Over the past two days, more than a dozen fund companies and asset management companies have collectively announced the start of self-purchase, saying that they will use their own funds to subscribe for their fund products in the near future.
Let’s review the past institutional self-purchasing behavior. The red line in the figure below is the Wind All-A Index in the past 10 years (right coordinate), and the blue line is the monthly total amount of institutional net self-purchased stock and hybrid funds (left coordinate, 100 million yuan):
(Data source: wind)
In the past ten years, the centralized self-purchasing of institutions has occurred three times, which are the three peaks of the blue line, which are marked with green vertical lines in the figure. They are:
(1) July-August 2015. There was a stock market crash in A-shares that dries up liquidity, and institutions collectively announced self-purchase. About two months after the purchase, the market reached a staged bottom and started a rebound.
(2) After the Spring Festival in February 2020. During the Spring Festival, the outbreak of the new crown epidemic, after the holiday, the opening institutions collectively announced self-purchase, the market bottomed out after a short decline, and began to rise.
(3) In the first quarter of 2022, the impact of the new crown epidemic will re-emerge, the market will turn from rising to falling, and institutions will buy large sums of money. This self-purchase lasted for a long time, and the peak did not end until March, and the market bottomed out at the end of April a month later.
It can be found that the centralized self-purchase by institutions is usually event-driven, which is intended to hedge the negative and convey confidence to the market. The location where self-purchase occurs is often in the range of lower valuations, but not necessarily the absolute bottom of the market.
In this discussion, the announced amount of self-purchase so far is 1.48 billion yuan. To accurately calculate the net purchase data, it is necessary to add the daily self-purchase amount of the institution, and then subtract the daily self-redemption amount. It is impossible to estimate accurately now. Roughly calculated according to the figure of 1.48 billion yuan, it will be a small blue line spike. The orange horizontal dotted line in the above picture marks the height that the spike can reach, and then paste the above picture again:
(Data source: wind)
It can be seen that the amount of this self-purchase is still very large, and it is expected to exceed the scale of previous self-purchases. However, it can also be seen from the above figure that after 2020, the amount of self-purchased by institutions has increased significantly, and the overall blue curve is higher. This is because of the great development of public funds in recent years, the scale of fund holdings has increased a lot, the market value of the stock market has also increased a lot, and the amount of self-purchasing should have risen.
A correction can be made, and the blue line can be changed to the net subscription amount/retention scale of common and hybrid funds. This is equivalent to the concept of self-purchase rate. When drawn, it becomes like this:
(Data source: wind)
This time the blue line is much more normal, and the center has been relatively stable. Another change is that the peak of self-purchase in the first quarter of 2022 is gone, which means that compared with the size of the fund at that time, the amount of institutional self-purchase at that time was not too large. The real effort is the self-purchase to deal with the impact of the epidemic after the Spring Festival in 2020. Perhaps it is a miracle. Only that time the market rose in response, and there was a delay of a month or two for other self-purchases to the bottom of the market. According to the currently released data, the self-purchase rate this time is about the orange line in the figure, which is stronger than the first quarter of this year, weaker than the self-purchase after the Spring Festival in 2020, and similar to the self-purchase intensity in 2015.
Institutional self-purchase is definitely good for market sentiment, but we still look at it with a calm attitude. There are too many factors that affect the rise and fall of the market. In the short term, the market will always show randomness. It is difficult to say that the market will continue to rebound or will fall. Compared with betting on ups and downs, a more reasonable way is to control the position to a level that is acceptable to both sides. If the rise is not too short, you can have enough positions to make a profit; if the fall is not unbearable, in the market Gradually increase the position in the process of gradually falling to give cheaper opportunities.
The right position depends on three factors: liquidity needs, risk tolerance, and market valuation levels. The first two factors vary from person to person. Under the condition that both are satisfied, the lower the market valuation is, the higher the position is suitable for. At present, the market as a whole is still in a low valuation range, which is suitable for maintaining a more active position allocation, and it is also possible to continue to accumulate chips in this area with the fixed investment of the Jiu Cong portfolio. However, we must always remain vigilant about liquidity and downside risks. Don’t beat yourself up, immediately pursue full positions, or even increase leverage at the first sight of good news. The most important thing is to ensure that in the event of adversity, you can survive, and you can make money by standing in the market for a long time.
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Funds are risky and investment should be cautious. Investment consultants do not guarantee the above-mentioned fund investment portfolio strategies will be profitable and minimum returns, nor do they make capital preservation commitments. The fund investment consulting business is still in the pilot stage, and there is a risk that the fund investment consulting institution cannot continue to provide services due to the cancellation of the pilot qualification.
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