinable fair values at cost minus impairment, if any, plus or minus changes resulting from observable price changes in orderly transactions for the identical or a similar investment of the same issuer; (ii) simplifying the impairment assessment of equity investments without readily determinable fair values by requiring a qualitative assessment to identify impairment, which means that when a qualitative assessment indicates that impairment exists, an entity is required to measure the investment at fair value; (iii) eliminating the requirement to disclose the fair value of financial instruments measured at amortized cost for entities that are not public business entities; (iv) eliminating the requirement for public business entities to disclose the method(s) and significant assumptions used to estimate the fair value that is required to be disclosed for financial instruments measured at amortized cost on the balance sheet; (v) requiring public business entities to use the exit price notion when measuring the fair value of financial instruments for disclosure purposes; (vi) requiring an entity to present separately in other comprehensive income the portion of the total change in the fair value of a liability resulting from a change in the instrument-specific credit risk when the entity has elected to measure the liability at fair value in accordance with the fair value option for financial instruments; (vii) requiring separate presentation of financial assets and financial liabilities by measurement category and form of financial asset (i.e., securities or loans and receivables) on the balance sheet or the accompanying notes to the financial statements; (viii) clarifying that an entity should evaluate the need for a valuation allowance on a deferred tax asset related to available-for-sale securities in combination with the entity's other deferred tax assets. The new standard is effective for annual reporting periods beginning after December 15, 2017. We are in the process of evaluating the impact of adoption of this guidance on our consolidated financial statements.

China is the world's second largest economy and its GDP has grown steadily over the last three decades since it opened up in the 1980s. China's real GDP grew at an average rate of 7.8% from 2011 to 2015. Although China's real GDP growth slowed down to 6.9% in 2015, the International Monetary Fund forecasts China's real GDP growth to be 6.3% and 6.0% in 2016 and 2017, while the forecast for global economic growth is 3.4% and 3.6% for the same period.

According to a report published by China Merchants Bank and Bain & Company, total investable assets held by Chinese residents grew at a CAGR of 19.2% from RMB39.0 trillion in 2008 to RMB112.0 trillion in 2014. It is estimated to grow to RMB129.0 trillion in 2015, and is expected to grow at a CAGR of 12.7% from 2016 to 2021. In addition, the population of high-net-worth individuals (with at least RMB10 million of investable assets) increased from 0.3 million in 2008 to approximately 1.0 million in 2014. The aggregate wealth owned by such individuals reached RMB32.0 trillion in 2014. The rapid accumulation of personal wealth and increased population of affluent individuals in China have stimulated the market demand for investment products and related services.

Commodities in the financial market generally refer to the primary products that are widely used as raw materials, such as agricultural products, non-ferrous metals, precious metals, chemical products and energy products. The commodity trading market can, based on the time of settlement, be divided into the spot market, in which the purchase and sale of goods are for immediate delivery or permanently extended, and the futures market, in which the purchase and sale of goods will take place on a contracted future date. It can also, based on the trading platform, be divided into the online market and offline market, depending on whether a trade is executed online or offline. The rapid development of information technology has made online trading more efficient and convenient and gradually gain popularity among traders and investors who trade commodities as an investment tool.

Electronic trading of commodities was first developed in China through futures markets in the 1990s. In 2002, the Shanghai Gold Exchange was established by the PBOC with approval of the State Council for spot trading of gold and other precious metals, marking it a key milestone in the development of online spot commodity trading market in China. Initially, trading on the exchange was open to institutional investors only. Since 2006, individual investors were also permitted to open trading accounts. The Shanghai Gold Exchange remains the only national exchange for spot commodity trading and the only exchange permited to conduct spot trading of gold. In 2008, pursuant to the "early pilot and experimentation" policies, the Tianjin Precious Metals Exchange was established with approval from Tianjin Municipality People's Government as one of the first major provincial exchanges for online spot commodity trading. Since then, provincial and other local governments have approved the establishment of hundreds of spot commodity exchanges, in an effort to formalize the previous underground trading of commodities and enhance China's pricing capability in global commodities markets. As new commodity exchanges emerge, new types of commodities are introduced to the market, providing investors with more trading products.

Driven by supportive government measures and the increasing demand for new investment products by Chinese investors, online spot commodity trading has recently emerged as an alternative investment product in China. The trading volume of online spot commodity trading grew at a CAGR of 35.4% from 2011 to 2015, reaching RMB29.0 trillion (US$4.5 trillion) in 2015.

The table below illustrates the trading volume and growth trend of the online spot commodity trading market in China. Precious metals, primarily gold and silver, have been the main trading products, with a combined trading volume increasing from RMB6.6 trillion in 2011 to RMB19.3 trillion in 2015, representing a CAGR of 30.7%, and their trading volume is expected to further increase with a CAGR of 24.6% from 2015 to 2020.

Source: Shanghai Gold Exchange Monthly Report, People's Bank of China Yearly Report, the MOFCOM, and the Euromonitor Industry Report.

The rapid growth of online spot commodity trading in recent years is largely attributable to its distinct features that appeal to individual investors in China. In general, Chinese individual investors have demonstrated strong appetite for volatility. Among major investment products including wealth management products, money market funds, stocks, real estates and bank deposits, stock trading generally involves higher volatility and stocks are heavily traded by individual investors. According to the Shanghai Stock Exchange Statistics Annual 2015, the turnover rate on the Shanghai Stock Exchange or SHSE, which is annual trading volume divided by total public float, was 4.4 times in 2014, significantly higher than the 0.8 times on the New York Stock Exchange in the same year. Moreover, according to SHSE Annual Statistics 2015, 85.2% of the trading volume on SHSE in 2014 was generated by individual investors who held 23.5% of the total market capitalization of SHSE, which is in sharp contrast to institutional investors who generated only 11.6% of the trading volume out of a 14.7% holding of the total market capitalization.

Online spot commodity trading is often conducted based on deposits and with a leverage ratio of 5 to 20 times, and allows for long and short trading directions. This offers relatively high volatility trading opportunities which appeal to certain Chinese individual investors.

The table below compares the trading features of spot commodity trading with stocks and commodity futures in China. These trading features apply to precious metals and some other spot commodities, but not to all spot commodities or to all exchanges.

	Stocks	Commodity Futures	Spot Commodities

Market Establishment	1990s	1990s	2000s
Underlying Assets	2,800+ listed stocks and ETFs	45 commodity categories including agricultural products, metals, industrial materials, etc.	Mainly precious metals including gold and silver, as well as other commodities
Leverage	No leverage by default unless through margin loan with cost	Normally 5 to 20 times	Normally 5 to 20 times
Trading Direction	Long by default unless through stock borrowing with cost	Long and short	Long and short
Trading Hours	4 hours per day; 5 days per week	4 to 9.5 hours per day depending on exchange and products; 5 days per week	9.5 to 22 hours per day depending on exchange and products; 5 days per week
Trading Volume in 2015 (RMB trillion)⁽¹⁾	255.1	136.5	29.0

Source: Shanghai Stock Exchange Statistics Annual, Shanghai Gold Exchange Monthly Report, the MOFCOM, China Futures Association, Wind Info and Euromonitor estimates from trade interviews and desk research by the end of 2015.

Commodity futures and spot commodities both offer higher volatility than stocks through deposit-based leverage trading method. Compared with commodity futures trading, spot commodity trading has the benefits of (i) the underlying assets (mainly silver and gold) are more familiar to individual investors, (ii) the spot contract is less complex as it generally has no expiry date and (iii) the trading hours are generally longer and continuous, which enables investors to trade during trading hours of overseas commodity markets. Compared to commodity futures markets, which had an aggregate trading volume of RMB136.5 trillion (US$21.1 trillion) in 2015, the online spot commodity market, with trading volume of RMB29.0 trillion (US$4.5 trillion) in 2015, is still small and has significant potential.

Leveraged foreign exchange trading is another high volatility trading product that is popular in international markets, but not yet permitted in China under its current regulatory framework for foreign exchange. Compared with foreign exchange trading, price volatility in spot commodity trading is generally higher while its leverage is considerably lower. For instance, according to the U.S. Commodity Futures Trading Commission, the leverage for individual investors to trade foreign exchange is 20 to 50 times depending on the currency and service providers. Leverage offered by service providers outside the U.S. is often higher, ranging from 50 to 400 times depending on the currency.

In China, online spot commodity trading is primarily carried out through exchanges. At the end of 2015, there were approximately 350 exchanges for online spot commodity trading in China, which vary in scale and the types of commodities offered for trading. The top five online spot commodity trading exchanges in China, in terms of trading volume in 2015, are the Shanghai Gold Exchange, the Tianjin Precious Metals Exchange, the Guangdong Precious Metals Exchange, the Jiangsu Mercantile Exchange and the Tianjin

Mineral Resources Exchange. These exchanges had a combined trading volume of RMB19,984.2 billion in 2015, accounting for 69.0% of the total trading volume of the online spot commodity trading market.

The Leading Exchanges for Online Spot Commodity Trading in China by Trading Volume in 2015

Source: Desk research of the Shanghai Gold Exchange Monthly Report, the MOFCOM and Euromonitor Industry Report.

The Shanghai Gold Exchange was organized by the PBOC and established in 2002 with approval of the State Council. It is the only exchange permitted for conducting spot trading of gold in China. It has adopted the order driven trading model and offers gold, silver and platinum for trading with a maximum leverage ratio ranging between 11.1 to 16.7 times. For more details of the order driven trading model, see "Business — The Commodity Exchange Systems We Operate on." The total trading volume of the Shanghai Gold Exchange was RMB10,784.2 billion in 2015, with a CAGR of 24.8% from 2011 to 2015. According to the Shanghai Gold Exchange Monthly Report, the total trading volume of gold reached RMB8,008.4 billion in 2015, accounting for 74.3% of the total trading volume of the exchange. Specifically, institutional investors are the major participants in gold trading on the Shanghai Gold Exchange, contributing a trading volume of RMB6,334.6 billion or more than 79% of the total trading volume of gold in 2015. Silver is also traded on the Shanghai Gold Exchange, accounting for 25.6% of the total trading volume in 2015. Individual investors are the major participants in silver trading, accounting for 86.0% of the total trading volume of silver in 2015.

Source: The Shanghai Gold Exchange, the PBOC and Euromonitor estimates from trade interviews and desk research.

As of December 31, 2015, there were 182 registered members on the Shanghai Gold Exchange. An individual investor can only open trading account with a financial member. There were a total of 26 financial members on the exchange, among which 23 members are commercial banks, two members are state-owned banknote and coin printing and minting companies and the other member is a clearing organization established with governmental approval. An institutional investor may open trading account with a financial or comprehensive member. Financial and comprehensive members may also trade on their own account.

The Tianjin Precious Metals Exchange was established in 2008 with the approval of Tianjin Municipal People's Government. Its shareholders include CITIC Group Corporation, Tianjin Property Rights Exchange and China Gold Group. It adopts the quote driven trading model and offers silver, platinum, palladium, nickel, copper and aluminum for trading with a maximum leverage ratio ranging from 6.7:1 to 12.5:1. For more details of the quote driven model, see "Business — The Commodity Exchange Systems We Operate On." It had a total trading volume of RMB2,900.0 billion in 2015, and the trading volume of silver on the exchange reached RMB2,065.2 billion, accounting for over 70% of the total trading volume. Individual investors are the major participants on this exchange and the trading volume of individual investors is RMB2,655.0 billion in 2015, accounting for approximately 91.6% of the total trading volume on this exchange in 2015. As of December 31, 2015, there were approximately a total of 106 comprehensive members on the Tianjin Precious Metals Exchange. The top five leading members accounted for approximately 43.2% of its total trading volume in 2015.

The Guangdong Precious Metals Exchange was established in 2010 with the approval of Guangdong Provincial People's Government. Its shareholders include Guangdong State-owned Assets Supervision and Administration Commission, as well as Guangdong Revenco Enterprises Corporation. It adopts the quote driven trading model and mainly offers trading of silver, platinum and palladium with a maximum leverage ratio ranging from 5 to 33 times. The Guangdong Precious Metals Exchange has a trading volume of RMB2,700.0 billion in 2015, representing a 94.8% increase from a trading volume of RMB1,386.0 billion in 2014. Similar to the Tianjin Precious Metals Exchange, silver is the major precious metal traded on the Guangdong Precious Metals Exchange and the trading volume of silver trading reached RMB1,620.0 billion in 2015. Individual investors are the major participants of the exchange, contributing a trading volume of RMB2,356.6 billion to, or 87.3% of, its total trading volume in 2015. As of December 31, 2015, there were approximately a total of 71 comprehensive members on the Guangdong Precious Metals Exchange.

The development of the online spot commodity trading market is driven by, among other things, a growing population of affluent individuals, expanding netizen population and thriving internet finance. It is also subject to many constraints, including macro-economic slowdown and competition from alternative investment products such as stocks, futures and new financial products such as peer-to-peer lending. As a relatively new investment product at its initial developing stage, the online spot commodity trading market is becoming more open and international, and yet more regulated.

Increasing population of affluent individuals and demand for new investment products

The steady increase of per capita disposable income and individual investable assets have stimulated the market demand for personal investment products and services. Moreover, there is a general desire among individual investors to diversify from traditional investment channels, such as stocks, real estate and wealth management products issued by banks, to new investment products, such as trust products, online money market products, peer-to-peer lending, crowd funding as well as online spot commodity trading.

China's rapid development of telecommunication infrastructure has increased nationwide internet access and facilitated the popularization of digital mobile devices, which have contributed to the expansion of the netizen population in China. According to China Internet Network Information Center, or CNNIC, as at the end of 2015, China had a total netizen population of 688.0 million and an internet penetration rate of 50.3%. The total mobile internet users increased from approximately 302.7 million in 2010 to approximately 619.8 million in 2015, representing a CAGR of 15.4%. In addition, the mobile internet users as a percentage of total internet users increased from 66.2% in 2010 to 90.1% in 2015, signaling the expansion of the mobile internet community.

The growing netizen population, the advancement of internet technology and the development of third party payment platforms have facilitated the development of internet finance. According to CNNIC, at the end of 2015, the total number of customers of online investment products reached 90.3 million, representing a penetration rate of 13.1% of the total netizen population. The development of the Internet finance market has accelerated the general public's acceptance of online spot commodity trading as an online investment product.

The further development and opening up of finance and service sectors, including the spot commodity trading industry, is an important element of China's 12th Five Year Plan. In September 2014, the Shanghai Gold Exchange introduced "Gold International Board", where international investors could trade gold and other precious metals directly on the Shanghai Gold Exchange, strengthening the pricing power by and the connection of China's gold market to international gold markets. In November 2014, the Shanghai Gold Exchange signed a Memorandum of Understanding to form a partnership with the Chicago Mercantile Exchange Group, to explore new commodity trading products and services that could be offered to Chinese and international investors. In addition, Chinese Gold and Silver Exchange Society and the Shanghai Gold Exchange launched a "Shanghai-Hong Kong Gold Connect" in 2015 to further connect China's gold market to the international gold markets. These strategic initiatives will help online spot commodity trading market to evolve into a more mature, dynamic, internationalized and appealing market for investors.

China's year-over-year GDP growth has been levelling out from a double-digit increase to just over 7.0% since 2012. It is expected that the trend will continue over the mid-to-long term, and the International Monetary Fund predicts China's macro-economy to grow at 6.3% in 2016. The slowdown of economic growth will exert downward pressure on the growth of individual disposable income and the investable asset pool in general. It may also decrease the general public's willingness to spend or invest due to reduced confidence in future prospects.

Online spot commodity trading competes against other investment products and is thus affected by investors' evolving preferences investment products. Although the recent cool-down of China's real estate market has prompted the capital outflow into other investment channels, China's stock market has rallied since 2014 and attracted a significant amount of capital. In addition, wealth management products with stable returns offered by commercial banks and other financial institutions remain popular among more conservative individual investors, and private banking service with individualized investment portfolio offered by these banks for affluent investors are gaining popularity. Besides traditional investment channels, as China's financial markets rapidly evolve, new investment products targeting individual investors are constantly being introduced into the market, such as peer-to-peer lending and crowd funding. The change of traditional investment channels and the introduction of new ones have stimulated individual investors' interest in investment products and services in general. However, with a relatively fixed aggregate individual investable asset pool at a given time point, online spot commodity trading needs to compete with other products for investment.

Due to the relatively short history and lack of regulation in the early stage of the industry, there have been several cases of fraudulent or illegal platforms for online spot commodity trading, resulting in heightened scrutiny and more stringent regulation by the government. On November 11, 2011, the State Council promulgated the Circular 38, and on July 12, 2012, the general office of the State Council further promulgated the Circular 37. After the issuance of Circulars 38 and 37, the government has investigated, rectified and closed down many illegal, irregularly operated or fraudulent trading platforms. Moreover, on November 8, 2013, the MOFCOM, the PBOC and the CSRC jointly issued the Special Provisions on Commodity Spot Market Trading (for Trial Implementation), or the Special Provisions, effective as of January 1, 2014. These regulations are introduced to protect investors' interest, reduce financial risks and build up a better regulatory framework for the industry. It also means exchanges and trading service providers like us will receive more scrutiny and oversight.

The spot commodity trading market is highly competitive and fragmented for trading service providers. As of December 31, 2015, there were over 1,000 active trading service providers that operate on over 350 exchanges nationwide. The exchanges compete against each other for members and customers, and they could attract high-quality members with larger customer base through setting more favorable trading models and rules. The trading service providers select the exchanges they operate on by taking into consideration a combination of factors, including the reputation, scale and reliability of the exchanges and the trading model and rules set by the exchanges.

The trading service providers compete for customers and trading volumes based on various factors. Since online spot commodity investors often rely on accurate and timely market information and in-depth market analysis to trade, trading service providers that have better technology platform and stronger research capabilities are able to attract customers with such advantages vis-a-vis their competitors. More importantly, due to the fact that investors often need to link their confidential personal information such as mobile numbers, national ID number and bank accounts with their trading accounts, trade service providers that have stronger brand recognition and reputation in the industry are able to develop customers more effectively and efficiently compared with their less well-known competitors.

The chart below sets forth the leading trading service providers for online spot commodity in China:

We were the largest online provider of spot commodity trading services in China by customer trading volume in 2015, with a market share of approximately 4.0% in terms of trading volume of individual investors. We had a market share, in terms of trading volume of individual investors, of approximately 15.5% on the Tianjin Precious Metals Exchange and approximately 10.4% on the Guangdong Precious Metals Exchange, in 2015. The other leading firms are mainly dedicated trading service providers like us, except NetEase, which is an Internet and online game services provider in China listed on Nasdaq (NASDAQ:NTES). Differing from our strategy of focusing on premier customers, NetEase sets low deposit requirements for account opening and gained a large customer base with small average invested amounts in a relatively short period.

We believe our proprietary technology platform, our focus on premier customers, our comprehensive customer services and strong brand recognition in the industry, will enable us to compete effectively in the fast evolving online spot commodity trading industry in the PRC.

We are the largest online provider of spot commodity trading services in China by customer trading volume in both 2014 and 2015, according to Euromonitor. We currently facilitate the trading by individual customers of silver, gold and other precious metals and commodities on three leading exchanges, namely the Shanghai Gold Exchange, the Tianjin Precious Metals Exchange and the Guangdong Precious Metals Exchange, which were the three largest exchanges for online spot commodity trading in China in terms of trading volume in 2015, respectively. We were the largest service provider by customer trading volume on the Tianjin Precious Metals Exchange from 2012 to 2015, and the largest service provider on the Guangdong Precious Metals Exchange in the fourth quarter of 2015. We commenced our operation on the Shanghai Gold Exchange in November 2015 and our customer trading volume has been growing rapidly since then.

Online spot commodity trading recently emerged as an alternative investment product in China, with aggregate trading volume growing at a CAGR of 35.4% from 2011 to 2015 and reaching RMB29.0 trillion (US$4.5 trillion) in 2015. We believe such growth is largely attributable to the distinctive features of online spot commodity trading. Its deposit-based leverage trading method offers relatively high volatility trading opportunities which appeal to a group of individual investors. Compared with other leveraged trading products such as futures, Spot commodity trading enjoys the following benefits: (i) the underlying assets, primarily silver and gold, are more familiar to individual investors, (ii) the spot commodity contract is less complex, and (iii) its trading hours are longer and continous. Compared with China's commodity futures markets, which had an aggregate trading volume of RMB136.5 trillion (US$21.1 trillion) in 2015, the spot commodity market is still small and we believe it has strong growth potential.

We have achieved substantial growth since our commencement of operation in July 2011. Our revenues increased significantly from RMB629.9 million in 2013 to RMB1,157.8 million in 2014, and further to RMB1,245.9 million (US$192.3 million) in 2015. We recorded net income of RMB106.8 million, RMB482.0 million and RMB403.0 million (US$62.2 million) in 2013, 2014 and 2015, respectively.

We believe that our success to date is largely attributable to the following competitive strengths.

Thanks to our efficient and scalable operating model, we have a track record of becoming market leader in a relatively short period after we commenced operation on an exchange. We commenced operation on the Tianjin Precious Metals Exchange in July 2011 and our customer trading volume was the largest among all service providers on the exchange from 2012 to 2015. We expanded our operation to the Guangdong Precious Metals Exchange in August 2013 and our customer trading volume ranked, among all service providers, No. 7 in 2014, No. 3 in the first nine months of 2015 and No. 1 in the fourth quarter of 2015. Our customer trading volume on the Shanghai Gold Exchange has been growing rapidly since our recent commencement of operation on the exchange in November 2015.

As a leading online provider of spot commodity trading services, we also enjoy strong brand recognition in the industry. Based on a survey conducted by Euromonitor in early 2015, the combination of our brands, including Yin Tian Xia, Rong Jin Hui Yin and Jin Xiang Yin Rui, received the highest investor recognition in the industry. Our brand Yin Tian Xia was awarded as one of the "China's 500 Most Valuable Brands 2015" by World Brand Lab, a leading global brand evaluation institution, as the only award granted in the industry of online spot commodity trading. We believe that our leading market position and strong brand recognition has created a virtuous circle which reinforced each other, helping us to succeed in this industry.

We acquire and serve our customers mostly online and do not operate physical branches. As such, our proprietary technology infrastructure, comprising client software, CRM system and information security and data analysis capabilities, is critical to our operations. We made substantial investments in research and development. As of December 31, 2015, we had a software research and development and maintenance team of 168 employees. The total operating expenses incurred by Yin Tian Xia Technology, our PRC subsidiary responsible for building our technology infrastructure, amounted to RMB23.4 million, RMB60.7 million and RMB154.7 million (US$23.9 million) in 2013, 2014 and 2015, respectively.

Our client software provides comprehensive trading information and tools, as well as interactive functions such as live discussion boards and instant messaging with customer representatives, which we believe enhance our customers' engagement. Our CRM system allows us to efficiently manage relationships with customers and potential customers, monitor and supervise customer communications, as well as centrally manage customer information to reduce the risk of leakage or misusage. We collect customer data through our client software and CRM system, as well as from the exchanges. We have a dedicated team to analyze these data, which can help to better allocate marketing budget, identify target customers and provide tailored customer service.

We believe this integrated technology infrastructure distinguishes us from our competitors and has helped us to replicate our success on different exchanges. To maintain our technological edge, we will continue to upgrade and optimize our technology based on customer feedback and market developments.

We strive to continuously enhance our customers' experience through our dedicated services. According to survey conducted by Euromonitor in early 2015, we received the highest customer satisfaction rating among online providers of spot commodity trading services. We believe such recognition is mainly due to our personal approach to customer services, our high-quality content and our focus on customer interactions.

Personal approach: As of December 31, 2015, we had a dedicated customer service team of approximately 421 professional personnel that provides real-time customer support in all phases of their trading. Thanks to the various customer data accessible through our CRM system, the team is able to provide tailored and informed services to our customers and enhance their experience with us.

High quality content: As of December 31, 2015, we had a professional research team consisting of 27 members who possess various qualifications in securities, futures and commodities trading. The team's work has been published on several leading journals. The team provides research reports, online lectures and live market commentaries to our customers to assist their decision making.

Customer interactions: We encourage our customers to interact with our customer representatives as well as among themselves through the live discussion boards in our client software, website and social media tools. We believe such interactions enhance our customers' engagement and experience.

We have established rigorous risk management policies and practices as we believe that risk management is crucial to the success of our business. We mainly focus on three types of risks: trading-related risks, operational risks and information security risks.

Trading-related risks: We face liquidation risks and market risks for our operation on the Tianjin Precious Metals Exchange and the Guangdong Precious Metals Exchange. Please see detailed description of such risks under "Business — Risk Management — Trading Related Risks." To reduce liquidation risks, we set a series of prudent internal policies and rules, including detailed funding and withdrawal procedures, that are strictly implemented by our risk control trading center. To minimize our market risks, in 2015, we entered into a risk and return transfer arrangement with a third party fund, under which our trading gains and losses on these two exchanges will be transferred to the fund.

Operational risks: We are exposed to operational risks for various aspects of our business and we formulated comprehensive internal policies to manage the risks related to four key business processes: marketing, customer development, research publication and customer service. Our compliance department reviews all promotion materials, advertisement, as well as research materials before publication, to avoid disclosure of misleading or inaccurate information. We monitor the interactions between our sales and potential customers, and between our customer representatives and customers, by screening recorded conversations using our automatic speech recognition system and spot checks.

Information security risks: We have set up a comprehensive information security system to safeguard our customers' information and our proprietary data. We received ISO27001 certification issued by British Standards Institution, the world's largest certification organization, in recognition of such system.

Our founders and members of our senior management team have significant experience in financial service and information technology industries, and possess valuable know-how in spot commodity trading services. Our core management is able to efficiently manage a team of over 1,800 employees and keep them coordinated and incentivized. In addition, we have a competent team of core staff covering many critical aspects of our business, including marketing and brand management, risk management, software development and human resources. We also strive to cultivate talents and build a multilevel high-quality talent pool. We have invested a significant amount of resources in training and professional development programs for our employees.

We strive to build an online investment service platform that is highly trusted by individual investors. To achieve this objective, we plan to implement the following strategies:

Currently, the spot commodity trading service market in China is characterized by high growth potential, limited operating history and high fragmentation. Going forward, we believe that individual customers will be gradually attracted to leading service providers with strong brand recognition, good reputation and high standards of customer service, and as a result, market concentration will increase.

To seize this opportunity, we plan to further strengthen our branding efforts so that more people will learn about spot commodity trading, our services and reputation. We are also committed to becoming a major driving force for higher industry standards in terms of research, services and employee professional qualifications. We believe this will expand the customer base of our industry, as well as strengthen our market leading position.

Prior to November 2015, we mainly provided services for the spot trading of silver and other commodities on the Tianjin Precious Metals Exchange and the Guangdong Precious Metals Exchange. We have recently expanded our services to cover the trading of gold on the Shanghai Gold Exchange, which is the only exchange permitted to conduct spot trading of gold in China.

We plan to further expand our product offerings to other commodities and exotic trading products such as collectible stamps, banknotes and coins, to the extent in compliance with applicable laws and regulations. Trading model for these collectible items is similar to that of equities, in that it offers long and, in rare cases, short (through selling a borrowed asset) trading opportunities generally without leverage. The underlying physical assets such as stamps are centrally deposited with exchanges and property titles to these assets are traded electronically on exchanges' trading systems.

Furthermore, as foreign exchange trading shares many features with the spot commodity trading (e.g., long and short trading directions, deposit-based and with leverage), as part of our long-term plan, we intend to provide foreign exchange trading services to our customers when such business becomes feasible under China's regulatory regime. We also seek to diversify from trading-oriented products and to venture into wealth management advisory services in the future.

We currently focus on premier customers. With the emergence of mobile Internet, we see an opportunity on the opposite end of the market, namely the mini-accounts. These are accounts with minimum deposit requirements as low as RMB10 and sometimes with a cap (e.g., RMB1,000) on total invested amount. With small amounts involved, it can be used as an investor education tool or even entertainment.

We believe that our technological capabilities and our understanding of the trading product and target customers accumulated through our existing business position us well to capture this opportunity. We intend to utilize the mobile Internet to acquire a large number of "long-tail" customers with relatively low cost and provide most services in an automated manner, thus achieving economies of scale. In March 2016, we acquired 70% equity interest in Da Xiang, a company focusing on providing online spot commodity trading services to mini-account customers. Da Xiang, through its designated mobile application (Wei Pan Bao), serves customer accounts with a minimum investment threshold of RMB8.0 (US$1.2). The mini-account business will not directly compete with our existing business and some of the mini-account customers could upgrade to become our premier customers, hence benefiting our existing business.

We believe that the spot commodity trading service market in China is still in its early stage of development. As part of our competitive strategy, we may consider acquiring peer firms with distinctive

advantages complementary to ours in order to strengthen our market position. Moreover, the broader Internet finance market in China has presented many business opportunities. We will selectively and cautiously explore acquisition opportunities, with a view to diversify and enhance our overall business profile as well as to create synergies and generate financial returns.

We rely on our management team and employees to serve our customers and implement our growth strategies. Hence, attracting, cultivating and retaining talent has been, and will remain, critical to our success. We plan to continue to attract and retain highly skilled personnel, particularly the technology and research professionals, and further strengthen our corporate culture by continuing to invest in employee training and other professional development programs. We will continue to provide our employees with growth opportunities, performance-based incentives linked to individual contributions and our operational results and other benefits to align employees' interests with those of our shareholders.

According to Euromonitor, there are two major trading models adopted by online spot commodity exchanges in China: the "order-driven" trading model and the "quote-driven" trading model. The Tianjin Precious Metals Exchange and the Guangdong Precious Metals Exchange have adopted substantially the same "quote-driven" model. Under this trading model, a price quoter, which could be the exchange or a trading participant, provides price quotations to buy or sell certain commodity, and other trading participants can choose to trade at the quoted price. On the other hand, the Shanghai Gold Exchange has adopted the "order-driven" model. Under the order-driven trading model, a trading participant submits orders to buy or sell certain commodity with specified price and quantity, which will be matched with other participants' orders to sell or buy, and the trade will be executed through the exchange's trading system. Besides setting the trading models and rules, each exchange also keeps trading records, maintains technology infrastructure, conducts bookkeeping and gives clearing instructions. Each exchange supervises its members and members' customers, including review qualification and grant approval for trading, and oversees the overall risk management of its exchange system.

Trading Model of the Tianjin Precious Metals Exchange and the Guangdong Precious Metals Exchange

Trading participants on the Tianjin Precious Metals Exchange and the Guangdong Precious Metals Exchange mainly include individual and institutional customers, comprehensive members and special members. The exchange quotes trading prices with reference to the prices from relevant international and domestic commodities markets, and the trading prices are made known to trading participants in real time. The prices quoted by the exchange are the only prices used for trading purposes by the trading participants. An individual customer can only initiate trades with a comprehensive member with which he or she has a trading account. A comprehensive member must unconditionally accept such trading orders placed with it and serve as the counterparty to the customer's trades. A comprehensive member may initiate trades with its contracted special member, which is usually assigned by the exchange, for risk management or proprietary trading purposes. The special member must unconditionally accept such trading orders from the comprehensive member and serve as the counterparty to such trades. If a special member is unable to accept such trading orders due to liquidity insufficiency, the exchange will transfer the orders to other special members. As of December 31, 2015, there were a total of 106 and 71 comprehensive members on the Tianjin Precious Metals Exchange and the Guangdong Precious Metals Exchange, respectively, and there were only a handful of special members on each of these two exchanges.

The following diagram illustrates the trading model currently adopted by the Tianjin Precious Metals Exchange and the Guangdong Precious Metals Exchange and the main participants on these exchanges:

Trading participants on the Shanghai Gold Exchange mainly include individual and institutional customers, financial members, comprehensive members and proprietary members. Trading participants may submit orders to buy or sell certain commodity with specified price and quantity, which will be matched with other participants' orders to sell or buy such commodity, and the trade is executed via the exchange's trading system. The proprietary member is only allowed to conduct proprietary trading, while the comprehensive member and financial member are allowed to conduct proprietary trading and agent business for institutional customers. In addition, a financial member could also conduct agent business for individual customers. A financial member may use agents to develop and service customers. We are such an agent of a financial member. As of December 31, 2015, there were a total of 26 financial members on the exchange, among which 23 members are commercial banks, two members are state-owned banknote and coin printing and minting companies and one member is a clearing organization established with governmental approval.

The following diagram illustrates the trading model currently adopted by the Shanghai Gold Exchange and the main participants on the exchange:

The exchanges typically designate one or more banks to serve as depositaries for all trading participants. The exchanges open their segregated deposit accounts and enter into custodian arrangements with such designated banks for fund deposit and withdraw made by its members or members' customers. For the Tianjin Precious Metals Exchange and the Guangdong Precious Metals Exchange, a member or a customer is required to enter into a tri-party depositary service agreement with the exchange and the designated bank, pursuant to which the bank will then set up a sub-account under the exchange's deposit account for such member or customer. For the Shanghai Gold Exchange, a member will enter into a tri-party depositary service agreement with each of its customers and the designated bank, pursuant to which the customers' accounts will be set up under such member's account, instead of under the exchange's account. For all three exchanges, all customers' and members' sub-accounts are segregated from each other and could only be freely withdrawn or funded by the corresponding member or customer, subject to the minimum deposit requirement.

Cash settlement is carried out on a "mark-to-market" basis by the deposit banks according to clearing instructions from the exchanges during settlement hours of each trading day. If a customer opens and closes a position on the same day, the profit or loss minus fees and expenses will be credited or debited to the customer's deposit account. If a position is left open until the next trading day, any profit or loss resulting from holding such position during this trading day will be credited or debited to the deposit account, as if the position had been closed on such day, and immediately reopened on the following day (with no fees or expenses charged to the customer) at the end of this trading day.

A customer can also request physical settlement of a trade by taking delivery of the underlying commodity. In such a situation, the customer is required to fully fund his or her position to buy or deliver the physical commodity in a sale order before settlement takes place. There are additional fees associated with the physical settlement process, such as tax, warehousing, shipping expenses and inspection charges. In our experience, customers very rarely make physical settlement requests.

A customer can enter into either a long position, i.e., purchase of a commodity with the expectation that price of the commodity will increase, or a short position, i.e., sale of a commodity with the expectation that price of the commodity will decrease. There is no expiration date for a particular position. For risk management purposes, the exchanges also set limits on the size of single trade order and the size of aggregate open positions which vary by commodity types and exchanges. An individual customer cannot execute a single order that is beyond the pre-set size limit and once his or her aggregate open positions reach the pre-set size limit, he or she cannot enter into new positions.

The exchanges have adopted a deposit-based leveraged trading system. Leverage allows a customer to use a small amount of capital, i.e., the trading deposit, as a lever to gain exposure to a larger quantity of the underlying commodity without the actual ownership of the underlying commodity.

Under this system, a customer is only required to have a certain level of deposit in his or her trading deposit account in order to enter into a position, and is not required to fully fund the position. The required deposit, or minimum deposit, can be calculated as the notional value of the position divided by the maximum leverage ratio set by the exchange, which depends on, among other things, commodity types and customer investment amount. The minimum deposit required cannot be withdrawn from the trading deposit account or used for other positions until the particular position is closed. For example, if a customer intends to take a position with notional value of RMB100,000 (US$15,437) and the applicable maximum leverage ratio is 10:1, he or she needs to have a minimum deposit of RMB10,000 (US$1,544) before taking such a position.

Once a position is established, the price movement of the underlying commodity will affect the value of the customer's account, or "equity." Generally, for any trading participant, equity is the net aggregate of its deposits, withdrawals, closed and open positions. It is made known to the trading participant through the exchange's online trading platform in real time. To mitigate the risk of "negative equity," i.e., a trading participant having an insufficient deposit to cover its loss and hence may default, the exchanges have adopted a mandatory liquidation mechanism that liquidates all positions of a trading participant if its equity falls below a certain level.

