The more it falls, the more Hong Kong stock ETF shares are rising.

　　Securities Times reporter Chen Shuyu

Since the beginning of this year, the Hong Kong stock market has continued to be weak. The Hang Seng Index closed down again on October 12. It has fallen for 5 consecutive trading days and has continued to hit a new low in 11 years. The Hang Seng Technology Index also closed down. The net worth of many ETFs tracking the two indexes has fallen during the year, but the fund share has continued to climb.

Looking forward to the fourth quarter, many fund managers believe that the opportunities in the Hong Kong stock market currently outweigh the risks.

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Fund inflows into HSI-related ETFs

On October 12, the Hang Seng Index opened lower, fell 2% and fell below 16,500 points during the session, and set a new low since October 2011. Although it started to rise in the afternoon and once surged by more than 1%, it then fell again, as of the close. , the Hang Seng Index still closed down 0.78%; the Hang Seng Technology Index fell unilaterally after opening low in early trading, and then quickly rose and turned up after falling more than 3.6% in the afternoon. It rose nearly 3% during the session, and then fell back and fell, down 0.27 as of the close. %, with an amplitude of 6.6% throughout the day.

Since the beginning of this year, Hong Kong stocks have generally been on a downward trend, with the Hang Seng Index down about 28% and the Hang Seng Technology Index down about 40%. Many ETFs tracking the Hang Seng Index and the Hang Seng Technology Index also saw their net value growth rates drop during the year, but the fund shares continued to rise, showing a trend of “buying more as they fall”.

Specifically, the net value of several ETFs tracking the Hang Seng Index fell by about 20% during the year, but the overall share of funds continued to grow. For example, the net value of China AMC Hang Seng ETF fell by more than 19% during the year, but its share increased by 4.886 billion shares, and the share change rate reached 50.77% , the net inflow of funds during the year exceeded 5.4 billion yuan.

There are also a number of ETFs tracking the Hang Seng Technology Index, where the net value fell by about 35% during the year, while the fund share more than doubled. For example, the net value of the China AMC Hang Seng ETF fell by 36.54% during the year, the share increased by 14.503 billion, and the share change rate reached 176.57%. The inflow of funds exceeded 8.3 billion yuan; in addition, the relatively small-scale Bosera Hang Seng Technology ETF and Dacheng Hang Seng Technology ETF share change rates during the year reached 268.04% and 226.77% respectively, and the net inflows during the year were 537 million yuan and 862 million yuan respectively.

Hong Kong stocks await catalyst

Regarding the relatively sluggish performance of the Hong Kong stock market recently, many fund managers said that it is closely related to the volatility of overseas markets, and follow-up needs to pay attention to relevant catalyst events. At the current level, the upside is greater than the downside risk.

Xing Cheng, a former Hang Seng Hong Kong Stock Connect Selected Mixed Fund Manager, said that Hong Kong stocks have undergone a relatively large adjustment recently, mainly due to concerns about interest rate hikes and disturbances in overseas market performance. The strength of the US non-farm payroll exceeded market expectations, increasing the probability of the Federal Reserve raising interest rates sharply again. The overall investment preference of Hong Kong stocks has converged, and risk aversion has increased. Before the marginal improvement of relevant factors, it is expected that the Hong Kong stock market may continue to consolidate in the short term. He said that the next important observation point or whether the Fed’s attitude will turn dovish marginally after the implementation of the Fed’s interest rate hike in the future will affect the flow trend of overseas funds in the fourth quarter, which in turn will affect the pricing of the Hong Kong market.

Ran Linghao, fund manager of Dacheng Hang Seng Technology ETF, said recently that since September 19, the Hang Seng Technology Index has continued to maintain a downward trend, during which the index hit a new low since 2020.Correspondingly, the Nasdaq and A sharesChiNext IndexThere have also been some declines. He believes that the upside at current levels outweighs the downside risk, suggesting investors focus on potential catalysts.

Guohai Franklin Fund believes that due to the situation in Ukraine and the impact of the Fed’s interest rate hike, Hong Kong stocks generally showed a downward trend in the third quarter. The current valuation is relatively low in history, and the market is quite attractive. Looking forward to the fourth quarter, the US inflationary pressure will weaken month-on-month due to the fall in commodity prices. The measures to stabilize domestic growth will be gradually implemented, and real estate sales are expected to increase month-on-month. Considering that the downstream industry chain of the real estate industry is relatively long, it will have an obvious effect on the economy; and the epidemic has also been better controlled, and consumption will gradually return to normal; Given the current active monetary and fiscal policies, the macro economy is likely to stabilize and rebound. Guohai Franklin Fund believes that corporate performance in the fourth quarter is expected to improve month-on-month, the overall valuation of Hong Kong stocks is low, and the financial, property, automotive, Internet, pharmaceutical and real estate sectors have better opportunities in the post-cycle cycle, and Hong Kong stocks have more opportunities than risks.

　　Haitong SecuritiesThe strategy team believes that Hong Kong stocks need to wait for A-shares and US stocks to stabilize. For A shares, the fundamentals of the domestic economy are the key points, of which real estate is one of the important factors. With the implementation of the policy of guaranteeing property handover and stabilizing growth, it is expected to catalyze a new round of rising in the A-share market, thus forming a positive pulling effect on Hong Kong stocks. However, it is not clear when the U.S. stock market will bottom out. The NBER indicator shows that the U.S. economy has entered a technical recession in July this year. According to historical laws, U.S. stocks have bottomed out in the middle and late stages of the U.S. economic recession. At the beginning of the bottom, this means that US stocks may still have a negative impact on Hong Kong stocks. Since it is difficult for US stocks to bottom out, Hong Kong stocks may have to wait for the bottom to stabilize, but considering that Hong Kong stocks are already in the bottom area, there is no need to be overly pessimistic about Hong Kong stocks.