Macroeconomic Overview of Southeast Asia - Southeast Asia faces dual pressures from the US "reciprocal tariffs" and the opening of a "zero-tariff door" by the US, leading to a reduction in export competitiveness due to an average tariff of 19-20% on goods exported to the US [2][7] - Despite these challenges, the average economic growth rate for Southeast Asia is projected to be 4.2% in 2026, outperforming the global average of 2.9% [2][7] - Individual GDP growth rates for 2026 are expected to be 7.0% for Vietnam, 5.7% for the Philippines, 4.9% for Indonesia, 4.2% for Malaysia, and 1.8% for both Singapore and Thailand [2][7] Investment Themes in Southeast Asia - A low-interest-rate environment is anticipated, benefiting the real estate sector and other capital-intensive industries, with policy rates in various countries reduced significantly [3] - The effective tax rate advantage for ASEAN countries is expanding, with an average effective tax rate of 15%, compared to 43% for China, which may benefit local industries and logistics [4] - Geopolitical tensions are expected to drive growth in sectors such as AI, data centers, and mining, particularly in Malaysia and Singapore, which have strong semiconductor and electronic manufacturing capabilities [5] Country-Specific Investment Strategies - **Vietnam**: Plans to achieve double-digit GDP growth by 2026, focusing on infrastructure and real estate investments, and aims to establish financial hubs [11] - **Indonesia**: Facing internal challenges but has plans for significant economic reforms and investments in public housing and resource integration [12] - **Malaysia**: The government is focusing on high-value industries like semiconductors and AI, aiming to enhance its position in global supply chains [13] - **Singapore**: Expected to benefit from a stable political environment and low-interest rates, with potential growth in construction and REITs [14] - **Thailand**: Internal conflicts and policy uncertainties may hinder economic performance, despite potential benefits from foreign capital [14] - **Philippines**: Faces challenges from stalled infrastructure projects and competition from AI, which may impact economic growth [14] Trade and Foreign Investment Dynamics - Southeast Asia is adapting to new trade dynamics due to high tariffs, with countries seeking to establish new trade relationships to mitigate risks from US tariffs [16] - The region has seen a diversification of foreign direct investment sources, with a notable decrease in US investment and an increase from ASEAN countries [28] - The manufacturing supply chain in Southeast Asia is evolving, with significant greenfield investments in sectors like automotive and machinery [24] Capital Market Trends - Southeast Asian equity markets have shown resilience, with Vietnam leading in performance, while other countries like Malaysia and Thailand face challenges due to internal issues [29] - The region's liquidity remains strong, but foreign institutional investors have been net sellers, indicating a shift in investment preferences towards fixed-income assets [33]

Core Viewpoint - The current low interest rate environment in China is likely to persist long-term, prompting investors to seek stable asset allocation strategies to achieve consistent returns [1][3]. Group 1: Low Interest Rate Environment - The yield on China's 10-year government bonds has fallen below 2.5%, marking a ten-year low, which raises concerns about asset allocation in a low-risk return scenario [1]. - Many investors believe that the low interest rate environment will be a long-term trend, influenced by both monetary policy and the natural evolution of the economic cycle [3]. Group 2: Appeal of Dividend Assets - Dividend assets are becoming increasingly attractive due to economic recovery and relatively low valuation levels, with their yields surpassing many fixed-income products [3]. - The ongoing issuance of the Hong Kong Stock Connect Dividend Low Volatility ETF (code: 159118) is designed to capture both stable large-cap stocks and the growth potential of smaller companies [4]. Group 3: Market Trends and Policy Support - Recent regulatory reforms, such as the New National Nine Articles and new market capitalization management rules, emphasize the importance of shareholder returns, making high-dividend companies more appealing [5]. - Institutional investors are increasingly favoring high-dividend strategies, aligning with market trends and policy incentives [5]. Group 4: Valuation Advantages in Hong Kong Market - The Hong Kong market offers a valuation advantage, with dividend stocks generally providing higher yields and lower valuations compared to A-shares; for instance, the Hang Seng Index's dividend yield exceeds 4%, while the CSI 300's is around 2.5% [6]. Group 5: Stability in Volatile Markets - The Dividend Low Volatility strategy has demonstrated stable performance during recent market fluctuations, focusing on companies with stable cash flows and reasonable valuations [7]. - Dividend assets provide certainty and consistent cash flow, offering investors a sense of security amid market volatility [7]. Group 6: Investment Recommendations - It is advisable to allocate a portion of the investment portfolio to the Dividend Low Volatility strategy, which can provide stable cash flow and reduce overall portfolio volatility [8]. - The unique characteristics of the Hong Kong Stock Connect Dividend Low Volatility ETF (159118) make it particularly advantageous in the current market environment, enhancing the investment experience [8].

