Investment Rating - The industry investment rating is "Overweight" indicating that the growth level of the industry is expected to be higher than that of the CSI 300 index over the next six months [3][38]. Core Views - The securities sector has seen a significant increase in margin trading balance, reaching a historical high of 2.45 trillion yuan, which accounts for 2.55% of the A-share market capitalization and 11% of the trading volume [2]. This growth is expected to provide a strategic opportunity for brokers as the capital market expands and trading activity increases [2]. - The current price-to-book (PB) ratio for the brokerage sector is 1.48, which is near the 40th percentile of 2020, indicating a historical low valuation [1]. - The report emphasizes that the integration within the industry is encouraged by regulators, and mergers and acquisitions are seen as effective means for brokers to achieve external growth [3][6]. Summary by Sections Securities - The securities sector index increased by 2.05%, slightly outperforming the CSI 300 index by 0.01 percentage points [1]. - The margin trading balance has reached a new high, with financing balance at 2.43 trillion yuan, indicating strong demand for financing among investors [2]. - The report suggests that the active trading environment and the increase in margin trading balance will support the performance of the brokerage sector [2]. Insurance - The insurance sector index rose by 1.85%, underperforming the CSI 300 index by 0.19 percentage points [6]. - In the first three quarters of 2025, 15 insurance asset management institutions registered 66 asset-backed plans with a total scale of 274.58 billion yuan, reflecting a year-on-year growth of 25.1% [7]. - The report highlights that asset-backed plans are becoming an important direction for insurance capital allocation due to their stable cash flow and lower risk compared to equity assets [7].

Core Viewpoint - The securities sector is experiencing significant growth, with major indices showing substantial increases and trading volumes reaching historical highs, indicating a favorable environment for investment in brokerage firms [1]. Group 1: Market Performance - As of 13:50, the Hong Kong Securities Index rose by 9.7%, while the CSI All Share Securities Companies Index increased by 6.3% [1]. - The Hong Kong Securities ETF (513090) recorded a real-time trading volume exceeding 30 billion yuan, making it the top ETF in the market [1]. Group 2: Margin Trading and Market Activity - The A-share margin trading balance has reached a historical high, maintaining above 2.4 trillion yuan for nearly five consecutive trading days [1]. - As of September 26, the average daily trading volume for A-shares in Q3 2025 reached 21,223 billion yuan, reflecting a 67% increase compared to Q2 and over 200% year-on-year growth compared to Q3 of the previous year [1]. Group 3: Investment Opportunities - Huatai Securities noted that the continuous increase in margin trading balance and rising market activity are likely to benefit the securities sector, with leading brokerage firms currently offering attractive valuation propositions [1]. - The Hong Kong Securities Index selects listed companies focused on securities investment, while the CSI All Share Securities Companies Index includes all listed companies in the securities industry, providing a comprehensive investment opportunity for investors [1].