Since the beginning of March, stock market turmoil at home and abroad has intensified. The market's monetary fund was favored by safe-haven funds, with a net inflow of 21 billion dollars in 10 trading days, and its scale soared 15%.
Net inflow of currency ETFs was RMB 21.4 billion
The size of the in-market cargo base soared
Recently, the A-share market has fluctuated and recovered, currency ETFs have become “safe havens” for capital, and a large amount of capital has been net inflow. According to the data, as of March 13, the total size of the 27 currency ETFs totaled 161,406 billion yuan, an increase of 22.422 billion yuan over the end of February; the 10-day trading day increase reached 15.3%. Among them, Huabao Tianyi, a leader in the market's commodity base, received a net inflow of 11.346 billion yuan during the period, increasing to 79.566 billion yuan; in the same period, the scale of Yinhua's daily profit increased from 50,594 billion yuan to 58.971 billion yuan.
Compared with data before the Spring Festival, the size of currency ETFs increased even more significantly, reaching 34.887 billion yuan, an increase of 27.57%. The net capital inflows of Huabao Tianyi and Yinhua Daily both increased by more than 15 billion yuan, while the net inflows of Jianxin Tianyi were 1,851 billion yuan.
Judging from the increase in product scale, E-Fangda's security deposit size increased the fastest, doubling from 717 million yuan to 1,433 million yuan; China Merchants Express and Yinhua Daily Interest increased by 57.1% and 34.68% respectively.
As an important trend in securities margin, the market stock base has always been viewed as a weather vane for the stock market, and it is also an important indicator for observing stock investors' sentiment.
Take Huabao Tianyi as an example. After the bull market ended in September 2015, the fund reached a quarterly high of 217.3 billion yuan. However, since the second quarter of 2019, the profit effect of the stock market has fermented, and the size of this fund has continuously declined. Stock market pullback pressure intensified in March, and fund size rose rapidly.
Three factors led to scale expansion
The change in scale still depends on the face of the stock market
The scale of currency ETFs has risen rapidly. Many industry insiders believe that the stock market pullback, the influx of arbitrage funds, and the continued marketing of fund companies are important factors in the rapid expansion of the scale of currency ETFs since March.
A person from the public equity market department in Shanghai analyzed that the size of the market's goods base is closely related to the sentiment of the stock market. With recent stock market adjustments, there is a clear trend of capital flowing from high-risk assets into currency ETFs to low-risk assets.
In addition to market reasons, the high premiums generated by capital's pursuit of cargo-based ETFs have also attracted a lot of arbitrage capital. Taking Huabao Tianyi as an example, the fund's intraday price soared to 100.036 yuan on March 9, and the potential annualized premium arbitrage income reached 7.6%.
The marketing department source mentioned above told the reporter that seeing market opportunities for currency ETFs, some companies have also recently continued to market such products, which has led to some increase in scale. “Some of the in-market goods are based on T+0 transactions. Investors sell stocks, and the funds are placed in market currency ETFs. Once an opportunity appears in the market, you can sell quickly and return your capital to buy stocks. This type of product is very suitable for shareholders' stock trading funds for idle financial management, and is an effective tool to increase the value of security deposits.”
Some fund company sources believe that the volatility of A-shares has increased significantly. Investors can reduce risk exposure through an in-market cargo base, continuously observe changes in market conditions in the future, and wait for opportunities to move.
Along with the expansion of fund size and the increase in arbitrage transactions, the trading activity of currency ETFs has also increased rapidly. As of March 16, the total daily turnover of 27 currency ETFs in the entire market since this month was 20.573 billion yuan, an increase of 27.22% over the previous two months; the average daily turnover rate also rose from 0.055% to 0.068%. The average daily turnover of leading products such as Huabao Tianyi ETF and Yinhua Rili all increased by more than 20%, while the average daily turnover of smaller currency ETFs such as Zhongrong Riying Currency ETFs, OTC currencies, China Merchants Express, and security deposits doubled compared to the previous two months, and trading activity increased markedly.
Referring to whether the growth in the size of cargo-based ETFs is sustainable, the person from the Shanghai marketing department mentioned above said that the future also depends on changes in the A-share market and investors' sentiment. If the stock market continues to be sluggish and investors' risk appetite declines, such products are still attractive; if the stock market warms up and investors are positive about the future market, the net inflow of cargo-based ETF capital may slow down or even flow back to the stock market.