Group 1: Macroeconomic Outlook - The report highlights that both the US and China are entering critical years, with global investment driven by three and a half engines: AI investment, defense spending, and industrial restructuring [1][14] - The nominal GDP growth rate is expected to recover, with a focus on domestic demand and technology as key policy areas [1][2] - The transition from old to new economic drivers in China is anticipated to gain momentum, leading to a rebalancing of supply and demand [2][11] Group 2: Policy Environment - The "15th Five-Year Plan" sets a supportive policy tone, with monetary policy expected to remain accommodative, albeit with less room than in the current year [3][15] - Fiscal policy is projected to maintain a certain level of expansion, with total tools estimated at 15.7 trillion yuan, an increase of approximately 1.2 trillion yuan from this year [3][15] - The report emphasizes the importance of structural tools and the coordination between monetary and fiscal policies to support various sectors [3][15] Group 3: Supply and Demand Dynamics - The narrative of "asset scarcity" in the bond market is expected to weaken, with a focus on the verification of corporate profits and capacity utilization [4][18] - The report notes that government bond supply is likely to increase, but market pressure will be manageable due to central bank support [4][18] - Institutional behavior is identified as a major source of market volatility, with a reduction in stable funding leading to increased market fluctuations [4][18] Group 4: Bond Market Strategy - The bond market is expected to maintain a "low interest rate + high volatility" characteristic, with the central rate likely remaining stable or slightly increasing [5][18] - The report suggests a strategy of segment trading, coupon strategies, and equity exposure as priorities over duration adjustment and credit downgrading [5][18] - The ten-year government bond yield is projected to fluctuate between 1.6% and 2.1%, with a widening of term spreads anticipated [5][18]

Core Viewpoint - The banking wealth management industry is undergoing a transformation towards "multi-asset multi-strategy" approaches to cope with low interest rates, asset scarcity, and high market volatility, aiming to enhance returns and manage risks effectively [4][5][10]. Industry Trends - As of the end of Q3 2025, the total scale of bank wealth management reached 32.13 trillion yuan, with over 80% of funds still allocated to fixed-income assets, highlighting the need for diversification [4]. - The negative effects of the low-interest-rate environment have become apparent, with the performance benchmark for newly issued fixed-income products dropping from over 4% at the end of 2021 to approximately 2.4% by September 2023 [4]. Strategic Shifts - The industry consensus is shifting from "asset-driven" to "strategy-combination-driven" approaches, emphasizing the need for diversified asset allocation to enhance returns and reduce risks [5][10]. - Banks are increasingly incorporating alternative assets such as REITs, gold, and overseas investments into their portfolios to achieve a more robust multi-asset strategy [10][12]. Challenges in Implementation - The transition to a multi-asset strategy is not straightforward, as banks face challenges in aligning investment styles between newly recruited equity managers and existing risk management frameworks [7][8]. - Conflicts often arise between investment teams and risk management departments regarding the timing of profit-taking and risk exposure, complicating the implementation of multi-asset strategies [8][9]. Internal Management and Technology - The shift towards multi-asset strategies necessitates a comprehensive overhaul of internal management processes, including trading links, risk control, information disclosure, and compliance operations [13][14]. - The need for automation and advanced technologies like AI is emphasized to manage the complexities of multi-asset investment strategies and ensure compliance with regulatory requirements [13][14]. Risk Management Evolution - A new risk control model is being developed to adapt to the multi-asset strategy, focusing on the individual risk characteristics of different assets and their interactions [14][15]. - The industry is moving towards a more systematic approach to risk management, emphasizing the balance between low risk and high returns [14][15].

Core Viewpoint - The bond market is experiencing a strong consolidation, with government bond futures mostly rising and interbank bond yields generally declining by around 1 basis point [1][2]. Market Performance - Government bond futures closed mostly higher, with the 30-year main contract up 0.19% to 116.15, and the 10-year main contract up 0.05% to 108.630 [2]. - The interbank major interest rate bond yields generally decreased, with the 10-year government bond yield down 1.05 basis points to 1.8025% [2]. Liquidity and Monetary Policy - The central bank conducted a net injection of 130.1 billion yuan in the open market on October 30, with short-term funding rates continuing to decline [1][6]. - The Shibor short-term rates collectively decreased, with the overnight rate down 9.7 basis points to 1.317% [6]. Institutional Insights - CITIC Securities noted that the central bank's influence on interest rates has increased, and the market is currently in a defensive strategy phase, with opportunities for wave trading in a range-bound market [7]. - Nanhua Research Institute indicated that the central bank's announcement to resume government bond trading has led to a strong market reaction, suggesting a potential bullish sentiment [8]. International Market Trends - In North America, U.S. Treasury yields rose across the board, with the 10-year yield increasing by 9.82 basis points to 4.074% [3]. - In Asia, Japanese bond yields mostly fell, with the 10-year yield down 0.3 basis points to 1.647% [4]. Primary Market Activity - The Export-Import Bank's 1-year and 3-year financial bonds had winning yields of 1.3571% and 1.6066%, respectively, with bid-to-cover ratios of 2.48 and 5.81 [5].