On the Tianjin Precious Metals Exchange and the Guangdong Precious Metals Exchange, for an individual customer, when the customer's equity falls below 50% of the aggregate minimum deposit required for all open positions, mandatory liquidation occurs immediately to all of the customer's positions. In addition, if a customer's equity falls below 100% of the aggregate minimum deposit required, he or she cannot withdraw cash from the trading deposit account or take on any new position. On the Shanghai Gold Exchange, for an individual customer, when the customer's equity falls below 100% of the aggregate minimum deposit required for all open positions, mandatory liquidation occurs on the next day starting from the customer's largest position to the smallest position until the minimum deposit requirement is met. On each of the three exchanges, a trading participant can monitor its equity in real time and replenish its trading deposit account as needed.

Trading participants other than individual customers, including comprehensive members, special members and proprietary members, are also required by the exchanges to maintain certain levels of deposit, and will face liquidation if their equity falls below a level set by the relevant exchanges. We are currently a comprehensive member of the Tianjin Precious Metals Exchange and the Guangdong Precious Metals Exchange, and for more details on our deposit requirement and liquidation risk, please see "— Risk Management — Trading Related Risks — Liquidation Risks."

The following table summarizes the major trading rules for individual customers of the three exchanges we operate on.

	Tianjin Precious Metals Exchange	Guangdong Precious Metals Exchange	Shanghai Gold Exchange

Commodity type	Silver, palladium, platinum, nickel, copper and aluminum	Silver, palladium and platinum	Gold, silver and platinum
Trading direction	Long or short	Long or short	Long or short
Mandatory liquidation	Mandatory liquidation of all positions if equity falls below 50% of minimum deposit required	Mandatory liquidation of all positions if equity falls below 50% of minimum deposit required	Mandatory liquidation on the next day if equity falls below 100% of minimum deposit required, and from largest position to smallest position until the minimum deposit requirement is met
Trading hours	Generally Monday 08:00 - 04:00 next day, Tuesday to Friday 07:00 - 04:00 next day	Generally Monday 08:00 - 04:00 next day, Tuesday to Friday 07:00 - 04:00 next day	Generally Monday - Friday 09:00 - 11:30, 13:30 - 15:30 and 20:00 - 02:30 next day
Maximum leverage ratio	Depends on investment amount, ranging from 6.7:1 to 12.5:1	Depends on commodity type and investment amount, ranging from 5:1 to 33:1	Depends on commodity type, ranging from 11.1:1 to 16.7:1

Our business process can be generally divided into three stages: marketing, customer development and customer service, all of which are supported by our technology infrastructure. The following diagram illustrates this process:

Marketing: We conduct brand promotion and precision marketing to attract potential customers through both online and traditional marketing channels. Interested persons who contact us and leave their contact information with us become our potential customers. We also promote our client software through various websites and app stores. Guest version of our software is free to download and use. Through simple online registration, people get free access to the user version of our client software and become our potential customers. We do not conduct cold calls.

Customer development: Our customer representatives interact with potential customers regarding online spot commodity trading, our client software and services through call, text message and instant messaging function in our client software. Our representatives begin building relationships with our customers in anticipation that they will open trading accounts with us.

Customer service: A potential customer who opens and activates a trading account with us becomes our customer. We provide more services to customers compared with potential customers, including free usage of the customer version of the client software which has richer features, as well as access to more comprehensive research reports and technical analysis tools.

We currently focus on premier individual customers and generally require each customer to deposit at least RMB100,000 (US$15,437) for account activation. As of December 31, 2015, on average each customer had invested a principal amount of over RMB200,000 (US$30,875), calculated as the highest net deposit amount (deposits minus withdrawals) since account activation. We believe that these customers are generally more sophisticated investors with higher risk-bearing ability, and we could concentrate on providing them with comprehensive and tailored services.

Our customers could open and activate trading accounts with us online in an easy and user-friendly manner. After filling in basic personal information in our application form, a customer could link his or her personal bank account to his or her trading deposit account, which is an independent depository account under the exchange's (for the Tianjin Precious Metals Exchange and the Guangdong Precious Metals Exchange) or financial member's (for the Shanghai Gold Exchange) account. We cannot access our customers' money, but as a comprehensive member, we can monitor their trading activities and account balances in real time through the exchanges' information system. Customers could freely withdraw funds from their accounts so long as the minimum deposit requirements for their trading positions are met. After a trading account is activated, it becomes a "tradable" account and will remain tradable until the account is closed. We define "active" accounts as tradable accounts that have executed at least one trade during a relevant period.

We believe that the growth of tradable accounts and active accounts, combined with our strategy to focus on premier customers, contributed to the significant growth of our customer trading volume historically. As we gradually diversify our business, our customer base and customer trading volume on Guangdong Precious Metals Exchange and Shanghai Gold Exchange have grown rapidly. The tables below set forth the tradable accounts as of the dates indicated and active accounts and total customer trading volume for the periods indicated:

	For the Year Ended December 31,

	2013		2014		2015
Active accounts
Tianjin Precious Metals Exchange		13,700		17,339		15,679
Guangdong Precious Metals Exchange		635		2,991		8,405
Shanghai Gold Exchange		—		—		369

Total		14,335		20,330		24,453

Customer trading volume
(in millions)		RMB		RMB		RMB	US$

Tianjin Precious Metals Exchange		367,969		563,737		412,591	63,693
Guangdong Precious Metals Exchange		5,820		59,677		244,433	37,734
Shanghai Gold Exchange		—		—		2,685	414

Total		373,789		623,414		659,709	101,842

As part of our efforts to expand our potential customer base in the mass market, in March 2016, we acquired 70% equity interest in Da Xiang, a company focusing on providing online spot commodity trading services to mini-account customers, for a total consideration of RMB7.0 million (US$1.1 million). Da Xiang, through its designated mobile application (Wei Pan Bao), provides its customers the opportunity to trade spot commodities with a minimum investment threshold of RMB8.0 (US$1.2). We expect this acquisition will help us further develop and attract mini-account customers.

Our marketing activities include promoting our brand recognition, attracting new customers through targeted marketing and promoting our client software, which has a broader reach of users who might become our potential customers.

We focus on investing in cost-effective marketing initiatives and continuously evaluate the effectiveness of various marketing channels to optimize the allocation of our marketing spending. We incurred advertising expenses of RMB124.8 million, RMB179.9 million and RMB221.9 million (US$34.2 million) for the years ended December 31, 2013, 2014 and 2015, respectively, accounting for 19.8%, 15.5% and 17.8% of total revenues for the same periods.

Our potential customers could initiate contact with us through call, text message and online instant message, as well as through software downloads and online registration. Our representatives generally follow up with potential customers to respond to their questions regarding online spot commodity trading and our software and services. Our representatives begin building relationships with our customers in anticipation that they will open trading accounts with us.

We use data mining to identify potential customers who are more likely to open trading accounts with us than others. We do so through an analysis of communications history and software usage records, thus improving the effectiveness of our customer development. For instance, based on our analysis, active users of our software are more likely to open a trading account with us than those who do not use our software. We have detailed internal rules regulating the conduct of our customer representatives. We also provide them with mandatory training to ensure the quality of their services. Our internal compliance team also uses our CRM system to monitor communications between our customer representatives and potential customers.

From 2013 to June 2014, we worked with certain sales agent companies selectively to develop customers on and only on the Tianjin Precious Metals Exchange. To better manage and to improve the cost-efficiency of customer development, we ceased such cooperation with sales agent companies in June 2014, and we have been developing customers on our own since then.

We believe that investor education is critical in preparing potential customers for spot commodity trading. We have developed a set of educational programs designed to target customers with a variety of experience levels and investment preferences. Our education programs include basic rules and processes of online spot commodity trading, fundamental analysis methods and technical analysis methods. We provide a simulated trading function through our client software for customers and potential customers, enabling them to experience real-life trading processes without committing any capital or assuming any risks. We offer online lectures and live video programs we produce in-house which cover a variety of topics. Most of our educational resources are easily accessible through PC and APP versions of our client software. Certain materials are also available on our websites.

We provide comprehensive market information to our customers, including real-time price quotes from various exchanges and international markets, technical indicators, commodity market news and macroeconomic data and news. Market information is accessible by our customers and potential customers through PC and APP versions of our client software.

We have a professional research team at our in-house research institute through which we provide research support services to our customers. Our research staff members possess various professional qualifications in securities, futures and commodity trading. Our research services include research reports, online lectures, live market commentaries and quantitative analysis. Our research reports include daily, monthly and special event reports. Our research personnel give live market commentary during trading hours, which can be accessed via PC and APP versions of our client software in text or video format. Our research team also develops various quantitative analysis models that can be used by our customers through our client software.

Historically, we outsourced research services to a related external company. We terminated such arrangement in November 2013, and since then, we have provided research services in-house.

Our client software not only provides market information and investor education to users, but also provides live discussion boards for the users to communicate with our research personnel and among themselves, with respect to market trends, investment opportunities and other related topics. For the year ended December 31, 2014 and 2015, we had an average of approximately 5,000 and 12,000 users, respectively, who participated in the discussions, either by making a post or raising a question, each month, respectively.

We are committed to providing high-quality customer support. Most of our services, including investor education, market information provision and research support services, are accessible through our client software, which we believe provides a positive experience for our customers due to its user-friendliness and easy access. Besides our client software, we have a dedicated team of customer service personnel that handles real-time customer inquiries about our software, market news and research reports, and other questions, via call, text message and online instant message. We request that all our customer representatives conduct customer communications via our communication system that is closely monitored by us. We also provide telephone order processing services during trading hours, allowing our customers to place their trading orders via telephone.

In addition, we receive customer complaints from time to time. To ensure that reasonable complaints made by each customer are adequately addressed and for risk management purposes, we have established a customer complaint department at our customer service center. For a complaint received, our customer compliant officer will first confirm details of the complaint with the customer and then verify the facts with the relevant department. Based on our verification results and our internal policy, we seek to resolve complaints through discussions with the customer. The complaint and our response are recorded in the CRM system, and feedback is also provided to relevant departments. We also report complaints to the

compliance department, which will check for noncompliance and advise the relevant department to take rectification measures, if necessary.

The client software and the CRM system comprise our core technology infrastructure and enable us to move each key phase of our business operation online. We received the "certified software enterprise and registered software products" qualification from the Shanghai Municipal Commission of Economy and Informatization in April 2013, and received ISO9001 certification for software development in June 2014, ISO20000 certification for IT service operation and maintenance in December 2014 and ISO27001 certification for information security management in December 2014. We made substantial investments in R&D. As of December 31, 2015, we had a software research and development and maintenance team of 168 employees. The total operating expenses incurred by Yin Tian Xia Technology, our PRC subsidiary responsible for building our technology infrastructure, amounted to RMB23.4 million, RMB60.7 million and RMB154.7 million (US$23.9 million) in 2013, 2014 and 2015, respectively.

While many of our competitors use third-party software to deliver such services, we have developed a proprietary client software to address our customers' needs. Through our client software, we provide customers with timely and comprehensive market information, investor education programs, simulated trading, research reports, live market commentary, quantitative analysis tools and interactive customer support functions. We operate three versions of our client software, and each version has a different level of functionalities. The guest version has limited functions and is free to download. The user version has more functions and can be used by our potential customers for free. The customer version has the most functions and is available to our tradable customers for free. As of the date of this prospectus, our customers could directly place trades on the Tianjin Precious Metals Exchange through our client software, and we are working to connect our client software to the trading system of the Guangdong Precious Metals Exchange, which we believe will further enhance our customers' trading experience. Currently our customers on the Shanghai Gold Exchange need to use the exchange's software for trading, and we are working to add such function to our client software.

Since early 2013, both the PC and APP versions of our client software have gained popularity among users. The following table summarizes the average number of monthly active users, who have logged onto our client software in a given month, of the PC and APP versions of our client software for the periods indicated:

We believe that in-house development of our client software can shorten development cycles and improve usability of our software based on continuous customer feedback, and therefore differentiate us from our competitors.

Our CRM system is the core IT system for customer development and customer services. Our CRM system allows us to centrally manage relationships with customers and potential customers, monitor and supervise customer communications conducted via calls, text messages and online instant messages, as well as collect and analyze customer data. Our CRM system allows us to manage customer relationships in the following ways:

Customer communication platform. Our CRM system is integrated with our call center, online instant message and text message platform, which enables customer representatives to engage in dial-in and dial-out communications and online chats with our customers, and sends out personalized SMS for promotion and other notices.

Customer relationship management. Our CRM system also facilitates the categorization of customers and potential customers, the management of account opening procedures, account status, rebate arrangement, collection of customer complaints and advice, as well as other customer activities. Through our CRM system, our customer representatives can access customers' communication history with us, their software usage records and trading records. Such background information can help them communicate in more effective ways with our customers and potential customers.

Monitoring. All customer communications through our CRM system are recorded, including calls, text messages and online instant messages. Our compliance department conducts spot checks of our customer communications on a daily basis for any behavior that is noncompliant with our internal policies and for any irregularities. We also recently installed an automatic speech recognition system to monitor calls with customers and identify any noncompliance or irregularities. These recordings and narratives may also be used for training and quality control purposes.

Internal information distribution. Our CRM system distributes internally generated information, such as market information, research reports, new commodity trading products, promotional information and compliance notices, to our customer representatives, which enables us to provide high-quality customer services and to maintain a consistent connection with our customers.

Human resource management: Our CRM system improves our efficiency by facilitating the allocation of existing and potential customers to our customer representatives. We can also monitor and evaluate the performance of each customer representative using data compiled by our CRM system such as the number of customers developed and the number of customer inquiries answered by each customer representative.

We collect data through our client software and CRM system. Through our client software, we are able to collect data with regard to users' usage history, including log-on/off time, duration of each log-on and users' activities during each log-on session, such as watching investor education programs, participating in online discussion board and performing simulated trading. Through our CRM system, we can collect data about a customer's or a potential customer's communication history with us, including recorded calls between the customer and our customer representatives, duration and content of each call, text messages and online instant message records. We also obtain customers' trading records from the exchanges. All of these collected data become our data assets. Our customer representatives can access most of this data through our CRM system. We also have a dedicated team to analyze this data.

We believe that collection and analysis of our data assets enhance our operational efficiency and improve our business in many ways. Our data assets enable us to accurately evaluate the effectiveness of different marketing channels and, consequently, to more efficiently allocate our marketing budget. Through analysis

of data on software usage, individual information and communication records, we can more accurately identify potential customers who have a high interest in opening a trading account with us and thus improve the efficiency of our customer development activities. Through our CRM system, our customer representatives can access customer-specific data, including software usage history, communication history with us and trading records, which make it easier for us to provide informed services to individual customers and enhance their experience with us.

Our client software runs on reliable hardware and software technologies with primary and back-up facilities hosted at two separate geographic locations in Shanghai and Beijing, respectively. In addition, both servers are located in advanced outsourced data centers with full business continuity features, including redundancy for power, telecommunications connections and daily monitoring.

We also maintain formal business continuity policies and practices aimed at ensuring rapid recovery from any business or trade interruptions. We rank each of our services according to the risks associated with potential interruptions and have also established business recovery time objectives for our services. We regularly review and test our recovery plans and controls to ensure the effectiveness of such plans and controls in meeting our business needs.

Our risk control trading center is responsible for the day-to-day management of trading related risks and its primary objective is to monitor the following: (i) equity and risk ratio of our own trading deposit accounts with the Tianjin Precious Metals Exchange and the Guangdong Precious Metals Exchange, (ii) our customers' equity levels and any abnormal trading activities through the exchanges' information system and (iii) abnormal price movements and trading system errors. The risk control trading center operates in three shifts with 24-hour coverage in order to ensure continuous monitoring during the trading hours of the exchanges.

The Tianjin Precious Metals Exchange and the Guangdong Precious Metals Exchange impose minimum trading deposit requirements on comprehensive members for risk management purposes. Such minimum trading deposit are calculated as a fixed percentage of the aggregate trading deposits of a comprehensive member's customers. Currently, the applicable percentage is 16.7% for both of the exchanges. By the end of each trading day, if a comprehensive member's equity falls below the minimum deposit requirement, it needs to replenish its deposit account to above such minimum level generally by the end of the next trading day. In addition, if during trading hours, a comprehensive member's "risk ratio," defined as real-time equity divided by the ending equity of the previous trading day, falls below 30%, the exchange will immediately liquidate all its positions. Then, the special member contracted by the comprehensive member will temporarily act as the counterparty to the trades placed by the comprehensive member's customers, until the comprehensive member meets the minimum deposit requirement again. As a consequence of such mandatory liquidation, we will generally lose all the spread fees and overnight fees associated with the transferred positions to the special member until we replenish our deposit above the minimum level. As an agent, we are not required by the Shanghai Gold Exchange to place any deposits.

Our deposit management goal is to ensure our compliance with the requirements of the exchanges and enhance our capital usage efficiency, which is to prevent any mandatory liquidation while at the same time to avoid any waste of capital as a result of having an excessive level of deposits. We achieve the above goals through a series of internal policies and procedures, including funding and withdrawal rules. We generally

maintain a level of trading deposits higher than the minimum level required by the exchanges, which reduces the risk that the exchanges may liquidate our positions as a result of sudden price fluctuations.

We are exposed to market risks related to the fluctuation of the prices of the underlying commodities when we act as counterparty to our customers' trades on the Tianjin Precious Metals Exchange and the Guangdong Precious Metals Exchange. From January 1, 2013 to December 31, 2015, in a total of 754 trading days, the largest daily loss we incurred from such principal positions was RMB37.1 million and the largest monthly loss we incurred was RMB63.8 million. Historically, we formulated and implemented prudent risk management policies and hedged the market risks associated with our principal positions through special members on these two exchanges and through the Shanghai Futures Exchange.

In order to reduce our exposure to market risks, in 2015, three of our PRC subsidiaries operating on the Tianjin Precious Metals Exchange or the Guangdong Precious Metals Exchange entered into a risk and return transfer arrangement with Pan Hou Wei Ran — PHC Commodity Equity Interest Swap Fund No. 1, a third party fund. Such arrangement has taken effect since August 23, 2015 with an initial term of five years. Pursuant to such arrangement, the trading gains and losses resulting from our principal positions on the Tianjin Precious Metals Exchange and the Guangdong Precious Metals Exchange are transferred to such fund, thus reducing our market risk exposure to commodity price movements volatility. Other than assuming such trading gains and losses, the fund is only allowed to hold cash and highly liquid cash management products.

We also entered into an execution guarantee agreement with such fund, as part of the risk and return transfer arrangement, pursuant to which the fund is required to maintain a net asset value of not less than 100% of the aggregate minimum deposits we need to place with the two exchanges. The net asset value of the fund mainly consists of three components: cash, highly liquid cash management products and amounts receivable by the fund pursuant to the risk and return transfer arrangement. The last component is accrued on a daily basis and settled on a monthly basis. The fund is also required to send us a daily report on its net asset value. If net asset value of the fund falls below 70% of the total minimum deposit requirements of the two exchanges, the fund has a contractual obligation to restore its net asset value to 100% of the total minimum deposit requirements by requesting its investors to inject additional capital in cash. If net asset value of the fund exceeds 120% of the total minimum deposit requirements, the fund has the right to distribute any excess cash from such account to its investors. If the net asset value of the fund falls below 10% of the total minimum deposit requirements on any given day, each of the fund and us is entitled to terminate the agreement and demand settlement immediately. As of December 31, 2015, the net asset of value of such fund was RMB245.5 million (US$37.9 million), which met the minimum deposit requirement for such date.

Also pursuant to the agreement, any withdrawal or transfer from the fund's bank account requires joint approval from us and the fund. We shall approve withdrawals and transfers in compliance with the agreement, such as distributions when net asset value exceeds 120% of the total minimum deposit requirements or investment in highly liquid cash management products, but would have the ability to block any withdrawal or transfer outside the agreed scope, which we believe reduces our credit exposure to the fund as a protective measure.

We are exposed to operational risks for various aspects of our business and we have formulated a series of internal procedures focusing on the risks of four key business areas. First, for advertisement, all promotion materials, webpages, information and media programs for public advertisement are reviewed by the compliance department before publication. Second, for customer development, we conduct spot checks on the audio recordings of customer development calls made by our customer representatives for any noncompliance or irregularities, and our automatic speech recognition system further facilitates such internal screening. Third, all our published research reports contain prominent disclaimers, and our research

institute and compliance department will review all research reports before publication, in order to prevent the disclosure of any misleading or inaccurate information or other potential risks. Fourth, for customer service, we monitor the interactions of our customer representatives with customers through our automatic speech recognition system and through conducting spot checks on recorded conversations with customers for any noncompliance. All customer-facing employees receive compliance training upon joining us and we also provide ad hoc compliance trainings on various compliance matters to all employees. In addition, we have also established an internal whistleblower system for all employees to report any violation to the compliance department on an anonymous basis.

Secure access to our customers' information and other confidential information is paramount to our business success and we are exposed to the risks that such information may be leaked or misused. We maintain strict internal practices, procedures and controls, such as providing different levels of access rights, which enable us to better protect our customers' sensitive information (including ID card number, telephone number and other personal data). We deploy advanced firewall technologies to restrict inappropriate access to our hosting facilities. Access to our information systems is granted to our internal users on an as-needed basis. Our in-house information security team monitors our websites and critical servers 24/7. We use hardware security machines to encrypt sensitive customer information in our CRM system. We received ISO27001 certification issued by British Standards Institution, the world's largest certification organization, in recognition of our information security system.

According to Euromonitor, we were the largest online provider of spot commodity trading services in China by customer trading volume in 2015, with a market share of approximately 4.0% in terms of trading volume of individual investors. We had a market share, in terms of trading volume of individual investors, of approximately 15.5% on the Tianjin Precious Metals Exchange and approximately 10.4% on the Guangdong Precious Metals Exchange, in 2015. Our customer trading volume on Tianjin Precious Metals Exchange was the largest among all service providers on the exchange from 2012 to 2015. Our customer trading volume on Guangdong Precious Metals Exchange ranked, among all service providers, No. 7 in 2014, No. 3 in the first nine months of 2015 and No. 1 in the fourth quarter of 2015. Our customer trading volume on the Shanghai Gold Exchange has been growing rapidly since our recent commencement of operation on the exchange in November 2015.

In addition, there are also over 20 commercial banks operating as financial members on the Shanghai Gold Exchange, through which individual customers can open accounts and trade gold and other precious metals on that exchange. However, we believe that in most cases, these banks only offer a trading channel to their existing customers as part of their overall banking package and do not provide specialized services for spot commodity trading. Recently, attracted by a booming online spot commodity trading market, certain Internet companies such as NetEase, Inc., also launched a spot commodity trading service. Differing from our strategy of focusing on premier customers, NetEase sets low deposit requirements for account opening and gained a large customer base with small average invested amounts in a relatively short period.

Although some of our competitors may have greater financial resources or a larger customer bases than we do, we believe that our proprietary technology platform, our focus on premier customers, our comprehensive customer services and strong brand recognition in the industry, will enable us to compete effectively in the fast evolving online spot commodity trading industry in the PRC.

We rely on our management team and employees to serve our customers and implement our growth strategies. Hence, attracting, cultivating and retaining talent has been, and will remain, critical to our success. We intend to accomplish this through providing our employees with growth opportunities, performance-based incentives linked to individual contributions and our operational results as well as by placing an emphasis on employee training and career development.

As of December 31, 2015, we had a total of 1,891 employees, who were all full-time employees. The following table sets out the total number of our employees by function as of December 31, 2015:

We enter into individual employment contracts with our employees to cover matters such as salaries, benefits, and grounds for termination. Each employee's employment contract also covers non-competition and confidentiality arrangements during such employee's employment with us. For information as to employment agreements with our executive officers, see "Management — Employment Agreements."

We generally formulate our employees' remuneration package to include salary, benefits and share-based compensation. We provide our employees with welfare benefits in accordance with applicable regulations and our internal policies. We also provide trainings for our employees with respect to business, compliance and internal management. Such trainings may be provided by internal departments or external trainers. We review the content of our trainings regularly to ensure that the trainings we provide to our employees are sufficient and up to date.

We are required under PRC laws and regulations to make contributions to our employees' social insurance and housing fund based on specified percentages of the salaries, bonuses, and certain allowances of our employees. Our employees are not covered by any collective bargaining agreement. We believe that we have a good relationship with our employees. The vast majority of our employees are based in China.

Our trademarks, copyrights, domain names, trade secrets and other intellectual property rights are important to us in distinguishing our brand and services from those of our competitors and contribute to our ability to compete in our target markets. We rely on a combination of copyright and trademark laws, trade secret protection and confidentiality agreements with our employees, business partners and selected third-party service providers to protect our business and intellectual property rights. We also enter into confidentiality and invention assignment agreements with all executive officers, key employees and rigorously control access to proprietary technology.

We have 27 registered trademarks in the PRC and we have applied to register for 8 additional trademarks. We have 20 software copyright registrations, 4 software product registrations and own 28 domain names

that we use in connection with the operation of our business. As our brand name gains more recognition among the general public, we will work to increase, maintain and enforce our trademark portfolio as well as software and domain name registration, the protection of which is important to our reputation and the continued growth of our business.

Our principal executive offices are located in Shanghai, China, where we leased approximately 16,004 square meters of office space. In addition to Shanghai, we also have leased properties principally used as office premises for our operations in Beijing, Guangzhou and other cities in China, totaling approximately 2,652 square meters. Most of our leases will expire in 2017. Our leased premises are leased from unrelated third parties who either have valid titles to the relevant properties or proper authorization from the title holder to sublease the property. We believe that we will be able to obtain adequate facilities, principally through leasing, to accommodate our future expansion plans.

We may from time to time become a party to various legal proceedings arising in the ordinary course of our business. We are not a party to, and we are not aware of any threat of, any legal proceeding that, in the opinion of our management, is likely to have a material adverse effect on our business, financial condition or results of operations, nor have we experienced any incident of noncompliance which, in the opinion of our directors, is likely to materially and adversely affect our business, financial condition or results of operations.

This section summarizes the principal current PRC laws and regulations relevant to our business and operations.

All limited liability companies and joint stock limited companies incorporated and operating in the PRC are governed by the Company Law of the People's Republic of China, or the Company Law, which was amended and promulgated by the Standing Committee of the National People's Congress on December 28, 2013 and came into effect on March 1, 2014. In the latest amendment, paid-in capital registration, minimum requirement of registered capital and timing requirement of capital contribution were abolished. Foreign invested enterprises must also comply with the Company Law, with exceptions as specified in foreign investment laws.

With respect to the establishment and operation of wholly foreign-owned enterprises, or WFOE, the MOFCOM, and the National Development and Reform Commission, or NDRC, promulgated the Catalogue of Industries for Guiding Foreign Investment, or the Catalogue, as amended on March 10, 2015, which came into effect on April 10, 2015. The Catalogue serves as the main basis for management and guidance for the MOFCOM to manage and supervise foreign investments. The Catalogue divides industries for foreign investment into three categories: encouraged, restricted and prohibited. Those industries not set out in the Catalogue shall be classified as industries permitted for foreign investment. According to the Catalogue, online spot commodity trading, technical development, technical consultation and technical services sectors are neither restricted nor prohibited.

According to the Provisions on Merger and Acquisition of a Domestic Enterprise by Foreign Investors, or the M&A Rules, promulgated jointly by the MOFCOM, the SASAC, the SAT, the SAIC, the CSRC and the SAFE, beginning on June 22, 2009, overseas special purpose vehicles which are established through acquisition of domestic companies in the PRC and are controlled by Chinese companies or individuals for the purpose of overseas listing must obtain the approval of the CSRC before overseas listing. According to the M&A Rules, if any domestic company, enterprise or natural person intends to merge an affiliated domestic company into an overseas company legally incorporated or controlled by the aforesaid domestic company, enterprise or natural person, the proposed merger shall be subject to the approval of the MOFCOM, and the parties thereto shall not circumvent the above provision through any means, including domestic investment by foreign invested enterprises (the "Related Party M&A Rules"). As none of Mr. Wenbin Chen, Mr. Ming Yan and Ms. Ningfeng Chen is a PRC citizen, our PRC legal advisor is of the view that the onshore acquisitions during our reconstruction are not subject to the Related Party M&A Rules.

We are a comprehensive member of the Tianjin Precious Metals Exchange and the Guangdong Precious Metals Exchange, and an agent of a financial member of the Shanghai Gold Exchange, collectively with the Tianjin Precious Metals Exchange and the Guangdong Precious Metals Exchange, referred as the Exchanges, and we are required to comply with the operational rules of the Exchanges to engage in online spot commodity trading services business and the agent business on the Exchanges. Operational rules of the Exchanges are summarized as below:

Pursuant to the Management Measures for Comprehensive Membership of the Tianjin Precious Metals Exchange (Interim) issued by the Tianjin Precious Metals Exchange on July 1, 2010, the Membership

Management Measures of the Guangdong Precious Metals Exchange (2014) issued by the Guangdong Precious Metals Exchange on March 24, 2014 and the Membership Management Measures of the Shanghai Gold Exchange issued by the Shanghai Gold Exchange on September 16, 2014, or collectively, the Membership Management Rules, business entities or other economic organizations that meet the prescribed conditions of the Exchanges may apply to the Exchanges for membership and, upon approval, engage in spot commodity trading business of precious metals products within the scope authorized by the Exchanges. Of our PRC subsidiaries, Rong Jin Hui Yin is the comprehensive member of the Tianjin Precious Metals Exchange (No. 160); and Jin Xiang Yin Rui (No. 003) and Sheng Ding (No. 160), are the comprehensive members of the Guangdong Precious Metals Exchange, respectively. Therefore, we are entitled to conduct spot commodity trading business of precious metals products on the Tianjin Precious Metals Exchange and the Guangdong Precious Metals Exchange. In November and December 2015, respectively, we have established Jin Dou and Jin Yi to carry out business on the Shanghai Gold Exchange.

Pursuant to the Membership Management Measures of the Shanghai Gold Exchange, there are two types of member in the Shanghai Gold Exchange, ordinary member and special member. Furthermore, Shanghai Gold Exchange divides its ordinary members into three categories according to their business scope: financial member, comprehensive member and proprietary member. The proprietary member is only allowed to conduct proprietary trading, while the comprehensive member and financial member are allowed to conduct proprietary trading and agent business for institutional customers. In addition, a financial member could also conduct agent business for individual customers.

Pursuant to the Membership Management Rules aforesaid, a member of the Exchanges is required to go through an annual inspection registration procedure with the Exchanges in order to renew its membership qualification. Additionally, as a comprehensive member of the Exchanges, Rong Jin Hui Yin, Jin Xiang Yin Rui and Sheng Ding are each required to pay an annual management fee of RMB100,000 (US$15,734), according to the relevant membership contracts with the Exchanges.

To ensure the compliance by the members of relevant rules and regulations, the Exchanges further promulgated several measures for the resolution of noncompliances and violations by the members and their customers, including daily examination, investigation initiation policies, resolution procedures and penalty provisions, as well as dispute resolution policies for any dispute between any member and individual customer. If a comprehensive member violates the relevant regulations of the Exchanges, the Exchanges may impose penalties on such member, including oral warning, written notification, compulsory training, suspension of membership qualification, revocation of membership qualification and payment of liquidated damages.

With respect to different categories of traded commodities including silver, platinum, nickel, palladium and copper, the Tianjin Precious Metals Exchange formulated and promulgated the Trading Rules of the Tianjin Precious Metals Exchange (for Silver) (Interim), the Trading Rules of the Tianjin Precious Metals Exchange (for Platinum) (Interim), the Trading Rules of the Tianjin Precious Metals Exchange (for Palladium) (Interim), the Trading Rules of the Tianjin Precious Metals Exchange (for Spot Nickel) and the Trading Rules of the Tianjin Precious Metals Exchange (for Spot Copper). The Guangdong Precious Metals Exchange also formulated and promulgated the Trading Rules of the Guangdong Precious Metals Exchange for Silver, the Trading Rules of the Guangdong Precious Metals Exchange for Platinum and the Trading Rules of the Guangdong Precious Metals Exchange for Palladium. For the trading of gold, silver and platinum, the Shanghai Gold Exchange also formulated and promulgated the Trading Rules for Spot Commodities Trading.

The above trading rules set out detailed provisions on product standard and quotation rules, trading methods, fee standards, cash settlement, delivery, risk control, information management and other aspects of spot trading of precious metals products, which collectively constitute the basic trading model of the Exchanges. Specifically, the Exchanges have the right to make adjustments on the trading rules based on different circumstances within a certain scope. For specific trading rules and procedures that apply to our

subsidiaries and their customers, please refer to "Business — The Commodity Exchange Systems We Operate On."

We are required to comply with the trading rules of the Tianjin Precious Metals Exchange and the Guangdong Precious Metals Exchange as we are the comprehensive member of these two exchanges. As for the trading rules of the Shanghai Gold Exchange, we are not required to comply with the rules which are specifically regulating the members. However, we are required to follow the trading and management rules, such as duly disclosing risks to the customers, based on the contract we entered into with a financial member of the Shanghai Gold Exchange.

According to the Measures of the Tianjin Precious Metals Exchange for Risk Control Management (Interim) promulgated by the Tianjin Precious Metals Exchange on September 7, 2010, the Measures of the Guangdong Precious Metals Exchange for Risk Control Management (Trial) issued by the Guangdong Precious Metals Exchange in 2014 and the Measures of the Shanghai Gold Exchange for Risk Control Management issued by the Shanghai Gold Exchange on September 16, 2014, the Exchanges have established the following rules for risk management of online spot commodity trading:

To manage trading funds, the Exchanges respectively issue the Measures of the Tianjin Precious Metals Exchange for Trading Funds Management (Trial), the Measures of the Guangdong Precious Metals Exchange for Trading Funds Management (2014) and the Measures of the Shanghai Gold Exchange for Management of Member Agency Trading Funds. Such trading management measures define the rights, obligations and liabilities of the parties involved in trading funds-related activities and set forth rules regulating the depository bank, bank account, customer trading account and member trading account.

In addition, to regulate the settlement procedures, the Tianjin Precious Metals Exchange promulgated the Measures of the Tianjin Precious Metals Exchange for Settlement Management and the Guangdong Precious Metals Exchange promulgated the Measures of the Guangdong Precious Metals Exchange for Settlement Management (2014). According to relevant settlement rules, the precious metals trading settlement shall be carried out in the principle of unified and real-time settlement and in the manner of parallel application of real-time settlement and day-end settlement. Both the real-time settlement during the transaction and the day-end settlement of each day will be completed automatically by the trading system which is operated by the Exchanges. As for the Shanghai Gold Exchange, the settlement procedures and rules are included in the Implementing Rules of the Shanghai Gold Exchange for Spot Trading Funds Settlement. However, as an agent of a financial member, we don't participate in the management and settlement of the trading funds and the relevant rules of the Shanghai Gold Exchange do not apply to us. For more details of the management and settlement of trading funds for us, please refer to "Business — The Commodity Exchange Systems We Operate On — Deposit and Cash Settlement."

On October 10, 2001, the PBOC obtained the approval of the establishment of the Shanghai Gold Exchange issued by the State Council. Later on October 31, 2001, the Shanghai Gold Exchange was officially set up by the PBOC and was registered by the SAIC on February 6, 2002. On December 20, 2011, the PBOC, the Ministry of Public Security, the SAIC, the China Banking Regulatory Commission, or CBRC, and the CSRC jointly issued the Notice of Reinforcing the Management of Gold Exchanges and Platforms Which Conduct Gold Trading Business (Yin Fa [2011] No. 301), which confirmed that the Shanghai Gold Exchange is the only approved exchange for spot trading of gold and the Shanghai Futures Exchange is the only approved exchange for trading of gold futures and clarified that the Shanghai Gold Exchange is under supervision of the State Council and the PBOC accordingly.

Rules on the Tianjin Precious Metals Exchange and the Guangdong Precious Metals Exchange

Up until the year of 2011, there is no law or regulation at the national level to regulate the establishment or operation of trading exchanges which conduct trading business of precious metal (excluding gold). Except for the trading exchanges approved to be established by the relevant departments of the State Council, other trading exchanges are regulated and supervised by the local governments.

