The Chinese government needs to encourage more institutional investing to stabilize its stock market, JPMorgan Chase's Jing Ulrich said Friday.
"If you look at the market structure, it is very different from the U.S. market," the firm's vice chairman of Asia Pacific told CNBC's "Squawk Box." "Retail investors play a huge role in China. So, when a market downturn happens … the hurt mentality really kicks in."
She said 90 percent of the trading in China is by retail investors, who can be "erratic and irrational."
"One of the medium- to long-term projects for the central government in China is to introduce more rational, institutional investors into the Chinese stock market," she said.