Core Insights - The recent surge in interest in the gold market is reminiscent of the 2015 market dynamics, with various stakeholders discussing gold investment opportunities and potential market shifts around October 29 [2] Group 1: Historical Context - In 2015, the gold market experienced significant volatility influenced by policy changes and market sentiment, with a notable drop in gold prices due to expectations of a Federal Reserve interest rate hike [3] - The fourth quarter of 2015 marked a turning point for gold prices, as global economic uncertainties led to increased safe-haven demand, stabilizing prices after a substantial decline [3] Group 2: Current Market Signals - Current market signals echo those of 2015, particularly regarding Federal Reserve monetary policy, with expectations of a shift towards interest rate cuts, enhancing gold's appeal as a store of value [4] - The phenomenon of "asset scarcity" is re-emerging, with investors seeking refuge in gold amid stock and bond market volatility, as traditional hedging strategies face challenges [4] - Central banks are increasing their gold holdings, with significant purchases from countries like China, Russia, and Turkey, indicating a strategic shift towards "de-dollarization" [4] Group 3: Market Stability Factors - The current gold market benefits from stronger stability factors compared to 2015, including ongoing geopolitical tensions that are likely to sustain safe-haven demand [5] - The investor base has shifted towards long-term holdings of gold, with a growing percentage of central banks and individual investors favoring gold as a stable asset [5] Group 4: Strategic Recommendations - Different strategies are recommended for various groups in light of the upcoming key market window on October 29, with advice for consumers to consider buying during price dips and for investors to adopt a phased investment approach [6] - Investors are advised to limit gold investments to a maximum of 10% of total assets and to focus on gold ETFs or paper gold for easier liquidity [6]

Core Insights - The value of a "good house" is shifting from a one-time sale to a financial asset that generates stable, sustainable cash flow [1][4] - The housing rental industry in China is transitioning from a fragmented "second landlord" model to a more financialized, institutionalized, and professionalized phase [1][3] - The current market drivers include the expansion of affordable rental housing, the need for state-owned enterprises to revitalize idle assets, and the desire of long-term capital like insurance REITs to seek stable returns amid an "asset shortage" [1][3] Industry Transformation - Leading companies are reducing renovation costs by 15% to 20% and increasing net operating income by 3% to 5% through modular renovations and digital operations, indicating a structural shift rather than a temporary efficiency gain [2][6] - The REITs market's stringent requirements for cash flow stability and predictability are forcing the entire industry to quantify the four dimensions of a "good house"—physical space, functional setup, community environment, and service system—into clear financial data [2][7] Role of State-Owned Enterprises - State-owned enterprises, with their vast holdings of idle land and old properties, are central to this asset revolution, benefiting from location and cost advantages but facing challenges in market-oriented operations and cost control [3][12] - Financial instruments like REITs and ABS provide a channel for asset realization and act as a "reform benchmark," pushing these enterprises towards internal optimization and professional transformation [3][12] Cash Flow and Valuation Metrics - The valuation logic has shifted from land appreciation to operational cash flow, with key metrics for assessing a "good house" now being NOI (Net Operating Income) and EBITDA (Earnings Before Interest, Taxes, Depreciation, and Amortization) [1][5] - NOI reflects property operational efficiency and real cash flow, while EBITDA indicates management capability and scalability, emphasizing a transition from developer thinking to asset management thinking [5][6] Market Dynamics and Competition - The competition in the housing rental market is expected to focus on "brand premium ability" and "extreme operational efficiency" over the next three to five years, leading to a dual structure of state-owned enterprises and specialized brands [3][20] - The rental housing market is characterized by a natural demand for housing, making it a defensive asset that can withstand economic fluctuations, unlike commercial real estate [16][17] Institutionalization and Future Outlook - The institutionalization rate of China's housing rental market is currently around 10%, with expectations of reaching a healthy level of 30% to 40% in the next 5 to 10 years as the market transitions from a "development logic" to a "holding and operation logic" [18] - The market is moving towards a more rational and professional long-termism phase, with competition shifting from price wars to quality and efficiency battles [19][20]