On November 11, 2011, the State Council promulgated the Circular 38, according to which, all the trading exchanges and firms engaging in transactions of property rights, works of culture and art, forward transactions of bulk commodities and other similar transactions, or the Trading Exchanges and Firms with the word "exchange" in their names must report their names to corresponding provincial governments for approval, unless otherwise approved by the State Council or the financial regulatory department under the State Council (such as the Shanghai Gold Exchange). As to Trading Exchanges and Firms that are established without obtaining approval pursuant to the above provisions, the SAIC and its local branches may not carry out the industrial and commercial registration procedures for the same. The Tianjin Precious Metals Exchange and the Guangdong Precious Metals Exchange have all obtained the approval for establishment from their respective provincial governments.

Pursuant to Circular 38, the governments at the provincial level supervise the Trading Exchanges and Firms within their jurisdictions, while the State Council supervises the Trading Exchanges and Firms that had received approval for establishment from it. Thus, the Tianjin Precious Metals Exchange and the Guangdong Precious Metals Exchange are respectively supervised by the People's Government of Tianjin and Guangdong. In practice, daily supervision of the People's Government of Tianjin and Guangdong on the Tianjin Precious Metals Exchange and the Guangdong Precious Metals Exchange are mainly conducted by the Tianjin Municipal Bureau of Financial Affairs and the Department of Commerce of Guangdong Province, respectively.

To better manage and rectify the Trading Exchanges and Firms, the State Council established the system of "Inter-ministerial Joint Meeting", or the Joint Meeting, led by the CSRC. The main task of the Joint Meeting is to make overall plans for and coordinate the work of involved departments and governments at the provincial level, to rectify illegal transactions of securities and futures, supervise the establishment of management rules to regulate the Trading Exchanges and Firms, and accomplish other tasks assigned by the State Council. The Joint Meeting shall not replace the State Council or provincial government in performing relevant regulatory duties.

Circular 38 further provides that all provincial governments are required to conduct centralized cleaning-up and rectification work of all Trading Exchanges and Firms within their jurisdiction. On July 12, 2012, the general office of the State Council further promulgated the Circular 37, under which certain Trading Exchanges and Firms are prohibited to carry out the following activities:

As specifically required by Circular 37, all provincial governments shall conduct inspection of Trading Exchanges and Firms accordingly. They shall rectify those Trading Exchanges and Firms that shall be rectified, close those that shall be closed, and complete the examination and approval procedures as required for those that are indeed necessary to be retained, and submit a comprehensive written summary of the cleaning-up and rectification work to the Joint Meeting once such close rectification is basically completed.

As of the date of this prospectus, the cleaning-up and rectification work of the Trading Exchanges and Firms in Guangdong has been completed and filed with the Joint Meeting. According to the inspection and acceptance results of the Joint Meeting, the Guangdong Precious Metals Exchange is permitted to be preserved after the cleaning-up and rectification work in 2013. However, the cleaning-up and rectification work of the Trading Exchanges and Firms in Tianjin has not been completed yet. For further information on such cleaning-up and rectification work and its impact on our business, please refer to "Risk Factors — Risks Related to Our Business and Industry — We operate in a highly regulated industry and any regulatory change may result in changes in trading models and trading rules of the Exchanges we operate on, which could adversely affect our business and prospects."

On November 8, 2013, the MOFCOM, the PBOC and the CSRC jointly issued the Special Provisions on Commodity Spot Market Trading (for Trial Implementation), or the Special Provisions, which came into effect on January 1, 2014. Pursuant to the Special Provisions, physical commodities, warehouse receipts and other similar proof for delivery of physical commodities, as well as other trading objects specified by the provincial governments in accordance with the law, are allowed to be traded through Trading Exchanges and Firms that are legally established with required service supporting functions. Trading Exchanges and Firms may conduct trading activities by agreement, unilateral bidding or other means of trading prescribed by the provincial governments in accordance with the law. Trading Exchanges and Firms shall not conduct any trading activities against the laws and regulations and shall not conduct standardized contract transaction with a centralized trading method. Competent commerce authorities of the governments at and above the county level shall be responsible for the industrial administration of the spot commodity market. The branches of the PBOC shall be responsible for the supervision and administration of the financial and

payment institutions involved in spot commodity trading activities within their respective administrative jurisdictions.

The PRC Labor Contract Law was amended by the Standing Committee of the National People's Congress on December 28, 2012 and came into force on July 1, 2013. In the amended PRC Labor Contract Law, more stringent provisions are adopted specifically for labor dispatch, including more qualifications for labor dispatch, reinforced principle of equal pay for equal work and defined restrictions on positions to which labor dispatch is applicable. The above-mentioned provisions are further elaborated in the Interim Provisions that were promulgated by the Ministry of Human Resources and Social Security on January 24, 2014 and came into force on March 1, 2014. It specifies that an employer shall strictly control the number of dispatched workers so that it shall not exceed 10% of the total number of its workers. The Interim Provisions also specify that if, before the Interim Provisions come into force, the number of dispatched workers in an employer exceeds 10% of the total number of its workers, the employer shall adjust its employment plan and reduce the proportion to the required proportion before March 1, 2016. The employer may not employ new dispatched workers unless the number of dispatched workers is reduced to the required proportion. However, if any labor dispatch agreement executed prior to, but expiring within two years of, the promulgation of the amended PRC Labor Contract Law, such agreements may continue to be performed until their expiry dates thereof. In addition, the employment of dispatched workers by an employer pursuant to labor dispatch arrangement shall be governed by the Interim Provisions.

According to the Interim Provisions, the labor dispatch entity shall pay social insurance premiums and follow relevant social insurance procedures for the dispatched workers as required by law and as agreed upon in the labor dispatch agreements. The Social Insurance Law of the People's Republic of China that was promulgated by the Standing Committee of the National People's Congress on October 28, 2010 and came into force on July 1, 2011 and the Interim Regulations on the Collection and Payment of Social Insurance Premiums that was promulgated by the State Council on and came into force on January 22, 1999, require employers to pay basic endowment insurance, unemployment insurance, basic medical insurance, employment injury insurance, maternity insurance and other social insurance for its employees. Where an employer fails to fully pay social insurance premiums, the relevant social insurance collection agency shall order it to make up for any shortfall within a prescribed time limit, and may impose a late payment fee at the rate of 0.05% per day of the outstanding amount from the due date. If such employer still fails to make up for the shortfalls within the prescribed time limit, the relevant administrative authorities shall impose a fine of one to three times the outstanding amount upon such employer.

According to the Regulations on the Administration of Housing Accumulation Funds that was promulgated by the State Council on and came into force on April 3, 1999 and was amended on March 24, 2002, all employers shall deposit housing accumulation funds on behalf of their employees. Where an employer fails to make deposit registration of housing accumulation funds or fails to open housing accumulation fund accounts for its employees, it shall be ordered by the housing accumulation fund management center to complete the procedures within a prescribed time limit, and if it still fails to complete the procedures within such time limit, a fine of RMB10,000 to RMB50,000 shall be imposed thereupon. Where an employer fails to deposit or underpays the housing accumulation funds within the time limit, it shall be ordered by the housing accumulation fund management center to deposit the funds in full within such time limit.

Our PRC operating entities incorporated in various locations in China have not made adequate employee benefit payments. Further, we had historically engaged certain third party employment agencies to dispatch contract workers to work for us, and the third party employment agencies had a shortfall in making contributions of the social insurance and housing fund for the dispatched workers. For further information regarding this issue, please refer to "Risk Factors — Risks Related to Doing Business in China — Failure to

make adequate contributions to various employee benefit plans as required by PRC regulations may subject us to penalties."

According to the Regulations on Computer Software Protection that was amended and promulgated by the State Council on January 16, 2013 and came into force on March 1, 2013, PRC citizens, legal entities or other organizations enjoy the copyright in the software that they have developed, whether published or not. A software copyright owner shall enjoy the rights of divulgation, developer-ship, alteration, reproduction, distribution, rental, communication through information network, translation and other rights. The term of software copyrights owned by a legal entity or an organization shall be fifty years, expiring on December 31 of the fiftieth year since the first publication of such software.

According to the Patent Law of the People's Republic of China that was amended and promulgated by the Standing Committee of the National People's Congress on December 27, 2008 and came into force on October 1, 2009, the inventor or designer of any invention-creation (including inventions, utility models and designs) could apply for the patent right for such invention-creation. An invention or utility model for which patents may be granted shall have novelty, creativity and practical applicability. A patent right for inventions shall remain in force and valid for twenty years and a patent right for utility models and designs shall remain valid for ten years, both commencing from the filing date of such patent right. The patent owner shall pay an annual fee for such patent right commencing the year in which the patent right was granted. In the event that a prescribed annual fee is not paid, the patent right will terminate before the expiration of its validity period.

According to the Trademark Law of the People's Republic of China that was amended and promulgated by the Standing Committee of the National People's Congress on August 30, 2013 and came into force on May 1, 2014, the term for a registered trademark shall be ten years, commencing from the date of registration approval. A trademark registrant intending to continue to use the registered trademark upon expiry of the validity term thereof shall complete relevant renewal procedures within twelve (12) months preceding the expiry date, failing which the trademark registrant may be granted a six-month grace period. The term of each renewal shall be ten years, commencing from the day immediately after the expiry date of the previous term thereof. If the renewal procedures are not completed within the grace period, the trademark shall be deregistered. The Administration of Industry and Commerce above county level shall have the authority to duly investigate and impose punishment upon any infringement of trademark rights, and any suspected criminal infringement shall be promptly transferred to judicial authorities for further handling according to the law.

According to the Measures for the Administration of Internet Domain Names of China that were promulgated by the Ministry of Information Industry on November 5, 2004 and came into force on December 20, 2004, the principle of "first come, first serve" was adopted for the domain name registration procedure. After completing the domain name registration, an applicant for the registration of a domain name shall be the holder of such domain name and shall pay relevant operation and management fees. If the holder of a domain name fails to pay the corresponding fees as required, the original domain name registrar shall deregister such domain name and notify the holder in writing.

The principal law governing foreign currency exchange in the PRC is the Foreign Exchange Administration Regulations, which was enacted by the State Council on January 29, 1996 and amended on August 5, 2008. According to the Foreign Exchange Administration Regulations, international payments in and transfer of foreign currencies under current account items shall not be restricted. Foreign currency transactions under capital accounts, such as direct investment and loans, are still subject to limitations and

require approvals from, or registration with, the State Administration of Foreign Exchange, or SAFE, and other relevant PRC governmental authorities.

On August 29, 2008, the SAFE promulgated the Notice of the General Affairs Department of the SAFE on the Relevant Operating Issues concerning the Improvement of the Administration of Payment and Settlement of Foreign Currency Capital of Foreign-invested Enterprises (HuiZongFa [2008] No. 142), or the SAFE Circular 142, to regulate the conversion by a foreign-invested enterprise of its foreign currency registered capital into RMB. The SAFE Circular 142 provides that the registered capital converted into RMB from foreign currency of a foreign-invested enterprise may only be used for purposes within the business scope approved by the applicable governmental authority and may not be used for equity investments within the PRC. The use of such RMB fund may not be altered without approval, and such RMB fund may not in any case be used to repay any RMB loans if the proceeds of such loans have not been utilized. Violations of the SAFE Circular 142 could result in severe monetary penalties.

The SAFE promulgated the Circular of the State Administration of Foreign Exchange on Issues Concerning Foreign Exchange Administration over the Overseas Investment and Financing and Round-Trip Investment by Domestic Residents through Special Purpose Vehicles (HuiFa [2014] No. 37), or the SAFE Circular 37, on July 4, 2014. Circular 37 requires PRC residents, including PRC individuals, institutions and foreign individuals who have a habitual residence in the PRC due to economic interests, to register with SAFE or its local branches in connection with their direct establishment or indirect control of an offshore entity, for the purpose of overseas investment and financing, with such PRC residents' legally owned assets or equity interests in domestic enterprises or offshore assets or interests. Such PRC residents must update their foreign exchange registrations with SAFE when the offshore entity, referred to as an offshore special purpose vehicle, undergoes material events relating to any change of basic information, increases or decreases in investment amount, share transfers or exchanges, or mergers or divisions.

If any shareholder holding interest in an offshore special purpose vehicle, who is a PRC resident as determined by Circular 37, fails to complete relevant SAFE registration, the PRC subsidiaries of that offshore special purpose vehicle may be prohibited from distributing their profits and dividends to their offshore parent company, contributing additional capital to its PRC subsidiaries, or carrying out other subsequent cross-border foreign exchange activities. Moreover, failure to comply with the SAFE registration described above could result in liability under PRC laws.

Historially, our ultimate individual beneficial owners were unable to complete the aforesaid SAFE registration. For further information on this, please refer to "Risk Factors — Risks Related to Our Corporate Structure — We may be subject to penalties, including restriction on our ability to inject capital into our PRC subsidiaries and our PRC subsidiaries' ability to distribute profits to us, if our PRC resident shareholders or beneficial owners fail to comply with relevant PRC foreign exchange regulations."

On February 15, 2012, SAFE promulgated the Circular of the State Administration of Foreign Exchange on Issues Concerning the Foreign Exchange Administration of Domestic Individuals' Participation in Equity

Incentive Plans of Overseas Listed Companies (HuiFa [2012] No. 7), or the Circular 7. Pursuant to Circular 7, all PRC residents who participate in an employee stock incentive plan or stock option plan of an overseas listed company are required, through the PRC subsidiary of such overseas listed company that they are employed by, to jointly entrust a PRC agent to handle foreign exchange registration with SAFE or its local branches and complete certain procedures relating to the share incentive schemes such as opening account and capital transfer. PRC residents include PRC nationals or foreign citizens who have been consecutively residing in PRC for not less than one year, acting as directors, supervisors, senior management personnel or other employees of PRC companies affiliated with such offshore listed company. A PRC agent could be a PRC subsidiary of such overseas listed company participating in the share incentive scheme or another PRC institution qualified for asset trusteeship as designated by the PRC subsidiary and in accordance with PRC laws. The PRC agent is required to amend the SAFE registration with respect to the stock incentive plan if there is any material change to the stock incentive plan, the PRC agent or the overseas entrusted institution or other material changes. The foreign exchange proceeds received by the PRC residents from the sale of shares under share incentive plans granted by the overseas publicly listed company must be remitted to bank accounts in the PRC opened by the PRC agents.

According to the EIT Law that was promulgated by the National People's Congress on March 16, 2007 and came into force on January 1, 2008, the enterprise income tax rate for both domestic enterprises and foreign-invested enterprises is 25% (except for certain eligible foreign invested enterprises). On December 6, 2007, the State Council promulgated the Regulations on the Implementation of the Enterprise Income Tax Law of the People's Republic of China, or the EIT Implementation Regulations, which came into force on January 1, 2008.

According to the EIT Law and the EIT Implementation Regulations, both resident and non-resident enterprises that earn income within the territory of China are subject to enterprise income tax at the rate of 25%. A non-resident enterprise without a permanent establishment in the PRC or a non-resident enterprise with a permanent establishment in the PRC whose earning income is not connected with such permanent establishment will only be subject to tax on its PRC-sourced income. The income for such enterprise will be taxed at a reduced rate of 10%, subject to the provisions of any applicable tax treaties.

According to the EIT Law and the EIT Implementation Regulations, income from equity investment between qualified resident enterprises such as dividends and bonuses, which refers to investment income derived by a resident enterprise from its direct investment in another resident enterprise, is tax-exempt income.

Pursuant to the Arrangement between Mainland China and the Hong Kong Special Administrative Region on the Avoidance of Double Taxation and Prevention of Fiscal Evasion on income, a PRC resident enterprise which distributes dividends to its Hong Kong shareholders must pay income tax according to PRC law. However, if the beneficial owner of the dividends is a Hong Kong resident enterprise that directly holds no less than 25% equity interests of the aforesaid enterprise (i.e., the dividend distributor), the distributed dividends may be subject to a reduced tax rate of 5%. If the beneficial owner is a Hong Kong resident enterprise, which directly holds less than 25% equity interests of the aforesaid enterprise, the tax levied will be 10% of the distributed dividends.

In addition, pursuant to the Circular of the SAT on Relevant Issues Relating to the implementation of Dividend Clauses in Tax Treaty issued by the SAT on February 20, 2009, all of the following requirements shall be satisfied for a non-PRC tax resident enterprise to be entitled to the benefits of any applicable tax treaty for the dividends received from PRC resident companies: (1) such non-PRC resident enterprise should be a company as provided in the tax treaty; (2) such non-PRC resident enterprise must directly own a specified percentage of the equity interests and voting shares of the PRC resident company; and (3) the capital ratio of the PRC resident company directly owned by such non-PRC resident enterprise must reach a

certain specified percentage in the applicable tax treaty at any time within 12 months prior to the receipt of the dividends.

Pursuant to the Announcement of the State Administration of Taxation on Promulgating the Administrative Measures for Tax Convention Treatment for Non-resident Taxpayers (Announcement of the State Administration of Taxation [2015] No.60) which came into effect on November 1, 2015, non-resident taxpayers which satisfy the criteria for entitlement to tax treaty benefits may, at the time of tax declaration or withholding declaration through a withholding agent, enjoy the tax treaty benefits, and be subject to follow-up administration by the tax authorities. Such taxpayers who make their own declaration shall self-assess whether they are entitled to tax treaty benefits, make truthful declaration and submit the relevant reports, statements and materials required by the relevant tax authorities.

On February 3, 2015, SAT issued the Announcement of the State Administration of Taxation on Several Issues concerning the Enterprise Income Tax on the Indirect Transfers of Properties by Non-Resident Enterprises, or the SAT Announcement 7. Pursuant to SAT Announcement 7, if a non-resident enterprise, or a transferor, transfers its equity in an offshore enterprise which directly or indirectly owns PRC taxable assets, including ownership interest in PRC resident company, or referred as the Taxable Properties, without a reasonable commercial purpose, such transfer shall be deemed a direct transfer of Taxable Properties. The payer, or the transferee, in the equity transfer shall be the withholding agent, and is thus obligated to withhold and remit enterprise income tax accordingly to the relevant PRC tax authorities. Factors that may be taken into consideration when determining whether there is a "reasonable commercial purpose" include components of the transferred equity, offshore tax situation of the transaction, the economic essence and duration of the offshore structure, trading fungibility and other factors. Specifically, when an equity transfer satisfies all the following requirements, such transaction will be considered an arrangement with "reasonable commercial purpose":

According to the Interim Regulations of the People's Republic of China on Business Tax that was amended by the State Council on November 10, 2008 and came into force on January 1, 2009, entities and individuals that engage in provision of services, transfer of intangible assets or sale of real estate within the PRC are subject to business tax. According to the Rules for Implementation of the Interim Regulations of the People's Republic of China on Business Tax that was amended by the Ministry of Finance on October 28, 2011 and came into force as of November 1, 2011, the range of the business tax threshold

shall be: (1) a sales turnover of RMB5,000 to RMB20,000 per month if the business tax is paid by periods; and (2) a sales turnover of RMB300 to RMB500 each business project (per day) if the business tax is paid by business projects.

According to the Interim Regulations of the People's Republic of China on Value Added Tax that was amended by the State Council on November 10, 2008 and came into force on January 1, 2009 and the Rules for Implementation of the Interim Regulations of the People's Republic of China on Value Added Tax that was amended by the Ministry of Finance on October 28, 2011 and came into force on November 1, 2011, entities and individuals that engage in the sale of commodities, provision of processing, repair and replacement services and import of goods within the PRC are subject to VAT at the rate of 17%, or 13% for taxpayers selling or importing certain kinds of specific commodities. According to the Circular on Printing and Distributing the Pilot Proposals for the Collection of Value-Added Tax in Lieu of Business Tax (CaiShui [2011] No. 110) promulgated by SAT and the Ministry of Finance on November 16, 2011 and Circular of the Ministry of Finance and the State Administration of Taxation on the Inclusion of the Railway Transport Industry and Postal Service Industry in the Pilot Collection of Value-added Tax in Lieu of Business Tax (CaiShui [2013] No. 106) promulgated by SAT and the Ministry of Finance on December 12, 2013, information technology service, including the software service and integrated circuit service, is subject to these rules and VAT.

According to the Circular of the State Council on Printing and Issuing the Policies for Encouraging the Development of the Software Industry and the Integrated Circuit Industry (GuoFa [2000] No. 18) promulgated by the State Council on June 24, 2000, eligible software enterprises shall enjoy preferential treatments in tax, investment and financing, research and development input, import and export and other relevant aspects.

On January 28, 2011, the State Council promulgated the Circular of the State Council on Printing and Issuing the Policies for Further Encouraging the Development of the Software Industry and the Integrated Circuit Industry (GuoFa [2011] No. 4), specifying that qualified software enterprises shall be exempt from business tax.

On October 13, 2011, the Ministry of Finance and the SAT promulgated the Circular on the Policies for Value Added Tax of Software Products (CaiShui [2011] No. 100), specifying that if a general VAT taxpayer sells self-developed and self-produced software products, the refund-upon-collection policy shall be applied to the portion of actual VAT burden in excess of 3% after VAT has been collected at a tax rate of 17%.

The Ministry of Finance and the SAT promulgated the Circular on the Enterprise Income Policies for Further Encouraging the Development of the Software Industry and the Integrated Circuit Industry (CaiShui [2012] No. 27), or the Circular 27, on April 20, 2012. According to Circular 27, an eligible software enterprise shall, upon recognition, be exempted from the enterprise income tax for the first two years and pay the enterprise income tax at a reduced rate of half of the statutory rate of 25% from the third year to the fifth year until expiry of the preferential period.

Circular 27 also specifies the standards of recognizing a software enterprise: (i) it is a legal person entity, which is legally established within the PRC and, upon certification, has obtained the qualification of software enterprise after January 1, 2011; (ii) employees who hold educational credentials of junior college or above and have signed labor contracts with the enterprise shall account for not less than 40% of the

monthly average number of employees of the enterprise in the current year, among which the personnel engaged in research and development shall account for not less than 20% of the monthly average number of employees of the enterprise in the current year; (iii) it owns core and key technology and carries out operation activities based on the core and key technology, and the total research and development expenditure in the current year shall account for not less than 6% of the total sales revenue of the enterprise, among which the research and development expenditure of the enterprise within the territory of China shall account for not less than 60% of the total research and development expenditure of the enterprise; (iv) the sales revenue from the development of software products shall account for not less than 50% of the total revenue of the enterprise (the sales revenue from the development of embedded software products and information system integrated products shall account for not less than 40% of the total revenue of the enterprise), among which the sales revenue from the independent development of software products shall account for not less than 40% of the total revenue of the enterprise (the sales revenue from the independent development of embedded software products and information system integrated products shall account for not less than 30% of the total revenue of the enterprise); (v) main business owns proprietary intellectual property rights, among which the software products have the test supporting materials issued by the software test institutions accredited by the competent software industry departments at the provincial level and Software Product Registration Certificate issued by the competent software industry department; (vi) it has the means and ability to ensure the quality of the designed products, and has established quality management system as required by software projects, and shall provide the valid operation document record; and (vii) it has required place of production and operation, and facilities of software and hardware accommodating to the development of software and has relevant technological support.

In addition, the Ministry of Industry and Information Technology, the NDRC, the Ministry of Finance and the SAT jointly promulgated the Administrative Measures for the Recognition of Software Enterprises on February 6, 2013, according to which a software enterprise refers to an enterprise which is duly established within the PRC and engages in the development and sale of application services. An eligible enterprise may submit an application to the competent authority, and the competent authority shall issue a software enterprise certificate if it determines such enterprise satisfies the standard for a software enterprise.

The following table sets forth the name, age and position of each of our directors and executive officers as of the date of this prospectus.

Mr. Wenbin Chen is our Founder, Chairman and Chief Executive Officer. Mr. Chen has 16 years of experience in the finance industry. He worked at Fuzhou Tianli Investment Consulting Co., Ltd. from July 1998 to July 2005, with his last position being deputy general manager. Mr. Chen founded Fujian Rulin Information Technology Development Co., Ltd. in July 2005 and served as its general manager until June 2007. Between August 2007 and June 2010, Mr. Chen was Assistant to the Chief Executive Officer of Caifu Software (Beijing) Co., Ltd. Mr. Chen graduated from Dalian University of Technology with a double bachelor's degree in chemical engineering and international enterprise management in July 1998. He graduated in October 2009 from Cheung Kong Graduate School of Business with an EMBA degree.

Mr. Ming Yan is our Founder and Director. Mr. Yan has founded a number of entertainment, culture and catering businesses in Beijing, Shanghai and Hong Kong. Mr. Yan graduated from Shanxi University of Finance with a bachelor degree in Finance in December 2011. He graduated in September 2014 from the Cheung Kong Graduate School of Business with an EMBA degree. Mr. Yan has been enrolled in the Doctor of Business Administration program at Shanghai Jiao Tong University since September 2013.

Ms. Ningfeng Chen is our Founder and Director. From September 1990 to September 2001, Ms. Chen worked as an engineer at Fuzhou Office of Earthquake Resistance and Fuzhou Urban and Rural Construction Committee. Between September 2001 and September 2003, Ms. Chen served as the chief engineer at Fuzhou Anxinda Engineering Consulting Co., Ltd. She was a North American market research consultant at Shanghai Naide Enterprise Management Consulting between September 2005 and February 2011. Ms. Chen graduated from Anhui Institute of Architecture & Industry with a bachelor degree in industrial and civil construction in July 1990. In June 2003, Ms. Chen graduated from the University of International Business and Economics with a master's degree in management. Ms. Chen also received a certificate of completion in financial analysis and investment management from the University of Toronto in May 2005.

Mr. Feng Li will serve as our Independent Director immediately upon completion of this offering. Mr. Li has approximately 16 years of experience in business management and financial education. At the University of

Michigan Stephen M. Ross School of Business, he was the Ernst & Young Assistant Professor from July 2004 to July 2011 and the Harry Jones Associate Professor with tenure from July 2011 to June 2015. Since July 2015, Mr. Li has been a professor of accounting and director of the Finance MBA Program at Shanghai Advanced Institute of Finance of Shanghai Jiao Tong University. Since July 17, 2014, Mr. Li has also been an independent director and the audit committee financial expert for Sungy Mobile Limited, a company listed on the NASDAQ (NASDAQ: GOMO). Mr. Li is a member of the American Accounting Association. Mr. Li graduated from Fudan University with a bachelor degree in economics in July 1996 and a master degree in economics in July 1998. He received his master degree in business administration from the University of Chicago in June 2004 and obtained a doctor of philosophy degree in accounting from the University of Chicago in June 2005.

Ms. Jue Yao will serve as our Independent Director immediately upon completion of this offering. Ms. Yao has extensive experience in accounting and corporate finance. Ms. Yao is the chief financial officer of Qihoo 360 Technology Co., Ltd., or Qihoo 360, a company listed on the New York Stock Exchange (NYSE: QIHU). From 1996 to 1999, Ms. Yao was a senior auditor at KPMG. From 1999 to 2006, Ms. Yao held various positions, including financial director, at Sohu.com Inc. Since 2006, Ms. Yao has held various positions at Qihoo 360, including as its financial director and vice president of finance from 2008 to 2012 and its co-chief financial officer of Qihoo 360 from 2012 to 2014. Ms. Yao graduated from the University of International Business and Economics in China with a bachelor degree in international accounting in June 1996.

Mr. Lijun Lin will serve as our Independent Director immediately upon completion of this offering. Mr. Lin is the founder and currently serves as CIO of Loyal Valley Innovation Capital, an investment company focusing on investing in entrepreneurship and innovation, founded in November 2015. Prior to that, Mr. Lin founded China Universal Asset Management Co., Ltd., or CUAM, in 2005, a leading fund management company in China with USD70 billion under management. He served as CUAM's chief executive officer and chairman of the investment committee from April 2004 to April 2015. Mr. Lin previously also served as a manager and an assistant director of the listing department of the Shanghai Stock Exchange and served at the CSRC as a regulator. Mr. Lin obtained a bachelor's and a master's degree in economics from Fudan University and a Master of Business Administration degree from Harvard Business School.

Mr. Gang Xu is our Vice President responsible for developing and maintaining our information technology infrastructure. Mr. Xu has over 12 years of experience in the field of information technology and Internet businesses. From March 2003 to May 2008, Mr. Xu worked as an engineer at two software companies. From July 2008 to December 2009, Mr. Xu served at two companies specializing in the development and sales of securities software. Mr. Xu co-founded a stock investor community website, 9666.cn (niuzaiwang) in January 2010 and served as its general manager until April 2011, before joining us. Mr. Xu graduated from University of Hunan in June 2002 with a bachelor degree in computer science and technology. Mr. Xu graduated from Renmin University of China in June 2009 with an MBA degree. Mr. Xu is currently pursuing a part-time EMBA degree at Shanghai Advanced Institute of Finance of Shanghai Jiao Tong University. Mr. Xu is the brother-in-law of Mr. Wenbin Chen.

Mr. Dikuo Bo is our Vice President responsible for our operations on the Guangdong Precious Metals Exchange. Mr. Bo was a manager at Tianli Jicang Cultural Communication Co., Ltd., a company specializing in the sales and investment of collectible cultural products, from May 2000 to July 2004. Mr. Bo co-founded Shanghai Tongguan Information Technology, a company providing financial information and services, in October 2007 and served as its general manager until March 2014, before joining us. Mr. Bo graduated from Dalian University of Technology in July 1997 with a bachelor degree in chemical equipment and machinery. He studied in the postgraduate program in finance in Shanghai University of Finance and Economics from September 2003 to July 2005. Mr. Bo is currently pursuing a part-time EMBA degree at Shanghai Advanced Institute of Finance of Shanghai Jiao Tong University.

Mr. Jigeng Chen is our Vice President responsible for our operations on the Tianjin Precious Metals Exchange. He has over 11 years of experience in the financial services industry. Mr. Chen was an investment consultant at Fujian Rulin Investment Management Development Co., Ltd. from April 2004 to December 2007. He worked at a number of companies providing securities software and related services, from January 2008 to May 2011, before joining us. Mr. Chen graduated from Xiangling High School in July 1999.

Mr. Qi Feng is our Vice President responsible for our operations on the Shanghai Gold Exchange. Mr. Feng has 12 years of experience in the financial services industry. He worked at E-Money (Shanghai Yimeng Software Technology Ltd.), a provider of securities software listed on China's NEEQ (National Equities Exchange and Quotations), from June 2002 to December 2013, with his last position being general manager of the sales department. From April to November 2014, he served as general manager at Tianjin Zhongyu Precious Metal Management Co., Ltd., a member of the Tianjin Precious Metals Exchange. Mr. Feng graduated from Shanghai Sanmen Vocational School with a degree in real estate development and management in June 1996.

Mr. Sheng Zhao is our Vice President and the general manager of our risk control trading center. Mr. Zhao worked as a designer at Beijing Qingyun Aerospace Instruments Co., Ltd., from September 1993 to July 1994. He was a manager of major clients at Beijing Coca-Cola Beverage Co., Ltd., a bottling facility, from January 1996 to March 2003. Mr. Zhao served as general manager at Beijing Zhongwang Lianhe Consultants Co., Ltd., a company providing investment management services, from April 2009 to April 2010. He was the vice general manager at Tianjin Huanrong Precious Metals Management Co., Ltd., a member of the Tianjin Precious Metals Exchange, from April 2010 to June 2011, before joining us. Mr. Zhao graduated with a bachelor degree in industrial design from Shenyang Institute of Aerospace and Industry in July 1993. He graduated from the University of International Business and Economics in June 2003 with a master's degree in finance.

Mr. Jingbo Wang is our Chief Financial Officer. Mr. Wang has over five years of experience in corporate finance, equity and debt capital markets and mergers and acquisitions. He also has six years of research experience in management studies and computer science. Mr. Wang worked at Deutsche Bank from July 2009 to October 2014, with his last position being vice president in the Corporate Finance Division. Mr. Wang graduated from Tsinghua University with a bachelor degree of engineering in automation in July 2003. He graduated from the University of Hong Kong with a master of philosophy degree in computer science in December 2005 and was awarded a doctor of philosophy degree in management studies from Saïd Business School, University of Oxford, in March 2010.

Our board of directors will consist of six directors upon the SEC's declaration of effectiveness of our registration statement on Form F-1 to which this prospectus forms a part. A director is not required to hold any shares in our company to qualify to serve as a director. A director who is in any way, whether directly or indirectly, interested in a contract or proposed contract with our company is required to declare the nature of his interest at a meeting of our directors. A general notice given to the directors by any director to the effect that he is a member, shareholder, director, partner, officer or employee of any specified company or firm and is to be regarded as interested in any contract or transaction with that company or firm shall be deemed a sufficient declaration of interest for the purposes of voting on a resolution in respect to a contract or transaction in which he has an interest, and after such general notice it shall not be necessary to give special notice relating to any particular transaction. A director may vote in respect of any contract or proposed contract or arrangement notwithstanding that he may be interested therein and if he does so his vote shall be counted and he may be counted in the quorum at any meeting of the directors at which any such contract or proposed contract or arrangement is considered. Our board of directors may exercise all of the powers of our company to borrow money, to mortgage or charge its undertaking, property and uncalled capital, or any part thereof, and to issue debentures, debenture stock or other securities whenever money is

borrowed or as security for any debt, liability or obligation of our company or of any thirdparty. None of our non-executive directors has a service contract with us that provides for benefits upon termination of service.

Prior to the completion of this offering, we will establish three committees under the board of directors: an audit committee, a compensation committee and a nominating and corporate governance committee. We expect that, at the time of the completion of this offering, all members of our audit committee, and a majority of the members of our compensation committee and nominating and corporate governance committee will be independent within the meaning of Rule 5605(a)(2) of the NASDAQ Listing Rules.

At the time of completion of this offering, our audit committee will consist of three directors, namely Mr. Feng Li, Mr. Lijun Lin and Ms. Jue Yao, and will be chaired by Mr. Feng Li. We expect that Mr. Feng Li, Mr. Lijun Lin and Ms. Jue Yao satisfy the "independence" requirements of Rule 10A-3 under the Securities Exchange Act of 1934, as amended, and Rule 5605(a)(2) of the NASDAQ Listing Rules. In addition, we expect that Mr. Feng Li will qualifie as an audit committee financial expert within the meaning of the applicable rule of the SEC. The audit committee will oversee our accounting and financial reporting processes and the audits of the financial statements of our company. The audit committee will be responsible for, among other things:

At the time of completion of this offering, our compensation committee will consist of three directors, namely Ms. Ningfeng Chen, Ms. Jue Yao and Mr. Feng Li, and will be chaired by Ms. Ningfeng Chen. We expect that Ms. Jue Yao and Mr. Feng Li will satisfy the "independence" requirements of Rule 10A-3 under the Securities Exchange Act of 1934, as amended, and Rule 5605(a)(2) of the NASDAQ Listing Rules. Our compensation committee will assist the board in reviewing and approving the compensation structure of our executive officers, including all forms of compensation to be provided to our executive officers. The compensation committee will be responsible for, among other things:

At the time of completion of this offering, our nominating and corporate governance committee will consist of three directors, namely Mr. Wenbin Chen, Mr. Feng Li and Mr. Lijun Lin, and is chaired by Mr. Wenbin Chen. We expect that Mr. Feng Li and Mr. Lijun Lin will satisfy the "independence" requirements of Rule 10A-3 under the Securities Exchange Act of 1934, as amended, and Rule 5605(a)(2) of the NASDAQ Listing Rules. The nominating and corporate governance committee will assist the board in identifying individuals qualified to become our directors and in determining the composition of the board and its committees. The nominating and corporate governance committee will be responsible for, among other things:

Under Cayman Islands law, our directors have a fiduciary duty to act honestly, in good faith and with a view to our best interests. Our directors also owe to our company a duty to act with skill and care. It was previously considered that a director need not exhibit in the performance of his duties a greater degree of skill than may reasonably be expected from a person of his knowledge and experience. However, English and Commonwealth courts have moved towards an objective standard with regard to the required skill and care and these authorities are likely to be followed in the Cayman Islands. In fulfilling their duty of care to us, our directors must ensure compliance with our memorandum and articles of association, as amended and re-stated from time to time. Our company has the right to seek damages if a duty owed by our directors is breached.

