When the stock market is out of stock market, wise friends will open their horizons. Several fans asked Muyu to analyze bond ETFs, and today the special analysis is here! Mu Yu thought that even if we don’t invest in bonds in the short term, it would be very beneficial to understand them as knowledge. After all, bonds are a major asset and are also the market’s underlying asset . One day you may need to allocate, and life does not require speculation every day.
Why look at bonds? Mainly because macroeconomic is weak, not only does the stock market have difficulty in having a big market, but the returns of various basic financial assets have also declined, and high-yield financial management has become a thing of the past. In this case, the bond's absolute return of , which doesn't look high, is a bit eye-catching. ETF's advantage is that it can make almost all asset allocations in all categories, and there are also a lot of ETFs in bonds.
Bond ETFs, like equity ETFs, also need to track the index.
So how did bond index come from? Generally, the bond index is also a bond selected by a package of specific rules, which meet some rules:
- has a considerable amount of time left before maturity. For example, for a 10-year Treasury bond ETF, the selected bonds require a remaining period of 7 to 10 years, and a five-year local bond requires a 4-5.25 year period. In this way, the bond value will not fluctuate significantly because it is close to the repayment period;
- has ratings except for treasury bonds. All selected bonds have tripartite ratings and the scope is specified in the preparation plan;
- has a fair market value. Bonds are listed on the bond market and can be traded in circulation, so the total value of the package can be calculated.
In addition, the interest allocated regularly will also be counted in the total market value of the package of bonds. In this way, the sum will be divided by the bond base to form an index.
As for how the market value of bonds is formed, we will not make too detailed analysis. For example, various discount of present value and maturity value. We are concerned about the overall fluctuations in the value of bonds, so we can look at macro factors.
Scarcity : Any asset is vaguely expensive. After the issuance of anti-epidemic treasury bonds, it has a certain impact on the value of other treasury bonds;
Risk preference : Bonds are assets with lower risks, and the benefit level is also limited. Generally speaking, those who buy debts in large quantities are risk-averse funds.
In addition, if you can't make money in other markets or the risk is too high, you will also flood into the bond market. For example, if the stock market expectations are not good, then large funds like insurance will increase allocation of fixed income assets such as bonds. On the contrary, if there is a bull market, a large amount of funds will sell their debts to buy stocks. It has a relatively obvious capital seesaw relationship with the stock market.
Monetary Policy: If the currency collects water, then there will be a greater number of financial assets that can form higher returns in the market. For example, if the interest rate for large certificates of deposit will be increased, the bonds will be relatively worthless. On the contrary, if the monetary policy is loose and neither enterprises nor banks are short of money, then high-interest credit asset cannot be formed, and there is not much interest rate for certificates of deposit, forming the so-called asset shortage. At this time, the bonds became relatively more fragrant, after all, their face value was.
Due to the above factors, the supply and demand relationship of bonds also changes from time to time, so the value of bonds also fluctuates. Many institutions use fluctuations to find ways to sell high and buy low, and make excess returns. In addition, Treasury bond futures technology adds leverage to amplify returns. This is gossip.
is divided roughly according to the issuing entity, and bonds are divided into corporate bonds, municipal bonds, local bonds and treasury bonds. As its credit rating becomes higher and higher, the face value interest rate becomes lower and lower, and the debt repayment risk becomes lower and lower. Therefore, different expectations should be given for the returns, volatility and risk levels of different bond types.
Next, let’s scan the mainstream bond ETFs in the market. Make a requirement for liquidity, with an average transaction of more than 100 million yuan per day.
above is the html January K-line trend of the 10-year treasury bond. Treasury bonds are equivalent to the market's risk-free interest rate, and ten-year Treasury bonds are the main force. After the bull market ended in 2020, the trend of treasury bonds was still very steady.The yield level varies every year because the macro side will impact bond value and market expectations. If the return level of
is 1.88% since 2022. You may not look down on it, but in fact, most public funds are still losing money, which seems valuable. The return in 2021 is 5.53%, which is actually a very good financial management. It was 1.51% in 2020 and 2.2% in 2019. In general, the annualized return expectations of treasury bonds are more rational and practical.
roughly see the connotation. The most important weight here is 20 interest-bearing treasury bonds, which means the 16th batch of book-based interest-bearing treasury bonds issued in 2020. The oldest ingredient coupons here were issued in 2019, and the package should be guaranteed to be new enough.
Let’s take a look at other varieties below.
The above treasury bond is a 5-year treasury bond ETF, and the yield level is relatively low. This year, it will be 1.41%, 4.26% in 2021, 1.22% in 2020, and 2.79% in 2019.
