Reporter Li Hui reported from Beijing
As the transition period of the new asset management regulations is approaching, the transformation of the large wealth management market has fully entered the deep water area. Under the background of the shrinking of fixed income products and the continuous structural market situation in the market, the traditional allocation strategy of high-net-worth people is under pressure.
In July this year, the news that a private placement FOF raised tens of billions of yuan on the first day of its issuance once aroused market attention. Under the volatile market, product types with better strategy allocation and risk diversification capabilities have begun to be sought after by the market, and investors' eyes have shifted from a single fund strategy to a fund of funds strategy.
The consensus of the industry is that by the end of 2021, the transition period of the new asset management regulations will end, and the funds corresponding to non-standard assets at the bottom of more than 20 trillion yuan will face the problem of redistribution. To a certain extent, the current absolute return of the investment strategy is small, there is a large demand gap, and FOF and other multi-strategy allocation attributes of assets due to the absolute return and excess return, there is a large market development space.
Asset allocation is timely
According to the "2021 China Private Wealth Report" released by Bain & Company, the number of high-net-worth individuals with investable assets of more than 10 million yuan in China will reach 2.62 million in 2020. It is estimated that by the end of 2021, the number of high-net-worth individuals in China will be close to 3 million, and the total scale of investable assets will exceed 90 trillion yuan.
At the same time, with the decline in the domestic population growth rate, the introduction of regulatory policies such as real estate taxes may promote the proportion of financial assets to further increase. According to the analysis of Tianfeng Securities, the proportion of non-financial assets of residents will drop from the current 43% to 33% in the next 10 years, asset allocation will continue to transfer to financial assets, and the wealth management market will increase from the current 253 trillion yuan to 660 trillion yuan, accounting for 55% of the total assets of residents from 40% in 2020 to 55% in 2030.
Under the dual background of the rising scale of household investable assets and the shrinking of traditional fixed income investment channels, the demand gap for multi-asset allocation is widening, and how to further enhance asset allocation capabilities and multi-allocation channels has become the key.
In the second and third quarters of this year, as the CSI 500 Index and the CSI 1000 Index came out of the trend market, rising for nearly 6 consecutive months, the performance of small and medium-cap stocks was active, and assets such as private foFs bucked the trend and became a faster growing category in asset allocation.
According to the analysis of the research department of CICC, private fofs have gradually begun to attract investors' attention in China, which is related to the market environment and product characteristics: First, as of the middle of 2021, the number of domestic private equity products has reached 67,062, and the performance differentiation between different products is large, which increases the difficulty of investors directly selecting products, while private foFs rely on professional managers to qualitative and quantitative analysis, which can achieve the best selection for investors.
Second, private foFs can achieve diversified investment, and there may be a risk of a single investment strategy and unstable performance in a single private placement product. With FOF investment in a basket of private equity products, if some products perform poorly, the portfolio can balance the returns; if the product performance is good, the portfolio will receive excess returns. In addition, private FOFs can look for long-term low-correlation strategies, and build a decentralized combination of strategies to cross cyclical fluctuations and resist extreme market risks. For example, when the domestic stock market fell in March 2020 and February 2021, the private CTA strategy reversed the trend and reached a new high, and the addition of equity neutrality, CTA and other multi-strategies in the FOF can smooth returns.
Wind data shows that as of the end of September, there were 8,908 registered securities private equity fund managers, and the latest filing management scale was 5.58 trillion yuan, compared with 3.77 trillion yuan at the end of last year, an increase of more than 45%. According to the statistics of Yuntong Digital Science, the number of domestic private FOF products exceeded 4600 in the same period, mainly from private equity funds' independent issuance, public offering special accounts, securities company asset management, etc., of which private funds themselves accounted for 40%.
Market volatility further highlights the importance of asset allocation, which also provides a bigger stage for FOF institutions that are good at portfolio investment. Huasoft New Power began to focus on the securities private equity FOF business in 2015, and Chairman Xu Yisheng said at a recent public forum: The current single strategy, single asset, and single manager fluctuate too much and the risk is too large, and investors need to invest and allocate through securities private FOF fund methods.
In his view, the purchase of products of a single asset, a single strategy, and a single manager are all investments, and matching their own income risk preferences through the combination of multi-asset, multi-strategy, and multi-manager can be understood as a solution. Compared with product investment, foF funds with multi-asset and multi-strategy solution ideas are conditional and capable of achieving dynamic portfolio and dynamic management, and actively managing and adjusting actively according to changes in the market environment, especially the active adjustment of the connotation of strategic allocation, to achieve the goal of customer return risk preference in the medium and long term.