Group 1 - The current low interest rate environment in China, with the 10-year government bond yield falling below 2.5%, is expected to persist long-term, influencing asset allocation strategies [1] - The appeal of dividend assets is increasing as their yields surpass many fixed-income products, driven by economic recovery and relatively low valuation levels [1] Group 2 - The newly issued Hong Kong Stock Connect Dividend Low Volatility ETF (code: 159118) is designed for the Hong Kong market, featuring a sample stock distribution where companies with a market cap above 50 billion account for approximately 24.56% and those below account for about 75.44%, indicating a mix of stable large-cap stocks and growth potential from smaller companies [2] - The average price-to-earnings (PE) ratio of the sample stocks is low, with 41.23% of stocks having a PE below 10 and 44.76% between 10 and 20, suggesting a significant safety margin for investors [2] Group 3 - Regulatory reforms, such as the New National Nine Articles and new market capitalization management rules, emphasize the importance of shareholder returns, making high-dividend companies increasingly attractive [3] - The Hong Kong market offers a valuation advantage over A-shares, with the Hang Seng Index's dividend yield exceeding 4%, compared to approximately 2.5% for the CSI 300 [3] Group 4 - The dividend low volatility strategy has demonstrated stable returns amid increased market volatility, focusing on companies with stable cash flows, consistent dividends, and reasonable valuations [4] - Dividend assets provide certainty during market downturns, offering continuous dividend distributions that help investors maintain stability [4] Group 5 - It is advisable to allocate a portion of assets to the dividend low volatility strategy, which can serve as a "core holding" to provide stable cash flow and reduce overall portfolio volatility while retaining flexibility for market gains [5] - The dual characteristics of "dividend + low volatility" in the Hong Kong Stock Connect Dividend Low Volatility ETF (159118) offer unique advantages in the current market environment, enhancing the investment experience [5]

Core Viewpoint - The announcement of new leadership at Xingzheng Global Fund, with Zhuang Yuanfang appointed as Chairman and Chen Jinqian as General Manager, marks a significant transition in the company's management structure, aiming to ensure stability and continuity in its operations [1][5][4]. Management Changes - Zhuang Yuanfang has been promoted to Chairman and legal representative, having a long tenure of over 33 years in the industry, including previous roles at Xingzheng Global Fund [3][4]. - Chen Jinqian, with over 26 years of investment experience, has been appointed as General Manager, previously serving as Deputy General Manager [5][3]. - Both executives have been with the company for over 10 years, fostering a culture of professionalism and responsibility [5]. Fund Performance and Management Scale - Xingzheng Global Fund manages 143 funds with a total management scale of 741.992 billion yuan, which has increased by 44.73 billion yuan since the end of 2024 [1][6]. - The fund's flagship product, Xingquan Global Vision Stock Fund, has shown strong performance, with a 3-month increase of 21.68% and a 6-month increase of 37.89% as of November 7, 2025 [2][7]. Shift in Fund Composition - There has been a notable increase in the scale of money market funds, which reached 414.016 billion yuan by the second quarter of 2025, compared to 186.923 billion yuan in the third quarter of 2020 [8][6]. - Conversely, the scale of equity funds has decreased significantly, with mixed funds shrinking from 235.469 billion yuan in 2021 to 122.84 billion yuan by mid-2025 [7][8]. Financial Performance - The company's revenue and net profit have declined from 3.916 billion yuan and 1.376 billion yuan in the first half of 2021 to 1.785 billion yuan and 719 million yuan in the first half of 2025, respectively [8].