Our board of directors has all the powers necessary for managing, and for directing and supervising, our business affairs. The functions and powers of our board of directors include, among others:

Our officers are elected by and serve at the discretion of our board of directors. Our directors are not subject to a term of office and hold office until such time as they are removed from office with or without cause by a board resolution passed by a majority of not less than one half of the directors or by an ordinary resolution of our shareholders. A director will be removed from office automatically if (i) becomes bankrupt or makes any arrangement or composition with his creditors; (ii) dies or is found by our company to be or becomes of unsound mind; (iii) resigns his office by notice in writing to the company; (iv) is removed from office by ordinary resolution or (v) is removed from office pursuant to any other provision of the articles of association.

We have entered into employment agreements with our executive officers. Under these agreements, each of our executive officers is employed for an initial term of two years, which term shall be renewed automatically for successive one-year terms unless a one-month notice of non-renewal is given by either party. We may terminate the employment for cause, at any time, without notice or remuneration, for certain acts of the executive officer. An executive officer may terminate his or her employment at any time with not less than one-month prior written notice.

Each executive officer has agreed to hold, both during and after the employment agreement expires or is earlier terminated, in strict confidence and not to use or disclose to any person, corporation or other entity without written consent, any confidential information. Each executive officer has also agreed to assign to our company any intellectual property rights that qualifies or is considered by the Company to qualify for patent, copyright, trademark, trade secret, or any other protection under the laws of PRC or Cayman Islands providing or creating intellectual property rights, during the period of the executive officer's employment with us and for a certain period following termination of the employment agreement that are related to the scope of the employment.

In addition, all executive officers have agreed to be bound by non-competition and non-solicitation restrictions set forth in their employment agreements. Specifically, each executive officer has agreed to devote all his or her working time and attention to our business and use best efforts to develop our business and interests. Moreover, each executive officer has agreed not to, for a certain period following termination of his or her employment or expiration of the employment agreement: (i) directly or indirectly engage in (whether as an officer, principal, agent, director, employee, partner, affiliate, consultant or other participant), or hold an equity interest of 5% or more in, any business or activity that is in competition with the Company, its subsidiaries or affiliated entities; (ii) solicit, encourage or assist other employees of the Company to seek employment with any business or organization in competition with the Company, its subsidiaries or affiliated entities; or (iii) engage in other activities that may cause conflicts with the interests of the Company during the term of the employment agreement.

For the fiscal year ended December 31, 2015, the aggregate cash compensation and benefits that we paid to our directors and executive officers was RMB3.9 million (US$0.6 million). No pension, retirement or similar benefits have been set aside or accrued for our executive officers or directors. We have no service contracts with any of our non-executive directors providing for benefits upon termination of employment. Our PRC subsidiaries are required by PRC laws and regulations to make contributions equal to certain percentages of each employee's salary for his or her retirement benefit, medical insurance benefits, housing funds, unemployment and other statutory benefit.

Win Yin Financial granted stock options and restricted share units on its shares to our employees pursuant to its 2013 Share Option Scheme, 2014 Share Option Scheme and Pre-IPO RSU Scheme, or the Share Incentive Plans. Pursuant to the group reorganization completed on November 18, 2015, our company became the holding company of the group and the majority of the operating PRC subsidiaries under Win Yin Financial became our wholly owned PRC subsidiaries. In connection with the reorganization, we assumed the Share Incentive Plans from Win Yin Financial and adopted the Amended and Restated 2013 Share Option Scheme, Amended and Restated 2014 Share Option Scheme and Amended and Restated Pre-IPO RSU Scheme. We have further amended and restated these share incentive plans to enlarge the authorized amount of options and RSUs by adopting the Second Amended and Restated 2013 Share Option Scheme, the Third Amended and Restated 2014 Share Option Scheme and the Third Amended and Restated Pre-IPO RSU Scheme. We issued stock options and RSUs to our employees to replace the stock options and RSUs issued by Win Yin Financial. The terms and conditions of the stock options and RSUs with respect to vesting and exercisability remain the same.

The purpose of the Share Incentive Plans is to enhance our ability to attract and retain highly qualified officers, directors, key employees and other persons, and to motivate such persons to serve us and our affiliates and to expend maximum effort to improve our business results and earnings, by providing such persons an opportunity to acquire or increase a direct interest in our operations and future success.

The maximum aggregate number of ordinary shares that can be issued under the Second Amended and Restated 2013 Share Option Scheme, or the 2013 Share Option Scheme, is 41,000,000. As of the date of this prospectus, options to purchase an aggregate of 36,771,900 ordinary shares have been granted by us and remain outstanding under the 2013 Share Option Scheme.

Eligible participants. Our employees, officers, directors, business associates or any other individual as determined by our board of directors, in its sole discretion, has contributed or will contribute to our company, are eligible to participate in the 2013 Share Option Scheme.

Exercise price. The exercise price in respect of options granted under the scheme before our initial public offering is US$0.163 per share, subject to any adjustment as a result of any alteration in the capital structure of our company by way of capitalization of profits or reserves, rights issue, sub-division or consolidation of shares or reduction of share capital of our company from time to time, but excluding, for the avoidance of doubt, any alteration in the capital structure of our company as a result of an issue of shares or other securities as consideration in a transaction to which our company is a party.

Vesting schedule. The administrator of the 2013 Share Option Scheme has the sole discretion in determining the individual vesting schedules and other restrictions applicable to shares awarded and opinions granted under such scheme.

Lapse of options. An option issued under the scheme shall lapse automatically under certain circumstances, including, but not limited to, the expiration of option period, termination of employment for cause and the tenth anniversary of the adoption date of the scheme.

Amendment. Any change to the authority of our board of directors in relation to any alteration to the terms of the scheme must be approved by the shareholders in general meeting. Subject to the above, our board of directors may amend any of the provisions of the scheme at any time provided that such amendment shall not affect adversely any rights which have accrued to any grantee at that date.

Termination. The scheme will terminate on the tenth anniversary of its date of adoption, unless terminated earlier. We may, by ordinary resolution in general meeting, or our board of directors may, at any time terminate the operation of the scheme and in such event no further options shall be granted. Options granted prior to such termination but not yet exercised at the time of termination shall continue to be valid and exercisable in accordance with the scheme.

Transfer restrictions. An option is personal to the grantee and shall not be assignable or transferable.

The following is a summary of the principal terms of the Third Amended and Restated 2014 Share Option Scheme, or the 2014 Share Option Scheme. The maximum aggregate number of ordinary shares that can be issued under the Scheme is 200,000,000. As of the date of this prospectus, options to purchase an aggregate of 47,575,714 ordinary shares have been granted by us and remain outstanding under the 2014 Share Option Scheme.

Exercise price. The exercise price in respect of options granted under the scheme before our initial public offering is US$0.163 per share subject to any adjustment as a result of any alteration in the capital structure of our company by way of capitalization of profits or reserves, rights issue, sub-division or consolidation of shares or reduction of share capital of our company from time to time, but excluding, for the avoidance of doubt, any alteration in the capital structure of our company as a result of an issue of shares or other securities as consideration in a transaction to which our company is a party.

Vesting schedule. The administrator of the 2014 Share Option Scheme has the sole discretion in determining the individual vesting schedules and other restrictions applicable to shares awarded and opinions granted under such scheme.

Lapse of options. An option issued under the scheme shall lapse automatically under certain circumstances, including but not limited to, the expiration of option period, termination of employment for cause and the tenth anniversary of the adoption date of the scheme.

Amendment. Any change to the authority of our board of directors in relation to any alteration to the terms of the scheme must be approved by the shareholders in general meeting. Subject to the above, our board may amend any of the provisions of the scheme at any time provided that such amendment shall not affect adversely any rights which have accrued to any grantee at that date.

Transfer restrictions. An option is personal to the grantee and shall not be assignable or transferable.

The following is a summary of the principal terms of the Third Amended and Restated Pre-IPO RSU Scheme or Pre-IPO RSU Scheme. The shares in aggregate underlying all awards under the Pre-IPO RSU Scheme shall not exceed 100,000,000. As of the date of this prospectus, RSUs granted by us and remain outstanding underly an aggregate number of 11,553,504 ordinary shares.

Eligible participants. Our employees, officers, directors, business associates or any other individuals as determined by our board of directors, in its sole discretion, has contributed or will contribute to our company, is eligible to participate in the Pre-IPO RSU Scheme.

Vesting schedule. The administrator of the Pre-IPO RSU Scheme have sole discretion in determining the individual vesting schedules and other restrictions applicable to shares awarded under such scheme.

Administration. The plan is administered by our board of directors. The board of directors may delegate the authority to administer the Scheme to one or more directors.

Lapse of options. An unvested award issued under the scheme shall lapse automatically under certain circumstances, including but not limited to, termination of employment and the winding-up our company.

Amendment. The terms of the scheme may be altered, amended or waived in any respect by our board of directors provided that such alteration, amendment or waiver shall not affect any subsisting rights of any grantee. Any alteration, amendment or waiver to the scheme of a material nature shall be approved by the shareholders of our company. The board shall have the right to determine whether any proposed alteration, amendment or waiver is material and such determination shall be conclusive.

Termination. The scheme will terminate on the tenth anniversary of its date of adoption, unless terminated earlier. The scheme may be terminated or our board of directors may at any time terminate prior to the expiry of the scheme period provided that such termination shall not affect any subsisting rights of any grantee and in such event no further awards shall be granted. Awards granted prior to such termination but not yet exercised at the time of termination shall continue to be valid in accordance with the scheme.

Transfer restrictions. A RSU under the scheme is personal to the grantee and shall not be assignable or transferable.

The following table summarizes, as of the date of this prospectus, options and RSUs that we granted to our executive officers and to other individuals as a group and remain outstanding under our 2013 Share Option Scheme, 2014 Share Option Scheme and Pre-IPO RSU Scheme.

Name			Date of Grant(4)	Date of Expiration(5)

Gang Xu	*⁽¹⁾	0.163	December 3, 2013	February 29, 2020
	*⁽²⁾	0.163	December 15, 2014	December 31, 2021/2022/2023
Dikuo Bo	*⁽²⁾	0.163	December 15, 2014	December 31, 2021/2022/2023
Jigeng Chen	*⁽¹⁾	0.163	December 3, 2013	February 29, 2020
	*⁽²⁾	0.163	December 15, 2014	December 31, 2021/2022/2023
Qi Feng	*⁽²⁾	0.163	December 15, 2014	December 31, 2021/2022/2023
	*⁽²⁾	0.163	January 13, 2016	December 31, 2021/2022/2023
Sheng Zhao	*⁽¹⁾	0.163	December 3, 2013	February 29, 2020
	*⁽²⁾	0.163	December 15, 2014	December 31, 2021/2022/2023
Jingbo Wang	*⁽²⁾	0.163	December 15, 2014	December 31, 2021/2022/2023
	*⁽²⁾	0.163	January 13, 2016	December 31, 2021/2022/2023
Other individuals as a group	32,071,900⁽¹⁾	0.163	December 3, 2013	February 29, 2020
	29,638,000⁽²⁾	0.163	December 15, 2014	December 31, 2021/2022/2023
	7,938,915⁽³⁾	—	January 15, 2015	January 12, 2025
	11,237,714⁽²⁾	0.163	January 13, 2016	December 31, 2021/2022/2023
	3,614,589⁽³⁾	—	January 13, 2016	January 12, 2025
Total	95,901,118

The following table sets forth information with respect to the beneficial ownership of our ordinary shares, as of the date of this prospectus, by:

The calculations in the shareholder table below assume that there are 1,000,000,000 ordinary shares outstanding as of the date of this prospectus prior to the completion of this offering. The total number of ordinary shares outstanding after the completion of this offering and the Concurrent Private Placement will be 1,164,814,815 assuming the underwriters do not exercise their over-allotment option.

Beneficial ownership is determined in accordance with the rules and regulations of the SEC and includes voting or investment power with respect to the ordinary shares. Except as indicated below, and subject to applicable community property laws, the persons named in the table have sole voting and investment power with respect to all ordinary shares shown as beneficially owned by them. In computing the number of shares beneficially owned by a person and the percentage ownership of that person, we have included shares that the person has the right to acquire within 60 days of the date of this prospectus, including through the exercise of any option, warrant or other right or the conversion of any other security. These shares, however, are not included in the computation of the percentage ownership of any other person.

	Ordinary Shares Beneficially Owned Prior to This Offering					Ordinary Shares Beneficially Owned After This Offering

	Number		Percentage			Number		Percentage
Directors and Executive Officers:
Wenbin Chen⁽¹⁾		400,000,000		40	%		400,000,000		34.3	%
Ming Yan⁽¹⁾		300,000,000		30	%		300,000,000		25.8	%
Ningfeng Chen⁽¹⁾		300,000,000		30	%		300,000,000		25.8	%
Gang Xu		*		*			*		*
Dikuo Bo		*		*			*		*
Jigeng Chen		*		*			*		*
Qi Feng		*		*			*		*
Sheng Zhao		*		*			*		*
Jingbo Wang		*		*			*		*
All directors and executive officers as a group		1,004,700,000		100	%		1,004,700,000		85.9	%
Principal Shareholders:
Coreworth Investments Limited⁽²⁾		400,000,000		40	%		400,000,000		34.3	%
Harmony Creek Investments Limited⁽³⁾		300,000,000		30	%		300,000,000		25.8	%
Rich Horizon Investments Limited⁽⁴⁾		300,000,000		30	%		300,000,000		25.8	%

As of the date of the prospectus, none of our outstanding ordinary shares are held by record holders in the United States. None of our shareholders has informed us that he or she is affiliated with a registered broker-dealer or is in the business of underwriting securities. We are not aware of any arrangement that may, at a subsequent date, result in a change of control of our company.

Transactions with Certain Directors, Shareholders and Affiliates and Key Management Personnel

Risk Sharing Agreements. At the early stage of our operation, our customer base and customer trading volume grew quickly while we had a relatively small capital base. Out of concern that we could not withstand all the market risks associated with our principal positions, we entered into risk sharing agreements with companies controlled by Mr. Wenbin Chen, Mr. Ming Yan and Ms. Ningfeng Chen, respectively, to share any profit or loss generated from such positions. Pursuant to these agreements, certain percentages of our spread fees and trading gains or losses arising from exchange-traded spot commodity contracts with customers, regardless of being positive or negative, were shared among these companies and us. During the year ended December 31, 2013, the percentage of such trading gains and losses shared with these companies ranged from 30% to 50%. The risk sharing agreements were terminated at the end of November 2013 with no termination compensation incurred and the amount we shared under such risk sharing agreements in 2013 was RMB244.3 million. As of December 31, 2013, we had an amount of RMB6.9 million payable and RMB3.0 million receivable under such arrangement, which were all settled subsequently. We did not incur any risk sharing expenses with related parties in 2014 and do not expect to incur such expenses with related parties in the future.

Research Service Arrangement. Prior to December 2013, we outsourced research support services to Shanghai Han Yu Information Technology Co., Ltd., or Shanghai Han Yu, which was 100% controlled by Mr. Ming Yan. We entered into a service agreement with Shanghai Han Yu on normal commercial terms in November 2011, pursuant to which Shanghai Han Yu provided research reports, VIP customer service, training of company personnel, seminars and other services to us. According to the service agreement, we are the owner of the related intellectual property rights of such research products and materials. In order to increase our control of research operation, we terminated such service agreement in late November 2013. We did not incur any termination fee and total research service expense incurred was RMB106.1 million for the year of 2013. As of December 31, 2013, we had a total of RMB0.8 million payable to Shanghai Han Yu, which was fully paid in January 2014. We did not incur such research services expenses in 2014 and have no plan to outsource such services in the future.

Related Party Loans. In 2013, we borrowed unsecured and non-interest bearing loans with no fixed repayment terms of RMB50.7 million from certain shareholders of our Company or entities controlled by those shareholders, which were fully repaid in 2014. On December 14, 2015, we borrowed an interest-free shareholder loan of US$39.4 million from our founders to increase the working capital of the Company, which was waived in full by our founders on the same day and the amount of such loans was recorded as additional paid-in capital of the Company. In December 2015, we received an interest-free loan of RMB118.9 million (US$18.4 million) from a founding shareholder in connection with our reorganization, which was repaid in full in February 2016.

In 2013, we extended unsecured and non-interest bearing loans with no fixed repayment terms of RMB99.8 million to certain shareholders of our Company or entities controlled by those shareholders, which were repaid in full in 2014. In 2014, an additional loan in the amount of RMB28.0 million with the same terms of the loans issued in 2013 were extended to related parties, of which RMB21.5 million were repaid in 2014 and the remaining amount repaid in May 2015. In 2015, additional loans of RMB40.0 million with the same terms of the loans issued in 2013 were extended to a related party, which were repaid in full during the same year.

Other Related Party Transactions. In 2014, Yin Tian Xia Technology sold application service totaling RMB1.8 million to entities wholly and jointly owned by the three founders of the Company. During the year

ended December 31, 2015, Yin Tian Xia Technology sold application services totaling RMB7.8 million (US$1.2 million) to entities wholly and jointly owned by the three founders of the Company.

See "Management — Employment Agreements" for a description of the employment agreements we have entered into with our senior executive officers.

See "Management — Share Incentive Plans" for a description of share options and restricted share units we have granted to our directors, officers and other individuals as a group.

We are a Cayman Islands company and our affairs are governed by our memorandum and articles of association and the Companies Law (as amended) of the Cayman Islands, or Companies Law.

As of the date of this prospectus, the Company is authorized to issue a maximum of 3,000,000,000 ordinary shares, with a par value of US$0.00001 each and of a single class. As of the date of this prospectus, there are 1,000,000,000 ordinary shares issued and outstanding.

Our amended and restated memorandum and articles of association will become effective upon completion of this offering. The following are summaries of material provisions of our proposed amended and restated memorandum and articles of association and the Companies Law as they relate to the material terms of our ordinary shares that we expect will become effective upon the closing of this offering.

The following discussion primarily concerns the ordinary shares and the rights of holders of the Shares. The holders of ADSs will not be treated as our shareholders and will be required to surrender their ADSs for cancellation and withdrawal from the depositary facility in which the shares are held in accordance with the provisions of the deposit agreement in order to exercise directly shareholders' rights in respect of the Shares. The depositary will agree, so far as it is practical, to vote or cause to be voted the amount of the Shares represented by ADSs in accordance with the non-discretionary written instructions of the holders of such ADSs. See "Description of American Depositary Shares — Voting Rights".

We are an exempted company incorporated with limited liability under the Companies Law. The Companies Law distinguishes between ordinary resident companies and exempted companies. Any company that is registered in the Cayman Islands but conducts business mainly outside of the Cayman Islands may apply to be registered as an exempted company. The requirements for an exempted company are essentially the same as for an ordinary resident company except for the exemptions and privileges listed below:

All of our outstanding ordinary shares are fully paid and non-assessable. Our shareholders who are non-residents of the Cayman Islands may freely hold and vote their ordinary shares.

The holders of our ordinary shares are entitled to receive such dividends as may be declared by our board of directors subject to our memorandum and articles of association and the Companies Law. In addition, our shareholders may by ordinary resolution declare a dividend, but no dividend may exceed the amount recommended by our directors. Under Cayman Islands law, dividends may be paid only out of profits and

out of share premium. No dividend may be declared and paid unless our directors determine that, immediately after the payment, we will be able to satisfy our liabilities as they become due in the ordinary course of business and we have funds lawfully available for such purpose.

Under Cayman Islands law, we must keep a register of members and there must be entered therein:

Under Cayman Islands law, the register of members of our company is prima facie evidence of the matters set out therein (i.e., the register of members will raise a presumption of fact on the matters referred to above unless rebutted). Upon the closing of this public offering, the register of members will be immediately updated to reflect the issue of shares by us as to the depositary. Once our register of members has been updated, the shareholders recorded in the register of members will be deemed to have legal title to the shares set against their names.

If the name of any person is, without sufficient cause, entered in or omitted from the register of members, or if default is made or unnecessary delay takes place in entering on the register the fact of any person having ceased to be a member, the person or member aggrieved or any member or the company itself may apply to the Cayman Islands Grand Court for an order that the register be rectified, and the Court may either refuse such application or it may, if satisfied of the justice of the case, make an order for the rectification of the register.

Holders of our ordinary shares have the right to receive notice of, attend, speak and vote at general meetings of our company. Each ordinary share shall be entitled to one vote on all matters subject to the vote at general meetings of our company. At any general meeting a resolution put to the vote of the meeting shall be decided on a show of hands, unless a poll is (before or on the declaration of the result of the show of hands) demanded by the chairman. An ordinary resolution to be passed by the shareholders requires the affirmative vote of a simple majority of the votes attaching to the ordinary shares cast in a general meeting, which can be an annual general meeting or a special meeting of shareholders. A special resolution requires the affirmative vote of no less than two-thirds of the votes attaching to the ordinary shares cast in a general meeting. Both ordinary resolutions and special resolutions may also be passed by a unanimous written resolution signed by all the shareholders of our company, as permitted by the Companies Law and our post-IPO memorandum and articles of association. A special resolution will be required for important matters such as a change of name or making changes to our memorandum and articles of association.

As a Cayman Islands exempted company, we are not obliged by the Companies Law to call shareholders' annual general meetings. Our post-IPO memorandum and articles of association provide that we may (but are not obliged to) in each year hold a general meeting as our annual general meeting in which case we will specify the meeting as such in the notices calling it, and the annual general meeting will be held at such time and place as may be determined by our directors. We, however, will hold an annual shareholders' meeting during each fiscal year, as required by NASDAQ rules.

Cayman Islands law provides shareholders with only limited rights to requisition a general meeting, and does not provide shareholders with any right to put any proposal before a general meeting. However, these rights may be provided in a company's articles of association. Our post-IPO memorandum and articles of association allow our shareholders holding at least 20% of paid-in-capital to requisition a special meeting of

the shareholders, in which case the directors are obliged to call such meeting and to put the resolutions so requisitioned to a vote at such meeting; however, our post-IPO memorandum and articles of association do not provide our shareholders with any right to put any proposals before annual general meetings or extraordinary general meetings not called by such shareholders.

A quorum required for a meeting of shareholders consists of one or more shareholders holding not less than one-third of all paid up voting share capital of our company present in person or by proxy or, if a corporation or other non-natural person, by its duly authorized representative. Advance notice of at least seven business days is required for the convening of our annual general meeting and other shareholders meetings.

Subject to the restrictions in our amended and restated memorandum and articles of association as set out below, any of our shareholders may transfer all or any of his or her ordinary shares by an instrument of transfer in the usual or common form or any other form approved by our board.

Our board of directors may, in its absolute discretion, decline to register any transfer of any ordinary share which is not fully paid-up or on which we have a lien. Our directors may also decline to register any transfer of any ordinary share unless:

The registration of transfers of shares or of any class of shares may, after compliance with any notice requirement of the designated stock exchange, be suspended at such times and for such periods (not exceeding in the whole thirty (30) days in any year) as the Board may determine.

On a return of capital on winding-up or otherwise (other than on conversion, redemption or purchase of ordinary shares), assets available for distribution among the holders of ordinary shares will be distributed among the holders of the ordinary shares on a pro rata basis. If our assets available for distribution are insufficient to repay all of the paid-up capital, the assets will be distributed so that the losses are borne by our shareholders proportionately. We are a "limited liability" company registered under the Companies Law, and under the Companies Law, the liability of our members is limited to the amount, if any, unpaid on the shares respectively held by them. Our memorandum of association contains a declaration that the liability of our members is so limited.

Our board of directors may from time to time make calls upon shareholders for any amounts unpaid on their ordinary shares in a notice served to such shareholders at least 14 calendar days prior to the specified time and place of payment. The ordinary shares that have been called upon and remain unpaid on the specified time are subject to forfeiture.

We may issue shares on terms that such shares are subject to redemption, at our option or at the option of the holders thereof, on such terms and in such manner as may be determined, before the issue of such shares, by our board of directors or by a special resolution of our shareholders. Our company may also repurchase any of our shares provided that the manner and terms of such purchase have been approved by

our board of directors and agree with the shareholder, or are otherwise authorized by our memorandum and articles of association. Under the Companies Law, the redemption or repurchase of any share may be paid out of our company's profits or one of the share premium account, or out of the proceeds of a fresh issue of shares made for the purpose of such redemption or repurchase, or, if so authorized by its articles of association, out of capital if the company can, immediately following such payment, pay its debts as they fall due in the ordinary course of business. In addition, under the Companies Law no such share may be redeemed or repurchased (a) unless it is fully paid-up, (b) if such redemption or repurchase would result in there being no shares outstanding, or (c) if the company has commenced liquidation. In addition, our company may accept the surrender of any fully paid share for no consideration.

If at any time the share capital is divided into different classes of shares, the rights attached to any class of shares may, unless otherwise provided by the terms of issue of the shares of that class, be varied with the sanction of a special resolution of the holders of the shares of that class.

Holders of our ordinary shares will have no general right under Cayman Islands law to inspect or obtain copies of our list of shareholders or our corporate records. However, we will provide our shareholders with annual audited financial statements. See "Where You Can Find Additional Information."

Subject to the Companies Law, our shareholders may by special resolution reduce our share capital and any capital redemption reserve in any manner authorized by law.

The following is a summary of our securities issuances and repurchases since our incorporation.

We were incorporated in the Cayman Islands on November 4, 2015, with an authorized share capital of US$30,000 divided into 3,000,000,000 ordinary shares, with a par value of US$0.00001 each, of which 1,000,000,000 ordinary shares were issued and outstanding, of which 400,000,000 shares were owned by Mr. Wenbin Chen through Coreworth, 300,000,000 shares were owned by Mr. Ming Yan through Harmony Creek and 300,000,000 shares were owned by Ms. Ningfeng Chen through Rich Horizon.

As of the date of this prospectus, options to purchase a maximum of 36,771,900 shares have been granted by us and remain outstanding under our 2013 Share Option Scheme and options to purchase a maximum of 47,575,714 shares have been granted by us and remain outstanding under the 2014 Share Option

Scheme. As of the date of this prospectus, 11,553,504 RSUs have been granted by us and remain outstanding under the Pre-IPO RSU Scheme. See "Management — Share Incentive Plans." We plan to grant options to purchase a maximum of 50,000,000 ordinary shares to our management and key employees upon the completion of this offering, at an exercise price per share equal to the initial public offering price of our ADSs adjusted to reflect the ADS-to-ordinary share ratio, which will vest in three equal installments upon the first, second and third anniversary of the completion of this offering.

The Companies Law is modeled after that of the English companies legislation but does not follow recent English law statutory enactments, and accordingly there are significant differences between the Companies Law and the current Companies Act of England. In addition, the Companies Law differs from laws applicable to Delaware corporations and their shareholders. Set forth below is a summary of the significant differences between the provisions of the Companies Law applicable to us and the laws applicable to Delaware corporations and their shareholders.

The Companies Law permits mergers and consolidations between Cayman Islands companies and between Cayman Islands companies and non-Cayman Islands companies. For these purposes, (a) "merger" means the merging of two or more constituent companies and the vesting of their undertakings, property and liabilities in one of such companies as the surviving company and (b) a "consolidation" means the combination of two or more constituent companies into a consolidated company and the vesting of the undertakings, property and liabilities of such companies to the consolidated company. In order to effect such a merger or consolidation, the directors of each constituent company must approve a written plan of merger or consolidation, which must then be authorized by (a) a special resolution of the shareholders of each constituent company, and (b) such other authorization, if any, as may be specified in such constituent company's articles of association. The written plan of merger or consolidation must be filed with the Registrar of Companies together with a declaration as to the solvency of the consolidated or surviving company, a declaration as to the assets and liabilities of each constituent company and an undertaking that a copy of the certificate of merger or consolidation will be given to the members and creditors of each constituent company and that notification of the merger or consolidation will be published in the Cayman Islands Gazette. Dissenting shareholders have the right to be paid the fair value of their shares (which, if not agreed between the parties, will be determined by the Cayman Islands court) if they follow the required procedures, subject to certain exceptions. Court approval is not required for a merger or consolidation which is effected in compliance with these statutory procedures.

In addition, there are statutory provisions that facilitate the reconstruction and amalgamation of companies, provided that the arrangement is approved by a majority in number of each class of shareholders and creditors with whom the arrangement is to be made, and who must in addition represent three-fourths in value of each such class of shareholders or creditors, as the case may be, that are present and voting either in person or by proxy at a meeting, or meetings, convened for that purpose. The convening of the meetings and subsequently the arrangement must be sanctioned by the Grand Court of the Cayman Islands. While a dissenting shareholder has the right to express to the court the view that the transaction ought not to be approved, the court can be expected to approve the arrangement if it determines that:

When a takeover offer is made and accepted by holders of 90% of the shares affected (within four months), the offeror may, within a two-month period commencing on the expiration of such four-month period, require the holders of the remaining shares to transfer such shares on the terms of the offer. An objection can be made to the Grand Court of the Cayman Islands, but this is unlikely to succeed in the case of an offer which has been so approved unless there is evidence of fraud, bad faith or collusion.

If the arrangement and reconstruction is thus approved, the dissenting shareholder would have no rights comparable to appraisal rights, which would otherwise ordinarily be available to dissenting shareholders of United States corporations, providing rights to receive payment in cash for the judicially determined value of the shares.

In principle, we will normally be the proper plaintiff and as a general rule a derivative action may not be brought by a minority shareholder. However, based on English authorities, which would in all likelihood be of persuasive authority in the Cayman Islands, there are exceptions to the foregoing principle, including when:

Under Delaware corporate law, a director of a Delaware corporation has a fiduciary duty to the corporation and its shareholders. This duty has two components, the duty of care and the duty of loyalty. The duty of care requires that a director act in good faith, with the care that an ordinarily prudent person would exercise under similar circumstances. Under this duty, a director must inform himself of, and disclose to shareholders, all material information reasonably available regarding a significant transaction. The duty of loyalty requires that a director must act in a manner he or she reasonably believes to be in the best interests of the corporation. A director must not use his or her corporate position for personal gain or advantage. This duty prohibits self-dealing by a director and mandates that the best interests of the corporation and its shareholders take precedence over any interest possessed by a director, officer or controlling shareholder not shared by the shareholders generally. In general, actions of a director are presumed to have been made on an informed basis, in good faith and in the honest belief that the action taken was in the best interests of the corporation. However, this presumption may be rebutted by evidence of a breach of one of the fiduciary duties. Should such evidence be presented concerning a transaction by a director, the director must prove the procedural fairness of the transaction and that the transaction was of fair value to the corporation.

As a matter of Cayman Islands law, a director of a Cayman Islands company is in the position of a fiduciary with respect to the company, and therefore it is considered that he or she owes the following duties to the company including a duty to act bona fide in the best interests of the company, a duty not to make a personal profit out of his or her position as director (unless the company permits him or her to do so), a duty not to put himself or herself in a position where the interests of the company conflict with his or her personal interests or his or her duty to a third party and a duty to exercise powers for the purpose for which such powers were intended. A director of a Cayman Islands company owes to the company a duty to act with skill and care. It was previously considered that a director need not exhibit in the performance of his or her duties a greater degree of skill than may reasonably be expected from a person of his or her knowledge and experience. However, there are indications that the English and commonwealth courts are moving towards an objective standard with regard to the required skill and care and these authorities are likely to be followed in the Cayman Islands.

Under our post-IPO memorandum and articles of association, directors who are in any way, whether directly or indirectly, interested in a contract or proposed contract with our company must declare the nature of

their interest at a meeting of the board of directors. Following such declaration, a director may vote in respect of any contract or proposed contract notwithstanding his interest.

Under the Delaware General Corporation Law, a corporation may eliminate the right of shareholders to act by written consent by amendment to its certificate of incorporation. The Companies Law and our post-IPO memorandum and articles of association provide that shareholders may approve corporate matters by way of a unanimous written resolution signed by or on behalf of each shareholder who would have been entitled to vote on such matter at a general meeting without a meeting being held.

Under the Delaware General Corporation Law, cumulative voting for elections of directors is not permitted unless the corporation's certificate of incorporation specifically provides for it. Cumulative voting potentially facilitates the representation of minority shareholders on a board of directors since it permits the minority shareholder to cast all the votes to which the shareholder is entitled for a single director, which increases the shareholder's voting power with respect to electing such director. There are no prohibitions in relation to cumulative voting under the laws of the Cayman Islands but our post-IPO memorandum and articles of association do not provide for cumulative voting.

Under the Delaware General Corporation Law, a director of a corporation may be removed with the approval of a majority of the outstanding shares entitled to vote, unless the certificate of incorporation provides otherwise. Under our post-offering amended and restated memorandum and articles of association, directors may be removed with or without cause, by an ordinary resolution of our shareholders.

The Delaware General Corporation Law contains a business combination statute applicable to Delaware public corporations whereby, unless the corporation has specifically elected not to be governed by such statute by amendment to its certificate of incorporation, it is prohibited from engaging in certain business combinations with an "interested shareholder" for three years following the date on which such person becomes an interested shareholder. An interested shareholder generally is one which owns or owned 15% or more of the target's outstanding voting shares within the past three years. This has the effect of limiting the ability of a potential acquiror to make a two-tiered bid for the target in which all shareholders would not be treated equally. The statute does not apply if, among other things, prior to the date on which such shareholder becomes an interested shareholder, the board of directors approves either the business combination or the transaction that resulted in the person becoming an interested shareholder. This encourages any potential acquiror of a Delaware public corporation to negotiate the terms of any acquisition transaction with the target's board of directors.

Cayman Islands law has no comparable statute. As a result, we cannot avail ourselves of the types of protections afforded by the Delaware business combination statute. However, although Cayman Islands law does not regulate transactions between a company and its significant shareholders, it does provide that such transactions entered into must be bona fide in the best interests of the company, for a proper corporate purpose and not with the effect of perpetrating a fraud on the minority shareholders.

Under the Delaware General Corporation Law, unless the board of directors approves the proposal to dissolve, dissolution must be approved by shareholders holding 100% of the total voting power of the corporation. Only if the dissolution is initiated by the board of directors may it be approved by a simple majority of the corporation's outstanding shares. The Delaware General Corporation Law allows a Delaware corporation to include in its certificate of incorporation a supermajority voting requirement in connection with dissolutions initiated by the board of directors. Under the Companies Law, our company may be dissolved, liquidated or wound up by a special resolution, or by an ordinary resolution on the basis that our company is unable to pay its debts as they fall due.

If at any time, our share capital is divided into different classes of shares, under the Delaware General Corporation Law, a corporation may vary the rights of a class of shares with the approval of a majority of the outstanding shares of such class, unless the certificate of incorporation provides otherwise. Under our post-IPO memorandum and articles of association and as permitted by the Companies Law, if our share capital is divided into more than one class of shares, we may vary the rights attached to any class with the sanction of a special resolution of the holders of the shares of that class.

Under the Delaware General Corporation Law, a corporation's governing documents may be amended with the approval of a majority of the outstanding shares entitled to vote, unless the certificate of incorporation provides otherwise. Under the Companies Law, our post-IPO memorandum and articles of association may only be amended by a special resolution of our shareholders.

Under the Delaware General Corporation Law, any shareholder of a corporation may for any proper purpose inspect or make copies of the corporation's stock ledger, list of shareholders and other books and records. Holders of our shares will have no general right under Cayman Islands law to inspect or obtain copies of our list of shareholders or our corporate records. However, we intend to provide our shareholders with annual reports containing audited financial statements.

Some provisions of our post-IPO memorandum and articles of association may discourage, delay or prevent a change of control of our company or management that shareholders may consider favorable, including a provision that authorizes our board of directors to issue preferred shares in one or more series and to designate the price, rights, preferences, privileges and restrictions of such preferred shares without any further vote or action by our shareholders.

However, under Cayman Islands law, our directors may only exercise the rights and powers granted to them under our memorandum and articles of association for a proper purpose and for what they believe in good faith to be in the best interests of our company.

