Stock-Bond Shift: Capital "Relocation" to Market

After the introduction of a policy "combination punch" to boost the market, the bond market continued to adjust, and the stock market welcomed a significant rise. As investors' risk appetite increased, the seesaw effect between stocks and bonds became apparent, and the enthusiasm for cash management financial products to "move" into the market continued to heat up.

At the same time, investors' demand for equity financial products increased, and financial companies actively adjusted multi-asset strategies, increasing the proportion of equity asset allocation and strengthening the layout of the equity market.

Market analysts believe that equities are the direction for subsequent increased investment in multi-asset strategies. As the impact of the new "Nine National Articles" policy becomes apparent, financial companies will be more proactive in their layout of the equity market. For ordinary investors, while diversifying asset allocation to increase returns, it is also necessary to pay attention to risks and maintain a certain proportion of bond assets to provide a ballast stone for fluctuations.

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Financial funds flow into the stock market

Since the beginning of October, several listed companies have announced plans to use their own funds for securities investment, including stocks, funds, new share allotment or subscription, and securities repurchase.

Compared with corporate investors, individual investors are also increasingly enthusiastic about transferring financial funds into the stock market. Mr. Liao from Guangzhou said that in order to be stable and meet liquidity needs, he has mainly bought financial products such as money market funds and short-term fixed income products. "However, the stock market has risen sharply recently. Before the National Day, I moved out a part of the funds into the stock market, and I will also replenish more positions after the festival. Although the stock market has回调ed in the past two days, the overall upward trend has started. Compared with the return on 7-day money market fund financial products, the return on the stock market is still more cost-effective."

A retail business person from a joint-stock commercial bank revealed to the reporter that since the start of the stock market at the end of September, some financial customers have requested redemption of funds. Among them, cash management products are more concentrated. "Many customers believe that the yield of various cash management products is too low, and the 7-day annualized yield is continuously declining. Under the rising stock market, its attractiveness has further decreased."

In terms of scale, the scale of cash management and fixed income financial products has obviously contracted since the end of September. According to data from Puyi Standards, as of October 6, the scale of cash management products in the entire market was 7.31 trillion yuan, a decrease of 496.24 billion yuan compared to the scale on September 22, and the scale accounted for 25.35% of the total scale.

Guosen Securities (002736.SZ) research report disclosed that from the structure of the存续理财产品 of financial companies, as of October 6, the存续 scale of fixed income financial products decreased by 442.4 billion yuan in the past two weeks, and the存续 scale of financial products within one month decreased by 13.01 billion yuan compared to two weeks ago.

Huachuang Securities research report pointed out that after the cross-season, the first week of bank financial products did not see the normal seasonal large-scale fund inflow brought by the scale increase, but decreased by 58.1 billion yuan to 29.33 trillion yuan, which is significantly lower than the seasonal growth level from 2021 to 2023, showing that the product faces redemption pressure.The market generally believes that the recent rise in the stock market, the weakening of the bond market, and the increase in risk appetite may be an important reason for investors to redeem financial management products, leading to a lower rebound in the scale of financial management in October than in previous years due to seasonal factors.

A research report from Guoxin Securities points out that since September, the heat in the capital market has been rising, which directly affects the demand for residents to hold cash-like and stable financial management products, and accelerates the "migration" of deposits and financial management towards equity assets and public funds, which have a higher risk preference. Combined with Puyi data, the redemption scale of pure bond-type financial management products sensitive to interest rates in this round is around 3%.

Liu Siyan, a researcher at the Jia'an Jinxin Fund Evaluation Center, believes that the introduction of favorable policies has to some extent boosted market risk appetite, and the "stock-bond seesaw" effect is significant. The bond market's correction has led to a retreat in the net value of fixed-income financial management products. At the same time, the rise in the stock market will also attract some funds to flow from the bond market to the stock market, exacerbating the downward pressure on the bond market in the short term.

Hua Chuang Securities believes that the redemption faced by bank financial management is more of a "stock redemption" rather than a "bond redemption". The main reason may be that the performance of the equity market has improved investors' risk appetite, and investors redeem financial management and invest in the stock market, rather than due to a significant decline in the net value of financial management itself.

Affected by the warming of financial management redemptions, many banks have recently announced the suspension of fast redemption services for cash management financial management products.

The above-mentioned retail business person of the joint-stock bank said that when the redemption volume of the product is too large, the bank will suspend the fast redemption function of the product. However, after the National Day, the stock market has fluctuated and adjusted, which will to some extent affect individual investors' enthusiasm for redeeming financial management and transferring to the stock market, and the bank's fast redemption pressure will also be alleviated.

