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Exceeded 3 trillion yuan! ETFs hit new highs

After breaking through 2 trillion yuan in December last year, it took only 9 months for the ETF market to achieve a milestone again, winning the 3 trillion yuan mark.

Wind data shows that as of September 30, the scale of ETFs in the whole market reached 3.41 trillion yuan, an increase of 646 billion yuan from the beginning of September, breaking through the 3 trillion yuan mark, of which equity ETFs increased by about 600 billion yuan in September, contributing to the main scale increase.

Especially with the recent sharp rise in the market, all kinds of funds are rushing through ETFs. Since September 24, in just five trading days, equity ETFs have received a net inflow of 112.305 billion yuan, and broad-based ETFs represented by CSI 300 ETFs have been favored by funds.

The market-wide ETF exceeded 3 trillion yuan

Wind data shows that as of September 30, the scale of ETFs in the whole market reached 3.41 trillion yuan, an increase of 646 billion yuan from the beginning of September, an increase of 1.34 trillion yuan from the beginning of the year, and more than 3 trillion yuan.

As of September 30, the scale of equity ETFs has exceeded 2.65 trillion yuan, breaking through the 2.5 trillion yuan mark, and an increase of about 600 billion yuan in September. In the same period, cross-border ETFs, bond ETFs, and commodity ETFs increased by 56.505 billion yuan, 6.61 billion yuan, and 3.288 billion yuan respectively, while currency ETFs decreased by 36.039 billion yuan.

It is worth noting that with the CSI 500 ETF hitting a new high, another member of the 100 billion ETF camp has been added. Up to now, there are 6 ETFs of 100 billion yuan in the whole market, namely: Huatai Pineapple CSI 300 ETF with a scale of 397.547 billion yuan, E Fund CSI 300 ETF with a scale of 262.027 billion yuan, ChinaAMC CSI 300 ETF with a scale of 167.074 billion yuan, ChinaAMC SSE 50 ETF with a scale of 165.036 billion yuan, Harvest CSI 300 ETF with a scale of 149.329 billion yuan, and CSI 500 ETF with a scale of 123.912 billion yuan.

The significant expansion of ETF scale this year is due to the increase in both fund shares and net fund value.

On the one hand, the continuous increase in holdings of "national teams" such as Central Huijin is an important reason for the significant expansion of ETF scale since the beginning of this year. According to the statistics of the Chinese reporter of the brokerage, according to the average transaction price of ETFs and the increase in shares, in the first half of this year, the "national team" dominated by Central Huijin accumulated more than 460 billion yuan in the market, of which the four major CSI 300 index ETFs increased their holdings by more than 310 billion yuan.

On the other hand, the sharp rise in the market has also helped the scale of ETFs to a new level. From September 24 to September 30, many ETFs such as Huaan ChiNext 50 ETF and Southern ChiNext ETF rose by more than 50%, and 253 ETFs in the whole market rose by more than 30%.

Hundreds of billions of funds to raise equity ETFs

In the rapidly rising market, equity ETFs are becoming an important channel for investors to get on the bus quickly.

Especially since September 24, in just five trading days, equity ETFs have received a net inflow of 112.305 billion yuan, of which the net inflows of Huatai Barry CSI 300 ETF, CSI 1000 ETF and CSI 500 ETF have exceeded 10 billion yuan.

Among the many equity ETFs, the CSI 300 ETF received the most net subscriptions, with Huatai Pineapple CSI 300 ETF, E Fund CSI 300 ETF, Harvest CSI 300 ETF, and ChinaAMC CSI 300 ETF receiving net inflows of 29.743 billion yuan, 9.942 billion yuan, 3.163 billion yuan, and 1.684 billion yuan respectively.

As for why the broad-based ETF represented by the CSI 300 ETF is the most popular, Liu Jun, director of the investment department of Huatai Berry Index, said that the current easing of monetary policy has sent a clear positive signal, which will help enhance the overall risk appetite of the market, and the intersection of the two incremental policies of swap convenience operation and "repurchase and re-lending" further highlights the guidance of the new "national nine articles" on the style of the large-cap leading market.

On the one hand, the securities, funds, and insurance capital swap facilities allow the CSI 300 constituent stocks and stock ETFs held by these institutions to be used as collateral to exchange high-liquidity assets such as treasury bonds from the central bank, which has increased the willingness of institutions to hold core assets to a certain extent. On the other hand, for repurchase and re-lending, listed companies with higher dividend levels and better cash flow are expected to fully enjoy the policy, including the future purchase of equalization funds or in this direction, for the leading stocks in the large market, the main incremental capital increase momentum may increase, so in essence, it has brought relatively clear incremental benefits to major index ETFs and constituent stocks such as CSI 300.

In addition, Liu Jun said that even though the current overall profit cycle of A-shares is still at a relatively low stage in the conversion of old and new kinetic energy, the 2024 semi-annual report performance disclosed by some listed companies has shown a relatively good recovery trend, especially for the CSI 300 index, although the net profit of the whole index is still negative year-on-year, it has achieved positive growth in the second quarter alone, showing a trend of stabilization and improvement in performance. At the same time, the start of the Fed's interest rate cut cycle is expected to attract foreign capital to accelerate the return of foreign capital to China's capital market, injecting more vitality into the market. With the support of multiple positive factors, the CSI 300 ETF with benchmark attributes is expected to become an important channel for domestic and foreign long-term funds to deploy high-quality Chinese assets.

Incremental funding will affect the style of the market

In recent years, ETFs have ushered in rapid development, when the market is down, there are funds to take advantage of the low layout of ETFs, and when the market is rising, there are also funds to take advantage of ETFs to get on the bus quickly.

Regarding the rapid expansion of the ETF market, Zhao Xu, deputy general manager of the index and quantitative investment department of ICBC Credit Suisse, said that in recent years, the development of ETFs has shown an unprecedented acceleration, and from the supply side, the continuous refinement and enrichment of the index system provides investors with more choices; From the demand side, the contrarian growth of ETF scale has fully demonstrated its market recognition.

He believes that in recent years, with the further improvement of market efficiency, the excess return in the market has reflected the characteristics of systematic decay to a certain extent, and the average market return level represented by ETF has been paid more and more attention by investors, and the proportion of institutional investors in the investor type has also increased significantly, and all kinds of investors have been able to use ETF to invest and allocate more familiarly.

Su Huaqing, fund manager of the quantitative investment department of Wells Fargo Fund, believes that incremental funds such as passive funds and insurance funds may be the key factors that determine the market style this year, while changes in economic expectations are the key variables that determine the downward and downward direction of the market. Combined with the profit cycle, market liquidity, valuation, favorable policies and other dimensions of listed companies, we are more optimistic about the performance of large-cap stocks in the future. Historically, it may be more effective to adopt a broad-based index layout strategy due to the smaller differentiation between sectors in the bottom region.

Source: Brokerage China