Hong Kong stock market trends this year, and as of October 19, 2022, the cumulative decline of Hang Seng Index reached 28%. The Hang Seng Index's 16800 point level also fell to the level in October 2011, setting a new low in the past 10 years.
Source: ifind
Hang Seng Technology Index has fallen to 42% so far, and the 3250-point level has also fallen to the level in March 2016.
Source: ifind
Although the overall Hong Kong stock market is in a downward adjustment trend this year, the enthusiasm of domestic investors to buy the bottom of has been increasing. Not only has the recent Hong Kong Stock Connect funds maintained a net inflow, but many of the broad-based ETFs and industry ETFs that track Hong Kong stocks continue to rise. Not only that, there are also well-known private equity institutions with a large position in Hong Kong stocks and clearly expressed optimism. Let’s take a look at the details.
. 84 billion domestic ETFs went south to increase their holdings in Hong Kong stocks
According to statistics, as of October 18, 2022, ETFs invested in Hong Kong stocks this year have received a total of 84 billion net subscriptions. From an industry perspective, the share share of the two major fund types, Hang Seng Technology ETFs, which invest in the Hong Kong stock market, and the pharmaceutical ETFs, which invest in the pharmaceutical sector, have increased the most.
The pharmaceutical sector in the Hong Kong stock market has continued to be sluggish since the beginning of this year, but the ETF purchase share has risen against the trend. For example, the share of Boshi Hang Seng Healthcare ETF increased by 9.445 billion shares, with a share change rate of 750.86%, and the net inflow of funds exceeded 5.016 billion yuan this year.
In addition, Penghua Hong Kong Pharmaceutical ETF shares increased by 152 million shares this year. GF Hong Kong Stock Innovation Drug ETF, E Fund Hong Kong Stock Connect Pharmaceutical ETF and Yinhua Hong Kong Stock Connect Pharmaceutical ETF were all established this year.
It is worth mentioning that as the positive news of the industry such as medical equipment interest subsidy loans and recovery of centralized procurement policies continue to be announced, the pharmaceutical sector ushered in a big rebound, and Hong Kong-listed pharmaceutical ETFs have risen sharply, such as GF Hong Kong-listed innovative drug ETF, Yinhua Hong Kong-listed pharmaceutical ETF, and E Fund Hong Kong-listed pharmaceutical ETF rose 5.34%, 4.82% and 4.72% respectively on October 18. The above three ETFs have accumulated growth of in the past five days.
Many ETFs tracking the Hang Seng Index fell by more than 20% this year, but the overall share of the fund is continuing to grow. For example, Huaxia Hang Seng Internet ETF has a net increase of 19.234 billion shares this year, with a share change rate of 58.23%, and a net inflow of 9.7 billion yuan this year. In addition, the net share growth of Huaxia Hang Seng Technology Index ETF and Huatai-Prudential Hang Seng Technology ETF during the year also had 18.103 billion shares and 9.445 billion shares respectively.
A list of configuration Hong Kong stock market ETFs:
Source: ifind
In terms of Hong Kong Stock Connect data, according to ifind statistics, as of October 18, 2022, just half of October, the net purchase of Hong Kong Stock Connect to the south reached HK$10.68 billion, while the net purchase of south tide in September was HK$14.78 billion. This also means that the net purchase amount of Hong Kong stocks going south in October is expected to hit the highest monthly data this year. As of now, the total net purchase of funds from the Hong Kong Stock Connect south in 2022 is approximately HK$278.322 billion.
Source: ifind
. 100 billion institutions Jinglin Hong Kong stock position nearly 50%
Recently, media reports have reported that as of the end of September 2022, the Hong Kong stock assets of the FOF (combination fund) of a well-known private equity institution with a scale of 100 billion Jinglin Assets account for nearly 50% of the total positions, which exceeds the A-share assets in the fund portfolio (the latter accounts for about 30% of the latter).
