1. Report Industry Investment Rating No relevant information provided. 2. Core View This week, the long - term credit bond market showed a positive trend. The yield of ultra - long credit bonds significantly recovered, the subscription enthusiasm for new ultra - long credit bonds reached a high level, and the long - bond index performed well. However, the sustainability of the ultra - long credit bond market will be affected by factors such as the market's pricing of new redemption fees, the stability of fund liabilities, and the direction of incremental funds [3][4][5][6]. 3. Summary by Directory 3.1 Stock Market Characteristics - The yield of ultra - long credit bonds significantly recovered. From October 27 to 31, 2025, due to factors such as the switch between stock and bond preferences, the central bank's mention of "resuming open - market treasury bond trading operations", and stable capital interest rates, the yield of ultra - long credit bonds dropped significantly. The number of outstanding ultra - long credit bonds with a yield of 2.2% - 2.3% increased to 189 compared with last week [3][14]. 3.2 Primary Issuance Situation - The subscription enthusiasm for new ultra - long credit bonds reached a high level. This week, the total issuance scale of new ultra - long credit bonds was 6 billion, with a relatively low supply. The issuance terms were mainly concentrated in 7 - 10 years. Compared with last week, the average coupon rate of industrial bonds over 7 years decreased by nearly 20bp to 2.37%, and the interest rate of new ultra - long urban investment bonds also decreased by more than 10bp. Driven by the spot - bond market, the enthusiasm for primary - market allocation of long - term bonds continued to rise, and the indicator reached about the 80th percentile in the past 24 years [4][23]. 3.3 Secondary Trading Performance - Long - bond indices outperformed. This week, long - term bonds led the bond market rally. The weekly increase of the over - 10 - year treasury bond index reached 1.15%. The ultra - long credit bond index performed relatively well among mainstream credit assets, with the 7 - 10 - year AA+ credit bond index rising 0.74% [5][30]. - The number of ultra - long credit bond transactions did not reach the level from June to July. Although the ultra - long credit bonds had a good rally this week, and the number of transactions of the most active 7 - 10 - year industrial bonds reached a new high since August (346 transactions), the total number of transactions of general credit bonds over 7 years was still lower than the average weekly reading from June to July. Moreover, compared with ultra - long general credit bonds, the improvement in the allocation preference for ultra - long secondary capital bonds of large banks was relatively greater, and investors paid more attention to the liquidity of bond varieties when choosing long - term bonds [5][33]. - In line with the secondary - market trading performance, the spread of short - and medium - term credit bonds within 3 years returned to the lowest point of the year. To achieve excess returns, ultra - long credit bonds became the target for extending duration. This week, the extent of transactions below the valuation of this variety widened significantly, and the proportion of TKN transactions in the 7 - 10 - year period approached 80% [5][37]. - In terms of investor structure, funds showed a preference for buying ultra - long credit bonds for the first time since August, with a single - week increase of 1.4 billion in the 7 - 10 - year variety. In the past two weeks, the behavior of insurance and other product categories in holding ultra - long credit bonds was stable, possibly considering reserving assets in advance for next year [5][44].

1. Report's Industry Investment Rating There is no information provided in the text regarding the industry investment rating. 2. Core View of the Report It is difficult to earn money from credit duration in the current market. The ultra - long - term credit bond market is facing challenges in both the primary and secondary markets, with adjustments in the yield, low investment cost - effectiveness, and weak trading sentiment [2][3][4]. 3. Summary According to the Directory 3.1 Credit Duration: Hard to Make Money 3.1.1 Stock Market Characteristics The ultra - long - term credit bonds are facing another adjustment. With the alleviation of "negative carry" concerns and the easing signal from the tariff policy, the bullish sentiment in the bond market has cooled down, and the yield of ultra - long - term credit bonds has continued to correct. The number of outstanding ultra - long - term credit bonds with a yield of over 2.4% has increased significantly compared to last week [2][13]. 3.1.2 Primary Issuance Situation The weekly issuance volume of ultra - long - term credit bonds has reached a new high. Due to the generally low yield of long - term bonds, the cost advantage for bond - issuing entities to issue ultra - long - term bonds still exists. In the latest week, the new supply of ultra - long - term credit bonds exceeded 80 billion yuan, and the 7 - 10 - year ultra - long - term industrial bonds were the main expanding variety. The average coupon rate of ultra - long - term industrial bonds is still declining, with a reading of less than 2.2%. Due to the low coupon yield, the investment cost - effectiveness of new ultra - long - term credit bonds is slightly insufficient, and the subscription sentiment in the primary market has continued to cool down this week [3][22]. 3.1.3 Secondary Trading Performance The index of ultra - long - term credit bonds has fallen significantly. The overall bond market has corrected, and most of the mainstream bond full - price indices have declined. The adjustment range of the ultra - long - term credit bond index is relatively larger than that of other bond varieties, with a weekly decline of 0.77% for AA + credit bonds over 10 years. The trading of ultra - long - term credit bonds has become inactive again. In the latest week, the number of trading transactions of urban investment bonds over 7 years has decreased to less than 40, the lowest since February this year. The cumulative number of weekly trading transactions of ultra - long - term industrial bonds is also less than 200. The low cost - effectiveness restricts the active trading of these bonds. The average trading yield of industrial bonds over 7 years is only around 2.3%, and the space for yield enhancement is not large compared to 4 - 5 - year medium - and long - term general - credit bonds. Correspondingly, the deviation between the valuation and trading of ultra - long - term credit bonds has turned positive this week, and the sentiment of investors to buy long - duration credit bonds has remained weak. The proportion of TKN transactions of 7 - 10 - year credit bonds has further dropped to 61.1%. In terms of investor structure, public funds have started to reduce their holdings of 5 - 10 - year general - credit bonds that they have been allocating for a month, and the purchase volume of insurance companies has also fallen to a low level. The net purchase volume of ultra - long - term credit bonds by insurance companies this week is less than 1.7 billion yuan [4][29][35]. From a more microscopic perspective, the spread of ultra - long - term credit bonds shows a slight upward trend in the shock. Except for the active bonds around 20 years, the credit spreads of active long - term bonds over 7 years are maintained between 55bp - 60bp. The net price of active ultra - long - term credit bonds has continued to decline this week, and the long - term bonds under 20 years have almost given back the capital gains of this month, highlighting the embarrassment of the high - odds nature of this variety [5][43].