China's cabinet on Friday outlined a slew of measures aimed at better protecting the interests of small and medium investors in the capital market.

Small and medium investors are the main players in China's capital market, but their interests are more likely to be infringed upon due to the lack of information and relatively weak risk-prevention and self-protection capabilities, the State Council said in a document.

Safeguarding the interests of small investors is the foundation for healthy and sustainable development of the capital market, it said.

The nine-point document outlined major measures that should be taken to protect investor interests, including intensifying investor classification, boosting information transparency and improving dispute settlement and compensation systems.

The country should categorize investors according to related rules to decide which kind of markets or products are suitable for each category, according to the document.

Securities companies and intermediaries should classify their products based on a scientific assessment of their risks and introduce customers to products appropriate for their risk tolerance.

Information affecting investor decisions must be made public in an accurate, complete and timely manner. Supervision on information disclosure will also be improved.

The right of small investors to cast votes and have a say in a company's leadership should be protected, and mechanisms for settling disputes and compensating small investors should be improved, the document said.

The management will also strengthen its crackdown on companies' illegal activities, including inappropriate correction of profit forecasts, misleading investors with false or fabricated information, and insider deals and market manipulation.