Investment Rating - The report indicates a focus on high-quality corporate long-duration bonds and suggests a flexible investment strategy to adapt to market conditions. Core Insights - The Chinese credit bond market has formed with non-financial credit bonds accounting for approximately 32 trillion RMB, presenting potential arbitrage opportunities, particularly in medium-term notes and corporate bonds [1][2] - Historical asset shortages have occurred during periods of loose monetary policy and insufficient real financing demand, with the current environment requiring close attention to policy changes [1][5] - Key investment strategies include focusing on high-quality long-duration products, exploiting regulatory arbitrage opportunities, and increasing allocations to high-grade products for stable returns [1][9] Summary by Sections Current Market Changes - The credit bond market has seen significant changes, with credit spreads remaining low amid an asset shortage and a decrease in default events, limiting trading opportunities based on spread fluctuations [2][11] Major Categories and Characteristics - Credit bonds are categorized into financial and non-financial types, with non-financial bonds primarily comprising short-term financing, medium-term notes, and corporate bonds, which may present arbitrage strategies [3][4] Rating Agency Impact - Rating agencies operate under issuer-paid and investor-paid models, with the latter primarily covering certain bonds in the interbank market. The actual practice still favors rated bonds despite regulatory changes allowing for the cancellation of mandatory ratings [4] Historical Asset Shortages - Four historical phases of asset shortages are identified, characterized by loose monetary policy and insufficient real financing demand, with varying influences from demand and supply factors [5] Feasible Investment Strategies - Current feasible investment strategies include focusing on high-quality long-duration bonds, utilizing arbitrage opportunities between different regulatory systems, and considering undervalued assets during severe asset shortages [7][9] Indicators of Rate Downturn Reversal - Key indicators for potential reversals during rate downturns include changes in fundamentals, stringent financial regulations, and institutional behaviors [8] Credit Spread Volatility - Credit spread volatility is influenced by central bank monetary policy, fundamental changes, and institutional behaviors, with historical events illustrating these impacts [10][12] Future Influencing Factors - Future factors affecting the credit bond market include central bank monetary policy changes, actual or expected fundamental changes, and institutional behaviors such as potential redemption waves [12] Risk Preference Influences - In adverse market conditions, risk preferences for credit bonds are influenced by default events, investor characteristics, liquidity compensation, and leverage operation convenience [13][14] Supply Pressure Impact - Credit bond supply pressure is influenced by corporate financing willingness, cost advantages of financing channels, and regulatory policies, with recent trends indicating a shift towards bond financing due to cost advantages [19][20] Common Investment Strategies - Common investment strategies in the credit bond market include regional and industry rotation, product selection based on market volatility, duration selection based on interest rate trends, and monitoring changes in wealth management product behaviors [21][22]