Report Industry Investment Rating - The report is bullish on the bond market, predicting that the yield of the 10Y Treasury bond will return to around 1.65% this year, the 30Y Treasury bond to 1.9%, and the 5Y Tier 2 capital bonds of large banks to 1.9% (for bonds without VAT) [74]. Core Viewpoints - The revenue growth rate of the entire A-share market and the net profit growth rate of the parent company are at a low level, indicating that the economic growth rate may have stabilized at a low level but still faces downward pressure. The yield of the 10-year Treasury bond is more closely related to the revenue growth rate of the entire A-share market than the nominal GDP growth rate [1][4]. - The loan growth rate has been declining, and the proportion of loans in the bank's asset side is decreasing. The demand for personal and corporate loans may be weak in the long term, while the scale of government bonds may significantly expand. The asset structure of the banking system may face long-term changes, with the proportion of loans likely to decline significantly [21][24]. - Since the beginning of 2023, the proportion of financial investments of large banks has rebounded, and the growth rate of bond investments has increased. The cost rate of interest-bearing liabilities of listed banks has been decreasing quarter by quarter, and it is expected to further decline in the future [1][49]. - The decline in bank liability costs will support the downward oscillation of bond yields. Given the current economic situation, the rapid decline in bank liability costs, and the loose capital situation, the report is bullish on the bond market [70][74]. Summary by Directory 1. Analyzing Economic and Bank Operating Pressures from the Q3 Reports of the Entire A-share Market - **Economic Insights from the Entire A-share Performance**: The revenue growth rate of the entire A-share market can reflect the nominal GDP growth rate to some extent. The revenue growth rate of the entire A-share market and the 10-year Treasury bond yield have a similar trend. The performance growth rate of the entire A-share market is still under pressure, and the growth rate of the real economy also faces significant pressure [5][6][9]. - **Economic Insights from the Bank Sector Performance**: The performance of the banking sector is closely related to the economy. In recent years, the performance growth of the banking sector has been under significant pressure, and the net interest margin of commercial banks has been continuously declining [11][12][15]. - **Financing Demand from the Entire A-share Liabilities**: Since Q1 2024, the long-term borrowing growth of the entire A-share market (excluding finance, petroleum, and petrochemicals) has almost stagnated, reflecting the weak financing demand of market-oriented enterprises. The social financing growth rate generally leads the nominal GDP growth rate by 1 - 2 quarters, but its guiding role may decline in the future [18][20]. 2. Changes in Bank Asset and Liability Situations - **Declining Loan Growth Rates of Large and Small Banks**: The loan growth rate has significantly declined. The growth of personal housing loans is facing negative growth pressure, which significantly drags down the growth rate of personal loans. The loan growth rates of both large and small banks have declined, and the proportion of loans is also decreasing. In the long term, the asset structure of the banking system may change, with the proportion of loans likely to decline and the proportion of bond investments likely to increase [21][25][36]. - **Decreasing Deposit Proportion on the Liability Side of Large Banks and Stable Deposit Proportion of Small Banks**: The growth of corporate deposits of large banks has slowed down. In recent years, the proportion of deposits on the liability side of large banks has decreased, while the average deposit proportion of listed joint-stock banks has increased [37][48]. 3. Banks with Significant Financial Investment Growth in Q3 2025 - Since the beginning of 2023, the proportion of financial investments of large banks has rebounded. In Q3 2025, the financial investments of some banks, such as ICBC and CCB, increased significantly, while those of a few banks decreased. The financial investment increments of large banks, joint-stock banks, and city and rural commercial banks were all significant, and the bond investment growth rates of the Big Four banks and small and medium-sized banks were also relatively high [49][56][59]. 4. Decrease in Bank Interest-Bearing Liability Costs - In 2025, the decline of the current deposit proportion slowed down. Since the beginning of 2024, the deposit interest payment rate has significantly decreased, and the interest-bearing liability cost rate has been decreasing quarter by quarter. It is expected to further decline in the future [60][63][66]. 5. Investment Recommendations - The decline in bank liability costs will support the downward oscillation of bond yields. In the future, the liability costs of commercial banks are expected to decline year by year, which will drive the yield of the 10-year Treasury bond to decline. Given the current economic situation and the value of government bond allocation, it is recommended that commercial bank self-operated departments increase the allocation of government bonds. The report is bullish on the bond market [70][73][74].

