ETF Interconnection helps international capital allocation of Chinese assets

5Jul

Wen | Zhang Ying

On July 4th, ETF was officially launched in the interconnection mechanism of the Mainland and the Hong Kong stock market transaction interconnection (hereinafter referred to as "interconnection and interoperability") to release an important signal of further opening up in my country's financial market. On the same day, the People's Bank of China, the Hong Kong Securities and Futures Supervision Commission, and the Hong Kong Financial Administration issued a joint announcement to conduct an interconnection and cooperation between the Hong Kong and the Mainland interest rate exchange market (hereinafter referred to as the "swap"). At the same time that the bond market system is increasingly open, ETF is included in interconnection, which can expand the source of funds for the allocation of ETFs in China, but also is also expected to enhance the attractiveness of A shares to overseas medium and long -term allocation funds. The Champions League of the President of the Hong Kong Stock Exchange Group said at the launching ceremony of the interconnection and interconnection that "the world is undergoing a change in decades, and China is at the center of the" financial development ". It is one of the important tools for promoting the flow of two -way capital. International investors will have the opportunity to greatly increase investment in the ETF market in the Mainland. Mainland investors also have more opportunities to use ETFs such as ETFs such as ETF Configuration. "It is reported that of the 87 ETF list selected for the interconnection mechanism, 83 are only A -share ETFs and 4 are Hong Kong stock ETFs. Industry insiders have unanimously stated that ETF's income from interconnection will help strengthen the long -term confidence of overseas investors in China's capital market, and it is expected to attract 100 billion yuan for A shares. In recent years, the China Securities Regulatory Commission has promoted the interconnection of the Mainland and Hong Kong's financial markets and infrastructure in an orderly manner. On November 17, 2014 and December 5, 2016, the Shanghai -Hong Kong Stock Connect and Shenzhen -Hong Kong Stock Connect mechanism created cross -border investment. New model. In the acceleration of opening up to the outside world, foreign capital poured into the Chinese capital market and also accelerated. As of July 4, the total net inflow amount of Shanghai and Shenzhen Stock Connect was approximately 1.71 trillion yuan, and the total net inflow amount of Hong Kong Stock Connect funds was about 2.39 trillion yuan. Among them, the net inflow of the northbound capital in 2021 reached 432.169 billion yuan, which was the highest level in the past five years. A dynamic and tough capital market must be an open and inclusive market. In recent years, the performance of the A -share market has been full of toughness. Especially since May this year, the A -share market is not afraid of the turbulence of the outer stock market, interpreting a wave of independent rebound, and the attributes of Chinese assets, which attracts the northern direction capital The inflow has accelerated again. Among them, since June this year, as of July 4, the net purchase amount reached 77.461 billion yuan. In the case of long -term optimistic about China's economy, recently, well -known foreign institutions have stated that they allocate Chinese assets. Goldman Sachs even shouted that the Chinese market "has excellent opportunities." On the first day of ETF incorporate interconnection transactions, Goldman Sachs said that due to the wider comprehensive coverage of ETF covering core assets or industry themes, it indirectly broaden the scope of investors' cross -border allocation of high -quality A -share and Hong Kong stocks, so market investors Especially the North -way investors have long been looking forward to the interconnection mechanism of ETF. It is expected that more foreign investment will flow into the Chinese financial market through the ETF interconnection mechanism. It is believed that with the acceleration of my country's capital market opening to the outside world, the market has become increasingly rooted in high -quality development, and the value investment concept is becoming more and more rational, and the market valuation is more reasonable. The Chinese capital market will go to the world stage with a more open attitude.

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