Report Industry Investment Rating No information provided in the content. Core Viewpoints of the Report - Recently, the market risk appetite has declined, and the high - elasticity secondary and perpetual (Er Yong) bonds have seen dual benefits of falling interest rates and narrowing spreads. Since October, the yields of 10 - year treasury bonds and 5 - year AAA - secondary capital bonds have both declined, with the latter having a significantly larger decline. The spreads have also narrowed, with the secondary capital bond spreads compressing more significantly [1][8]. - The supply of Er Yong bonds remains weak, and the background of asset shortage continues. The issuance of Er Yong bonds has decreased this year, and the net financing scale is expected to decline further next year. Meanwhile, the demand for Er Yong bonds may fluctuate due to factors such as regulations on public fund redemption fees and new accounting standards for insurance [10][14]. - The amplifying effect of Er Yong bonds as "interest rate amplifiers" has weakened recently, mainly due to the reduced trading attribute. The main demand force for Er Yong bonds has changed, deepening their allocation characteristics and weakening trading attributes [2][15]. - The credit spreads of 5 - year Er Yong bonds have a large compression space. The current credit spreads of Er Yong bonds are only slightly lower than those of ultra - long credit bonds, and their investment value should not be ignored [3][24]. - The pricing fitting model estimates that the yield of 5 - year AAA - secondary capital bonds may decline to around 2.07% next year. There are three investment ideas based on the scale - valuation bubble chart: band - trading of state - owned bank Er Yong bonds, extending duration for high - rated Er Yong bonds, and credit - sinking with controlled duration [4][42]. Summary According to Related Catalogs Supply and Demand Analysis - **Supply**: This year, with treasury bonds supplementing the core tier - one capital of large state - owned commercial banks, the issuance of Er Yong bonds has decreased. For example, the net financing of Bank of Communications and Bank of China's secondary capital bonds from January to October 24 was - 40 billion yuan and - 10 billion yuan respectively. The overall net financing scale of Er Yong bonds from January to September was lower than that of the same period last year. Next year, the maturity scale of Er Yong bonds will remain at a high level of 1.12 trillion yuan, and the net financing scale is expected to decline further [10]. - **Demand**: Regulations on public fund redemption fees may have a negative impact on bond funds, leading to the sale of Er Yong bonds. Although the new regulations have not been officially implemented, the adjustment range may be limited. In the future, in the context of asset shortage, funds will still increase bond allocation, but the redemption and allocation process will have a phased impact on the market. Also, from 2026, non - listed insurance companies will implement new accounting standards, which may affect their enthusiasm for allocating Er Yong bonds [14]. Er Yong Bond Turnover Statistics - From January to September this year, the monthly turnover rate of Er Yong bonds remained relatively stable. The average monthly turnover rate of secondary capital bonds was 18.14%, with an average monthly trading volume of 769.1 billion yuan, and the average monthly turnover rate increased by 0.8% compared to last year. The average monthly turnover rate of bank perpetual bonds was 20.35%, with an average monthly trading volume of 519.2 billion yuan, and the average monthly turnover rate decreased by 1.00% compared to last year [2][18]. - Among state - owned banks, Industrial and Commercial Bank of China and China Construction Bank had relatively high trading activity; among joint - stock banks, China Minsheng Bank, Shanghai Pufa Bank, Ping An Bank, China Merchants Bank, and China CITIC Bank were more active; among city and rural commercial banks with assets over one trillion yuan, Bank of Jiangsu, Bank of Hangzhou, Bank of Beijing, and Huishang Bank had relatively high trading activity [2][20]. Credit Spread Compression Space - As of October 23, the credit spreads of 1 - year, 3 - year, and 5 - year AAA - secondary capital bonds were 8.81bp, 19.99bp, and 41.29bp respectively, at historical percentiles of 0.6%, 14.2%, and 79.7% since 2024. The credit spreads of 1 - year, 3 - year, and 5 - year AA - secondary capital bonds were 15.2bp, 31.2bp, and 63.7bp respectively, at historical percentiles of 0.0%, 18.0%, and 64.1% since 2024 [3][24]. - The current credit spread of 5 - year AAA - secondary capital bonds is only slightly lower than that of 7 - year AA + medium - term notes. Since the end of 2024, the credit spread of 5 - year AAA - secondary capital bonds has mostly been lower than that of 7 - year AA + medium - term notes, and the two have been relatively close since September [3][26]. Pricing Fitting Model - The pricing fitting model uses five variables: the funding price R007, weekly net financing of Er Yong bonds, weekly net financing of urban investment bonds, secondary weekly demand for Er Yong bonds, and the turnover rate of Er Yong bonds to fit the yield of secondary capital bonds [29]. - Assuming different scenarios for R007, weekly net financing of Er Yong bonds, weekly net financing of urban investment and industrial bonds, secondary weekly demand, and turnover rate, the yield center of 5 - year AAA - secondary capital bonds may be at 1.91%, 2.07%, or 2.23% [4][38]. Full Review of Er Yong Bond Scale and Valuation - The outstanding scale of AAA - secondary capital bonds accounts for 96%, with an average valuation of 2.12%. The outstanding scale of AAA - bank perpetual bonds accounts for 96.2%, with an average valuation of 2.35% [4][39]. - There are three investment ideas based on the scale - valuation bubble chart: band - trading of state - owned bank Er Yong bonds, extending duration for high - rated Er Yong bonds (e.g., those of Ping An Bank, Minsheng Bank, Everbright Bank, and Bohai Bank), and credit - sinking with controlled duration (e.g., those of Yingkou Bank, Shengjing Bank, and Great Wall Huaxi Bank) [4][42].

