Fund Falcon 50 Index: Selecting the number of core assets enters differentiated competition
Original title:[Depth]Report on the Fund 50 Battle Index | Edited by Huang Huiling | Song Yi’s stocks that make money this year are particularly in line with the aesthetics of public funds.
They are the leading companies in their industry. In addition to the traditional hot targets of public funds, they also wear flashing labels such as “Social Security Heavy Warehouse”, “MSCI China Concept”, “QFII Heavy Warehouse”.
They are also called “core assets” by market capital.
Extreme, Northbound funds and institutions cling to heating “core assets”, the first high-priced stock in Maotai, Guizhou (600519.
(SH) Repeatedly hitting new highs, forming a stark contrast with the “small, bad” companies that frequently burst.
According to wind data statistics, as of October 16, the average increase of A-shares has been 23% this year, and the average increase of 45 stocks of public offering funds (with more than 500 funds) has reached 52%, far exceeding the average of A-shares.Gains.
The prevailing “core assets” theory has influenced the product design thinking of index funds. Whether it is a broad-based index or a custom industry index fund, the idea of “selected stocks” is adopted.
More interestingly, the sample size was invariably set at 50.
50: The number of core assets is selected. The big bull market of blue chip stocks from 2017 has made the concept of “beautiful 50” deeply rooted in the hearts of the people. Every company wants to create its own “Chinese version of beautiful 50”.
The SSE 50 Index is a preliminary 50-target index.
Initially, there are over 37 SSE 50 Index funds in various forms.
Even so, the giants continue to enter.
On September 6, E Fund’s SSE 50ETF and its affiliate funds were established.
Prior to this, E Fund has owned E Fund’s SSE 50 Index, SSE 50 Index Enhanced Fund; on September 9, Tibet Dongcai Fund Company reported its first fund, which is also an index fund that tracks the SSE 50 Index.
Looking at the fund circle, in addition to the heated SSE 50 Index battlefield, the category “50” has also quietly blossomed.
Among the funds established this year, there are both the local 50 index-Zheshang Huijin CSI Phoenix 50ETF, and the strategic 50 index-Jiashi CSI Ruilian Fundamental 50ETF, and Zhongrong CCTV Finance 50ETF.
There are more 50 funds on the road, including China Merchants Hang Seng Shanghai-Hong Kong-Shenzhen Greater Bay Area Innovative Select 50 ETF, and China Securities Industry 50 Series Index Fund of Wells Fargo, covering consumer, pharmaceutical, and technology fields.
In addition to equity index funds, bond index funds also favor the “50”.
Interface News found that according to wind statistics, a total of 228 bond index funds have been declared in the past five years.
Since the end of last year, a limited number of bond index funds have appeared, of which the most selected “50”.
Including Industrial Bank’s CSI Bank 50 Financial Bond Index Fund, Anxin Fund’s CSI Credit Entity 50 Bond Index Fund, Changxin Fund’s CSI Convertible Bond and Exchangeable Bond 50 Index Fund, etc.
In addition to the explicit “50” funds, many custom index funds also control the sample size to about 50.
For example, China Securities Technology TapIndex tracked by Huabao Technology TapETF has 50 constituent stocks.
In addition, the Shenzhen Science and Technology Innovation Index Fund, which is currently to be issued by Essence Fund, has 50 constituents.
Why are 50?
Why are 50?
Hu Ying, general manager of the financial management department of Anxin Fund, told Interface News that the choice of 50 is to find a balance between the stability and capacity of the index sample.
“30 are too few, 80 are too many, and 50 are just right.”
CSI Fund Subject 50 Bond Index Fund reported by Anxin Fund selected 50 credit subjects.
Hu Ying said that whether it is a bond or an equity index, three principles are complied with when compiling: one is to have sufficient liquidity; the other is to strive to choose the best target; the third is to increase the number from the underground and take into account the easier to remember numbers.
”As far as the CSI Credit Subject 50 Bond Index is concerned, if the number of credit subjects increases to 70 or 80, the tail subjects may be wrong, which will increase the frequency of position swaps and tracking defects.
“The letter of the CSI Credit Entity 50 Bond Index Fund of Anxin Fund is a” selected bond “idea.
“The interest rate debt has been very hot for the first two years, but in the end, the allocation priority of investors will gradually extend to credit debt.
Compared with active funds, passive funds have low fees and can give investors more choices.
Hu Ying said.
As for the stock index, a person in the fund that participates in index customization told Interface News that 50 is a better choice for selecting in a segmented industry.
“When doing index selection, first of all, the sample space must be relatively large.
There are too few samples of certain lithium battery positive and negative materials to be indexed.Well, in an exponential space, 50 is enough.
In terms of name, everyone prefers the whole, jumping to 100 is too much. ”
”In fact, these two years of references to core assets, beautiful 50, the background is the stock economy, the leader is sought after.
“The source believes that this is not the time for a hundred schools of thought. Everyone thinks that high-quality companies are selected to compile the index.
Su Yanqing, fund manager of China Merchants Fund Global Quantitative Investment Department, also holds the same view.
When cooperating with the Hang Seng Index Company to compile the Hang Seng Shanghai-Hong Kong-Shenzhen Greater Bay Area Innovation Select 50 Index, their idea was to highlight the advantages of enterprises in the Guangdong-Hong Kong-Macao Greater Bay Area and choose companies with obvious technological innovation advantages in the Greater Bay Area.
“Some companies are relatively small, and they have not reached the stable growth range. Although some companies are connected, their investment in science and technology is not high, which is inconsistent with the index positioning. Such companies are not expected to affect the performance of the index.”
Su Yanqing believes that the selection of high-quality stocks as the tracking target is becoming a trend in the entire market.
