On the evening of February 7, the third domestic ** ETF with a scale of 100 billion yuan was born.
With the firm judgment of long-term investors on the bottom of the A** market, broad-based ETFs are playing a core weapon to transfuse blood and activate the market, and E Fund confirmed that its CSI 300 ETF exceeded 100 billion yuan on the evening of February 7. Brokerage China reporters noticed that after Huijin Company announced on February 6 to expand the scope and scale of ETF holdings, the next day, the scale of ChinaAMC SSE 50 ETF and E Fund CSI 300 ETF successively announced that the scale exceeded 100 billion. At the same time, a number of public offerings announced the imminent issuance of blockbuster new broad-based ETFs, which also highlights that the opportunities outweigh the risks in the current A** market position, and the high-paced issuance and capital growth of ETFs in 2024 are expected to have a positive impact on the market.
One more has been added to the 100 billion club.
Brokerage China reporters learned that E Fund's CSI 300 ETF, a subsidiary of E Fund, exceeded 100 billion yuan on February 7, becoming the third **ETF product in the whole market with a scale of more than 100 billion. As of February 6, nearly 170 billion yuan of funds have flowed into ETF products tracking the CSI 300 Index, of which as much as 48.3 billion yuan has flowed into E Fund CSI 300 ETF, and the inflow of funds on February 7 has further boosted the scale of E Fund's related products.
The CSI 300 Index tracked by E Fund CSI 300 ETF is the most representative large-cap blue-chip index in the A** market, which gathers the core equity assets of A-shares, covering the leaders of various industries, and the performance of the index is closely related to China's macroeconomic cycle and the overall profitability of leading listed companies in various industries. Regarding the influx of funds into the CSI 300 ETF products, Pang Yaping, general manager of E Fund** Index Research Department, said that the recent increase in positive factors in the market has restored investors' cautious expectations. At present, the valuation level of the A** field is at a historically low position, the medium and long-term investment value is highlighted, and it is facing a good time window for low-level layout. Taking the CSI 300 Index as an example, the index currently has a rolling price-to-earnings ratio of about 11 times, and its valuation is below the 20% quantile since the index was released in 2005, so it has high investment value in the long run.
It is understood that E Fund CSI 300 ETF took the lead in reducing management fees and custody fees as early as early 2015 to improve investors' holding experience and better meet the financial needs of investors. At present, the total management fee and custody fee of E Fund CSI 300 ETF are only 02% per year, which is one of the lowest fees among all CSI 300 ETFs. Lower rates help to generate higher returns for investors. Judging from the historical data of E Fund CSI 300 ETF, the annualized tracking error of this product in 2023 is 042% and achieved 2With an excess return of 24%, it ranks first among the CSI 300 ETFs with a scale of more than 10 billion. In the long run, from 2019 to 2023, the cumulative rate of return of this product is about 4 percentage points higher than that of other CSI 300 ETFs with a scale of more than 10 billion.
The influx of money into broad-based ETFs implies market signals.
E Fund's CSI 300 ETF exceeded 100 billion yuan, which is an important market vane.
Previously, the only **ETF product with a scale of more than 100 billion yuan in China was Huatai Pineapple CSI 300 ETF, and then the scale of ChinaAMC SSE 50 ETF under Huaxia ** was the first to exceed 100 billion on February 7, becoming the second **ETF product with a scale of 100 billion, and by the evening of February 7, E Fund ** confirmed that its CSI 300 ETF exceeded 100 billion scale. This means that broad-based ETFs will play an extremely important role in enhancing the vitality of the market with long-term funds.
As a highly influential ** Huijin company among long-term investors, it continues to invest in the funding channels of broad-based ETFs. On February 6, ** Huijin Company announced that it fully recognized the value of the current A** market allocation, and has recently expanded the scope of ETF** products, and will continue to increase the intensity and scale of the increase, and resolutely maintain the smooth operation of the capital market. As of June 30, 2023, the institutions of the "*Huijin" family (including **Huijin Investment Co., Ltd., **Huijin Asset Management Co., Ltd., Huijin Asset Management Single Asset Management Plan, etc.) are among the top 10 holders of 36** ETFs. Based on the latest net value, the total market value of the above-mentioned **ETF held by Huijin is 6653.5 billion yuan. **Huijin's latest announcement means that it has begun to increase its holdings in broad-based ETFs, and therefore appeared after a trading day, that is, on February 7, the Shanghai Stock Exchange 50 ETF under Huaxia ** and the CSI 300 ETF under E Fund successively announced that they had entered the 100 billion scale club, which also brought the number of 100 billion ETFs in the market to three.