Core Insights - The issuance of wealth management products has steadily increased, with 32 companies issuing 6,361 net value-based products in Q3 2025, representing a year-on-year increase of over 40% compared to Q3 2024 [1][2] - The overall market size for wealth management products reached 32.13 trillion yuan by the end of Q3 2025, reflecting a year-on-year growth of 9.42% [1] - There is a notable shift towards short-term, open-ended, and high-liquidity products, as well as a diversification in asset allocation strategies among wealth management companies [7] Product Issuance - In Q3 2025, the number of net value-based products issued increased by 42.21% year-on-year, with the highest issuance from Huaxia Wealth Management, Puyin Wealth Management, and Xingyin Wealth Management [2][4] - The proportion of fixed-income products decreased slightly to 97.89%, while mixed and equity products saw an increase in issuance [4] - Publicly offered products accounted for over 95.6% of the total, while privately offered products made up 4.4% [4] Investment Trends - The trend towards shorter investment durations is evident, with products having a maturity of less than one month exceeding 20%, reaching 22.6%, an increase of 3.76 percentage points year-on-year [5] - The proportion of products with maturities of 6-12 months has decreased significantly, dropping by 5.03 percentage points compared to Q3 2024 [5] Pricing Trends - The performance benchmark for wealth management products has been on a downward trend since 2024, with the average rate for products with a maturity of less than one month falling to 1.88% by June 2025 [8][9] - The pricing consensus among wealth management companies indicates a long-term low interest rate environment, with many products now priced below 2.5% for maturities over three years [8] Fundraising Performance - The total fundraising amount for newly issued products in Q3 2025 was approximately 946.59 billion yuan, with an average fundraising size of 258 million yuan, reflecting an 8.83% decline year-on-year [10] - The top fundraising products were primarily low to medium-risk, closed-end, fixed-income products, indicating a conservative investment approach among investors [11][13]

Core Insights - The issuance of wealth management products has steadily increased, with 32 wealth management companies issuing 6,361 net value-based products in Q3 2025, representing a year-on-year increase of over 40% compared to Q3 2024 [1][2] - The total market size of wealth management products reached 32.13 trillion yuan by the end of Q3 2025, reflecting a year-on-year growth of 9.42% [1] - There is a notable shift towards higher liquidity and shorter-term products, with a significant increase in the issuance of mixed and equity products [1][4] Product Issuance - In Q3 2025, the issuance of wealth management products saw a 42.21% increase year-on-year, with 6,361 products compared to 4,473 in Q3 2024 [2] - The proportion of fixed-income products decreased to 97.89%, while mixed and equity products saw an increase, with 106 mixed products and 11 equity products issued [2] - Major contributors to product issuance include Huaxia Wealth Management, with 478 products, and other leading firms like Ping An and Xingyin [2] Product Structure - Publicly offered products accounted for 95.6% of total issuance, while privately offered products made up 4.4% [3] - The proportion of closed-end net value products fell below 60% to 57.7%, a decrease of 10.77 percentage points year-on-year, while open-end products rose to over 40% [3] - Short-term products (less than 1 month) now account for 22.6%, an increase of 3.76 percentage points from the previous year [3] Pricing Trends - The performance benchmark for bank wealth management products has been on a downward trend since 2024, driven by lower underlying asset yields and stricter regulations [5] - The average pricing for products across various terms has generally declined, with products under 1 month dropping to 1.88% by June 2025 [6] Fundraising Performance - The overall fundraising scale for newly issued products in Q3 2025 was 946.59 billion yuan, with an average fundraising size of 258 million yuan, down 8.83% from the previous year [7] - The most successful product in terms of fundraising was "Anying Xiang Fixed Income Stable Profit No. 14," which raised over 100 billion yuan [7] - The top products in fundraising were primarily low to medium risk, closed-end, and fixed-income products, indicating a conservative investment approach among investors [7]

Investment Rating - The industry investment rating is "Positive" (maintained) [1] Core Views - The REITs market is expected to continue to offer good investment opportunities due to the downward pressure on bond market interest rates, the strengthening of policy support, and the anticipated entry of social security and pension funds into the market [4][6] Summary by Sections Market Overview - As of the 43rd week of 2025, the CSI REITs (closing) index was 816.04, up 5.63% year-on-year and up 0.16% month-on-month. The CSI REITs total return index was 1045.13, up 11.93% year-on-year and up 0.16% month-on-month [4][15][20] - Year-to-date, the CSI REITs (closing) index has increased by 7.88%, while the CSI 300 index has increased by 35.84%, resulting in an excess return of -27.96% [15][20] Trading Activity - In the 43rd week, the trading volume of the REITs market reached 630 million shares, a year-on-year increase of 37.86%, with a transaction value of 2.719 billion yuan, up 53.96% year-on-year [4][26][29] - The turnover rate for the period was 2.59%, down 0.39 percentage points year-on-year [26] Sector Performance - Weekly performance for various REITs sectors in the 43rd week included: - Affordable housing: +0.32% - Environmental: +0.53% - Expressways: +0.51% - Industrial parks: -0.40% - Warehousing and logistics: +0.26% - Energy: +0.24% - Consumer: -0.04% - Monthly performance showed declines across most sectors, with environmental REITs down 3.98% [4][36] Upcoming Listings - There are currently 12 REITs funds awaiting listing, indicating an active issuance market [7][54]