There are no limitations imposed by foreign law or by our post-IPO memorandum and articles of association on the rights of non-resident or foreign shareholders to hold or exercise voting rights on our ordinary shares. In addition, there are no provisions in our post-IPO memorandum and articles of association governing the ownership threshold above which shareholder ownership must be disclosed.

The Companies Law and our post-IPO memorandum and articles of association do not contain statutory provisions that require staggered board arrangements for a Cayman Islands company.

The Bank of New York Mellon, as depositary, will register and deliver American Depositary Shares, also referred to as ADSs. Each ADS will represent 20 shares (or a right to receive 20 shares) deposited with The Hongkong and Shanghai Banking Corporation Limited, as custodian for the depositary in Hong Kong. Each ADS will also represent any other securities, cash or other property which may be held by the depositary. The depositary's office at which the ADSs will be administered is located at 101 Barclay Street, New York, New York, 10286. The depositary's principal executive office is located at 225 Liberty Street, New York, New York, 10286.

You may hold ADSs either (A) directly (i) by having an American Depositary Receipt, also referred to as an ADR, which is a certificate evidencing a specific number of ADSs, registered in your name, or (ii) by having uncertificated ADSs registered in your name, or (B) indirectly by holding a security entitlement in ADSs through your broker or other financial institution that is a direct or indirect participant in The Depository Trust Company, also called DTC. If you hold ADSs directly, you are a registered ADS holder, also referred to as an ADS holder. This description assumes you are an ADS holder. If you hold the ADSs indirectly, you must rely on the procedures of your broker or other financial institution to assert the rights of ADS holders described in this section. You should consult with your broker or financial institution to find out what those procedures are.

Registered holders of uncertificated ADSs will receive statements from the depositary confirming their holdings.

As an ADS holder, we will not treat you as one of our shareholders and you will not have shareholder rights. Cayman Islands law governs shareholder rights. The depositary will be the holder of the shares underlying your ADSs. As a registered holder of ADSs, you will have ADS holder rights. A deposit agreement among us, the depositary, ADS holders and all other persons indirectly or beneficially holding ADSs sets out ADS holder rights as well as the rights and obligations of the depositary. New York law governs the deposit agreement and the ADSs.

The following is a summary of the material provisions of the deposit agreement. For more complete information, you should read the entire deposit agreement and the form of ADR. Directions on how to obtain copies of those documents are provided on page 168.

The depositary has agreed to pay or distribute to ADS holders the cash dividends or other distributions it or the custodian receives on shares or other deposited securities, upon payment or deduction of its fees and expenses. You will receive these distributions in proportion to the number of shares your ADSs represent.

Cash. The depositary will convert any cash dividend or other cash distribution we pay on the shares into U.S. dollars, if it can do so on a reasonable basis and can transfer the U.S. dollars to the United States. If that is not possible or if any government approval is needed and cannot be obtained, the deposit agreement allows the depositary to distribute the foreign currency only to those ADS holders to whom it is possible to do so. It will hold the foreign currency it cannot convert for the account of the ADS holders who have not been paid. It will not invest the foreign currency and it will not be liable for any interest.

Before making a distribution, any withholding taxes, or other governmental charges that must be paid will be deducted. See "Taxation" for additional information. It will distribute only whole U.S. dollars and cents and will round fractional cents to the nearest whole cent. If the exchange rates fluctuate during a time when the depositary cannot convert the foreign currency, you may lose some of the value of the distribution.

Shares. The depositary may distribute additional ADSs representing any shares we distribute as a dividend or free distribution. The depositary will only distribute whole ADSs. It will sell shares which would require it to deliver a fraction of an ADS (or ADSs representing those shares) and distribute the net proceeds in the same way as it does with cash. If the depositary does not distribute additional ADSs, the outstanding ADSs will also represent the new shares. The depositary may sell a portion of the distributed shares (or ADSs representing those shares) sufficient to pay its fees and expenses in connection with that distribution.

Rights to purchase additional shares. If we offer holders of our securities any rights to subscribe for additional shares or any other rights, the depositary may (i) exercise those rights on behalf of ADS holders, (ii) distribute those rights to ADS holders or (iii) sell those rights and distribute the net proceeds to ADS holders, in each case after deduction or upon payment of its fees and expenses. To the extent the depositary does not do any of those things, it will allow the rights to lapse. In that case, you will receive no value for them. The depositary will exercise or distribute rights only if we ask it to and provide satisfactory assurances to the depositary that it is legal to do so. If the depositary will exercise rights, it will purchase the securities to which the rights relate and distribute those securities or, in the case of shares, new ADSs representing the new shares, to subscribing ADS holders, but only if ADS holders have paid the exercise price to the depositary. U.S. securities laws may restrict the ability of the depositary to distribute rights or ADSs or other securities issued on exercise of rights to all or certain ADS holders, and the securities distributed may be subject to restrictions on transfer.

Other Distributions. The depositary will send to ADS holders anything else we distribute on deposited securities by any means it thinks is legal, fair and practical. If it cannot make the distribution in that way, the depositary has a choice. It may decide to sell what we distributed and distribute the net proceeds, in the same way as it does with cash. Or, it may decide to hold what we distributed, in which case ADSs will also represent the newly distributed property. However, the depositary is not required to distribute any securities (other than ADSs) to ADS holders unless it receives satisfactory evidence from us that it is legal to make that distribution. The depositary may sell a portion of the distributed securities or property sufficient to pay its fees and expenses in connection with that distribution. U.S. securities laws may restrict the ability of the depositary to distribute securities to all or certain ADS holders, and the securities distributed may be subject to restrictions on transfer.

The depositary is not responsible if it decides that it is unlawful or impractical to make a distribution available to any ADS holders. We have no obligation to register ADSs, shares, rights or other securities under the Securities Act. We also have no obligation to take any other action to permit the distribution of ADSs, shares, rights or anything else to ADS holders. This means that you may not receive the distributions we make on our shares or any value for them if it is illegal or impractical for us to make them available to you.

The depositary will deliver ADSs if you or your broker deposits shares or evidence of rights to receive shares with the custodian. Upon payment of its fees and expenses and of any taxes or charges, such as stamp taxes or stock transfer taxes or fees, the depositary will register the appropriate number of ADSs in the names you request and will deliver the ADSs to or upon the order of the person or persons that made the deposit.

Except for ordinary shares deposited by us in connection with this offering, no shares will be accepted for deposit during a period of 180 days after the date of this prospectus. The 180-day lock-up period is subject to adjustment under certain circumstances as described in the section entitled "Shares Eligible for Future Sale — Lock-up Agreements."

You may surrender your ADSs for the purpose of withdrawal at the depositary's office. Upon payment of its fees and expenses and of any taxes or charges, such as stamp taxes or stock transfer taxes or fees, the depositary will deliver the shares and any other deposited securities underlying the ADSs to the ADS holder or a person the ADS holder designates at the office of the custodian. Or, at your request, risk and expense, the depositary will deliver the deposited securities at its office, if feasible. The depositary may charge you a fee and its expenses for instructing the custodian regarding delivery of deposited securities.

How do ADS holders interchange between certificated ADSs and uncertificated ADSs?

You may surrender your ADR to the depositary for the purpose of exchanging your ADR for uncertificated ADSs. The depositary will cancel that ADR and will send to the ADS holder a statement confirming that the ADS holder is the registered holder of uncertificated ADSs. Upon receipt by the depositary of a proper instruction from a registered holder of uncertificated ADSs requesting the exchange of uncertificated ADSs for certificated ADSs, the depositary will execute and deliver to the ADS holder an ADR evidencing those ADSs.

ADS holders may instruct the depositary how to vote the number of deposited shares their ADSs represent. If we request the depositary to solicit your voting instructions (and we are not required to do so), the depositary will notify you of a shareholders' meeting and send or make voting materials available to you. Those materials will describe the matters to be voted on and explain how ADS holders may instruct the depositary how to vote. For instructions to be valid, they much reach the depositary by a date set by the depositary. The depositary will try, as far as practical, subject to the laws of the Cayman Islands and the provisions of our articles of association or similar documents, to vote or to have its agents vote the shares or other deposited securities as instructed by ADS holders. If we do not request the depositary to solicit your voting instructions, you can still send voting instructions, and, in that case, the depositary may try to vote as you instruct, but it is not required to do so.

Except by instructing the depositary as described above, you won't be able to exercise voting rights unless you surrender your ADSs and withdraw the shares. However, you may not know about the meeting enough in advance to withdraw the shares. If we timely requested the depositary to solicit your instructions but no instructions are received by the depositary from an owner with respect to any of the deposited securities represented by the ADSs of that owner on or before the date established by the depositary for such purpose, the depositary shall deem that owner to have instructed the depositary to give a discretionary proxy to a person designated by us with respect to such deposited securities, and the depositary shall give a discretionary proxy to a person designated by us to vote such deposited securities. However, no such instruction shall be deemed given and no such discretionary proxy shall be given with respect to any matter if we inform the depositary we do not wish such proxy given, substantial opposition exists or the rights of holders of the ordinary shares would be materially and adversely affected.

We cannot assure you that you will receive the voting materials in time to ensure that you can instruct the depositary to vote your shares. In addition, the depositary and its agents are not responsible for failing to carry out voting instructions or for the manner of carrying out voting instructions. This means that you may not be able to exercise voting rights and there may be nothing you can do if your shares are not voted as you requested.

In order to give you a reasonable opportunity to instruct the depositary as to the exercise of voting rights relating to Deposited Securities, if we request the depositary to act, we agree to give the depositary notice of any such meeting and details concerning the matters to be voted upon at least 45 days in advance of the meeting date.


Persons depositing or withdrawing shares or ADS holders must pay:		For:
$5.00 (or less) per 100 ADSs (or portion of 100 ADSs)		Issuance of ADSs, including issuances resulting from a distribution of shares or rights or other property
		Cancellation of ADSs for the purpose of withdrawal, including if the deposit agreement terminates
$.05 (or less) per ADS		Any cash distribution to ADS holders
A fee equivalent to the fee that would be payable if securities distributed to you had been shares and the shares had been deposited for issuance of ADSs		Distribution of securities distributed to holders of deposited securities (including rights) that are distributed by the depositary to ADS holders
$.05 (or less) per ADS per calendar year		Depositary services
Registration or transfer fees		Transfer and registration of shares on our share register to or from the name of the depositary or its agent when you deposit or withdraw shares
Expenses of the depositary		Cable, telex and facsimile transmissions (when expressly provided in the deposit agreement)
		converting foreign currency to U.S. dollars
Taxes and other governmental charges the depositary or the custodian has to pay on any ADSs or shares underlying ADSs, such as stock transfer taxes, stamp duty or withholding taxes		As necessary
Any charges incurred by the depositary or its agents for servicing the deposited securities		As necessary

The depositary collects its fees for delivery and surrender of ADSs directly from investors depositing shares or surrendering ADSs for the purpose of withdrawal or from intermediaries acting for them. The depositary collects fees for making distributions to investors by deducting those fees from the amounts distributed or by selling a portion of distributable property to pay the fees. The depositary may collect its annual fee for depositary services by deduction from cash distributions or by directly billing investors or by charging the book-entry system accounts of participants acting for them. The depositary may collect any of its fees by deduction from any cash distribution payable (or by selling a portion of securities or other property distributable) to ADS holders that are obligated to pay those fees. The depositary may generally refuse to provide fee-attracting services until its fees for those services are paid.

From time to time, the depositary may make payments to us to reimburse us for costs and expenses generally arising out of establishment and maintenance of the ADS program, waive fees and expenses for services provided to us by the depositary or share revenue from the fees collected from ADS holders. In performing its duties under the deposit agreement, the depositary may use brokers, dealers, foreign currency or other service providers that are owned by or affiliated with the depositary and that may earn or share fees, spreads or commissions.

The depositary may convert currency itself or through any of its affiliates and, in those cases, acts as principal for its own account and not as agent, advisor, broker or fiduciary on behalf of any other person and earns revenue, including, without limitation, transaction spreads, that it will retain for its own account. The

revenue is based on, among other things, the difference between the exchange rate assigned to the currency conversion made under the deposit agreement and the rate that the depositary or its affiliate receives when buying or selling foreign currency for its own account. The depositary makes no representation that the exchange rate used or obtained in any currency conversion under the deposit agreement will be the most favorable rate that could be obtained at the time or that the method by which that rate will be determined will be the most favorable to ADS holders, subject to the depositary's obligations under the deposit agreement. The methodology used to determine exchange rates used in currency conversions is available upon request.

You will be responsible for any taxes or other governmental charges payable on your ADSs or on the deposited securities represented by any of your ADSs. The depositary may refuse to register any transfer of your ADSs or allow you to withdraw the deposited securities represented by your ADSs until those taxes or other charges are paid. It may apply payments owed to you or sell deposited securities represented by your American Depositary Shares to pay any taxes owed and you will remain liable for any deficiency. If the depositary sells deposited securities, it will, if appropriate, reduce the number of ADSs to reflect the sale and pay to ADS holders any proceeds, or send to ADS holders any property, remaining after it has paid the taxes.

Tender and Exchange Offers; Redemption, Replacement or Cancellation of Deposited Securities

The depositary will not tender deposited securities in any voluntary tender or exchange offer unless instructed to do by an ADS holder surrendering ADSs and subject to any conditions or procedures the depositary may establish.

If deposited securities are redeemed for cash in a transaction that is mandatory for the depositary as a holder of deposited securities, the depositary will call for surrender of a corresponding number of ADSs and distribute the net redemption money to the holders of called ADSs upon surrender of those ADSs.

If there is any change in the deposited securities such as a sub-division, combination or other reclassification, or any merger, consolidation, recapitalization or reorganization affecting the issuer of deposited securities in which the depositary receives new securities in exchange for or in lieu of the old deposited securities, the depositary will hold those replacement securities as deposited securities under the deposit agreement. However, if the depositary decides it would not be lawful and to hold the replacement securities because those securities could not be distributed to ADS holders or for any other reason, the depositary may instead sell the replacement securities and distribute the net proceeds upon surrender of the ADSs.

If there is a replacement of the deposited securities and the depositary will continue to hold the replacement securities, the depositary may distribute new ADSs representing the new deposited securities or ask you to surrender your outstanding ADRs in exchange for new ADRs identifying the new deposited securities.

If there are no deposited securities underlying ADSs, including if the deposited securities are cancelled, or if the deposited securities underlying ADSs have become apparently worthless, the depositary may call for surrender or of those ADSs or cancel those ADSs upon notice to the ADS holders.

We may agree with the depositary to amend the deposit agreement and the ADRs without your consent for any reason. If an amendment adds or increases fees or charges, except for taxes and other governmental charges or expenses of the depositary for registration fees, facsimile costs, delivery charges or similar items,

or prejudices a substantial right of ADS holders, it will not become effective for outstanding ADSs until 30 days after the depositary notifies ADS holders of the amendment. At the time an amendment becomes effective, you are considered, by continuing to hold your ADSs, to agree to the amendment and to be bound by the ADRs and the deposit agreement as amended.

The depositary will initiate termination of the deposit agreement if we instruct it to do so. The depositary may initiate termination of the deposit agreement if:

If the deposit agreement will terminate, the depositary will notify ADS holders at least 90 days before the termination date. At any time after the termination date, the depositary may sell the deposited securities. After that, the depositary will hold the money it received on the sale, as well as any other cash it is holding under the deposit agreement, unsegregated and without liability for interest, for the pro rata benefit of the ADS holders that have not surrendered their ADSs. Normally, the depositary will sell as soon as practicable after the termination date.

After the termination date and before the depositary sells, ADS holders can still surrender their ADSs and receive delivery of deposited securities, except that the depositary may refuse to accept a surrender for the purpose of withdrawing deposited securities if it would interfere with the selling process. The depositary may refuse to accept a surrender for the purpose of withdrawing sale proceeds until all the deposited securities have been sold. The depositary will continue to collect distributions on deposited securities, but, after the termination date, the depositary is not required to register any transfer of ADSs or distribute any dividends or other distributions on deposited securities to the ADSs holder (until they surrender their ADSs) or give any notices or perform any other duties under the deposit agreement except as described in this paragraph.

Limits on our Obligations and the Obligations of the Depositary; Limits on Liability to Holders of ADSs

The deposit agreement expressly limits our obligations and the obligations of the depositary. It also limits our liability and the liability of the depositary. We and the depositary:

In the deposit agreement, we and the depositary agree to indemnify each other under certain circumstances.

Before the depositary will deliver or register a transfer of ADSs, make a distribution on ADSs, or permit withdrawal of shares, the depositary may require:

The depositary may refuse to deliver ADSs or register transfers of ADSs when the transfer books of the depositary or our transfer books are closed or at any time if the depositary or we think it advisable to do so.

ADS holders have the right to cancel their ADSs and withdraw the underlying shares at any time except:

This right of withdrawal may not be limited by any other provision of the deposit agreement.

The deposit agreement permits the depositary to deliver ADSs before deposit of the underlying shares. This is called a pre-release of the ADSs. The depositary may also deliver shares upon cancellation of pre-released ADSs (even if the ADSs are canceled before the pre-release transaction has been closed out). A pre-release is closed out as soon as the underlying shares are delivered to the depositary. The depositary may receive ADSs instead of shares to close out a pre-release. The depositary may pre-release ADSs only under the following conditions: (1) before or at the time of the pre-release, the person to whom the pre-release is being made represents to the depositary in writing that it or its customer owns the shares or ADSs to be deposited; (2) the pre-release is fully collateralized with cash or other collateral that the depositary considers appropriate; and (3) the depositary must be able to close out the pre-release on not more than five business days' notice. In addition, the depositary will limit the number of ADSs that may be outstanding at any time as a result of pre-release, although the depositary may disregard the limit from time to time if it thinks it is appropriate to do so.

In the deposit agreement, all parties to the deposit agreement acknowledge that the Direct Registration System, also referred to as DRS, and Profile Modification System, also referred to as Profile, will apply to the ADSs. DRS is a system administered by DTC that facilitates interchange between registered holding of uncertificated ADSs and holding of security entitlements in ADSs through DTC and a DTC participant. Profile is feature of DRSs that allows a DTC participant, claiming to act on behalf of a registered holder of uncertificated ADSs, to direct the depositary to register a transfer of those ADSs to DTC or its nominee and to deliver those ADSs to the DTC account of that DTC participant without receipt by the depositary of prior authorization from the ADS holder to register that transfer.

In connection with and in accordance with the arrangements and procedures relating to DRS/Profile, the parties to the deposit agreement understand that the depositary will not determine whether the DTC participant that is claiming to be acting on behalf of an ADS holder in requesting registration of transfer and delivery as described in the paragraph above has the actual authority to act on behalf of the ADS holder (notwithstanding any requirements under the Uniform Commercial Code). In the deposit agreement, the parties agree that the depositary's reliance on and compliance with instructions received by the depositary through the DRS/Profile system and in accordance with the deposit agreement will not constitute negligence or bad faith on the part of the depositary.

The depositary will make available for your inspection at its office all communications that it receives from us as a holder of deposited securities that we make generally available to holders of deposited securities. The depositary will send you copies of those communications or otherwise make those communications available to you if we ask it to. You have a right to inspect the register of holders of ADSs, but not for the purpose of contacting those holders about a matter unrelated to our business or the ADSs.

Upon completion of this offering we will have outstanding 7,500,000 ADSs representing 150,000,000 ordinary shares, or approximately 12.88% of our total outstanding ordinary shares, assuming the underwriters do not exercise their overallotment option to purchase additional ADSs. All of the ADSs sold in this offering will be freely transferable by persons other than our "affiliates" without restriction or further registration under the Securities Act. Sales of substantial amounts of our ADSs in the public market could adversely affect prevailing market prices of our ADSs. Prior to this offering, there has been no public market for our ordinary shares or the ADSs, and while application has been made for the ADSs to be listed on the NASDAQ, a regular trading market for our ADSs may not develop. Our ordinary shares will not be listed on any exchange or quoted for trading on any over-the-counter trading system. We do not expect that a trading market will develop for our ordinary shares not represented by the ADSs.

We have agreed that we will not offer, sell, contract to sell, pledge, grant any option, right or warrant to purchase, sell any option or contract to purchase, purchase any option or contract to sell, lend, make any short sale or otherwise transfer or dispose of (including entering into any swap or other arrangement that transfers to another, in whole or in part, any of the economic consequences of ownership interests), directly or indirectly, any ADSs or ordinary shares or any securities that are convertible into or exchangeable for, or that represent the right to receive, our ADSs or ordinary shares or any substantially similar securities, without the prior written consent of the representatives on behalf of the underwriters for a period ending 180 days after the date of this prospectus, except issuances pursuant to the exercise of share options outstanding on the date hereof or certain other exceptions.

Our directors, officers, existing shareholders and certain holders of our options have agreed not to offer, sell, contract to sell, pledge or otherwise dispose of, directly or indirectly, any ADSs or ordinary shares or securities convertible into or exchangeable or exercisable for any ADSs or ordinary shares, for a period of 180 days after the date this prospectus becomes effective. MeMeStar Limited, a wholly-owned subsidiary of SINA Corporation (NASDAQ: SINA), has agreed to enter into a similar lock-up agreement relating to the ordinary shares to be purchased pursuant to the Concurrent Private Placement. In addition, we have instructed The Bank of New York Mellon, as depositary, not to accept for deposit any ordinary shares or issue any ADSs for 180 days after the date of this prospectus (other than in connection with this offering), unless we instruct the depositary with the prior written consent of the representative of the underwriters. After the expiration of the 180-day period, the ordinary shares or ADSs held by our directors, officers, shareholders, option holders and MeMeStar Limited may be sold subject to the restrictions under Rule 144 under the Securities Act or by means of registered public offerings.

The 180-day restricted period is subject to adjustment under certain circumstances. If (1) during the last 17 days of the 180-day restricted period, we issue an earnings release or material news or a material event relating to us occurs; or (2) prior to the expiration of the 180-day restricted period, we announce that we will release earnings results during the 16-day period beginning on the last day of the 180-day period, the restrictions will continue to apply until the expiration of the 18-day period beginning on the issuance of the earnings release or the occurrence of the material news or material event, unless, with respect to the restricted period applicable to us, our directors and executive officers and existing shareholders, such extension is waived by the representatives on behalf of the underwriters.

Other than this offering, we are not aware of any plans by any significant shareholders to dispose of significant numbers of our ADSs or ordinary shares. However, one or more existing shareholders or owners of securities convertible or exchangeable into or exercisable for our ADSs or ordinary shares may dispose of significant numbers of our ADSs or ordinary shares. We cannot predict what effect, if any, future sales of our ADSs or ordinary shares, or the availability of ADSs or ordinary shares for future sale, will have on the

trading price of our ADSs from time to time. Sales of substantial amounts of our ADSs or ordinary shares in the public market, or the perception that these sales could occur, could adversely affect the trading price of our ADSs.

All of our ordinary shares outstanding prior to this offering are "restricted securities" as that term is defined in Rule 144 under the Securities Act and may be sold publicly in the United States only if they are subject to an effective registration statement under the Securities Act or pursuant to an exemption from the registration requirements such as those provided by Rule 144 and Rule 701 promulgated under the Securities Act. In general, beginning 90 days after the date of this prospectus, a person (or persons whose shares are aggregated) who at the time of a sale is not, and has not been during the three months preceding the sale, an affiliate of ours and has beneficially owned our restricted securities for at least six months will be entitled to sell the restricted securities without registration under the Securities Act, subject only to the availability of current public information about us, and will be entitled to sell restricted securities beneficially owned for at least one year without restriction. Persons who are our affiliates and have beneficially owned our restricted securities for at least six months may sell a number of restricted securities within any three-month period that does not exceed the greater of the following:

Sales by affiliates under Rule 144 must be made through unsolicited brokers' transactions. They are also subject to manner of sale provisions, notice requirements and the availability of current public information about us.

In general, under Rule 701 of the Securities Act as currently in effect, each of our employees, directors or consultants who purchases our ordinary shares from us pursuant to a compensatory stock or option plan or other written agreement relating to compensation is eligible to resell such ordinary shares 90 days after we become a reporting company under the Exchange Act in reliance on Rule 144, but without compliance with some of the restrictions, such as the holding period, contained in Rule 144. However, the Rule 701 shares would remain subject to lock-up arrangements and would only become eligible for sale when the lock-up period expires.

We intend to file a registration statement on Form S-8 under the Securities Act covering all ordinary shares which are either subject to outstanding options or may be issued upon exercise of any options, RSUs or other equity awards which may be granted or issued in the future pursuant to our stock plans. Shares registered under any registration statements will be available for sale in the open market, except to the extent that the shares are subject to vesting restrictions with us or the contractual restrictions described below.

The following discussion of the material Cayman Islands, PRC and United States federal income tax consequences of an investment in our ADSs or ordinary shares is based upon laws and relevant interpretations thereof in effect as of the date of this prospectus, all of which are subject to change. This discussion does not deal with all possible tax consequences relating to an investment in our ADSs or ordinary shares, such as the tax consequences under state, local and other tax laws, or tax laws of jurisdictions other than the Cayman Islands, PRC and the United States. To the extent that the discussion relates to matters of Cayman Islands tax law, it represents the opinion of Walkers, our Cayman Islands counsel. To the extent that the discussion relates to matters of PRC tax laws, it represents the opinion of King & Wood Mallesons, our PRC counsel. Based on the facts and subject to the limitations set forth herein, the statements of law or legal conclusions under the caption "— United States Federal Income Taxation" constitute the opinion of Davis Polk & Wardwell LLP, our United States counsel, as to the material United States federal income tax consequences to United States holders of an investment in the ADSs or the ordinary shares represented thereby.

The Cayman Islands currently levies no taxes on individuals or corporations based upon profits, income, gains or appreciation and there is no taxation in the nature of inheritance tax or estate duty. There are no other taxes likely to be material to us levied by the government of the Cayman Islands except for stamp duties which may be applicable on instruments executed in, or brought within the jurisdiction of the Cayman Islands. The Cayman Islands is not a party to any double tax treaties that are applicable to any payments made to or by our company. There are no exchange control regulations or currency restrictions in the Cayman Islands.

Under the PRC EIT Law, an enterprise established outside the PRC with "de facto management bodies" within the PRC is considered a "resident enterprise" of the PRC. The SAT, issued the Circular on Issues Concerning the Identification of Chinese-Controlled Overseas Registered Enterprises as Resident Enterprises in Accordance With the Actual Standards of Management Bodies, or Circular 82, on April 22, 2009 and amended on January 29, 2014. Circular 82 clarified that dividends and other income paid by such resident enterprises will be considered PRC-source income and subject to PRC withholding tax, currently at a rate of 10%, when paid to non-PRC enterprise shareholders.

Under the implementation rules to the PRC EIT Law, a "de facto management body" is defined as a management body that has substantial and overall management and control over the manufacturing and business operations, personnel and human resources, finances and properties of an enterprise. In addition, the above circular specifies that certain PRC-invested enterprises will be classified as PRC resident enterprises if the following are located or resident in the PRC: (i) senior management personnel and core management departments that are in charge of daily production, and operation management; (ii) financial and human resources decision-making bodies; (iii) major assets, accounting books, company seals, and minutes and files of board meetings and shareholders' meetings; and (iv) more than half of the senior management or directors having voting rights.

Although Circular 82 explicitly provides that the above standards shall apply to enterprises which are registered outside the PRC and funded by PRC enterprises or PRC enterprise groups, not those controlled by PRC individuals or foreigners as controlling investors, it is still uncertain whether such standards under this circular may be cited for reference and be adopted when considering whether our "effective management" is in the PRC or not, and whether we may be considered a resident enterprise under the PRC EIT Law. We do not believe that Yintech, our Cayman Islands holding company, meets all of the conditions above to be considered a resident enterprise. Therefore, we believe that Yintech should not be treated as a "resident

enterprise" for PRC tax purposes. However, it remains unclear how PRC tax authorities will determine the tax residency status of foreign enterprises controlled by individuals or foreign entities, such as us. If the PRC tax authorities determine that Yintech is a PRC resident enterprise for enterprise income tax purposes, we may be required to withhold a 10% withholding tax from dividends we pay to our shareholders that are non-resident enterprises, including the holders of our ADSs. In addition, non-resident enterprise shareholders (including ADS holders) may be subject to PRC tax on gains realized on the sale or other disposition of ADSs or ordinary shares, if such income is treated as sourced from within the PRC. It is unclear whether our non-PRC individual shareholders (including our ADS holders) would be subject to any PRC tax on dividends or gains obtained by such non-PRC individual shareholders in the event we are determined to be a PRC resident enterprise. If any PRC tax were to apply to such dividends or gains, it would generally apply at a rate of 20% (unless a reduced rate is available under an applicable tax treaty). It is also unclear whether non-PRC shareholders of Yintech would be able to claim the benefits of any tax treaties between their tax residence and the PRC in the event that Yintech is treated as a PRC resident enterprise.

In the opinion of Davis Polk & Wardwell LLP, the following are material U.S. federal income tax consequences to the U.S. Holders described below of owning and disposing of the ADSs or ordinary shares, but it does not purport to be a comprehensive description of all of the tax considerations that may be relevant to a particular person's decision to acquire ADSs or ordinary shares. This discussion applies only to a U.S. Holder that acquires our ADSs or ordinary shares in this offering and holds the ADSs or ordinary shares as capital assets (generally, property held for investment) for U.S. federal income tax purposes. In addition, it does not describe all of the tax consequences that may be relevant in light of a U.S. Holder's particular circumstances, including the alternative minimum tax, the Medicare contribution tax on net investment income and tax consequences applicable to U.S. Holders subject to special rules, such as:

If an entity that is classified as a partnership for U.S. federal income tax purposes owns ADSs or ordinary shares, the U.S. federal income tax treatment of a partner will generally depend on the status of the partner and the activities of the partnership. Partnerships owning ADSs or ordinary shares and partners in such partnerships should consult their tax advisers as to the particular U.S. federal income tax consequences of owning and disposing of ADSs or ordinary shares.

This discussion is based on the Internal Revenue Code of 1986, as amended, or the Code, administrative pronouncements, judicial decisions, final, temporary and proposed Treasury regulations, and the income tax treaty between the United States and the PRC, or the Treaty, all as of the date hereof, any of which is subject to change, possibly with retroactive effect. This discussion is also based, in part, on representations by the Depositary and assumes that each obligation under the deposit agreement and any related agreement will be performed in accordance with its terms.

As used herein, a "U.S. Holder" is a person who is a beneficial owner of our ADSs or ordinary shares that is, for U.S. federal income tax purposes:

In general, a U.S. Holder who owns ADSs will be treated as the owner of the underlying shares represented by those ADSs for U.S. federal income tax purposes. Accordingly, no gain or loss will be recognized if a U.S. Holder exchanges ADSs for the underlying shares represented by those ADSs.

The U.S. Treasury has expressed concern that parties to whom American depositary shares are released before the underlying shares are delivered to the depositary (a "pre-release"), or intermediaries in the chain of ownership between holders of American depositary shares and the issuer of the security underlying the American depositary shares, may be taking actions that are inconsistent with the claiming of foreign tax credits by holders of American depositary shares. These actions would also be inconsistent with the claiming of the reduced rate of tax, described below, applicable to dividends received by certain non-corporate holders. Accordingly, the creditability of PRC taxes, and the availability of the reduced tax rate for dividends received by certain non-corporate U.S. Holders, each described below, could be affected by actions taken by such parties or intermediaries. U.S. Holders should consult their tax advisers concerning the U.S. federal, state, local and non-U.S. tax consequences of owning and disposing of ADSs or ordinary shares in their particular circumstances.

This discussion assumes that the Company is not, and will not become, a passive foreign investment company, or a PFIC, as described below.

Taxation of Distributions. Distributions paid on our ADSs or ordinary shares, other than certain pro rata distributions of ADSs or ordinary shares, will be treated as dividends to the extent paid out of our current or accumulated earnings and profits, as determined under U.S. federal income tax principles. Because we do not maintain calculations of our earnings and profits under U.S. federal income tax principles, it is expected that distributions generally will be reported to U.S. Holders as dividends. Dividends will not be eligible for the dividends-received deduction generally available to U.S. corporations under the Code. Subject to applicable limitations and the discussion above regarding concerns expressed by the U.S. Treasury, dividends paid to certain non-corporate U.S. Holders may be taxable at reduced rates. Non-corporate U.S. Holders should consult their tax advisers regarding the availability of the reduced tax rate on dividends in their particular circumstances.

Dividends will be included in a U.S. Holder's income on the date of the U.S. Holder's, or in the case of ADSs, the Depositary's, receipt. The amount of any dividend income paid in foreign currency will be the U.S. dollar amount calculated by reference to the spot rate in effect on the date of receipt, regardless of whether the payment is in fact converted into U.S. dollars on such date. If the dividend is converted into U.S. dollars on the date of receipt, a U.S. Holder generally should not be required to recognize foreign currency gain or loss in respect of the amount received. A U.S. Holder may have foreign currency gain or loss if the dividend is converted into U.S. dollars after the date of receipt.

Dividends will be treated as foreign-source income for foreign tax credit purposes. As described in "— People's Republic of China Taxation", dividends paid by the Company may be subject to PRC withholding tax. For U.S. federal income tax purposes, the amount of the dividend income may include amounts withheld in respect of the PRC withholding tax. Subject to applicable limitations, which vary depending upon the U.S. Holder's circumstances, and subject to the discussion above regarding concerns expressed by the U.S. Treasury, PRC taxes withheld from dividend payments (at a rate not exceeding the applicable rate provided in the Treaty in the case of a U.S. Holder that is eligible for the benefits of the

Treaty) generally will be creditable against a U.S. Holder's U.S. federal income tax liability. The rules governing foreign tax credits are complex and U.S. Holders should consult their tax advisers regarding the creditability of foreign tax credits in their particular circumstances. In lieu of claiming a credit, a U.S. Holder may elect to deduct such PRC taxes in computing its taxable income, subject to applicable limitations. An election to deduct foreign taxes instead of claiming foreign tax credits must apply to all foreign taxes paid or accrued in the taxable year.

Sale or Other Taxable Disposition of ADSs or Ordinary Shares. A U.S. Holder will generally recognize capital gain or loss on a sale or other taxable disposition of ADSs or ordinary shares in an amount equal to the difference between the amount realized on the sale or other taxable disposition and the U.S. Holder's tax basis in such ADSs or ordinary shares disposed of, in each case as determined in U.S. dollars. The gain or loss will be long-term capital gain or loss if, at the time of the sale or disposition, the U.S. Holder has owned the ADSs or ordinary shares for more than one year. Long-term capital gains recognized by non-corporate U.S. Holders may be subject to tax rates that are lower than those applicable to ordinary income. The deductibility of capital losses is subject to limitations.

As described in "— People's Republic of China Taxation," gains on the sale of ADSs or ordinary shares may be subject to PRC taxes. A U.S. Holder will be entitled to use foreign tax credits to offset only the portion of its U.S. federal income tax liability that is attributable to foreign-source income. Because under the Code capital gains of U.S. persons are generally treated as U.S.-source income, this limitation may preclude a U.S. Holder from claiming a credit for all or a portion of any PRC taxes imposed on any such gains. However, U.S. Holders that are eligible for the benefits of the Treaty may be able to elect to treat the gain as PRC-source and therefore claim foreign tax credits in respect of PRC taxes on such disposition gains. U.S. Holders should consult their tax advisers regarding their eligibility for the benefits of the Treaty and the creditability of any PRC tax on disposition gains in their particular circumstances.

Passive Foreign Investment Company Rules. In general, a non-U.S. corporation will be a PFIC for any taxable year in which (i) 75% or more of its gross income consists of passive income or (ii) 50% or more of the average quarterly value of its assets consists of assets that produce, or are held for the production of, passive income. For purposes of the above calculations, a non-U.S. corporation that directly or indirectly owns at least 25% by value of the shares of another corporation is treated as if it held its proportionate share of the assets of the other corporation and received directly its proportionate share of the income of the other corporation. Passive income generally includes interest, rents, dividends, royalties and net gains from transactions relating to commodities (other than certain active business income, including gains derived by certain dealers in property).