Unlike sector ETFs, broad-based ETFs are often the most efficient vehicle for large, long-term capital placement at the bottom of the market. Broad-based ETFs can help investors get rid of the entanglement of choosing industries and picking, and enjoy the steady growth of blue-chip companies or the long-term growth income of small and medium-sized caps for a long time, and obtain average market returns.
It is precisely because of the above-mentioned characteristics of the broad-based ETF that it has also become a core weapon for blood transfusion to the market, which is also reflected in the recent intensive issuance of new broad-based ETF products. Brokerage China reporters noticed that from February 6th to February 7th, Ping An**, Yinhua**, Fuguo**, Huabao** and many other ** companies have issued announcements saying that their CSI A50 ETF will be sold on the first trading day after the Spring Festival (that is, February 19) to March 1, with the upper limit of the initial offering size of 2 billion yuan, and will adopt the method of doomsday proportional confirmation to achieve effective control of the scale. According to public information, the CSI A50 Index was released on January 2, 2024, and it is the first A50 index compiled by a domestic index company in A-shares, and 50 of the largest market capitalization in various industries are selected as index samples.
It is expected that the funds and issuance of ETFs in 2024 will play a greater supporting role in the A** market. "Morgan Stanley** said in a report a month ago that the Shanghai Composite 50 Index has a high cost performance, the valuation of the CSI 300 Index has returned to a historical low, and the investment opportunities in the A** field have room for imagination in 2024.
Consistent with the above-mentioned **company**, on February 7, the scale of ChinaAMC SSE 50 ETF and E Fund CSI 300 ETF both exceeded 100 billion, highlighting that the bottoming out of the market has been confirmed.
Policy funds have helped to increase market confidence.
Regarding the importance of broad-based ETFs in the current market and the current opportunities in the A** market, many ** companies also believe that in the context of the opportunities in the A** market, the inflow of relevant funds will greatly boost the capital and sentiment of the market.
Yu Haiyan, manager of E Fund CSI 300 ETF**, said that the favorable conditions for China's economic development in 2024 will be stronger than the unfavorable factors, and the upward trend of the economy will continue to be consolidated and strengthened. China's economic development still has good support and favorable conditions, the market space is broad, the industrial system is complete, the material and technological foundation is strong, the talent dividend continues to increase, the transformation and upgrading continues to advance, the reform and opening up continues to deepen, the macro policy space is large, and the basic trend of long-term economic improvement has not changed, which will further boost market expectations and confidence. Considering that the current A** market has entered the value range in terms of asset pricing and long-term allocation value, as of the end of the fourth quarter, the risk premium (ERP) of the CSI 300 Index has broken through the high quantile of 98% in the past five years; The leading indicators of A-shares represented by the net increase in industrial capital have appeared, and the A-market has met the conditions for valuation repair, and the opportunities in the current position outweigh the risks.
Regarding the influx of a large number of funds into the broad-based ETF, the Great Wall ** relevant person pointed out that ** Huijin Company announced that it has expanded the scope and scale of ETF holdings, and the entry of policy funds into the market also constitutes an important support for the market, at the same time, foreign capital has recently begun to flow into more than 10 billion, which has also greatly boosted the capital and sentiment of the market, and at the same time, the real estate-related policies in many places are expected to be further relaxed, and the industry is expected to usher in an upward cycle. The resumption of work and production after the holiday is expected to drive production and manufacturing data and support the repair of economic fundamentals.
*Huijin said that it fully recognizes the value of the current A** market allocation, and has recently expanded the scope of ETF** holdings, and will continue to increase its holdings and expand the scale of its holdings. Li Zhan, chief economist of the China Merchants Research Department, believes that short-term policies are actively boosting confidence, and the market is expected to bottom out and stabilize, focusing on the over-falling opportunities of growth stocks. In the medium term, the current valuation and risk premium of A-shares have reached a historically low level, and when counter-cyclical fiscal and monetary policies are introduced in a timely manner to maintain stability and stabilize the market, economic expectations will be revised upward, and the micro transaction structure will be gradually cleared.
Editor-in-charge: Yang Yucheng.
Proofreading: Su Huanwen.
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