Many market analysts believe that the trend of bond market correction in the future may continue, and the stock market will also rise in fluctuations, showing a trend of increasing allocation of equity assets by investors. Tian Jie, a securities industry consultant at Analysys Qianfan, emphasized that judging from the press conference of the State Council Information Office on September 24, the focus of policy in the future period will be the capital market and the real estate market, and squeezing the scale of fixed-income assets has become a means to boost the capital market. At the same time, the performance of the capital market will also promote more funds to flow out of the bond market and into the stock market and fund products, and this trend will continue for a relatively long period.

The average return on equity financial management has turned positive.

As the stock market heats up and attracts investors to rush in, the performance of equity financial management has also shown a significant rebound trend.

Zhang Jing, a senior bank financial management analyst at Huabao Securities, said that due to the recovery of the equity market, the net value of equity financial management has been significantly repaired. Puyi data shows that as of October 6, the average annualized return on equity financial management products in the whole market this year has turned positive from negative, reaching 12.35%. Since the start of this round of the market, from September 22 to October 6, the average return on equity financial management products in the whole market was 3.19%.Under this influence, financial management institutions are also actively increasing their layout in equity products. Liu Siyan pointed out that the recent significant rebound in the equity market has repaired the previously extremely pessimistic market sentiment, and investors' risk appetite has rebounded, increasing the demand for equity financial product allocation. Financial management companies are also actively launching more financial products containing equity, such as the issuance of "fixed income +" products and mixed financial products has increased to a certain extent, while the issuance of higher-risk equity products and commodity and financial derivative products has not changed significantly for the time being.

From the market response, some financial management companies are actively adjusting multi-asset strategies and strengthening the layout of the equity market.

Taking Ping An Financial Management as an example, under the call of the "Guiding Opinions on Promoting the Entry of Medium and Long-term Funds into the Market", the company, on the one hand, strengthens the research strength of the equity market by introducing outstanding talents in the industry, and on the other hand, constructs richer investment strategies to continuously enhance market competitiveness. "Specifically, we have laid out financial products with different equity ratios at the top level, and at the bottom level, we have reserved different style factor stock strategies such as dividends, quality, and growth, such as adopting smart-beta bottom strategies to actively respond to different market conditions and enhance the returns of top-level products." said a person in charge of relevant business at Ping An Financial Management.

Bai Wenxi, the vice chairman of the China Enterprise Capital Alliance, said that financial management companies are actively adjusting their business strategies, strengthening the layout of equity products, and consolidating the construction of investment research systems to enhance the competitiveness of bank financial management.

Subsequently, with the impact of the new "Nine National Articles" policy, financial management companies will be more active in the layout of the equity market. In Liu Siyan's view, the new "Nine National Articles" encourages bank financial management to participate in the capital market and increase the scale of equity investment. Financial management companies will also respond to the policy call and show a more active attitude towards the layout of the equity market.

Yuan Shuai, the executive vice president of the Rural Culture and Tourism Industry Revitalization Research Institute, pointed out that in the future, financial management companies will pay more attention to long-term value investment, strengthen risk management, and diversify investment strategies in the layout of the equity market. Yu Fenghui, a new financial expert, also said that it is expected that the allocation strategy of equity financial products will be more diversified, including定向增发 and convertible bonds and other tools will be richer to seize market opportunities.

However, market analysts generally believe that for ordinary investors, stock market fluctuations have increased the risks of equity financial management and stock market investment. While pursuing returns, it is still necessary to balance risks.

The bond market is still the ballast stone for stable returns. The analysis by the YINGMI Fund Qiming Research Team pointed out that in the long run, as the overall return center of economic growth rate and capital price slowly moves down, coupled with the ability to provide stable coupon income, bond assets will continue to maintain the characteristics of stable returns. As an investment consultant, when weighing the risk and return preferences of customers, the bond market is still a major asset that provides ballast for fluctuations.

Zhaoyin Financial Management also believes that from a medium-term perspective, the main factors supporting the bond market have not changed, and the basic and monetary policy environment is still favorable for the bond market. "From the perspective of product managers, we suggest that investors maintain a good attitude and wait patiently for the net value to be repaired. As a revenue-generating asset, bond assets are expected to gradually repair the loss of short-term capital gains with the passage of time." said the team.

The YINGMI Fund Qiming Research Team analysis pointed out that this round of economic recovery, from the current policy and population age structure, industrial structure level, is a weak recovery. From the perspective of the overall return basis, the equity market has not seen the strong premise of a golden bull market. "Therefore, from a medium-term perspective, investment consultants should help customers manage different funds' accounts and match products with risk and return characteristics and holding periods suitable for different accounts. Then, by combining multi-asset + multi-strategy + multi-field diversified allocation, provide customers with more investment opportunities and a better holding experience, thereby establishing a way to build long-term customer trust."