Based upon the manner in which we currently operate our business, the present composition of our income and assets (including the expected proceeds from this offering) and the estimated value of our assets, including goodwill, which is based on the expected price of our ADSs in this offering, we do not expect to be a PFIC for our current taxable year or in the foreseeable future. However, our PFIC status is a factual determination that is made on an annual basis. Because our PFIC status for any taxable year will depend on the manner in which we operate our business (including the manner and extent to which we hedge our positions with customers) and on the composition of our income and assets and the value of our assets from time to time (the value of which may be determined, in part, by reference to the market price of our ADSs, which is likely to fluctuate significantly) there can be no assurance that we will not be a PFIC for any taxable year.

Generally, if we are a PFIC for any taxable year during which a U.S. Holder owned our ADSs or ordinary shares, gain recognized upon a disposition (including, under certain circumstances, a pledge) of ADSs or ordinary shares by the U.S. Holder will be allocated ratably over the U.S. Holder's holding period for the ADSs or ordinary shares. The amounts allocated to the taxable year of disposition and to years before we became a PFIC will be taxed as ordinary income. The amounts allocated to each other taxable year will be subject to tax at the highest rate in effect for that taxable year for individuals or corporations, as

appropriate, and an interest charge will be imposed on the tax allocated to each taxable year. Further, to the extent that any distribution received by a U.S. Holder on its ADSs or ordinary shares exceeds 125% of the average of the annual distributions received (or deemed received) during the preceding three years or the U.S. Holder's holding period, whichever is shorter, the distribution will be subject to taxation in the manner described above.

Alternatively, if we were a PFIC and our ADSs or ordinary shares were "regularly traded" on a "qualified exchange," a U.S. Holder could make a mark-to-market election with respect to its ADSs or ordinary shares, which would result in tax treatment different from the general tax treatment for PFICs described above. The ADSs or ordinary shares would be treated as "regularly traded" for any calendar year in which more than a de minimis quantity of the ADSs or ordinary shares were traded on a qualified exchange on at least 15 days during each calendar quarter. The NASDAQ, where our ADSs are expected to be listed, is a qualified exchange for this purpose. If a U.S. Holder makes the mark-to-market election, the U.S. Holder generally will recognize as ordinary income any excess of the fair market value of the ADSs at the end of each taxable year over their adjusted tax basis, and will recognize an ordinary loss in respect of any excess of the adjusted tax basis of the ADSs over their fair market value at the end of the taxable year (but only to the extent of the net amount of income previously included as a result of the mark-to-market election). If a U.S. Holder makes the election, the U.S. Holder's tax basis in the ADSs will be adjusted to reflect these income or loss amounts. In addition, if a U.S. Holder makes the mark-to-market election, any gain that the U.S. Holder recognizes on the sale or other disposition of ADSs in a year when we are a PFIC will be treated as ordinary income and any loss will be treated as an ordinary loss (but only to the extent of the net amount of income previously included as a result of the mark-to-market election), and any distributions paid on the ADSs will be treated as discussed under "— Taxation of Distributions" above. If we were a PFIC and any of our subsidiaries or other entities in which we own equity interests were also a PFIC, or a Lower-tier PFIC, a U.S. Holder would not be able to make a mark-to-market election with respect to such Lower-tier PFIC and may therefore be subject to federal income tax under the general PFIC rules described in the preceding paragraph with respect to certain distributions by, or gains from disposition of ordinary shares of, such Lower-tier PFIC.

We do not intend to provide U.S. Holders with the information necessary to make qualified electing fund elections which, if available, could result in a further alternative tax treatment were we a PFIC.

If we are a PFIC for any taxable year during which a U.S. Holder owns ADSs or ordinary shares, we will generally continue to be treated as a PFIC with respect to the U.S. Holder for all succeeding years during which the U.S. Holder owns ADSs or ordinary shares, even if we cease to meet the threshold requirements for PFIC status. If a U.S. Holder owns ADSs or ordinary shares during any year in which we are a PFIC, the U.S. Holder generally will be required to file annual reports on IRS Form 8621 (or any successor form) with respect to us, generally with the U.S. Holder's federal income tax return for that year. U.S. Holders should consult their tax advisers regarding the determination of whether we are a PFIC for any taxable year and the potential application of the PFIC rules.

Information Reporting and Backup Withholding. Payments of dividends and sales proceeds that are made within the United States or through certain U.S.-related financial intermediaries may be subject to information reporting and to backup withholding, unless (i) the U.S. Holder is a corporation or other "exempt recipient" and (ii) in the case of backup withholding, the U.S. Holder provides a correct taxpayer identification number and certifies that it is not subject to backup withholding. The amount of any backup withholding from a payment to a U.S. Holder will be allowed as a credit against the U.S. Holder's U.S. federal income tax liability and may entitle it to a refund, provided that the required information is timely furnished to the IRS.

Certain U.S. Holders who are individuals (and certain entities controlled by individuals) may be required to report information relating to their ownership of ADSs or ordinary shares, unless the ADSs or ordinary shares are held in accounts at financial institutions (in which case the accounts may be reportable if maintained by non-U.S. financial institutions). U.S. Holders should consult their tax advisers regarding their reporting obligations with respect to the ADSs or ordinary shares.

Subject to the terms and conditions set forth in the underwriting agreement, dated , 2016, between us and Jefferies LLC, as the representative of the underwriters named below and the sole book-running manager of this offering, we have agreed to sell to the underwriters, and each of the underwriters has agreed, severally and not jointly, to purchase from us, the respective number of ADSs shown opposite its name below:

The underwriting agreement provides that the obligations of the several underwriters are subject to certain conditions precedent such as the receipt by the underwriters of officers' certificates and legal opinions and approval of certain legal matters by their counsel. The underwriting agreement provides that the underwriters will purchase all of the ADSs if any of them are purchased. If an underwriter defaults, the underwriting agreement provides that the purchase commitments of the nondefaulting underwriters may be increased or the underwriting agreement may be terminated. We have agreed to indemnify the underwriters and certain of their controlling persons against certain liabilities, including liabilities under the Securities Act, and to contribute to payments that the underwriters may be required to make in respect of those liabilities.

The underwriters have advised us that, following the completion of this offering, they currently intend to make a market in the ADSs as permitted by applicable laws and regulations. However, the underwriters are not obligated to do so, and the underwriters may discontinue any market-making activities at any time without notice in their sole discretion. Accordingly, no assurance can be given as to the liquidity of the trading market for the ADSs, that you will be able to sell any of the ADSs held by you at a particular time or that the prices that you receive when you sell will be favorable.

The underwriters are offering the ADSs subject to their acceptance of the ADSs from us and subject to prior sale. The underwriters reserve the right to withdraw, cancel or modify offers to the public and to reject orders in whole or in part. In addition, the underwriters have advised us that they do not intend to confirm sales to any account over which they exercise discretionary authority.

Ping An of China Securities (Hong Kong) Company Limited is not a broker-dealer registered with the SEC and therefore may not make sales of any of our ADSs in the United States or to U.S. persons. Ping An of China Securities (Hong Kong) Company Limited has agreed that it does not intend to and will not offer or sell any of the ADSs in the United States or to U.S. persons in connection with this offering.

The underwriters have advised us that they propose to offer the ADSs to the public at the initial public offering price set forth on the cover page of this prospectus and to certain dealers, which may include the underwriters, at that price less a concession not in excess of US$ per ADS. The underwriters may allow, and certain dealers may reallow, a discount from the concession not in excess of US$ per ADS to certain brokers and dealers. After the offering, the initial public offering price, concession and reallowance to dealers may be reduced by the representative. No such reduction will change the amount of proceeds to be received by us as set forth on the cover page of this prospectus.

The following table shows the public offering price, the underwriting discounts and commissions that we are to pay the underwriters and the proceeds, before expenses, to us in connection with this offering. Such amounts are shown assuming both no exercise and full exercise of the underwriters' option to purchase additional ADSs.

We estimate expenses payable by us in connection with this offering, other than the underwriting discounts and commissions referred to above, will be approximately US$4.0 million. We may at our sole discretion pay Jefferies LLC a discretionary fee of 0.5% of the aggregate public offering price of the ADSs. We have also agreed to reimburse the underwriters for their out-of-pocket expenses, including roadshow and other expenses, in connection with this offering. Such reimbursements are deemed underwriter compensation by FINRA. The aggregate amount of our reimbursement of out-of-pocket expenses to Jefferies LLC and any discretionary fee we may pay to Jefferies LLC will not exceed 1.0% of the aggregate public offering price of the ADSs.

In addition, pursuant to an engagement letter between us and Jefferies LLC, we have granted Jefferies LLC a right of first refusal, during the term of the engagement letter and for a period of 24 months following the termination of the engagement letter, to be retained by us in connection with any equity or debt financing or other investment in our company, any tender or exchange offer for, or consent solicitation with respect to debt securities, and any material merger or acquisition or any other activity for which we would engage a financial advisor.

Prior to this offering, there has not been a public market for our ADSs. Consequently, the initial public offering price for our ADSs will be determined by negotiations between us and the representative. Among the factors to be considered in these negotiations will be prevailing market conditions, our financial information, market valuations of other companies that we and the underwriters believe to be comparable to us, estimates of our business potential, the present state of our development and other factors deemed relevant.

We offer no assurances that the initial public offering price will correspond to the price at which the ADSs will trade in the public market subsequent to the offering or that an active trading market for the ADSs will develop and continue after the offering.

We have applied to have the ADSs listed on the NASDAQ under the trading symbol "YIN."

If you purchase ADSs offered in this prospectus, you may be required to pay stamp taxes and other charges under the laws and practices of the country of purchase, in addition to the offering price listed on the cover page of this prospectus.

We have granted to the underwriters an option, exercisable for 30 days from the date of this prospectus, to purchase, from time to time, in whole or in part, up to an aggregate of 1,125,000 ADSs from us at the public offering price set forth on the cover page of this prospectus, less underwriting discounts and commissions. If the underwriters exercise this option, each underwriter will be obligated, subject to specified conditions, to purchase a number of additional ADSs proportionate to that underwriter's initial purchase commitment as indicated in the table above. This option may be exercised only if the underwriters sell more ADSs than the total number set forth on the cover page of this prospectus.

We, our officers, directors, existing shareholders and certain holders of our options have agreed, subject to specified exceptions, not to directly or indirectly:

This restriction terminates after the close of trading of the ADSs and including the 180^th day after the date of this prospectus.

In addition, we have instructed The Bank of New York Mellon, as depositary, not to accept for deposit of any ordinary shares or issue any ADSs for 180 days after the date of this prospectus (other than in connection with this offering).

Jefferies LLC may, in its sole discretion and at any time or from time to time before the termination of the 180-day period release all or any portion of the securities subject to lock-up agreements. There are no existing agreements between the underwriters and any of our shareholders who will execute a lock-up agreement, providing consent to the sale of ADSs or ordinary shares prior to the expiration of the lock-up period.

Concurrently with, and subject to, the completion of this offering, MeMeStar Limited, a limited liability company incorporated in the BVI and a wholly-owned subsidiary of SINA Corporation (NASDAQ: SINA), has agreed to purchase from us US$10 million of our ordinary shares at a per share price equal to the initial public offering price of our ADSs adjusted to reflect the ADS-to-ordinary share ratio, or the Concurrent Private Placement. Assuming an offering price of US$13.50 per ADS, being the midpoint of the estimated initial public offering price range shown on the front cover of this prospectus, MeMeStar Limited will purchase 14,814,815 ordinary shares from us. This Concurrent Private Placement is being made pursuant to an exemption from registration with the U.S. Securities and Exchange Commission under Regulation S of the Securities Act. Under the subscription agreement between the Company and MeMeStar Limited dated March 24, 2016, the completion of this offering is the only substantive closing condition in this Concurrent

Private Placement. MeMeStar Limited has agreed with us and the underwriters not to, directly or indirectly, sell, transfer or dispose of any ordinary shares acquired in the Concurrent Private Placement for a period of 180 days after the date of this prospectus, subject to certain exceptions.

The underwriters have advised us that they, pursuant to Regulation M under the Securities Exchange Act of 1934, as amended, certain persons participating in the offering may engage in short sale transactions, stabilizing transactions, syndicate covering transactions or the imposition of penalty bids in connection with this offering. These activities may have the effect of stabilizing or maintaining the market price of the ADSs at a level above that which might otherwise prevail in the open market. Establishing short sales positions may involve either "covered" short sales or "naked" short sales.

"Covered" short sales are sales made in an amount not greater than the underwriters' option to purchase additional shares of our ADSs in this offering. The underwriters may close out any covered short position by either exercising their option to purchase additional ADSs or purchasing the ADSs in the open market. In determining the source of ADSs to close out the covered short position, the underwriters will consider, among other things, the price of ADSs available for purchase in the open market as compared to the price at which they may purchase ADSs through the option to purchase additional ADSs.

"Naked" short sales are sales in excess of the option to purchase additional ADSs. The underwriters must close out any naked short position by purchasing ADSs in the open market. A naked short position is more likely to be created if the underwriters are concerned that there may be downward pressure on the price of the ADSs in the open market after pricing that could adversely affect investors who purchase in this offering.

A stabilizing bid is a bid for the purchase of ADSs on behalf of the underwriters for the purpose of fixing or maintaining the price of the ADSs. A syndicate covering transaction is the bid for or the purchase of ADSs on behalf of the underwriters to reduce a short position incurred by the underwriters in connection with the offering. Similar to other purchase transactions, the underwriter's purchases to cover the syndicate short sales may have the effect of raising or maintaining the market price of our ADSs or preventing or retarding a decline in the market price of our ADSs. As a result, the price of our ADSs may be higher than the price that might otherwise exist in the open market. A penalty bid is an arrangement permitting the underwriters to reclaim the selling concession otherwise accruing to a syndicate member in connection with the offering if the ADSs originally sold by such syndicate member are purchased in a syndicate covering transaction and therefore have not been effectively placed by such syndicate member.

Neither we nor any of the underwriters make any representation or prediction as to the direction or magnitude of any effect that the transactions described above may have on the price of ADSs. The underwriters are not obligated to engage in these activities and, if commenced, any of the activities may be discontinued at any time.

A prospectus in electronic format may be made available by e-mail or on the web sites or through online services maintained by one or more of the underwriters or their affiliates. In those cases, prospective investors may view offering terms online and may be allowed to place orders online. The underwriters may agree with us to allocate a specific number of ADSs for sale to online brokerage account holders. Any such allocation for online distributions will be made by the underwriters on the same basis as other allocations. Other than the prospectus in electronic format, the information on the underwriters' web sites and any information contained in any other web site maintained by any of the underwriters is not part of this prospectus, has not been approved and/or endorsed by us or the underwriters and should not be relied upon by investors.

At our request, the underwriters have reserved for sale at the initial public offering price up to 375,000 ADSs for our employees and their related persons, and people that have business relationships with us. The number of ADSs available for sale to the general public in the offering will be reduced to the extent these persons purchase the directed ADSs in the program. Any directed ADSs not so purchased will be offered by the underwriters to the general public on the same terms as the other ADSs. We have agreed to indemnify the underwriters against certain liabilities and expenses, including liabilities under the Securities Act, in connection with sales of the directed shares.

The underwriters and certain of their affiliates are full service financial institutions engaged in various activities, which may include securities trading, commercial and investment banking, financial advisory, investment management, investment research, principal investment, hedging, financing and brokerage activities. The underwriters and certain of their affiliates have, from time to time, performed, and may in the future perform, various commercial and investment banking and financial advisory services for us and our affiliates, for which they received or will receive customary fees and expenses.

In the ordinary course of their various business activities, the underwriters and certain of their affiliates may make or hold a broad array of investments and actively trade debt and equity securities (or related derivative securities) and financial instruments (including bank loans) for their own account and for the accounts of their customers, and such investment and securities activities may involve securities and/or instruments issued by us and our affiliates. If the underwriters or their respective affiliates have a lending relationship with us, they routinely hedge their credit exposure to us consistent with their customary risk management policies. The underwriters and their respective affiliates may hedge such exposure by entering into transactions which consist of either the purchase of credit default swaps or the creation of short positions in our securities or the securities of our affiliates, including potentially the ADSs offered hereby. Any such short positions could adversely affect future trading prices of the ADSs offered hereby. The underwriters and certain of their respective affiliates may also communicate independent investment recommendations, market color or trading ideas and/or publish or express independent research views in respect of such securities or instruments and may at any time hold, or recommend to clients that they acquire, long and/or short positions in such securities and instruments.

The distribution of the ADSs in Canada is being made only in the provinces of Ontario, Quebec, Alberta and British Columbia on a private placement basis exempt from the requirement that we prepare and file a prospectus with the securities regulatory authorities in each province where trades of these securities are made. Any resale of the ADSs in Canada must be made under applicable securities laws which may vary depending on the relevant jurisdiction, and which may require resales to be made under available statutory exemptions or under a discretionary exemption granted by the applicable Canadian securities regulatory authority. Purchasers are advised to seek legal advice prior to any resale of the securities.

By purchasing the ADSs in Canada and accepting delivery of a purchase confirmation, a purchaser is representing to us and the dealer from whom the purchase confirmation is received that:

Canadian purchasers are hereby notified that Jefferies is relying on the exemption set out in section 3A.3 or 3A.4, if applicable, of National Instrument 33-105 — Underwriting Conflicts from having to provide certain conflict of interest disclosure in this document.

Securities legislation in certain provinces or territories of Canada may provide a purchaser with remedies for rescission or damages if the prospectus (including any amendment thereto) such as this document contains a misrepresentation, provided that the remedies for rescission or damages are exercised by the purchaser within the time limit prescribed by the securities legislation of the purchaser's province or territory. The purchaser of these securities in Canada should refer to any applicable provisions of the securities legislation of the purchaser's province or territory for particulars of these rights or consult with a legal advisor.

All of our directors and officers as well as the experts named herein may be located outside of Canada and, as a result, it may not be possible for Canadian purchasers to effect service of process within Canada upon us or those persons. All or a substantial portion of our assets and the assets of those persons may be located outside of Canada and, as a result, it may not be possible to satisfy a judgment against us or those persons in Canada or to enforce a judgment obtained in Canadian courts against us or those persons outside of Canada.

Canadian purchasers of the ADSs should consult their own legal and tax advisors with respect to the tax consequences of an investment in the ADSs in their particular circumstances and about the eligibility of the ADSs for investment by the purchaser under relevant Canadian legislation.

This prospectus is not a disclosure document for the purposes of Australia's Corporations Act 2001 (Cth) of Australia, or Corporations Act, has not been lodged with the Australian Securities & Investments Commission and is only directed to the categories of exempt persons set out below. Accordingly, if you receive this prospectus in Australia:

To the extent that you are unable to confirm or warrant that you are an exempt sophisticated investor, associated person or professional investor under the Corporations Act any offer made to you under this prospectus is void and incapable of acceptance.

B. You warrant and agree that you will not offer any of the securities issued to you pursuant to this prospectus for resale in Australia within 12 months of those securities being issued unless any such resale

offer is exempt from the requirement to issue a disclosure document under section 708 of the Corporations Act.

In relation to each member state of the European Economic Area which has implemented the Prospectus Directive, or each referred as a "Relevant Member State", an offer to the public of any common shares which are the subject of the offering contemplated by this prospectus supplement and the accompanying prospectus may not be made in that Relevant Member State except that an offer to the public in that Relevant Member State of any common shares may be made at any time under the following exemptions under the Prospectus Directive, if they have been implemented in that Relevant Member State:

provided that no such offer of common shares shall require us or any of the underwriters to publish a prospectus pursuant to Article 3 of the Prospectus Directive or supplement a prospectus pursuant to Article 16 of the Prospectus Directive.

For the purposes of this provision, the expression an "offer common shares to the public" in relation to the common shares in any Relevant Member State means the communication in any form and by any means of sufficient information on the terms of the offer and the common shares to be offered so as to enable an investor to decide to purchase or subscribe to the common shares, as the same may be varied in that Relevant Member State by any measure implementing the Prospectus Directive in that Relevant Member State and the expression "Prospectus Directive" means Directive 2003/71/EC (and amendments thereto, including the 2010 PD Amending Directive, to the extent implemented in the Relevant Member State), and includes any relevant implementing measure in the Relevant Member State and the expression "2010 PD Amending Directive" means Directive 2010/73/EU.

This prospectus may not be circulated or distributed in the PRC and the ADSs may not be offered or sold, and will not offer or sell to any person for re-offering or resale directly or indirectly to any resident of the PRC except pursuant to applicable laws and regulations of the PRC. For the purpose of this paragraph, PRC does not include Taiwan and the special administrative regions of Hong Kong and Macau.

No securities have been offered or sold, and no securities may be offered or sold, in Hong Kong, by means of any document, other than to persons whose ordinary business is to buy or sell shares or debentures, whether as principal or agent; or to "professional investors" as defined in the Securities and Futures Ordinance (Cap. 571) of Hong Kong, or the SFO, and any rules made under that Ordinance; or in other circumstances which do not result in the document being a "prospectus" as defined in the Companies Ordinance (Cap. 32) of Hong Kong, or the CO, or which do not constitute an offer or invitation to the public for the purpose of the CO or the SFO. No document, invitation or advertisement relating to the securities has been issued or may be issued or may be in the possession of any person for the purpose of issue (in each case whether in Hong Kong or elsewhere), which is directed at, or the contents of which are likely to be accessed or read by, the public of Hong Kong (except if permitted under the securities laws of Hong Kong) other than with respect to securities which are or are intended to be disposed of only to persons

outside Hong Kong or only to "professional investors" as defined in the SFO and any rules made under that Ordinance.

This prospectus has not been registered with the Registrar of Companies in Hong Kong. Accordingly, this prospectus may not be issued, circulated or distributed in Hong Kong, and the securities may not be offered for subscription to members of the public in Hong Kong. Each person acquiring the securities will be required, and is deemed by the acquisition of the securities, to confirm that he is aware of the restriction on offers of the securities described in this prospectus and the relevant offering documents and that he is not acquiring, and has not been offered any securities in circumstances that contravene any such restrictions.

The offering has not been and will not be registered under the Financial Instruments and Exchange Law of Japan (Law No. 25 of 1948 of Japan, as amended), or FIEL, and the Initial Purchaser will not offer or sell any securities, directly or indirectly, in Japan or to, or for the benefit of, any resident of Japan (which term as used herein means any person resident in Japan, including any corporation or other entity organized under the laws of Japan), or to others for re-offering or resale, directly or indirectly, in Japan or to, or for the benefit of, any resident of Japan, except pursuant to an exemption from the registration requirements of, and otherwise in compliance with, the FIEL and any other applicable laws, regulations and ministerial guidelines of Japan.

This prospectus has not been and will not be lodged or registered as a prospectus with the Monetary Authority of Singapore. Accordingly, this prospectus and any other document or material in connection with the offer or sale, or invitation for subscription or purchase, of the notes may not be circulated or distributed, nor may the notes be offered or sold, or be made the subject of an invitation for subscription or purchase, whether directly or indirectly, to persons in Singapore other than (i) to an institutional investor under Section 274 of the Securities and Futures Act, Chapter 289 of Singapore, or the SFA, (ii) to a relevant person pursuant to Section 275(1), or any person pursuant to Section 275(1A), and in accordance with the conditions specified in Section 275, of the SFA, or (iii) otherwise pursuant to, and in accordance with the conditions of, any other applicable provision of the SFA.

Where the notes are subscribed or purchased under Section 275 of the SFA by a relevant person which is:

securities (as defined in Section 239(1) of the SFA) of that corporation or the beneficiaries' rights and interest (howsoever described) in that trust shall not be transferred within six months after that corporation or that trust has acquired the notes pursuant to an offer made under Section 275 of the SFA except:

The securities may not be publicly offered in Switzerland and will not be listed on the SIX Swiss Exchange, or the SIX, or on any other stock exchange or regulated trading facility in Switzerland. This prospectus has been prepared without regard to the disclosure standards for issuance prospectuses under art. 652a or art. 1156 of the Swiss Code of Obligations or the disclosure standards for listing prospectuses under art. 27 ff. of the SIX Listing Rules or the listing rules of any other stock exchange or regulated trading facility in Switzerland. Neither this prospectus nor any other offering or marketing material relating to the securities or the offering may be publicly distributed or otherwise made publicly available in Switzerland.

Neither this prospectus nor any other offering or marketing material relating to the offering, the Company or the securities have been or will be filed with or approved by any Swiss regulatory authority. In particular, this prospectus will not be filed with, and the offer of securities will not be supervised by, the Swiss Financial Market Supervisory Authority FINMA, and the offer of securities has not been and will not be authorized under the Swiss Federal Act on Collective Investment Schemes, or the CISA. The investor protection afforded to acquirers of interests in collective investment schemes under the CISA does not extend to acquirers of securities.

This prospectus is only being distributed to, and is only directed at, persons in the United Kingdom that are qualified investors within the meaning of Article 2(1)(e) of the Prospectus Directive that are also (i) investment professionals falling within Article 19(5) of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005, as amended, or the Order, and/or (ii) high net worth entities falling within Article 49(2)(a) to (d) of the Order and other persons to whom it may lawfully be communicated (each such person being referred to as a "relevant person").

This prospectus and its contents are confidential and should not be distributed, published or reproduced (in whole or in part) or disclosed by recipients to any other persons in the United Kingdom. Any person in the United Kingdom that is not a relevant person should not act or rely on this document or any of its contents.

Set forth below is an itemization of our total expenses, excluding underwriting discounts and commissions, which are expected to be incurred in connection with the offer and sale of the ADSs by us. With the exception of the SEC registration fee, the Financial Industry Regulatory Authority filing fee and the NASDAQ listing fee, all amounts are estimates.

Certain legal matters as to the United States federal and New York law in connection with this offering will be passed upon for us by Davis Polk & Wardwell LLP. Certain legal matters as to the United States federal and New York law in connection with this offering will be passed upon for the underwriters by Kirkland & Ellis International LLP. The validity of the ordinary shares represented by the ADSs offered in this offering and certain other legal matters as to Cayman Islands law will be passed upon for us by Walkers. Legal matters as to PRC law will be passed upon for us by King & Wood Mallesons, and for the underwriters by Jingtian & Gongcheng. Davis Polk & Wardwell LLP may rely upon Walkers with respect to matters governed by Cayman Islands law and King & Wood Mallesons with respect to matters governed by PRC law. Kirkland & Ellis International LLP may rely upon Jingtian & Gongcheng with respect to matters governed by PRC law.

Our combined and consolidated balance sheets as of December 31, 2014 and 2015 and the related combined and consolidated statements of comprehensive income, shareholders' equity and cashflows for each of the years in the three-year period ended December 31, 2015, have been included herein in reliance upon the report of KPMG Huazhen LLP, an independent registered public accounting firm, as set forth in their report thereon appearing elsewhere herein, and upon the authority of said firm as experts in accounting and auditing.

The Shanghai Branch of KPMG Huazhen LLP is located at 50^th floor, Plaza 66, 1266 Nanjing West Road, Shanghai, People's Republic of China.

We have filed with the SEC a registration statement on Form F-1, including relevant exhibits and schedules under the Securities Act with respect to underlying ordinary shares represented by the ADSs, to be sold in this offering. We have also filed with the SEC a related registration statement on Form F-6 to register the ADSs. This prospectus, which constitutes a part of the registration statement, does not contain all of the information contained in the registration statement. You should read the registration statement on Form F-1 and its exhibits and schedules for further information with respect to us and our ADSs.

As a result of this offering, we will become subject to periodic reporting and other informational requirements of the Exchange Act as applicable to foreign private issuers. Accordingly, we will be required to file reports, including annual reports on Form 20-F, and other information with the SEC. All information filed with the SEC can be inspected and copied at the public reference facilities maintained by the SEC at 100 F Street, N.E., Washington, D.C. 20549. You can request copies of these documents, upon payment of a duplicating fee, by writing to the SEC. Please call the SEC at 1-800-SEC-0330 for further information on the operation of the public reference rooms. You may also obtain additional information over the Internet at the SEC's website at www.sec.gov.

As a foreign private issuer, we are exempt from the rules of the Exchange Act prescribing the furnishing and content of proxy statements to shareholders, and our executive officers, directors and principal shareholders are exempt from the reporting and short-swing profit recovery provisions contained in Section 16 of the Exchange Act. In addition, we will not be required under the Exchange Act to file periodic reports and financial statements with the SEC as frequently or as promptly as U.S. companies whose securities are registered under the Exchange Act. However, we intend to furnish the depositary with our annual reports, which will include a review of operations and annual audited combined and consolidated financial statements prepared in conformity with U.S. GAAP, and all notices of shareholders' meeting and other reports and communications that are made generally available to our shareholders. The depositary will make such notices, reports and communications available to holders of ADSs and, upon our written request, will mail to all record holders of ADSs the information contained in any notice of a shareholders' meeting received by the depositary from us.

COMBINED AND CONSOLIDATED FINANCIAL STATEMENTS OF
YINTECH INVESTMENT HOLDINGS LIMITED

The Board of Directors and Shareholders
Yintech Investment Holdings Limited (the "Company"):

We have audited the accompanying combined and consolidated balance sheets of Yintech Investment Holdings Limited and subsidiaries as of December 31, 2014 and 2015, and the related combined and consolidated statements of comprehensive income, shareholders' equity, and cash flows for each of the years in the three-year period ended December 31, 2015. These combined and consolidated financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on these combined and consolidated financial statements based on our audits.

We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.

In our opinion, the combined and consolidated financial statements referred to above present fairly, in all material respects, the financial position of Yintech Investment Holdings Limited and subsidiaries as of December 31, 2014 and 2015, and the results of their operations and their cash flows for each of the years in the three-year period ended December 31, 2015, in conformity with U.S. generally accepted accounting principles.

YINTECH INVESTMENT HOLDINGS LIMITED
COMBINED AND CONSOLIDATED BALANCE SHEETS
(Amounts in thousands)

			December 31,

	Note		2014 RMB		2015 RMB		2015 (Note2) USD
			Combined		Consolidated		Consolidated Unaudited
Assets
Cash		4		83,534		362,461		55,954
Derivative assets		11		—		445		69
Available-for-sale investments		5		354,000		75,670		11,681
Deposits with clearing organizations		6		234,869		239,904		37,035
Amount due from related parties		25		8,800		—		—
Equipment and leasehold improvements		7		23,652		18,315		2,827
Deferred tax assets		22		1,794		3,782		584
Other assets		8		56,609		79,180		12,223

Total assets				763,258		779,757		120,373



Liabilities and Shareholders' Equity
Derivative liabilities		11		—		14,336		2,213
Amount due to related parties		25		—		118,880		18,352
Income tax payable				26,582		23,385		3,610
Accounts payable				23,156		3,645		563
Accrued employee benefits				48,530		76,503		11,810
Dividend payable		14		—		126,876		19,586
Other liabilities		9		51,804		52,535		8,109

Total liabilities				150,072		416,160		64,243



Ordinary shares, USD 0.00001 par value.
Authorized 3,000,000,000 shares;
issued and outstanding 1,000,000,000
shares as of December 31, 2015		12		—		65		10
Paid-in capital		13		125,000		—		—
Additional paid-in capital		13		7,560		257,098		39,689
Retained earnings		15		480,626		105,193		16,239
Accumulated other comprehensive income		16		—		1,241		192

Total shareholders' equity				613,186		363,597		56,130



Commitments and contingencies		10
Total liabilities and shareholders' equity				763,258		779,757		120,373

The accompanying notes are an integral part of the combined and consolidated financial statements.

YINTECH INVESTMENT HOLDINGS LIMITED
COMBINED AND CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
(Amounts in thousands, except share and per share data)

			Year ended December 31,

	Note		2013 RMB			2014 RMB			2015 RMB			2015 (Note2) USD
			Combined			Combined			Combined and Consolidated			Combined and Consolidated Unaudited
Revenues
Commissions and fees, net		18		413,258			860,819			990,698			152,937
Trading gains, net		19		214,861			268,850			166,428			25,692
Interest and investment income				365			445			4,443			686
Other revenues		20		1,436			27,693			84,305			13,014

				629,920			1,157,807			1,245,874			192,329



Expenses
Employee compensation and benefits				(82,876	)		(214,431	)		(388,168	)		(59,923	)
Advertising and promotion		21		(256,092	)		(285,732	)		(221,859	)		(34,249	)
Research services from a related party		25		(106,050	)		—			—			—
Information technology and communications				(11,603	)		(21,238	)		(32,803	)		(5,064	)
Occupancy and equipment rental				(21,377	)		(39,487	)		(41,950	)		(6,476	)
Taxes and surcharges				(5,200	)		(18,884	)		(21,711	)		(3,352	)
Other expenses				(34,569	)		(58,688	)		(54,164	)		(8,361	)

				(517,767	)		(638,460	)		(760,655	)		(117,425	)



Income before income taxes				112,153			519,347			485,219			74,904
Income taxes		22		(5,321	)		(37,390	)		(82,204	)		(12,690	)

Net income				106,832			481,957			403,015			62,214

Earnings per share		23
Basic				0.11			0.48			0.40			0.06
Diluted				0.11			0.48			0.38			0.06
Pro forma earnings per share (unaudited)		26
Basic				—			—			0.37			0.06
Diluted				—			—			0.35			0.05
Other comprehensive income		16
Unrealized gains on available-for-sale investments, net of nil income taxes				—			—			—			—
Foreign currency translation adjustment				—			—			1,241			192

Comprehensive income				106,832			481,957			404,256			62,406

The accompanying notes are an integral part of the combined and consolidated financial statements.

YINTECH INVESTMENT HOLDINGS LIMITED
COMBINED AND CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY
(Amounts in thousands)



Balance as of January 1, 2013
Combined		—	109,000		—		(8,163	)	—	100,837

Net income		—	—		—		106,832		—	106,832
Share-based compensation		—	—		420		—		—	420
Others		—	—		4		—		—	4

Balance as of December 31, 2013
Combined		—	109,000		424		98,669		—	208,093

Net income		—	—		—		481,957		—	481,957
Capital contribution	13	—	16,000		—		—		—	16,000
Dividend distribution	14	—	—		—		(100,000	)	—	(100,000	)
Share-based compensation		—	—		6,954		—		—	6,954
Others		—	—		182		—		—	182

Balance as of December 31, 2014
Combined		—	125,000		7,560		480,626		—	613,186

Net income prior to Reorganization		—	—		—		297,822		—	297,822
Share-based compensation prior to Reorganization		—	—		28,214		—		—	28,214
Others prior to Reorganization		—	—		(86	)	—		—	(86	)
Dividend distribution prior to Reorganization	14	—	—		—		(831,876	)	—	(831,876	)
Issuance of ordinary shares	12	65	—		—		—		—	65

Balance as of Reorganization date		65	125,000		35,688		(53,428	)	—	107,325

Reorganization	13	—	(125,000	)	(35,688	)	53,428		—	(107,260	)
Capital contribution	13	—	—		254,298		—		—	254,298
Net income following Reorganization		—	—		—		105,193		—	105,193
Share-based compensation following Reorganization		—	—		2,769		—		—	2,769
Other comprehensive income following Reorganization		—	—		—		—		1,241	1,241
Others following Reorganization		—	—		31		—		—	31

Balance as of December 31, 2015
Consolidated (RMB)		65	—		257,098		105,193		1,241	363,597



Balance as of December 31, 2015
Consolidated (USD) Unaudited (Note2)		10	—		39,689		16,239		192	56,130

The accompanying notes are an integral part of the combined and consolidated financial statements.

