Image credit: Visual China

Following the sharp rise in the stock market, market risk preference has significantly increased.

Statistics from Wind data show that since September 24, the net inflow of stock ETFs has been 186.7 billion shares, while the net inflow of currency ETFs has been 43.7 billion shares, indicating a clear movement of funds. Although bond ETFs have increased by a net 0.806 billion shares, the increase is mainly contributed by the "semi-stock nature" of convertible bond and exchangeable bond ETFs.

Since the 24th, the total share of 27 money market ETFs in the whole market has decreased from 183.2 billion shares to 136.9 billion shares, with a net redemption of 46.3 billion shares and a net redemption rate of 25.29%.

Among them, the top three money market ETFs in size all have redemption ratios exceeding 20%, namely: Hwabao WP Listed Money Market Fund-A with a net redemption of 20.5 billion shares, redemption ratio 22.76%; Yinhua Exchange Traded Money Market Fund-A with a net redemption of 20 billion shares, redemption ratio 26.97%; Jianxintianyi Money Market ETF with a net redemption of 6.3 billion shares, redemption ratio 22.66%.

To meet redemption demands, some money market funds have increased the withdrawal limits.

For instance, on October 10, Guosen Securities adjusted the withdrawal limit of Guosen Money Market Maximization product: the total withdrawal service for all investors was increased from 0.8 billion yuan to 1 billion yuan. At the end of the first half of the year, the total scale of this product was 15.3 billion yuan.

On September 27, Zhongjin Wealth Jujinli also increased the withdrawal quota: the total amount that can be quickly withdrawn in a single day has been raised from the previous 0.07 billion yuan to 0.12 billion yuan.

With the decrease in deposit rates, the 7-day annualized return of money market funds has generally dropped to around 1.4%. For example, Tianhong Yu'ebao, the largest money market fund in the market, had a 7-day annualized return of 1.46% on October 11, compared to 2.36% at the beginning of the year (January 1), a decrease of 90 basis points, with a significant decline in returns.

There was an outflow of shares of currency ETFs, with funds moving to more volatile stock ETFs and convertible bond ETFs.

Since September 24, the net inflow of stock ETFs has been 18.67 billion shares, with the most volatile being the Star Market sector ETF (20% daily limit up or down), which is the main target of fund rushing. Six stock ETFs with inflows of over 10 billion shares, five of which are related to the Star Market and Growth Enterprise Market ETFs.

At the bond ETF level, although there was a net increase of 0.806 billion shares, the increase was mainly contributed by two convertible bond ETFs: Bosera CSI Convertible Bond and Exchangeable Bond ETF with a net inflow of 0.693 billion shares, and Golden Sun CSI Convertible Bond ETF with a net inflow of 0.175 billion shares. Stock ETFs and convertible bond ETFs were heavily bought, indicating a rapid increase in market risk appetite.