This is just a municipal bond, which is a bond issued by local financing platform company . It is issued and operated according to the corporate bond model, but it can be regarded as a bond issued by the government. The market also defaults to the government to fulfill its debt repayment obligations. But, obviously, the risk management level of municipal bonds is something we need to pay attention to. The volatility level of municipal bonds should be said to be higher, rising by 4.45% this year and 5.8% in 2021, but in 2020, it was only 0.97%. In many cases, municipal bonds are issued at a discount , and the face value interest rate may not be high, but the actual return is high.
Municipal bonds have relatively high rating requirements, all AA- or above. The fiscal and debt repayment capabilities across the country are inconsistent. Although local governments endorse as , there are actually differences in ratings. If you want to invest in municipal bonds, the higher-rated varieties still have advantages.
In addition, there are more than 400 bonds in the municipal bond ETF as components, which greatly weakens the overall risks brought by individual risks. Let’s take a look at local debt.
This is a 5-year local debt, a bond issued directly by local governments, and its credit level is second only to national debt. Judging from the performance in the past few years, the return level is very stable, 3.36% this year, 3.35% in 2021, and 2.37% in 2020.
Check out the ingredient coupons, they are all directly issued by local governments. Similar to the naming rules of treasury bonds, the first major weight is the 7th batch of bonds issued by Beijing in 22 years. The securities code can check the bond market.
Local debts generally receive AAA or above ratings. Some people do not have ratings, which is probably too late. The default is 3A. The number of component bonds for this 5-year local bond ETF is as high as 731, reflecting the market's expectations for the value of medium-term local bonds.
The next is just a 10-year local bond, with more than 1,800 ingredient coupons, which is more holistic. The earnings this year were 3.81%, 3.28% in 2021 and 3.29% in 2020. They are not sensitive to stock market performance and are very stable. There is a more powerful one under
.
This is a convertible bond ETF, a convertible bond combination issued by listed companies in Shanghai and Shenzhen. It is also a kind of corporate debt, with rich gameplay and great fluctuations. Convertible bonds are bonds issued by listed companies. The face value interest rate is usually relatively low (such as 1%), but the rules will be designed to achieve the conversion with listed company stocks (primary stocks). I won’t talk about it here. Its market value will be related to the fluctuations of the underlying stocks, so there was a wave of major adjustments in the first half of this year with the stock market. If you get involved in stocks, speculation will naturally come. Moreover, T+0 is an amplifier for speculation, so it fluctuates greatly. The return of convertible bond ETFs has been -0.2% this year, but the return was as high as more than 14% in a wave of speculation last year.
convertible bond ETF contains more than 400 bonds, but usually large and high-quality listed companies occupy the main weight. Therefore, the convertible bonds that hot money are speculated on have little impact on the entire ETF, but if the atmosphere becomes stronger, the entire ETF will also be affected.
The credit ratings of listed companies are diverse, but being able to go public is a kind of credit endorsement. What you earn is not interest, but potential arbitrage opportunities for stock conversion, and the speculative value of speculation.
convertible bonds cannot be left without the support of the stock market. If the stock trend is poor, corporate bonds will not be strong.We also pay more attention to the hype atmosphere, and there are limited research. Friends who are more familiar with each other can share more.
This is a Shanghai Stock Exchange convertible bond, which is limited to bonds issued by listed companies of the Shanghai Stock Exchange. The company with the capital stock is larger, so the fluctuations are smaller, which is meaningless.
Is there any pure corporate bond ETF? There are also, just a smaller transaction volume, just take a look.
trading volume is only 20 million a day, and the tracked index is unclear: "China Bond-Medium-High-Level Corporate Bond Interest Spread Factor Index". Mu Yu looked at the index compilation rules and felt that he was not clear enough. But it is basically invested in corporate bonds listed in Shanghai, which are aimed at medium and high credit ratings. The formula is just to provide feedback on the market value and returns of bonds during the reporting period. It is also a slow bull variety, with average liquidity.
-Summary-
From the above analysis, convertible bonds are linked to the stock market. Other treasury bonds, local bonds, municipal bonds, and corporate bonds can generally obtain a different operating style from the stock market. Overall, local debt is relatively balanced, with both returns and stable returns.
When the stock market is not in a market, even if the bonds’ returns are not that exaggerated, they can still prevent the principal from losing money and fill in the pit of inflation. At present, when the macro economy in the first half of the year was lower than expected, there is still a big market difference between whether there is a general market for A shares in in the third quarter. If you are not good at seizing local opportunities, then look at the bond ETFs, and expect to be placed on the pile of sand to avoid the risks brought by uncertainty. It is not a matter of a gentleman.
Today Muyu passed the mainstream bond ETF and shared it with you completely. The level is limited, but I hope you will find it a bit valuable for reference!
I am Muyu ETF, focusing on ETF investment research! If you support Mu Yu, just like, forward, like, follow and share comments. It’s really not easy to write pure original articles! What is the logic for switching size of
? These ETF funds have a "small" style worth paying attention to
seven experiences! To use broad-based ETFs well, you must also choose the right ones.