YINTECH INVESTMENT HOLDINGS LIMITED
COMBINED AND CONSOLIDATED STATEMENTS OF CASH FLOWS
(Amounts in thousands)

	Year ended December 31,

	2013 RMB			2014 RMB			2015 RMB			2015 (Note2) USD
	Combined			Combined			Combined and Consolidated			Combined and Consolidated Unaudited
Cash flows from operating activities:
Net income		106,832			481,957			403,015			62,214
Adjustments to reconcile net income to cash provided by operating activities:
Depreciation		7,054			10,179			11,880			1,834
Loss/(gain) on sale of equipment		—			1			(147	)		(23	)
Fair value change of derivatives		(10	)		10			13,891			2,144
Realized gain on sale of available-for-sale investments		(369	)		(2,865	)		(8,190	)		(1,265	)
Deferred taxes		662			294			(1,988	)		(307	)
Share-based compensation		420			6,954			30,983			4,783
Imputed interest		4			182			(55	)		(8	)
Changes in operating assets and liabilities, net of acquisition:
(Increase)/decrease in deposits with clearing organizations		(50,031	)		(109,699	)		17,314			2,673
Increase in other assets arising from operating activities		(23,557	)		(24,788	)		(21,228	)		(3,277	)
Decrease/(increase) in amount due from related parties		(2,120	)		1,181			1,800			277
Decrease in accounts payable		(33,130	)		(7,429	)		(19,511	)		(3,012	)
Increase in accrued employee benefits		13,275			28,489			27,973			4,319
Increase/(decrease) in other liabilities arising from operating activities		14,787			33,924			(21,726	)		(3,352	)
Decrease in amount due to related parties		(59,070	)		(7,683	)		—			—
Increase/(decrease) in income taxes payable		3,273			20,801			(3,197	)		(494	)

Net cash provided by/(used in) operating activities		(21,980	)		431,508			430,814			66,506



Cash flows from investing activities:
Proceeds from sale of equipment		3			210			2,183			337
Cash paid for purchase of equipment and leasehold improvements		(20,582	)		(13,281	)		(8,579	)		(1,324	)
Cash paid for purchase of available-for-sale investments		(458,000	)		(2,218,000	)		(4,862,180	)		(750,591	)
Cash received from sale of available-for-sale investments		428,369			1,896,865			5,148,700			794,822
Issuance of loans to third parties		(13,000	)		—			—			—
Cash received from repayment of loans to third parties		5,150			13,000			—			—
Issuance of loans to related parties		(99,792	)		(28,000	)		(40,000	)		(6,175	)
Cash received from repayment of loans to related parties		189,417			21,535			47,000			7,256
Payment for reorganization		—			—			(107,260	)		(16,558	)

Net cash provided by/(used in) investing activities		31,565			(327,671	)		179,864			27,767



Cash flows from financing activities:
Cash acquired from acquisition		—			—			6			1
Proceeds from capital contribution		—			16,000			254,298			39,257
Proceeds from issuance of ordinary shares		—			—			65			10
Proceeds from borrowings from related parties		50,708			—			118,880			18,352
Repayment of borrowings from related parties		(20,498	)		(32,100	)		—			—
Proceeds from borrowings from third parties		13,020			—			—			—
Repayment of borrowings from third parties		(10,000	)		(13,398	)		—			—
Dividends paid		—			(100,000	)		(705,000	)		(108,833	)

Net cash provided by/(used in) financing activities		33,230			(129,498	)		(331,751	)		(51,213	)



Net increase/(decrease) in cash		42,815			(25,661	)		278,927			43,060
Cash — beginning of year		66,380			109,195			83,534			12,894

Cash — end of year		109,195			83,534			362,461			55,954



Supplemental disclosure of cash flow information
Cash paid for income taxes		1,385			16,295			87,949			13,577
Cash paid for interest		—			—			—			—

The accompanying notes are an integral part of the combined and consolidated financial statements.

Yintech Investment Holdings Limited ("Yintech", or the "Company") was incorporated under the laws of the Cayman Islands on November 4, 2015.

Yintech and its subsidiaries (hereinafter the "Group") primarily provide trading and investment services for online spot commodity trading through three exchanges, namely Shanghai Gold Exchange ("Shanghai Exchange"), Tianjin Precious Metals Exchange ("Tianjin Exchange") and Guangdong Precious Metals Exchange ("Guangdong Exchange") (collectively, the "Exchanges") in the PRC. Among the three exchanges the Group operates on, Shanghai Exchange is established by the People's Bank of China ("PBOC"), with the approval of the State Council of the PRC, and is the only national-level exchange for spot commodity trading in China. Tianjin and Guangdong Exchanges are provincial-level exchanges supervised by the Finance Office of Tianjin Municipal Government and the Department of Commerce of Guangdong Province, respectively.

Three subsidiaries of the Group are comprehensive members of either Tianjin Exchange or Guangdong Exchange. As a comprehensive member of the Tianjin and Guangdong Exchanges, the Group earns commissions and fees on customers' trades and serves as the counterparty to customers' trades. Therefore, the Group is exposed to market risk related to fluctuations of the prices of the underlying commodities that primarily consist of silver, palladium, platinum, copper, aluminum and nickel. The Group does not hold cash, securities, or property from customers that would be used to margin, guarantee, or secure any trades or contracts that result from customers' order. On the Shanghai Exchange, the Group serves as an agent and do not hold principal positions. To a lesser extent, the Group also trades in physical commodity of raw silver.

As of December 31, 2015, Yintech has subsidiaries in countries and jurisdictions including the People's Republic of China ("PRC"), Hong Kong, and British Virgin Islands ("BVI"). Details of the subsidiaries of the Company are set out below:

1. DESCRIPTION OF BUSINESS, ORGANIZATION, AND BASIS OF PRESENTATION (Continued)

Name of subsidiary	Date of incorporation/ acquisition	Paid up capital			Place of incorporation

Shanghai Yin Tian Xia Precious Metal Products Co., Ltd. ("Yin Tian Xia Products")*	Incorporated on July 29, 2013	RMB 20 million	100	%	PRC
Shanghai Yin Tian Xia Financial and Information Service Co., Ltd. ("Yin Tian Xia Information")*	Incorporated on May 15, 2014	RMB 5 million	100	%	PRC
Yintech Enterprise Co., Ltd. (formerly known as Win Yin Gold Investment Co., Ltd. (BVI))*	Incorporated on September 29, 2014	USD1 dollar	100	%	BVI
Yintech Enterprise (HK) Co., Ltd. (formerly known as Win Yin (HK) Gold Investment Co., Ltd.)*	Incorporated on October 31, 2014	HKD1 dollar	100	%	Hong Kong
Shanghai Ke Chang Investment Consulting Co., Ltd ("Ke Chang")*	Incorporated on June 18, 2015	RMB 20 million	100	%	PRC
Shanghai Qian Zhong Su Investment Management Co., Ltd. ("Qian Zhong Su")*	Incorporated on April 14, 2015	USD 30 million	100	%	PRC
Guangdong Sheng Ding Precious Metal Management Co., Ltd. ("Sheng Ding")	Acquired on November 16, 2015	RMB 10 million	100	%	PRC
Shanghai Jin Dou Information Technology Co., Ltd. ("Jin Dou")	Incorporated on November 12, 2015	RMB 0	100	%	PRC
Shanghai Jin Yi Information Technology Co., Ltd., ("Jin Yi")	Incorporated on December 4, 2015	RMB 0.05 million	100	%	PRC
Yintech Frontier Co., Ltd.	Incorporated on 5 November, 2015	USD1 dollar	100	%	BVI
Yintech Frontier (HK) Co., Ltd.	Incorporated on 19 November, 2015	HKD1 dollar	100	%	Hong Kong

1. DESCRIPTION OF BUSINESS, ORGANIZATION, AND BASIS OF PRESENTATION (Continued)

Note (*): These entities were acquired by Yintech through a group reorganization (the "Reorganization") as described below.

The Reorganization was completed on November 18, 2015. The Reorganization involved the incorporation of Yintech and the transfer of Rong Jin Hui Yin, Jin Xiang Yin Rui, Yin Tian Xia Technology, and Yintech Enterprise Co., Ltd., and their subsidiaries Yin Tian Xia Products, Yin Tian Xia Information, Yintech Enterprise (HK) Co., Ltd., Qian Zhong Su, and Ke Chang (collectively, the "Transferred Entities") from Win Yin Financial and Information Service Company Limited ("Win Yin") to Yintech. Prior to the Reorganization, the Transferred Entities' equity interests were 100% owned by Win Yin. Chen Wenbin, Yan Ming, and Chen Ningfeng (collectively the "Founding Shareholders"), each owned 40%, 30%, and 30% equity interest in Win Yin.

Establishment of Yintech. Yintech was established in the Cayman Islands on November 4, 2015 as an exempted company with limited liability under Companies Law (2011 Revision) (as combined and revised) of the Cayman Islands. Yintech is 100% ultimately owned by the Founding Shareholders, each owned 40%, 30%, and 30% equity interest in Yintech.

Transfer of Transferred Entities to the Group. In November 2015, Yintech acquired Yintech Enterprise Co.,Ltd. and its subsidiaries from Win Yin at book value of USD1 (RMB 6). As a result, Yintech became the holding company of Yintech Enterprise Co.,Ltd., Yintech Enterprise (HK) Co.,Ltd, and Qian Zhong Su. Also in November 2015, Qian Zhong Su acquired Rong Jin Hui Yin, Jin Xiang Yin Rui and Yin Tian Xia Technology, and their subsidiaries from Shanghai Long Jin Co., Ltd. ("Long Jin"), a wholly owned subsidiary of Win Yin, at book value of RMB 107.26 million, which was settled in December 2015. The consideration was financed by a shareholder loan which was subsequently repaid in February 2016. These acquisitions, as part of the Reorganization, were completed on November 18, 2015.

Basis of Presentation for the Reorganization. The Founding Shareholders' respective equity interest in Yintech is identical to the Founding Shareholders' respective equity interest in each of the Transferred Entities. Accordingly, the accompanying combined and consolidated financial statements prior to the Reorganization are the combination of the financial statements of the Transferred Entities, which are recorded at carryover basis, and have been prepared in a manner similar to a pooling of interests, as the Transferred Entities have identical ultimate ownership both prior to and following the Reorganization.

The combined and consolidated financial statements are prepared in accordance with U.S. generally accepted accounting principles ("U.S. GAAP").

Prior to the Reorganization, the combined financial statements include the financial statements of the Transferred Entities since the date of incorporation, and were prepared on a combined basis. Following the Reorganization, the consolidated financial statements include the accounts of Yintech and its subsidiaries. All significant intercompany balances and transactions have been eliminated upon combination and consolidation. The Group has no involvement with variable interest entities.

The accompanying combined and consolidated financial statements are reported in Renminbi ("RMB").

Yintech's functional currency is USD, and the reporting currency is RMB. Yintech's subsidiaries determine their functional currencies based on the criteria of FASB ASC 830, Foreign Currency Matters. The consolidated financial statements are translated into RMB using the exchange rate at the balance sheet date for assets and liabilities, and the average exchange rate in the period for revenues, expenses, gains and losses. Any translation gains or losses are recorded in other comprehensive income / (loss).

Transactions denominated in foreign currencies are translated into the functional currency at the exchange rates prevailing on the transaction dates. Assets and liabilities denominated in foreign currencies are translated into the functional currency at the exchange rates prevailing at the balance sheet date. Exchange gains and losses are included in earnings as a component of other revenues.

Translations of amounts from RMB into USD for the convenience of the reader have been calculated at the exchange rate of RMB6.4778 per USD1.00 on December 31, 2015, the last business day for the year ended 31 December, 2015, as published on the website of the United States Federal Reserve Board. No representation is made that the RMB amounts could have been, or could be, converted into U.S. dollars at such rate. The USD convenience translation is not required under U.S. GAAP and all USD convenience translation amounts in the accompanying combined and consolidated financial statements are unaudited.

The preparation of combined and consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the combined and consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. On an ongoing basis, the Group evaluates its estimates and judgments including those related to: the fair value of stock based compensation; the fair value of derivatives; the useful lives and recoverability of equipment and leasehold improvements; the fair value of investments; the carrying value of receivables from customers; the determination of the allowance for doubtful accounts; the liabilities for unrecognized tax benefits; indefinitely reinvested earnings; and the valuation allowance for deferred income tax assets.

The Group recognizes all derivative instruments as either assets or liabilities in the balance sheet at their respective fair values.

In the normal course of business and as a comprehensive member of the Tianjin and Guangdong Exchanges, the Group enters into transactions in derivative financial instruments with customers. As a comprehensive member of the Tianjin and Guangdong Exchanges, the Group is required to serve as the counterparty of the customer trading of precious metals through exchange-traded spot commodity contracts. The Tianjin and Guangdong Exchanges quote trading prices of the spot commodity contracts with reference to the prices from relevant international and domestic spot commodities markets. The Group does not apply hedge accounting, as all derivative financial instruments are held for trading purposes and therefore recorded at fair value with changes reflected in earnings. Contracts with customers are traded either as long or short positions and the notional amount and fair values of the contracts in a loss position are not offset against notional amount and the fair value of contracts in a gain position. Gains and losses (realized and unrealized) on all derivative financial instruments are shown as a component of trading gains / (losses), net.

In accordance with the Tianjin and Guangdong Exchanges' requirements, the Group's customers must meet, at a minimum, the deposit requirements established by the Tianjin and Guangdong Exchanges at which the spot commodity contracts are traded. Therefore, exchange traded spot commodity contracts generally do not give rise to significant counterparty exposure due to the cash settlement procedures for daily market movements ("variation margin") and the deposit requirements of the Tianjin and Guangdong Exchanges. The variation margin payments represent the daily settlement of the outstanding exposure of the derivative contract. Likewise, as the counterparty to customer trades, the Group is also required to place deposits with custodian banks of the Tianjin and Guangdong Exchanges to meet the minimum deposit requirements. Such amount placed at banks to meet the minimum deposit requirements is included in deposits with clearing organizations and restricted from withdrawal.

In 2013, 2014 and 2015, the Group traded commodity future contracts on the Shanghai Futures Exchange to manage its exposure on spot commodity contracts and physical trading of raw silver. Commodity future contracts are recorded at fair value with changes reflected in earnings. Gains and losses from these contracts are recorded in trading gains / (losses), net. At the end of December 31, 2014 and 2015, the Group has no commodity future contracts outstanding.

In 2013, the Group entered into risk sharing agreements with entities controlled by the Founding Shareholders. Under the risk sharing agreements, certain percentages of the spread fees and trading gains or losses arising from exchange-traded spot commodity contracts with customers are shared with these companies. The shared spread fees are recorded in commissions and fees, net. The shared trading gains and losses are recorded in trading gains / (losses), net.

In 2015, the Group entered into risk and return transfer agreements with a third party fund. Gains and losses from the risk and return transfer agreements are recorded in trading gains / (losses), net.

The Group classifies wealth management products issued by banks and money market funds issued by fund management companies as available-for-sale ("AFS") investments. AFS investments are recorded at fair value. Unrealized holding gains and losses, net of the related tax effect, on AFS investments are excluded from earnings and are reported as a separate component of accumulated other comprehensive income until realized. Realized gains and losses from the sale of AFS investments are determined on a specific-identification basis and are recorded as trading gains / (losses). Interest and investment income are recognized when earned.

Equipment and leasehold improvements are stated at cost. Depreciation is provided on a straight-line basis using estimated useful lives of three to five years. Leasehold improvements are amortized over the shorter of the economic useful life of the improvement or the term of the lease.

Advertising expenses represent expenses for placing advertisements on television, radio and newspaper, as well as on Internet websites and search engines. Promotion expenses represent commissions paid to sales agents for bringing in new customers. Advertising and promotion cost are expensed as incurred.

Pursuant to relevant PRC regulations, the Group is required to make contributions to various defined contribution plans organized by municipal and provincial PRC governments. The contributions are made for each PRC employee at statutory rates as determined by local social security bureau. Contributions to the defined contribution plans are charged to the combined and consolidated statements of income. The Group has no obligations for payment of pension benefits associated with the plans beyond the amount it is required to contribute.

The Group measures the cost of employee services received in exchange for an award of equity instruments based on the grant-date fair value of the award and recognizes the cost over the period the employee is required to provide service in exchange for the award, which generally is the vesting period. The Group recognizes compensation cost for an award with only service conditions that has a graded vesting schedule on a straight-line basis over the requisite service period for the entire award, net of estimated forfeitures, provided that the cumulative amount of compensation cost recognized at any date at least equals to the portion of the grant-date value of such award that is vested at that date. Forfeiture rates are estimated based on historical and future expectations of employee turnover rates. Stock compensation expense, when recognized, is recorded as expense with the corresponding entry to additional paid-in capital.

Income taxes are accounted for under the asset and liability method. Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases and operating loss and tax credit carry forwards. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date. A valuation allowance is provided to reduce the carrying amount of deferred income tax assets if it is considered more likely than not that some portion or all of the deferred income tax assets will not be realized. The Group recognizes the effect of income tax positions only if those positions are more likely than not of being sustained. Recognized income tax positions are measured at the largest amount that is greater than 50 percent likely of being realized. Changes in recognition or measurement are reflected in the period in which the change in judgment occurs. The Group presents any interest or penalties related to an underpayment of income taxes as part of its income tax expense.

Deferred offering costs consist principally of legal, printing and registration costs in connection with the initial public offering of the Company's ordinary shares ("IPO"). Such costs are deferred until the closing of the offering, at which time the deferred costs are offset against the offering proceeds. In the event the offering is unsuccessful or aborted, the costs will be expensed. Deferred offering costs as of December 31, 2015 amounted to RMB 5.59 million and were included in other assets.

Liabilities for loss contingencies arising from claims, assessments, litigation, fines, and penalties and other sources are recorded when it is probable that a liability has been incurred and the amount can be reasonably estimated. Legal costs incurred in connection with loss contingencies are expensed as incurred.

In May 2014, the Financial Accounting Standards Board ("FASB") issued ASU No. 2014-09, Revenue from Contracts with Customers, which outlines a comprehensive new revenue recognition model designed to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. In August 2015, the FASB issued ASU No. 2015-14 to defer the effective date to annual reporting periods (including interim reporting periods within those periods) beginning after December 15, 2017. The Group is in the process of evaluating the impact of adoption of this guidance on the Group's consolidated financial statements.

In January 2016, the FASB issued ASU No. 2016-01, Financial Instruments — Overall. Amendments in ASU 2016-01 are as follows: 1) require equity investments (except those accounted for under the equity method of accounting or those that result in consolidation of the investee) to be measured at fair value with changes in fair value recognized in net income. However, an entity may choose to measure equity investments that do not have readily determinable fair values at cost minus impairment, if any, plus or minus changes resulting from observable price changes in orderly transactions for the identical or a similar investment of the same issuer; 2) simplify the impairment assessment of equity investments without readily determinable fair values by requiring a qualitative assessment to identify impairment. When a qualitative assessment indicates that impairment exists, an entity is required to measure the investment at fair value; 3) eliminate the requirement to disclose the fair value of financial instruments measured at amortized cost for entities that are not public business entities; 4) eliminate the requirement for public business entities to disclose the method(s) and significant assumptions used to estimate the fair value that is required to be disclosed for financial instruments measured at amortized cost on the balance sheet; 5) require public business entities to use the exit price notion when measuring the fair value of financial instruments for disclosure purposes; 6) require an entity to present separately in other comprehensive income the portion of the total change in the fair value of a liability resulting from a change in the instrument-specific credit risk when the entity has elected to measure the liability at fair value in accordance with the fair value option for financial instruments; 7) require separate presentation of financial assets and financial liabilities by measurement category and form of financial asset (that is, securities or loans and receivables) on the balance sheet or the accompanying notes to the financial statements; 8) clarify that an entity should evaluate the need for a valuation allowance on a deferred tax asset related to available-for-sale securities in combination with the entity's other deferred tax assets. The new standard is effective for annual reporting periods beginning after December 15, 2017. The Group is in the process of evaluating the impact of adoption of this guidance on the Group's consolidated financial statements.

In addition to those described above, the FASB has issued other accounting standards, none of which are expected to have a material impact on the Group's consolidated financial statements when adopted.

FASB ASC 820 defines fair value, establishes a framework for measuring fair value, and establishes a hierarchy of fair value inputs. Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. A fair value measurement assumes that the transaction to sell the asset or transfer the liability occurs in the principal market for the asset or liability or, in the absence of a principal market, the most advantageous market. Valuation techniques that are consistent with the market, income or cost approach, as specified by FASB ASC 820, are used to measure fair value.

The fair value hierarchy prioritizes the inputs to valuation techniques used to measure fair value into three broad levels:

The inputs used to measure fair value may fall into different levels of the fair value hierarchy. In such cases, for disclosure purposes, the level in the fair value hierarchy within which the fair value measurement falls in its entirety is determined based on the lowest level input that is significant to the fair value measurement in its entirety.

A description of the valuation techniques applied to the Group's major categories of assets and liabilities measured at fair value on a recurring basis as follows.

Exchange-Traded Derivative Contracts. Derivatives that are actively traded are valued based on quoted prices from the exchanges and are categorized in level 1 of the fair value hierarchy.

Available-for-sale Investments. Available-for-sale investments include wealth management products issued by banks and money market funds, which are valued based on prices per units quoted by issuers. They are categorized in level 2 of the fair value hierarchy.

Risk Sharing Contracts. Risk sharing contracts entered into with related parties are valued based on quoted prices from the exchanges of spot commodity contracts entered by the Group with its customers, and are categorized in level 2 of the fair value hierarchy.

Risk and Return Transfer Contracts. Risk and return transfer contracts are valued based on the quoted prices of spot commodity contracts entered by the Group with its customers and the fair value of unsettled receivables or payables under the contracts. They are categorized in level 2 of the fair value hierarchy.

The following table presents the Group's fair value hierarchy for those assets and liabilities measured at fair value on a recurring basis.

Additional Disclosures About the Fair Value of Financial Instruments (Including Financial Instruments Not Carried at Fair Value)

Certain financial instruments that are not carried at fair value on the combined and consolidated balance sheet are carried at amounts that approximate fair value due to their short-term nature and generally negligible credit risk. These financial instruments include cash, deposits with clearing organizations, other financial assets (amount due from related parties, awards receivable from the Exchanges, and deposits and others) and other financial liabilities (amount due to related parties, accounts payables, customer rebates payable, and payable to third parties).

The following table presents the carrying values and estimated fair values of financial assets and liabilities, excluding financial instruments that are carried at fair value on a recurring basis, and information is provided on their classification within the fair value hierarchy.

Cash represents cash on hand and bank deposits. To limit exposure to credit risk relating to bank deposits, the Group primarily places bank deposits with large financial institutions in the PRC with acceptable credit rating. As of December 31, 2014 and 2015, the Group had cash balances at two and three PRC individual financial institutions, respectively, that held cash balances in excess of 10% of the Group's total cash balances. These bank deposits collectively accounted for approximately 90% and 93% of the Group's total cash balances as of December 31, 2014 and 2015, respectively.

The Group's available-for-sale investments represent wealth management products issued by banks and money market funds, both of which mainly invest in money market and other fixed income products and can be redeemed upon demand.

Realized gains and losses from the sales of AFS investments are determined on a specific-identification basis and are recorded as trading gains / (losses). Interest and investment income are recognized when earned. As at December 31, 2014 and 2015, fair value of these investments is approximate to cost, there were no unrealized holding gains or losses.

Deposits with clearing organizations represent the amount placed in the depository accounts at the custodian banks of the Tianjin and Guangdong Exchanges.

In accordance with the Tianjin and Guangdong Exchanges requirements, the Group is required to enter into a tri-party depositary service agreement with the Tianjin and Guangdong Exchanges and the designated custodian bank in order to be eligible for trading. As the counterparty to customer trades, the Group is required to place deposits with the custodian banks to meet the minimum deposit requirements. Such amount placed at the custodian banks to meet the deposit requirements is restricted from withdrawal.

	December 31,

	2014 RMB		2015 RMB		2015 (Note2) USD
					Unaudited
Receivables from customers		104		910		141
Prepayment to suppliers		5,117		5,779		892
Silver products		4,711		5,047		779
Acquired software		1,861		4,786		739
Value-added-tax refund receivable		31,016		21,840		3,372
Government grant receivable		—		12,420		1,917
Awards receivable from the Exchanges		—		6,943		1,071
Deferred offering costs		—		5,593		863
Expense advances to employees		392		647		100
Goodwill		—		102		16
Deposits and others		13,408		15,113		2,333

Total		56,609		79,180		12,223

Deposits and others primarily consist of the rental deposits for the Group's office premises.

Taxes and surcharges payable consists business tax, value-added tax and the relevant surcharges of the PRC entities of the Group.

The acquisition consideration payable was in relation to the acquisition of Sheng Ding and was subsequently settled in February 2016.

The Group's leases are for the office premises. Future minimum lease payments under non-cancellable operating leases agreements as of December 31, 2015 are as follows. The Group's leases do not contain any contingent rent payment terms.

Rental expenses incurred under operating leases were RMB 11.22 million, RMB 20.47 million and RMB 24.43 million for the years ended December 31, 2013, 2014 and 2015, respectively.

Under the trading rules of the Tianjin and Guangdong Exchanges, the Group is required to accept the customers' trades and to serve as the counterparty to the customers' trades. That is, when a customer

places a trade for a long or short position on a spot commodity contract, the Group takes the corresponding opposite short or long position on that contract.

Prior to the risk and return transfer arrangement, to manage the Group's risks associated with the net open positions on these contracts, the Group historically entered into separate spot commodity contracts with special members of the Tianjin and Guangdong Exchanges. The spot commodity contracts the Group entered into with the special member of the Tianjin and Guangdong Exchanges did not qualify for hedge accounting under ASC 815 and therefore were recorded at fair value with changes recorded in trading gains / (losses), net. The Group did not offset the notional amount or the fair value of the contracts with the special member against the notional amount or the fair value of the contracts entered into with the customers.

According to the Tianjin and Guangdong Exchanges' trading and settlement rules, if a customer does not close its spot commodity contracts at the end of the trading day, any profit or loss resulting from holding such contract during this trading day is deposited into or withdrawn from the customer's trading deposit account (variation margin) on a daily basis by the custodian bank according to the clearing instruction given by the Tianjin and Guangdong Exchanges, as if the position had been closed. The corresponding loss or profit arising from customer driven transactions is withdrawn from or deposited into the Group's trading deposit account. In effect, the contract price of the open position is re-set to the ending spot price at the end of each day with the ending spot price carried forward to the next trading day.

Variation margin payment is considered a settlement of the spot commodity contract for accounting purposes since the contractual rights to cash has been transferred to the Group and the customer's receipt of the variation margin payment from the Group meets the criteria in ASC 405-20-40 for extinguishment of a liability. Therefore the payment or receipt of the variation margin reduces the derivative asset or liability to zero at the end of each day. Accordingly, at the end of December 31, 2014 and 2015, the derivative asset and liability of the Group's spot commodity contracts with customers and special members are nil.

The Group also traded commodity future contracts through Shanghai Futures Exchange for which there was no requirement for daily cash settlement of variation margin.

As of December 31, 2014 and 2015, the majority of the underlying of the open spot commodity contracts is silver. Notional amount of open spot commodity contracts is calculated based on the closing spot price of

the underlying commodities and the quantity specified in the contract. The notional amount and fair value of derivatives as at December 31 are set out as follows:

The Group is exposed to market risk relating to spot and future commodity contracts since their fair values fluctuate as a result of changes in market price of commodities. As of December 31, 2015, the Group's open short positions on spot commodity contracts expose the Group to losses beyond the notional amount of the contracts. As of December 31, 2015, the maximum exposure to losses of the Group's open long positions on spot commodity contracts is the notional amount of the contracts. The Group's maximum risk exposure on these contracts is partially reduced by the Tianjin and Guangdong Exchanges' force liquidation of open positions held by the Group if the price movements of the contracts result in the minimum deposit requirements not being maintained.

In 2015, Rong Jin Hui Yin, Jin Xiang Yin Rui and Sheng Ding entered into risk and return transfer agreements with an independent third party fund, pursuant to which gains or losses arising from exchange-traded spot commodity contracts with customers are transferred to and absorbed by the third party fund. The amount payable to or amount receivable from the third party fund is settled on a monthly basis. The terms of the risk and return transfer agreements cover the period from August 23, 2015 to

August 22, 2020 for Rong Jin Hui Yin, from August 23, 2015 to October 1, 2020 for Jin Xiang Yin Rui, and from October 23, 2015 to October 1, 2020 for Sheng Ding.

Effectively, the risk and return transfer arrangement is an offer from the third party fund to accept the risk on all Rong Jin Hui Yin, Jin Xiang Yin Rui and Sheng Ding's future customer-driven spot commodity contracts during the contract periods at the market value at the moment they are entered into.

The execution guarantee agreement was entered into to guarantee the execution of the risk and return transfer arrangement, pursuant to which the fund's bank account is under joint administration of the fund and the Group. Pursuant to the agreement, any cash withdrawal or transfer from the fund's account requires approval from both the fund and the Group. However, the Group cannot unreasonably interfere or limit the normal withdrawal or transfer activities of the bank account by the fund under the agreement.

The execution guarantee agreement only provides the Group with a protective right to ensure the fund's bank account retains enough balance to fulfil the minimum deposit requirement under, and is merely an execution guarantee arrangement supplementary to, the risk and return transfer arrangement, to safeguard the repayment ability to the Group. It does not represent a separate guarantee provided by the fund to the Company or vice-versa, rather it is a mechanism to mitigate the risk of the fund having insufficient cash to honor any obligations that may arise under the risk and return transfer arrangement.

Pursuant to the execution guarantee agreement, if the net asset value of the fund falls below 70% of the total minimum deposit requirements of Tianjin and Guangdong Exchanges, the third party fund has a contractual obligation to restore it to 100% by requesting its investors to inject additional capital in cash. As at December 31, 2015, the net asset value of the third party fund is RMB 245.49 million.

Yintech was established in the Cayman Islands on November 4, 2015 as an exempted company with limited liability under Companies Law (2011 Revision) (as combined and revised) of the Cayman Islands. Authorized share capital of Yintech is USD 0.03 million, or 3,000,000,000 authorized shares with a par value of USD 0.00001 each. 1,000,000,000 shares were issued to Founding Shareholders at par value, equivalent to ordinary share capital of USD 0.01 million.

Holders of ordinary share are entitled to one vote per share, and to receive dividends and, upon liquidation or dissolution, are entitled to receive all assets available for distribution to shareholders. The holders have no preemptive or other subscription rights and there are no redemption or sinking fund provisions with respect to such shares.

As of December 31, 2014, paid-in-capital in the combined balance sheet represented the combined contributed capital of the following entities. All of the following entities are limited liability companies under PRC law. Such companies do not issue shares, but the registered capital, method and amount of capital contributions and rights and obligations of the investors are established in the articles of association of each company.

In 2014, the Founding Shareholders made capital injection of RMB 16 million to Jin Xiang Yin Rui. As a result, the paid-in-capital of Jin Xiang Yin Rui was increased from RMB 4 million to RMB 20 million as of December 31, 2014.

As part of the Reorganization, Qian Zhong Su acquired Rong Jin Hui Yin, Jin Xiang Yin Rui and Yin Tian Xia Technology, and their subsidiaries from Long Jin at a consideration of RMB 107.26 million in November 2015, upon which, Rong Jin Hui Yin, Jin Xiang Yin Rui and Yin Tian Xia Technology became wholly owned subsidiaries of the Company and the paid-in capital of RMB 125 million was eliminated in the consolidated balance sheet as of December 31, 2015 to reflect the legal capital of Yintech (par value of ordinary shares and additional paid-in capital).

On December 14, 2015, a shareholder loan of USD 39.39 million (RMB 254.30 million) was extended to Yintech by Founding Shareholders to increase the working capital of Yintech. On the same date, the loan was waived in full by the Founding Shareholders and USD 39.39 million (RMB 254.30 million) was recorded as additional paid-in capital of Yintech.

In 2014, the Board of Directors of Yin Tian Xia Technology announced and distributed dividend of RMB 100 million.

Prior to the completion of Reorganization, the Board of Directors of Rong Jin Hui Yin, Jin Xiang Yin Rui and Yin Tian Xia Technology announced dividend of RMB 831.88 million in 2015. As at December 31, 2015, outstanding dividend payable was RMB 126.88 million.

Pursuant to the Company Law of the PRC, each of the PRC entity is required to appropriate 10% of its net income to the statutory reserve on an annual basis until the aggregated amount of the reserve reaches 50% of its registered capital. Statutory reserve is not distributable. Subject to the approval of the shareholders, the statutory reserve may be used to offset accumulated losses, or converted into capital of the company.

As of December 31, 2015, Yin Tian Xia Technology has reached such maximum reserve amount and therefore stopped appropriation, while other PRC entities have not yet reached their respective maximum reserve amount.

			Unrealized gain on available-for-sale investments

	Foreign currency translation adjustment		Before tax amount RMB			Tax (expenses) or benefit RMB			Net-of-tax amount RMB
Balance at January 1, 2013		—		—			—			—

Other comprehensive income before reclassification		—		369			(92	)		277
Amounts reclassified from accumulated other comprehensive income		—		(369	)		92			(277	)

Balance at December 31, 2013		—		—			—			—



Balance at January 1, 2014		—		—			—			—

Other comprehensive income before reclassification		—		2,865			(716	)		2,149
Amounts reclassified from accumulated other comprehensive income		—		(2,865	)		716			(2,149	)

Balance at December 31, 2014		—		—			—			—



Balance at January 1, 2015		—		—			—			—

Other comprehensive income before reclassification		1,241		8,190			(2,047	)		6,143
Amounts reclassified from accumulated other comprehensive income		—		(8,190	)		2,047			(6,143	)

Balance at December 31, 2015		1,241		—			—			—



Balance at December 31, 2015, in USD (Note2) (unaudited)		192		—			—			—

The amounts reclassified out of accumulated other comprehensive income represent realized gains on the available-for-sale investments upon their sales, which were then recorded in "Trading gains / (losses), net" in the combined and consolidated statements of comprehensive income.

On November 16, 2015, the Group acquired 100% of the shares of Sheng Ding from third parties. The results of Sheng Ding's operations have been included in the combined and consolidated financial statements since that date. Set up in October 30, 2012, Sheng Ding is engaged in providing trading and investment services for online spot commodity trading through Guangdong Exchange. The notional amount of the long and short position of the exchange-traded spot commodity contracts at the acquisition date were RMB 45.6 million and RMB 7.0 million, respectively. The goodwill of RMB 0.10 million arising from the acquisition is recorded in other assets in the consolidated financial statements, and is not amortizable for tax purpose.

The following table summarizes the consideration paid for Sheng Ding and the amounts of estimated fair value of the assets acquired and liabilities assumed at the acquisition date.

The Group earns trading commissions, spread fees and overnight fees from its operation on Tianjin and Guangdong Exchanges, which are settled on a daily basis. The Group earns trading commissions from its operation on Shanghai Exchange, which are settled on a monthly basis.

Spread fees are earned based on the quantity of the underlying commodities of the customer's trades. The amount of the spread fees for each type of spot commodity contract is fixed and set by the Tianjin and Guangdong Exchanges and varies by commodity types. Trading commissions are generated based on the notional trading transaction value of the customers at the opening and closing of a position. Overnight fees are generated from customers who hold a long or short position overnight to the next trading day. The spread fees, standard trading commission rate and overnight fees for each commodity are determined by the Exchanges where such spot commodity contract is traded.

Cash rebates are offered to customers on the trading commission and overnight fees. The cash rebates are determined by the Group on an individual customer basis and paid monthly. The rebates are deducted from the gross trading commission or overnight fees. Total customer rebates recognized during the years ended December 31, 2013, 2014 and 2015 were RMB 81.21 million, RMB 192.26 million and RMB 166.89 million, respectively. As at December 31, 2014 and 2015, outstanding customer rebates payable were RMB 19.07 million and RMB 14.83 million, respectively.

Trading gains / (losses) consists of realized and unrealized gains and losses from exchange-traded spot commodity contracts with customers and special members, commodity future contracts, risk sharing contracts with related parties, and risk and return transfer agreements with third party fund, the realized gain from trading of physical commodities, and realized gains and losses from the sales of AFS investments, all represented on a net basis.

As disclosed in Note 11, pursuant to the risk and return transfer agreements, the Group's gains / (losses) arising from exchange-traded spot commodity contracts with customers are transferred to, and absorbed by the third party fund during the contract periods. Fair value movements on the risk and reward transfer agreement are recognised as trading gains / (losses). Settlements are made on a monthly basis.