According to the fund monthly report data, the latest Jinglin FOF products currently have the latest major asset allocation ratios in order of H shares (accounting for 44.32%), A shares (accounting for 27.68%), and US stock (accounting for 21.59%).
Jinglin Asset's FOF products are invested on average to multiple independently operated private equity funds , covering the four most representative fund managers of Jinglin - Jiang Jinzhi , Jiang Tong, Jin Meiqiao, and Gao Yuncheng.
Source: Jinglin Assets
Information on the above asset allocation As of the end of September 2022, compared with the end of July, Jinglin's Hong Kong stock allocation increased by 6%.This also shows that Jinglin Asset is paying more and more attention to the allocation of Hong Kong stocks in the context of the continued decline in the Hong Kong stock market.
Among the industries of Jinglin's asset allocation, the most popular ones are the consumer and technology technology industries. The top five industries of
Jinglin FOF are information technology (accounting for 27.45%), optional consumption (accounting for 20.65%), daily consumption (13.99%), Telecom services (8.51%), and industry (5.76%).
It can be seen that TMTh industry and consumer industry are still Jinglin's main positions, with the allocation ratio exceeding 30%.
3. How do well-known institutions view Hong Kong stocks
So the question that investors are most concerned about, how do these well-known fund institutions view the future investment value of Hong Kong stocks?
Jinglin Asset said, "Hong Kong stocks are currently extremely cheap, and the room for upward is likely to be greater than the risk of downward, and the risk-adjusted returns are already very attractive."
A-share and Hong Kong stock investors' previous extreme expectations are marginally reversing. The market is expected to find a bottom in performance, the policy side is gradually recovering, and the valuation is close to the bottom. For high-quality companies that have experienced cycles, maintained and enhanced core competitiveness, it is recommended to buy heavily and hold for a long time.
Jinglin Asset said that from the perspective of three factors, investors should remain positive for the market's medium- and long-term performance. First, around the beginning of October, the transaction volume of A-shares reached the "bottom position", showing signs of bottoming out of again; second, the market valuation has been relatively cheap, and has been close to the historical extreme level again; third, some of the focus issues that the market focuses on are improving recently.
Jinglin Asset believes that China's long-term competitive advantages still exist, and intellectual clusters, industrial supporting clusters, infrastructure improvements and energy resource guarantees will surely further upgrade and iterate China's manufacturing industry, and we maintain confidence in the long-term performance of the future market.
, while the world-renowned investment bank Goldman Sachs recently stated that investors should sell S&P 500 call options and buy Hang Seng China Enterprise Index call options.
Goldman Sachs strategist team said: "Investor sentiment towards China-related assets remains sluggish this year, not reflecting the risk appetite for the rebound in the summer, while underestimating investors' sentiment towards global growth. Although the options market predicts recent volatility in China-related assets, compared with history, the volatility of the Hang Seng China Enterprise Index is lower than that of the S&P 500."
In general, Goldman Sachs generally has low stock allocations in its cross-asset allocation and has a neutral attitude towards the S&P 500, but still increases its holdings in Chinese stocks in Asia.
In addition to institutions' optimism, the Hong Kong stock market has also been positive recently.
Recently, the Chief Executive of the Hong Kong Special Administrative Region Li Jiachao read out his first policy report since taking office and mentioned strengthening connectivity. The implementation of a series of interconnection arrangements previously announced by the China Securities Regulatory Commission will be carried out at full speed. includes submitting the draft regulations within this year, exempting the stock trading stamp duty of the dual-currency stock market dealer to optimize the RMB stock trading mechanism, and completing the preparations for the "Northbound" of the interest rate swap market interconnection between the two places as soon as possible. The Hong Kong Stock Exchange is also expected to modify the main board listing rules next year to facilitate financing of advanced technology companies that have not yet been profitable or performance-backed; at the same time, it is conceived to activate GEM (formerly known as GEM ) to provide a more effective financing platform for small and medium-sized and start-ups. Investors in the Hong Kong stock market can pay close attention to the above information.
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