"Subjective + quantitative" two-pronged cracking configuration is difficult
As early as 2019, the Asset Management Business Professional Committee of the Asset Management Association of China (hereinafter referred to as the "Association") called on industry institutions to pay close attention to studying the development model of private asset management FOF and MOM business, contribute industry wisdom to rule making, and give full play to the diversification of private FOF/MOM products and multi-strategy asset allocation.
It is worth noting that among the existing FOF products, the choice of different strategy types has also attracted much attention.
In fact, under this year's structured market, the scale of quantitative private placement has rapidly expanded. According to the data of the private placement ranking network, by the end of the second quarter of 2021, the total scale of quantitative private equity funds exceeded the "1 trillion" mark, accounting for 21% of the total scale of securities private placement. According to the data of Chaoyang Perpetual Fund Research Platform, as of the beginning of October, there were 14 tens of billions of private placements with a yield of more than 20% this year, of which 11 were quantitative private placements.
Quantitative trading is the use of mathematical models to replace human subjective judgments, using computer technology to select a variety of "high probability" events that can bring excess returns from huge historical data to formulate strategies. The subjective strategy is the traditional bottom-up approach to analyzing company fundamentals, industry patterns, growth, and so on. In this year's volatile market, there are more opportunities for swing trading, which is conducive to the arbitrage of quantitative strategies.
However, it is worth noting that since mid-to-late September, the market as a whole has seen a more obvious adjustment, whether it is subjective or quantitative stock long strategy has shown a significant retracement.
A senior executive of a private equity institution told reporters: "Recently, the market style has shifted from the small and medium-sized to the large market in stages, and the quantitative stock private placement is based on the enhancement of the CSI 500 index as the mainstream strategy, so the drawdown is more obvious than the subjective stock private placement, and some head quantitative private placements have certain exposures in the industry and style factors due to the pursuit of higher excess returns, so the drawdown is larger than the average." ”
Relatively speaking, some products remain relatively neutral in the industry and style, so excess earnings are more stable. Historical performance data show that as of September 30 this year, the net value of "Huashi New Power Steady Progress No. 1" rose by 37.3% (after the fee), and the maximum drawdown was only 5.9%, and the return risk ratio was higher. It is understood that this is due to the fact that in addition to the short-term volume price factors that are greatly affected by the market, the above-mentioned funds have also allocated medium- and long-term fundamental factors, and in the future, the CSI 300 Index enhancement strategy can also be increased in stages according to the market environment, and the strategy is more balanced.
In addition, the above-mentioned Huasoft New Power related products are only charged at the bottom level due to performance remuneration, and the comprehensive product fee is similar to that of a single product, which is obviously different from the dual charging positioning of other FOF product management fees and performance remuneration in the market.
The executives of the above-mentioned private equity institutions believe that the quantitative stock strategy, based on breadth, is more stable and the fluctuation is relatively small, while the subjective stock strategy, based on depth, has relatively large fluctuations, but the stage excess return is more prominent.
At present, there is no shortage of investment research platform companies positioned in the market that are positioned as "subjective + quantitative + FOF". Houwei Investment is an emerging private equity manager in recent years, with a current management scale of about 2 billion yuan. Liu Xiaohao, the underlying fund manager of Houwei Investment, believes that excess returns come from the combination of value and trend, in addition to the traditional sense of selecting good companies in the industry through rigorous fundamental research and strictly considering the return-risk ratio before building a position, it will also pay special attention to changes in market liquidity and sentiment, combine value judgments, conduct swing operations, and lock in returns. At the operational level, it will also grasp the hot spots of the stage according to the rotation of the plate, and at the same time use the stock index futures to hedge at the right time to better smooth the systemic risk.
It should be noted that although the rotation of the plate and the change of style have accelerated this year, the overall difficulty of fund operation has increased, and to a certain extent, the impact on subjective stock bulls has been greater, but some products can still maintain good performance. It is understood that as of September 30 this year, the net value of Houwei Investment's "Yuanyao No. 3" series of representative works "Yuanyao No. 3" rose by 32.2%, which is very different from the performance of the traditional allocation value investment private placement that has been frequently "Waterloo" this year.
In the view of the above-mentioned private equity institution executives: in 2021, the market sector rotation and style switching will accelerate, the difficulty of operation will increase, and although the current investment time point is good, as far as investors are concerned, it is not easy to choose the right product. Whether it is a subjective or quantitative strategy, it is best to be able to choose products that can adapt to the current and changeable market on the one hand, and can be effective for a long time in the future. From the perspective of investor allocation, the "subjective + quantitative" two-pronged approach, combined with the allocation of large-scale assets, is undoubtedly more conducive to investors locking in returns and smoothing risks.