The following table presents trading gains / (losses) for the years ended December 31:

During the year ended December 31, 2015, the Group recognized awards of RMB 38 million from the Exchanges based on customer trading volume of the Group. Awards from the Exchanges are recognized when there is reasonable assurance that they will be received and amounts can be reasonably estimated. The outstanding award receivable from the Exchanges is RMB 6.94 million as at December 31, 2015.

Government grants and others primarily consist of financial subsidies granted by provincial and local governments for operating a business in their jurisdiction. The government grants are non-recurring in nature and there is no assurance that the Group will continue to receive such government grants in the future. The outstanding government grant receivable is RMB 12.42 million as at December 31, 2015.

Advertising and promotion consists of market promotion cost and sales agent cost paid to third party companies.

The sales agent expenses are related to fees paid to external sales agent companies for their customer development services on the Tianjin Exchange. Such arrangements were terminated in June 2014, and the Group established and used its own in-house sales team for customer development on the Tianjin Exchange since then.

Under the current laws of the Cayman Islands and BVI, the Group is not subject to tax on income or capital gains. Additionally, upon payments of dividends by Yintech to its shareholders, neither Cayman Islands nor BVI withholding tax will be imposed.

Under the Hong Kong tax laws, subsidiaries in Hong Kong are exempted from income tax on their foreign-derived income and there are no withholding taxes in Hong Kong on remittance of dividends.

The subsidiaries incorporated in PRC file separate tax returns in the PRC. The PRC statutory income tax rate is 25% according to the Corporate Income Tax ("CIT") Law. Substantially all the pretax income of the Group is from the PRC.

The reconciliation between the reported income tax expense and income tax computed by applying the PRC statutory income tax rate of 25% to income before income taxes is as follows:

In assessing the recoverability of its deferred tax assets, management considers whether some portion or all of the deferred tax assets will not be realized. The ultimate realization of deferred tax assets is dependent upon the generation of future taxable income during the periods in which those temporary differences become deductible. Management considers the cumulative earnings and projected future taxable income in making this assessment.

Based upon the level of historical taxable income and projections for future taxable income over the periods in which the deferred tax assets are recoverable, management believes that it is more likely than not that the Group will realize the benefits of its deferred tax assets as at December 31, 2014 and 2015.

Deferred income tax assets represent the net tax effects of operating loss carryforwards and temporary differences between the carrying amounts of assets for financial reporting purposes and the amounts used

for income tax purposes. The Group does not have deferred tax liabilities as at 31 December 2014 and 2015. Significant components of the Group's deferred tax assets are presented below:

As at December 31, 2014 and 2015, the Group has a net operating loss carry-forward for PRC income tax purpose of approximately RMB 4 million and RMB 15 million, respectively, which will expire between 2017 and 2019, and 2017 to 2020, respectively. The tax effect of the increase in net operating loss for which a benefit was recognized for the years ended December 31, 2013, 2014 and 2015 were RMB 1.62 million, RMB 0.41 million and RMB 3.36 million, respectively.

At 31 December, 2014 and 2015, the Group had unrecognized tax benefit of RMB 3.84 million. The unrecognized tax benefits pertain to income recognition under PRC's tax laws and expense adjustments. The amount of unrecognized tax benefits which would have an impact on the Group's effective tax rate are RMB 1.68 million, RMB 3.84 million and RMB 3.84 million as at December 31, 2013, 2014 and 2015, respectively. A reconciliation of the beginning and ending amount of unrecognized tax benefits is as follows:

As of and for the year ended December 31, 2015, interest related to unrecognized tax benefits was RMB 0.6 million, which was recorded as part of the income tax payable and income tax expense in the consolidated financial statements.

The Group's only major jurisdiction is China where tax returns generally remain open and subject to examination by tax authorities for tax years 2011 onwards.

Prior to the Reorganization, the combined financial statements include the combined financial position and results of the Transferred Entities. Upon the consummation of the Reorganization on November 18, 2015, all of the retained earnings accumulated prior to the Reorganization was declared and paid or payable to a wholly-owned PRC subsidiary of Win Yin, for which no withholding tax was required.

The Group has considered temporary differences on the book to tax differences pertaining to all investment in subsidiaries including the determination of the indefinite reinvestment assertion that would apply to each foreign subsidiary following the Reorganization. The Group evaluated each entity's historical, current business environment and plans to indefinitely reinvest all earnings accumulated after the Reorganization in its respective jurisdiction for purpose of future business expansion.

As of December 31, 2015, the gross balance with respect to the undistributed earnings from the foreign subsidiaries is approximately RMB 0.1 billion. The Group has not provided deferred tax liability for such temporary differences that are indefinitely reinvested. The unrecognized deferred tax liability is approximately RMB 10 million. If future changes of business environment makes the Group to change its plan to allow some or all of the undistributed earnings to be remitted offshore, such temporary difference would become taxable.

The following table sets forth the computation of basic and diluted earnings per share for the years ended December 31, 2013, 2014 and 2015, for which the basic weighted average number of common shares are based on the 1,000,000,000 common shares issued by Yintech upon the consummation of the Reorganization on November 18, 2015, as if those shares were issued as of the earliest date presented.

36,771,900 potential ordinary shares issuable upon exercise of share options are excluded from the calculation of diluted earnings per share for the year ended December 31, 2013, because their effect is anti-dilutive.

Win Yin granted stock options and restricted share units ("RSUs") on Win Yin's shares to certain directors, eligiable person and employees of the Transfered Entities. Compensation cost related to the grant of the share options and RSUs are recorded as expense with a corresponding credit to equity.

Pursuant to the Reorganization completed on November 18, 2015, Yintech became the holding company of the Transferred Entities. In connection with the Reorganization, Yintech issued stock options and RSUs on its shares to the Group's employees as replacement of the stock options and RSUs issued by Win Yin. The terms and conditions of the stock options, such as vesting and exercisability, remain the same.



Balance at January 1, 2013	—		—	—	—
Granted	36,771,900		USD 0.163	6.25	—
Exercised	—		—	—	—
Forfeited	—		—	—	—
Expired	—		—	—	—
Balance at December 31, 2013	36,771,900		USD 0.163	6.17	—

Exercisable at December 31, 2013	—		—	—	—
Balance at January 1, 2014	36,771,900		USD 0.163	6.17	—
Granted	46,524,100		USD 0.163	7.86	46,571
Exercised	—		—	—	—
Forfeited	—		—	—	—
Expired	—		—	—	—
Balance at December 31, 2014	83,296,000		USD 0.163	6.67	83,379

Exercisable at December 31, 2014	—		—	—	—
Balance at January 1, 2015	83,296,000		USD 0.163	6.67	83,379
Granted	—		—	—	—
Exercised	—		—	—	—
Forfeited	(4,639,500	)	USD 0.163	6.92	(7,504	)
Expired	—		—	—	—
Balance at December 31, 2015	78,656,500		USD 0.163	5.60	127,216

Exercisable at December 31, 2015	—		—	—	—

The weighted average grant date fair value of options granted during the years ended December 31, 2013 and 2014 was RMB 6.38 million and RMB 51.90 million, respectively. The Company didn't grant any stock options in 2015 due to the Reorganization, new grants were subsequently made in January 2016.

At December 31, 2015, there was RMB 18.88 million of total unrecognized compensation cost related to unvested stock options. That cost is expected to be recognized over a weighted average period of 1.58 years. During the years 2013, 2014 and 2015, compensation cost recognized in earnings in relation to stock options are RMB 0.4 million, RMB 6.95 million and RMB 21.21 million, respectively. No tax benefit was recognized on the share-based compensation.

The estimate of the fair value of the share options granted is measured based on a binomial lattice model. The contractual life of the share option is used as an input into this model. Expectations and staff turnover rate are incorporated into the binomial lattice model.

Because Yintech's shares did not have a trading history at the time the options were issued, the expected volatility was based on the historical volatilities of comparable publicly traded companies engaged in the similar industry. Expected dividends are based on historical dividends. Changes in the subjective input assumptions could materially affect the fair value estimate.

Share options were granted under a service condition. This condition has not been taken into account in the grant date fair value measurement of the services received. There was no market conditions associated with the share option grants.

On January 15, 2015, Win Yin granted a total of 12,665,000 RSUs to certain directors, eligible person and employees. The RSUs will be vested during the vesting period, subject to the fulfillment of certain operational and/or financial performance targets as set by the Board that are probable of being met. Upon vesting, each RSU shall be entitled to the transfer or issue of one ordinary share in the share capital of Yintech.

The fair value of RSUs at the Grant Date is RMB 23.40 million. As of December 31, 2015, there was RMB 8.94 million of total unrecognized compensation cost related to unvested RSUs. That cost is expected to be recognized over a weighted average period of 1.57 years. In 2015, compensation cost recognized in earnings in relation to RSUs is RMB 9.77 million. No tax benefit was recognized on the share-based compensation.

In 2013, the Group extended non-interest bearing loans of RMB 99.79 million to certain Founding Shareholders or entities controlled by those Founding Shareholders. These lending with related parties, are unsecured, interest free and have no fixed repayment terms. During 2013, RMB 189.42 million of the loans to these related parties were repaid, which included the loans extended in 2012 of RMB 90.16 million.

In 2014, additional loans of RMB28 million with terms same as the loans issued in 2013 were extended to related parties. During 2014, these related parties repaid loans of RMB 21.53 million. The remaining loan balances of RMB 7.00 million as at December 31, 2014 were subsequently repaid in May 2015.

In 2015, additional loans of RMB 40 million with terms same as the loans issued in 2013 and 2014 were extended to a related party controlled by the Founding Shareholders. All the loans were fully settled as at December 31, 2015.

During the years ended 2013, 2014 and 2015, an imputed interest income of RMB 0.40 million, RMB 0.09 million and RMB 0.29 million were recorded as a reduction to additional paid-in capital based on the tenor of the loans and the effective interest rate with reference to the basic lending rate published by the PBOC, respectively.

In 2013, the Group received non-interest bearing loans of RMB 50.71 million from certain Founding Shareholders or entities controlled by those Founding Shareholders. These borrowings from related parties, are unsecured, interest free and have no fixed repayment terms. During 2013, RMB 20.50 million of the borrowings from these related parties were repaid. During 2014, all of the interest free borrowings from these related parties were fully repaid.

On December 14, 2015, a shareholder loan of USD 39.39 million was extended to Yintech by Founding Shareholders to increase the working capital of Yintech. On the same date, the loan was waived in full by the Founding Shareholders and USD 39.39 million was recorded as additional paid-in capital of Yintech.

Also in December 2015, the Group received additional loans of RMB 118.88 million with terms same as the loans received in 2013 from a Founding Shareholder. The borrowings were subsequently repaid in February 2016.

During the years ended 2013, 2014 and 2015, an imputed interest expense of RMB 0.40 million, RMB 0.28 million and RMB 0.23 million were recorded as an addition to additional paid-in capital based on the tenor of the borrowings and the effective interest rate with reference to the basic lending rate published by the PBOC, respectively.

In 2014 and 2015, Yin Tian Xia Technology sold application service totaling RMB 1.80 million and RMB 7.83 million to entities wholly owned by the Founding Shareholders, respectively. The amounts were fully received in 2015.

In 2011, due to the small capital base of the Group's trading business and the market risks associated with the Group's open spot commodity contracts with customers, the Group entered into risk sharing agreements with entities controlled by the Founding Shareholders. Under the risk sharing agreements, certain percentages of the spread fees and trading gains or losses arising from exchange-traded spot commodity contracts with customers are shared with these companies. During the year ended December 31, 2013, the percentage shared with these companies ranged from 30% to 50% and the amount of RMB 116 million and RMB 128 million shared was recorded against commissions and fees and trading gains / (losses), respectively. In November 2013, the risk sharing agreement was terminated, with no termination compensation incurred. As of December 31 2013, the Group had an amount of RMB 6.89 million payable and RMB 2.98 million receivable under the risk sharing agreements, which were all settled subsequently in 2014.

Prior to December 2013, the Group outsourced its research support services to Shanghai Han Yu Information Technology Co. Ltd. ("Shanghai Han Yu"), which was 100% controlled by Yan Ming. The Group entered into a service agreement with Shanghai Han Yu in November 2011, pursuant to which Shanghai Han Yu provided research reports, VIP customer service, training to employees of the Group, seminars and other services to the Group. In late November 2013, the service agreement was terminated, with no termination fee incurred. During the year ended December 31, 2013, the total research service expense incurred was RMB 106.05 million. At December 31, 2013, the Group had an amount of RMB 0.79 million payable to Shanghai Han Yu and the amount was fully paid in January 2014.

Prior to the completion of Reorganization, the Board of Directors of Rong Jin Hui Yin, Jin Xiang Yin Rui and Yin Tian Xia Technology approved dividend distribution of RMB 831.88 million in 2015. As at December 31, 2015, outstanding dividend payable was RMB 126.88 million, which was fully paid in February 2016.

Unaudited pro forma earnings per share has been computed to give effect to the number of shares whose proceeds would be deemed necessary to pay the excess distribution in the amount of RMB 428.86 million, representing the excess in distribution of dividends of RMB 831.88 million over the earnings for the Group for the year ended December 31, 2015 of RMB 403.02 million.

The supplemental pro forma information has been computed, assuming an initial public offering price of $0.675 per share, the midpoint in the estimated price range set forth on the cover of the prospectus included in the Company's Form F-1 Registration Statement. The computations assume there will be no exercise by the underwriters of their option to purchase additional numbers of ordinary shares and as if these shares had been issued as of January 1, 2015.

Management has considered subsequent events through February 29, 2016, which was the date these combined and consolidated financial statements were issued.

On January 13, 2016, Yintech granted a total of 13,741,271 stock options and a total of 4,075,435 RSUs under the existing schemes to certain directors, eligible person and employees. The stock options will be vested during the vesting period, subject to the fulfillment of certain operational and/or financial performance targets as set by the Board that are probable of being met.

Cayman Islands law does not limit the extent to which a company's articles of association may provide for indemnification of officers and directors, except to the extent any such provision may be held by the Cayman Islands courts to be contrary to public policy, such as to provide indemnification against civil fraud or the consequences or committing a crime. Under our post-IPO memorandum and articles of association, which will become effective immediately prior to completion of this offering, to the fullest extent permissible under Cayman Islands law, every director and officer of our company shall be indemnified against all actions, proceedings, costs, charges, expenses, losses, damages or liabilities incurred or sustained by such director or officer, otherwise than by reason of such person's own dishonesty, willful default or fraud, in connection with the execution or discharge of his duties, powers, authorities or discretions as a director or officer of our company, including without prejudice to the generality of the foregoing, any costs, expenses, losses or liabilities incurred by him in defending (whether successfully or otherwise) any civil proceedings concerning our company or its affairs in any court whether in the Cayman Islands or elsewhere.

Pursuant to the indemnification agreement, the form of which is filed as Exhibit 10.4 to this registration statement, we will agree to indemnify our directors and officers against certain liabilities and expenses incurred by such persons in connection with claims made by reason of their being such a director or officer.

The underwriting agreement, the form of which is filed as Exhibit 1.1 to this registration statement, will also provide for indemnification of us and our officers and directors.

Insofar as indemnification for liabilities arising under the Securities Act may be permitted to directors, officers or persons controlling us pursuant to the foregoing provisions, we have been informed that in the opinion of the Securities and Exchange Commission such indemnification is against public policy as expressed in the Securities Act and is therefore unenforceable.

During the past three years, we have issued and sold the securities listed below without registering the securities under the Securities Act. We believe that each of the following issuances was exempt from registration under the Securities Act in reliance on Regulation S under the Securities Act regarding sales by an issuer in offshore transactions or under Regulation D under the Securities Act, Rule 701 under the

Securities Act, Section 4(a)(2) of the Securities Act regarding transactions not involving a public offering. No underwriters were involved in any of these issuances.

Purchaser	Date of issuance	Type and number of securities	Consideration (US$)

Coreworth Investments (BVI)	November 4, 2015	400,000,000 ordinary shares⁽¹⁾	4,000
Rich Horizon Investments (BVI)	November 4, 2015	300,000,000 ordinary shares⁽¹⁾	3,000
Harmony Creek Investments (BVI)	November 14, 2015	300,000,000 ordinary shares⁽¹⁾	3,000
Certain employees	November 18, 2015	Options to purchase 36,771,900 ordinary shares⁽²⁾	Exercise price at US$0.163 per share
Certain employees	November 18, 2015	Options to purchase 46,524,100 ordinary shares⁽³⁾	Exercise price at US$0.163 per share
Certain employees	November 18, 2015	12,665,000 restricted share units⁽⁴⁾	Service to our Company
Certain employees	January 13, 2016	Options to purchase 13,741,271 ordinary shares⁽⁵⁾	Exercise price at US$0.163 per share
Certain employees	January 13, 2016	4,075,435 restricted share units⁽⁶⁾	Service to our Company

Notes:

⁽¹⁾: Represents shares issued by Yintech after its incorporation on November 4, 2015. All the ordinary shares issued to Harmony Creek Investments (BVI) were transferred from Fortune State Investments Limited (BVI), both of which are wholly owned holding companies of Mr. Ming Yan, on November 14, 2015.
⁽²⁾: Represents options granted to our officers, employees and business associates under our 2013 Share Scheme adopted as effective on November 18, 2015, which replaced the original 2013 Share Scheme adopted on December 17, 2014.
⁽³⁾: Represents options granted to our officers, employees and business associates under our 2014 Share Scheme adopted as effective on November 18, 2015, which replaced the original 2014 Share Scheme adopted on December 17, 2014.
⁽⁴⁾: Represents restricted share units granted to our employees and business associates under our Pre-IPO RSU Scheme adopted as effective on November 18, 2015, which replaced the original Pre-IPO RSU Scheme adopted on January 13, 2015.
⁽⁵⁾: Represents options granted to our officers, employees and business associates under our 2014 Share Scheme adopted as effective on November 18, 2015.
⁽⁶⁾: Represents restricted share units granted to our employees and business associates under our Pre-IPO RSU Scheme adopted as effective on November 18, 2015.

Schedules have been omitted because the information required to be set forth therein is not applicable or is shown in our combined financial statements or the notes thereto.

The undersigned registrant hereby undertakes to provide to the underwriter at the closing specified in the underwriting agreements, certificates in such denominations and registered in such names as required by the underwriter to permit prompt delivery to each purchaser.

Insofar as indemnification for liabilities arising under the Securities Act may be permitted to directors, officers and controlling persons of the registrant under the provisions described in Item 6, or otherwise, the registrant has been advised that in the opinion of the SEC such indemnification is against public policy as expressed in the Securities Act and is therefore unenforceable. In the event that a claim for indemnification against such liabilities (other than the payment by the registrant of expenses incurred or paid by a director, officer or controlling person of the registrant in the successful defense of any action, suit or proceeding) is asserted by such director, officer or controlling person in connection with the securities being registered, the registrant will, unless in the opinion of its counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question whether such indemnification by it is against public policy as expressed in the Securities Act and will be governed by the final adjudication of such issue.

Pursuant to the requirements of the Securities Act, the registrant certifies that it has reasonable grounds to believe that it meets all of the requirements for filing on Form F-1 and has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, on April 19, 2016.

Pursuant to the requirements of the Securities Act of 1933, this registration statement has been signed by the following persons in the capacities and on the dates indicated.

Under the Securities Act, the undersigned, the duly authorized representative in the United States of Yintech Investment Holdings Limited, has signed this registration statement or amendment thereto in New York, on April 19, 2016.

		Description of Document

1.1		Form of Underwriting Agreement
3.1	†	Memorandum and Articles of Association of the Registrant, as currently in effect
3.2	†	Form of Amended and Restated Memorandum and Articles of Association of the Registrant (effective upon the closing of this offering)
4.1		Registrant's Specimen American Depositary Receipt (included in Exhibit 4.3)
4.2		Registrant's Specimen Certificate for Ordinary Shares
4.3		Form of Deposit Agreement, among the Registrant, the Depositary and holders of the American Depositary Receipts
5.1		Opinion of Walkers regarding the validity of the ordinary shares being registered
8.1		Opinion of Davis Polk & Wardwell LLP regarding certain U.S. tax matters
8.2		Opinion of Walkers regarding certain Cayman Islands tax matters (included in Exhibit 5.1)
8.3	†	Opinion of King & Wood Mallesons regarding certain PRC tax matters (included in Exhibit 99.2)
10.1		Second Amended and Restated 2013 Share Option Scheme
10.2		Third Amended and Restated 2014 Share Option Scheme
10.3		Third Amended and Restated Pre-IPO RSU Scheme
10.4	†	Form of Indemnification Agreement entered into among the Registrant and its directors and officers
10.5	†	Employment Agreements entered into between the Registrant and Executive Officers of the Registrant
10.6	†	English Translation of Membership Agreement between the Tianjin Precious Metals Exchange and Tianjin Rong Jin Hui Yin Precious Metal Management Co., Ltd.
10.7	†	English Translation of Membership Agreement between the Guangdong Precious Metals Exchange and Guangdong Jin Xiang Yin Rui Precious Metal Management Co., Ltd.
10.8	†	English Translation of Risk Disclosure and Trading Agreement between the Guangdong Precious Metals Exchange and Guangdong Jin Xiang Yin Rui Precious Metal Management Co., Ltd.
10.9	†	English Translation of Risk and Return Transfer Agreement with Pan Hou Wei Ran — PHC Commodity Equity Interest Swap Fund No. 1
10.10	†	English Translation of Supplemental Risk and Return Transfer Agreements with Pan Hou Wei Ran — PHC Commodity Equity Interest Swap Fund No. 1
10.11	†	English Translation of Risk and Return Transfer Execution Guarantee Agreement with Pan Hou Wei Ran — PHC Commodity Equity Interest Swap Fund No. 1

Title of Each Class of Securities to Be Registered	Amount of Shares to Be Registered(1)(2)	Proposed Maximum Offering Price per Share(1)	Proposed Maximum Aggregate Offering Price(2)	Amount of Registration Fee(4)




Ordinary shares, par value US$0.00001 per share(2)(3)	172,500,000	US$0.725	US$125,062,500	US$12,594

	Ordinary Shares Purchased

						Total Consideration
						Total Consideration					Average Price Per Ordinary Shares		Average Price Per ADS
	Number		Percent			Amount		Percent			Average Price Per Ordinary Shares		Average Price Per ADS
Existing shareholder		1,000,000,000		85.85	%	US$	10,000		0.01	%	US$	0.00001	US$	0.0002
New investors		164,814,815		14.15	%	US$	111,250,000		99.99	%	US$	0.675	US$	13.50

Total		1,164,814,815		100	%	US$	111,260,000		100	%



Expected volatility	40.45	%	39.53%	39.53%	46.75%-51.48%	46.75%-51.48%
Option life	6.25		6.97-8.97	—	5.97-7.97	—
Expected dividends	—		—	—	—	—
Risk-free interest rate	1.46	%	1.41%-1.61%	1.41%-1.61%	1.69%-1.94%	1.69%-1.94%

	As of

	March 31, 2014		June 30, 2014		September 30, 2014		December 31, 2014		March 31, 2015		June 30, 2015		September 30, 2015		December 31, 2015
Tradable accounts(1)		22,494		26,084		29,521		33,903		38,210		42,900		45,133		50,598

	For the Three Months Ended

	March 31, 2014		June 30, 2014		September 30, 2014		December 31, 2014		March 31, 2015		June 30, 2015		September 30, 2015		December 31, 2015
Active accounts(1)		8,976		9,828		10,445		11,516		12,042		13,604		11,639		13,435
	RMB		RMB		RMB		RMB		RMB		RMB		RMB		RMB
Customer trading volume (in millions)		141,046		129,159		173,116		180,092		182,443		182,981		142,345		151,941


Cayman Islands (State or Other Jurisdiction of Incorporation or Organization)		6200 (Primary Standard Industrial Classification Code Number)		Not Applicable (I.R.S. Employer Identification Number)


Copies to:
Li He, Esq. Davis Polk & Wardwell LLP 2201 China World Office 2 1 Jian Guo Men Wai Avenue Chao Yang District, Beijing 10004 People's Republic of China +86 10 8567 5000		David Zhang, Esq. Benjamin Su, Esq. Kirkland & Ellis International LLP c/o 26th Floor, Gloucester Tower, The Landmark 15 Queen's Road Central Hong Kong +852 3761 3300

	PER ADS	TOTAL

Initial public offering price	US$	US$
Underwriting discounts and commissions⁽¹⁾	US$	US$
Proceeds, before expenses, to the Issuer	US$	US$


Prospectus Summary			1
The Offering			7
Summary Combined and Consolidated Financial and Operating Data			10
Risk Factors			15
Special Note Regarding Forward-Looking Statements and Industry Data			42
Use of Proceeds			43
Dividend Policy			44
Capitalization			45
Dilution			46
Exchange Rate Information			48
Enforceability of Civil Liabilities			49
History and Corporate Structure			51
Selected Combined and Consolidated Financial and Operating Data			52
Recent Developments			57
Management's Discussion and Analysis of Financial Condition and Results of Operations			58
Industry			84
Business			92
Regulation			112
Management			124
Principal Shareholders			134
Related Party Transactions			136
Description of Share Capital			138
Description of American Depositary Shares			146
Shares Eligible for Future Sale			154
Taxation			156
Underwriting			161
Expenses Relating to This Offering			170
Legal Matters			171
Experts			172
Where You Can Find Additional Information			173
Index to Combined and Consolidated Financial Statements			F-1

	As of December 31, 2015

	Actual				As adjusted(1)
(in thousands)	RMB		US$		RMB		US$
Equity:
Ordinary shares (US$0.00001 par value per share; 3,000,000,000 shares authorized; 1,000,000,000 shares issued and outstanding on an actual basis and 1,164,814,815 shares outstanding on an adjusted basis as of December 31, 2015)		65		10		76		12
Additional paid-in capital⁽²⁾		257,098		39,689		906,199		139,893
Retained earnings		105,193		16,239		105,193		16,239
Accumulated other comprehensive income		1,241		192		1,241		192

**Total shareholders' equity⁽²⁾**		363,597		56,130		1,012,709		156,336

Total capitalization⁽²⁾		363,597		56,130		1,012,709		156,336

	Type of Awards		Exercise Price		Fair Value of Underlying Ordinary Shares

			US$		US$
Grant Date
December 3, 2013	Options	36,771,900		0.163		0.106
December 15, 2014	Options	46,524,100		0.163		0.325
January 15, 2015	RSUs	12,665,000		—		0.325
January 13, 2016	Options	13,741,271		0.163		0.406
January 13, 2016	RSUs	4,075,435		—		0.406

	Unit

All Commodities	RMB bn	8,620.9	11,048.4	15,270.7	20,611.8	28,958.6	35.4	%	26.9	%
— Precious Metals⁽¹⁾	RMB bn	6,620.9	7,248.4	10,462.7	14,237.8	19,291.7	30.7	%	24.6	%
— Others⁽²⁾	RMB bn	2,000.0	3,800.0	4,808.0	6,374.0	9,666.9	48.3	%	31.0	%
All Investors	RMB bn	8,620.9	11,048.4	15,270.7	20,611.8	28,958.6	35.4	%	26.9	%
— Institutions	RMB bn	4,639.3	6,015.4	7,550.1	9,025.9	12,632.0	28.5	%	22.1	%
— Individuals	RMB bn	3,981.6	5,033.0	7,720.6	11,585.9	16,326.6	42.3	%	30.2	%

	Exchange Name		Trading Volume		Market Share(1)		Commodities

			(RMB billion)		%
1	Shanghai Gold Exchange	2002		10,784.2		37.2%	gold, silver, platinum
2	Tianjin Precious Metals Exchange	2010		2,900.0		10.0%	silver, platinum, palladium, nickel, copper, aluminum
3	Guangdong Precious Metals Exchange	2012		2,700.0		9.3%	silver, platinum, palladium
4	Jiangsu Mercantile Exchange	2012		1,900.0		6.6%	silver, asphalt, agricultural products such as Pu'er tea, etc.
5	Tianjin Mineral Resources Exchange	2010		1,700.0		5.9%	mineral resources including gold ore, silver ore and other minerals
	Subtotal			19,984.2		69.0%	—
	Other Exchanges			8,974.4		31.0%	—

	Industry Total			28,958.6		100.0%	—

(in RMB billions)

Shanghai Gold Exchange
— Gold	2,477.2	2,150.6	3,213.4	4,589.2	8,008.4
— Gold by Individual Investors	501.6	303.9	626.6	871.9	1,673.8
— Silver	1,939.9	1,358.1	1,983.5	1,906.1	2,762.3
— Silver by Individual Investors	1,457.5	1,113.6	1,646.3	1,601.1	2,375.5
— Other Precious Metals	24.0	21.0	27.3	18.8	13.5

Total	4,441.1	3,529.7	5,224.2	6,514.0	10,784.2



— Individual Investors	1,977.1	1,434.8	2,296.9	2,489.9	4,062.3
Individual as % of Total	44.5%	40.6%	44.0%	38.2%	37.7%

(in RMB billions)

Tianjin Precious Metal Exchange⁽¹⁾
— Silver	1,293.0	2,530.0	3,135.0	3,345.8	2,065.2
— Others	480.0	280.0	165.0	401.6	834.8

Total	1,773.0	2,810.0	3,300.0	3,747.4	2,900.0



— Individual Investors	1,607.0	2,580.0	3,000.0	3,387.4	2,655.0
Individual as % of Total	90.6%	91.8%	90.9%	90.4%	91.6%

(in RMB billions)

Guangdong Precious Metals Exchange⁽¹⁾
— Silver	—	8.7	388.8	1,307.8	1,620.0
— Others	—	—	6.6	78.2	1,080.0
Total	—	8.7	395.4	1,386.0	2,700.0
— Individual Investors	—	8.3	364.6	1,281.0	2,356.6
Individual as % of Total	—	95.4%	92.2%	92.4%	87.3%


Ranking(2)	Trading Service Provider	Main Exchanges Operating On	Estimated Customer Trading Volume in 2015 (RMB billion)(2)		As % of Total Trading Volume of Individual Investors in 2015		Estimated Net Commissions and Fees in 2015 (RMB million)(3)
1	Yintech (the Company)⁽¹⁾	Shanghai Gold Exchange, Tianjin Precious Metals Exchange, Guangdong Precious Metals Exchange		660		4.0%		990
2	Company A	Shanghai Gold Exchange		600		3.7%		210
3	Company B	Guangdong Precious Metals Exchange		350		2.1%		490
4	Company C	Shanghai Gold Exchange, South Rare Precious Metals Exchange		300		1.8%		200
5	Company D	Tianjin Precious Metals Exchange		280		1.7%		450

	As of December 31, 2015

	Number		% of Total Employees
Technology		168		9	%
Research		27		1	%
Customer Service		421		22	%
Sales & Marketing		976		52	%
General & Administration		299		16	%

Total		1,891		100	%

Name		Position/Title

Wenbin Chen	41	Co-Founder, Chairman and Chief Executive Officer
Ming Yan	41	Co-Founder and Director
Ningfeng Chen	47	Co-Founder and Director
Feng Li	39	Independent Director Appointee*
Jue Yao	42	Independent Director Appointee*
Lijun Lin	43	Independent Director Appointee*
Gang Xu	36	Vice President
Dikuo Bo	41	Vice President
Jigeng Chen	33	Vice President
Qi Feng	38	Vice President
Sheng Zhao	44	Vice President
Jingbo Wang	34	Chief Financial Officer

Underwriter		Number of ADSs

Jefferies LLC
Ping An of China Securities (Hong Kong) Company Limited

Total			7,500,000

	Per ADS		Total

	Without Option to Purchase Additional ADSs	With Option to Purchase Additional ADSs	Without Option to Purchase Additional ADSs	With Option to Purchase Additional ADSs
Public offering price	US$	US$	US$	US$
Underwriting discounts and commissions paid by us	US$	US$	US$	US$
Proceeds to us, before expenses	US$	US$	US$	US$


Securities and Exchange Commission registration fee	US$	12,594
Financial Industry Regulatory Authority filing fee	US$	19,260
NASDAQ listing fee	US$	125,000
Printing and engraving expenses	US$	400,000
Legal fees and expenses	US$	1,900,000
Accounting fees and expenses	US$	1,100,000
Miscellaneous	US$	400,000

Total	US$	3,956,854

		Page(s)

Table of Contents
Report of Independent Registered Public Accounting Firm			F-2
Combined and Consolidated Balance Sheets as of December 31, 2014 and 2015			F-3
Combined and Consolidated Statements of Comprehensive Income for the Years Ended December 31, 2013, 2014 and 2015			F-4
Combined and Consolidated Statements of Shareholders' Equity for the Years Ended December 31, 2013, 2014 and 2015			F-5
Combined and Consolidated Statements of Cash Flows for the Years Ended December 31, 2013, 2014 and 2015			F-6
Notes to Combined and Consolidated Financial Statements			F-7

Name of subsidiary	Date of incorporation/ acquisition	Paid up capital			Place of incorporation

Tianjin Rong Jin Hui Yin Precious Metals Management Co., Ltd. ("Rong Jin Hui Yin") *	Incorporated on May 18, 2011	RMB 100 million	100	%	PRC
Guangdong Jin Xiang Yin Rui Precious Metals Management Co., Ltd. ("Jin Xiang Yin Rui")*	Incorporated on October 24, 2012	RMB 20 million	100	%	PRC
Shanghai Yin Tian Xia Technology Co., Ltd. ("Yin Tian Xia Technology")*	Incorporated on June 27, 2011	RMB 5 million	100	%	PRC

Name of subsidiary	Date of incorporation/ acquisition	Paid up capital			Place of incorporation

Yintech Elements Co., Ltd.	Incorporated on 9 November, 2015	USD1 dollar	100	%	BVI
Yintech Elements (HK) Co., Ltd.	Incorporated on 19 November, 2015	HKD1 dollar	100	%	Hong Kong


• Level 1:		Quoted prices (unadjusted) in active markets for identical assets or liabilities that the Group can access at the measurement date.
• Level 2:		Inputs other than quoted prices included within level 1 that are observable for the asset or liability either directly or indirectly.
• Level 3:		Unobservable inputs for the asset or liability.



Asset
Derivative assets	—	445	—	445
Available-for-sale investments	—	75,670	—	75,670

Total	—	76,115	—	76,115



Liabilities
Derivative liabilities	—	14,336	—	14,336

Total	—	14,336	—	14,336

				Aggregate fair value

	Aggregate cost basis RMB			Aggregate fair value
At December 31, 2015	Aggregate cost basis RMB			RMB		USD (Note2)
						Unaudited
Wealth management products		75,670	—		75,670		11,681

Total		75,670	—		75,670		11,681

At December 31, 2014

Wealth management products	256,000	—	256,000
Money market funds	98,000	—	98,000

Total	354,000	—	354,000

		RMB

Year ending December 31
2016			17,628
2017			13,420
2018			2,701
2019			173
2020			181
2021 and thereafter			929

Total			35,032

	December 31 2014,

			Fair Value
	Notional amount RMB		Derivative assets RMB		Derivative liabilities RMB
Spot commodity contracts
— Long position		755,781		—		—
— Short position		1,631,762		—		—

Total (RMB)		2,387,543		—		—

		December 31, 2014 RMB

Rong Jin Hui Yin			100,000
Jin Xiang Yin Rui			20,000
Yin Tian Xia Technology			5,000

Total			125,000


Recognized amounts of identifiable assets acquired and liabilities assumed:
Cash	6
Deposit with clearing organization	22,349
Other liabilities	(12,457	)

Total identifiable net assets acquired	9,898



Cash consideration	10,000
Goodwill	102

		RMB

Balance at January 1, 2013			1,680
Balance at December 31, 2013			1,680



Balance at January 1, 2014			1,680
Increase based on tax positions taken in the current year			2,158
Balance at December 31, 2014 and December 31, 2015			3,838



Expected volatility (expressed as weighted average volatility)	40.45	%	39.53	%	—
Option life (expressed as weighted average life)	6.25		6.97 - 8.97		—
Expected dividends	—		—		—
Risk-free interest rate	1.46	%	1.41% - 1.61	%	—