Core Viewpoint - The Huazhong Fengtai Bond Fund is set to launch on November 11, focusing on stable investment strategies in a low-interest-rate environment, aiming to provide asset allocation solutions for investors seeking stability [1] Group 1: Fund Characteristics - The fund will invest at least 80% of its assets in bonds, with 5%-20% allocated to equity and convertible bonds, and a minimum of 5% in domestic stocks [2] - The fund manager, Wu Wenming, has nearly 16 years of experience in finance and fund management, with a focus on macro trend analysis and precise bond pricing [2] - The fund management team employs a diversified approach, ensuring comprehensive coverage across various asset classes and investment strategies [2] Group 2: Investment Strategy - The fund aims to build a solid foundation through high-rated bonds while maintaining a balanced equity exposure to optimize risk and return [1][2] - In the current market, the likelihood of significant adjustments in bond yields is low, presenting opportunities for strategic investments [3] - The fund will actively participate in credit bonds that have not fully recovered from previous interest rate increases, while maintaining liquidity in the portfolio [3]

Core Viewpoint - The banking wealth management sector is undergoing a transformation towards a "multi-asset, multi-strategy" approach to address challenges posed by low interest rates, asset scarcity, and market volatility, necessitating a comprehensive restructuring of investment strategies, asset acquisition, trading processes, risk control, product disclosure, and compliance operations [2][4][5]. Group 1: Industry Challenges and Transformation - The banking wealth management industry is facing significant challenges due to the low interest rate environment, which has led to a decline in the returns of fixed-income assets, impacting the overall performance of wealth management products [4][5]. - As of the end of Q3 2023, 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 transition to a "multi-asset, multi-strategy" model is seen as essential for creating stable and attractive returns in the current market landscape [4][5]. Group 2: Implementation of Multi-Asset Strategies - Banks are actively expanding their investment teams to include equity investments, quantitative strategies, and alternative assets such as REITs and gold, aiming to enhance returns and mitigate risks [2][11]. - The integration of diverse asset classes requires a shift from traditional fixed-income strategies to a more dynamic approach that emphasizes risk management and performance consistency [5][11]. - The challenges of aligning investment styles between new hires from brokerage firms and the conservative investment philosophy of bank wealth management teams have led to difficulties in achieving cohesive strategies [8][9]. Group 3: Internal Management and Risk Control - The shift to a "multi-asset, multi-strategy" framework necessitates a complete overhaul of internal management processes, including trading links, risk control iterations, information disclosure, and compliance operations [14][15]. - The complexity of managing diverse investment strategies requires advanced technology solutions, such as AI and automation, to enhance operational efficiency and ensure compliance with regulatory requirements [15][16]. - A new risk control model is being developed to adapt to the multi-asset environment, focusing on the unique risk characteristics of different assets and strategies while ensuring low correlation among them to achieve better risk diversification [16][17].

