The Direxion Daily FTSE China Bull 3X Shares (YINN) soared 12.21% on Monday, fueled by a renewed frenzy of buying interest from hedge funds betting on a swift recovery in China's equity market and economy.

Hedge funds have been piling into Chinese stocks at a record pace, making record net purchases of Asian equities in September led by China and Hong Kong, according to data from Goldman Sachs' prime brokerage desk. The buying spree comes as Beijing unleashes an extensive package of stimulus measures and policy support aimed at reviving the nation's struggling economy.

US-based Mount Lucas Management and Singapore's GAO Capital are among the heavyweight funds entering bullish positions on China-focused exchange-traded funds and large-cap stocks. Some, like Australia's Tribeca Investment Partners, are gaining exposure through proxies such as mining companies that benefit from China's economic growth.