“In the past, indices were provided by index companies and fund companies simply tracked them.
Now fund companies will more or less participate in compiling the index, adding fundamental factors, choosing to choose leading companies or companies that meet certain styles. ”
A deeper consideration is the vigilance of individual stock risks.
“In the past two years, regulations have become more stringent, and some stocks have experienced risks. Fund companies will also consider potential risks in the process of preparation.
“Su Yanqing said,” This approach can make investors feel that fund companies still create some screening for investors.
“How to choose 50?
Wang Lele and his colleagues from ETF Investment Director of Quantitative Investment Department of Wells Fargo Fund have prepared for at least half a year, from discussing and determining the plan, to customizing the index company, to product declaration, approval, and final issuance.
Wells Fargo’s industry leader index fund is a rare series of product lines covering consumer, pharmaceutical, technology, military and other industries.
Although they all take “leading” as the core, if you look closely at these index compilation schemes, you will find that the compilation ideas of different industries are different, and the definitions of leading industries are also different.
”Consumer and pharmaceutical earnings are relatively stable, and stocks can be selected based on profitability.
Technology is an explosive industry and requires relatively high investment in scientific research.
The military stocks must screen companies whose core business is military.
Wang Lele introduced that because different industries have different attributes and investment logic, it is not easy to apply a formula to screen leading stocks.
During the interview, Wang Lele has been involved in “investment logic”.
“We are all indices selected based on the investment logic of the industry.
The traditional compilation of the CSI 300 Index is very simple in selecting stocks by market value. ”
In order to make the index more in line with investment logic, Wells Fargo Fund has transformed the power of the external brain.
“When working on the military leader ETF project, I asked the Aviation Industry Group, the first largest military group.
Our understanding of the military industry unit may not be as good as that of external experts, so we will replace them with suggestions.
“Looking at the Technology 50 Strategy Index, it is also somewhat different from other technology index in the market.
In order to avoid the risks of the high-tech industry, the index added a number of risk indicators, including the pledge ratio, the ratio of goodwill to net assets, current ratio, receivable turnover rate, return on net assets, and tried to exclude high-risk companies.
“All the selected stocks have been counted again, some rules have been found, and then the products have been productized according to the index.
“For nearly two years of differentiated competition, ETFs have flourished at a rate that is visible to the naked eye.
Thousand sails raced, and some themed tracks have become very crowded.
The most sought-after theme in the secondary market this year is technology, and the technology 50ETF of Wells Fargo Fund is currently being issued.
Prior to it, at least eight companies were hunting for technology concepts.
In the first three quarters of this year alone, 21 technology-based index funds have been issued, of which four have been named as “technology.”
And the share of the first technology ETF, the leader of Huabao Technology, has already settled on the rocket, and has been the top leader of technology funds with a scale of nearly 7 billion.
In the traditional battle of index funds, it is important to seize the starting high ground.
Is there a chance for the rich country fund that is late to overtake the curve?
Is there a regret for the Wells Fargo Foundation?
Wang Lele’s answer was: “No regrets.Future trends in technology are still there.
Since 5G, China’s technology industry has entered the best track.
“More importantly, the deep processing of the index has allowed these funds to return to the track of differentiation and competition.
“Our technology 50 represents technology understood by rich countries, not technology understood by our peers.
We dare not say that our stock selection method is perfect, but the technology 50 stock selection logic is easier to find the research and development capabilities of listed companies.
“A careful comparison of the technology 50 of Fortune and the technology leader of Fortune will reveal that there is a clear difference in concept between the two.
The focus of Fortune 50 is on “sustainable technological innovation capabilities”, while the focus of Huabao Technology is on “large scale and high market share”.
The suspicion of the 0 era used Wang Lele’s words, “We are in Fund 3.
0 era. ”
However, being ahead does not mean making money.
Although each company has its own characterization of the index, the reality is cruel, “more than 90% of investors only look at names.”
In the PK of the first round of the Science and Technology Index Fund, Huabao’s “technology leader” made the right place and debuted in the C position.
The actual difference effect brought by the differentiated design of the product can only wait for the time to declare the answer.
Beyond the siege of product homogeneity, these more subjective index funds surrounded a new siege.
A few people are cautious about smart beta, mainly because of the high cost of interpretation, the difficulty of understanding users and the effectiveness of factors.
“Some of the smart beta backtest data are beautiful, but they actually perform very averagely.
Is 杭州桑拿 the backtest data over-optimized?
Furthermore, a strategy that works well in the past does not mean it works in the future.
“A fund analyst said so.
The high cost of explanation has discouraged some fund companies.
Taking the risk control of index funds as an example, an index fund manager told Interface News that although they intentionally avoided possible individual stock risks, and the company also had its own risk factor database to identify financial fraud and credit risk, etc.Still choose common indicators that the market has accepted, rather than self-made indicators.
”There is a difficult acceptance process for investors from cognition to acceptance. Investors are still a bit scared of the unknown.
Everyone will not understand your method in depth, but only look at performance and value warehouse 佛山桑拿网 positions.
“The fund manager cited Kangmei Pharmaceutical,” “Our model identified the risks very early. Active funds must not be bought, but they have more than doubled before the fraud took place.
If it is a passive fund, investors will be reluctant to understand your product when they see that the core companies are not in it.
“In the future, more and more index funds will become smarter.
Whether the investment logic is feasible and the factors are valid still needs to be tested by time.
The cognitive development of investors also takes time to precipitate.
Undoubtedly, the transformation of the industry and the development of the capital market is mature, and fund products will move towards more sophisticated instrumentation.
And Wang Lele firmly believes that the future market will be the world of passive investment.
“For the first time in August, the size of US index funds exceeded that of actively managed funds, and China’s capital market will do the same.