Core Insights - The arrival of a low-interest-rate environment has created dual challenges for insurance fund investment management, necessitating a balance between risk and return through the "fixed income +" strategy [1][2] - The "fixed income +" strategy has evolved from merely enhancing fixed income returns to becoming a crucial means of compensating for declining bond yields [2][6] Group 1: Definition and Evolution of "Fixed Income +" - The essence of the "fixed income +" strategy is to use fixed income assets as a base while adding other assets and strategies to achieve higher returns under controlled risk [2] - The changing yield structure in a low-interest-rate environment has shifted the focus of the "fixed income +" strategy, making the "add-on" portion more critical for enhancing returns [2][3] Group 2: Characteristics of Insurance Funds - Insurance funds have unique characteristics such as stable liabilities, long duration, and rigid cost structures, which differentiate their "fixed income +" strategies from other financial institutions [4][5] - The stability and low liquidity demands of insurance liabilities allow for a focus on long-term alternative assets, such as private equity and real estate [4] - The long duration of liabilities leads insurance funds to prefer ultra-long-term bonds in their fixed income base, while other institutions may favor shorter-duration credit bonds [5] Group 3: Opportunities in a Low-Interest-Rate Environment - The low-interest-rate environment has created new opportunities for the "add-on" portion of the strategy, allowing for higher valuations of various assets [6] - The market's "fixed income +" strategies have increasingly relied on equities, gold, and REITs, with a notable performance from high-growth technology stocks [6][7] - AIA Life has adjusted its strategic asset allocation to increase equity exposure, focusing on a mix of growth stocks and high-dividend stocks [7] Group 4: Future Directions and Considerations - Future directions for the "fixed income +" strategy may include exploring diverse avenues such as bond southbound channels, gold investments, and public REITs [8] - While the "fixed income +" strategy can enhance returns, it also introduces risks that require careful management through diversification and risk hedging [8] - The focus should be on the risk-return ratio rather than just returns, emphasizing the importance of value investment and maintaining a margin of safety [8]

Group 1 - The bank wealth management market has reached a record scale of 32.13 trillion yuan as of the end of Q3 2025, marking a year-on-year growth of 9.42% [1] - Fixed income products dominate the market, with a total scale of 31.21 trillion yuan, accounting for over 97% of the total [1] - Despite the growth in scale, the returns on wealth management products have been declining, with cumulative returns of 568.9 billion yuan in the first three quarters, decreasing from 206 billion yuan in Q1 to 179.2 billion yuan in Q3 [1] Group 2 - Under a moderately loose monetary policy, the downward trend in bond market interest rates and deposit rates will continue to suppress the yields of pure fixed income products [3] - "Fixed income +" strategy products are expected to become a significant growth engine for the wealth management market in Q4, with an estimated annual scale increase of over 1.4 trillion yuan [3] - In Q3, banks increased their allocation to cash and bank deposits, interpreted as a safety cushion during the interest rate decline cycle, while reducing their allocation to public funds [3] Group 3 - The market landscape is changing, with wealth management companies expanding their market share to 91.13% of the total by the end of Q3 [3] - The enthusiasm of banks to apply for wealth management licenses has varied, with some banks showing reduced motivation while regional banks like Chengdu Bank are actively pursuing license applications [3] - More small and medium-sized banks are shifting towards agency sales, with 583 institutions participating in cross-bank sales of wealth management products as of September this year [3]

Group 1 - The banking wealth management market showed characteristics of "total growth, pressure on returns" in Q3 2025, with a market size reaching a new high of 32.13 trillion yuan, a year-on-year increase of 9.42% [1] - Fixed income products remain the main driver of growth, with a total size of 31.21 trillion yuan, accounting for 97.14% of all wealth management products [1] - The demand for wealth management products is expected to further increase in Q4 due to the large-scale maturity of insurance company agreement deposits and the continuous decline in deposit rates [2] Group 2 - The cumulative return generated for investors by wealth management products in the first three quarters was 568.9 billion yuan, with quarterly returns decreasing from 206 billion yuan to 179.2 billion yuan [2] - The "fixed income plus" strategy is expected to continue growing and become a significant driver of market size growth, with an estimated annual increase of over 1.4 trillion yuan for these products [2] - The market share of wealth management companies has expanded, reaching 91.13% of the total market by the end of Q3, an increase of 1.52 percentage points from June [3] Group 3 - There is a divergence in banks' enthusiasm for applying for wealth management licenses, with some banks reducing their efforts while others, like those in Sichuan, are actively pursuing joint applications [3] - As of September 2025, 583 institutions were involved in cross-bank sales of wealth management products, an increase of 35 institutions compared to the same period last year [3]