Report Summary 1. Core View - Due to the narrowing of long - bond spreads to the lowest level since 2024, institutional investors have different views on the allocation of ultra - long credit bonds. With insufficient spread protection and uncertainty about the inflection point, if there are floating profits in ultra - long credit bonds, it is recommended to focus on the profit - taking strategy in the short term [5]. 2. Summary by Directory 2.1 Stock Market Characteristics - Ultra - long credit bond yields have marginally adjusted back. Due to the compression of long - bond spreads to the lowest level since 2024, institutional investors' attitudes towards the allocation of ultra - long credit bonds have diverged, and profit - taking behavior has led to a slight adjustment in yields. The number of outstanding ultra - long credit bonds with a yield of 2.4% - 2.5% has increased to 299 [2][12]. 2.2 Primary Issuance Situation - The supply of ultra - long credit bonds has reached the bottom. This week, the total issuance scale of new ultra - long credit bonds was 2.3 billion, and only two urban investment entities, Beijing Infrastructure Investment and Anhui Investment Group, issued long - term bonds with a term of 7 years or more (preferred exercise). Although the trading sentiment in the cash bond market has weakened, investors' enthusiasm for participating in the primary market allocation of ultra - long urban investment bonds remains high [3][21]. 2.3 Secondary Transaction Performance - The upward trend of the ultra - long credit bond index has significantly slowed down. This week, the general credit bond index above 7 years has slightly increased. The 7 - 10 - year AA+ credit bond index has increased by 0.03%, and the AA+ credit bond index above 10 years has only increased by 0.11%, performing weaker than long - term interest - rate bonds [29]. - The trading volume of ultra - long credit bonds has significantly decreased. After three consecutive weeks of increase, the spread of general credit bonds above 7 years has been compressed to a low level. The spread between 7 - 10 - year industrial bonds and 20 - 30 - year treasury bonds has narrowed to 21bp. Concerned about the insufficient protection space of long - term credit spreads, the number of trading transactions of ultra - long general credit bonds has dropped to 315 this week, a decrease of 35.7% compared with the previous week [32]. - The intensity of buying ultra - long credit bonds at a low valuation has weakened significantly compared with the previous two weeks, and some urban investment long - term bond varieties have even shifted to high - valuation transactions. The proportion of TKN transactions in credit bonds above 10 years has dropped to 54.2% [37]. 3. Industry Investment Rating The document does not mention the industry investment rating.

1. Report Industry Investment Rating No industry investment rating information is provided in the report. 2. Core Viewpoints of the Report - Despite the recent push in the credit duration market, the current trading activity of long - duration credit bonds has not reached an extreme level, and the participation of major non - bank institutions in long - term credit is also relatively restrained. If the interest rate decline continues, long - term credit can still be allocated. However, the compression space of the current 5 - year credit spread is relatively limited, and products with stable liability sides can tentatively participate in 5 - 10 - year high - grade credit bonds [1][2][3] - For profit - taking decisions, pay attention to two time points: when funds continue to net buy but the spread narrowing trend significantly slows down or stops, or when the spread starts to adjust and funds gradually reduce the net purchase of long - duration credit bonds until they turn into net selling [3][4] - Bank secondary and perpetual bonds have a deeper decline compared to general credit bonds. Currently, they are affected by the new regulations on fund sales fees. After the implementation of the new regulations, their recovery speed may be faster [5] 3. Summary by Relevant Catalogs 3.1 City Investment Bonds - Net financing turned negative. From November 1 - 9, 2025, city investment bonds issued 107.4 billion yuan and matured 136.9 billion yuan, with a net outflow of 29.5 billion yuan. The primary subscription sentiment remained high, and the proportion of subscriptions over 3 times increased to 72%. The proportion of long - term issuance increased in November [30] - The issuance interest rate of city investment bonds over 1 year decreased significantly. Since November, the weighted average issuance interest rates of bonds within 1 year, 1 - 3 years, 3 - 5 years, and over 5 years decreased by 1bp, 17bp, 20bp, and 15bp respectively compared to October [30] - In the secondary market, the 5 - year variety performed best, with the yields of AA(2) and above decreasing by 4 - 6bp and the credit spreads compressing by 9 - 11bp. The liquidity of city investment bonds remained good, and the trading volume of bonds over 3 years increased significantly [33][36] 3.2 Industrial Bonds - Issuance and net financing increased year - on - year. From November 1 - 9, 2025, industrial bonds issued 181.6 billion yuan, a year - on - year increase of 86.9 billion yuan, and the net financing was 81.1 billion yuan, a year - on - year increase of 97.9 billion yuan. The issuance sentiment weakened slightly, and the proportion of medium - and long - term varieties increased [39] - The trading sentiment weakened. The proportion of TKN decreased from 81% to 72% month - on - month, and the proportion of low - valuation transactions decreased from 76% to 57%. The trading duration decreased, with the proportion of transactions within 1 year increasing by 6pct to 32% [41] 3.3 Bank Secondary and Perpetual Bonds - In the primary market, Hengfeng Bank and China Resources Bank issued 12 billion and 3 billion yuan of 5 + 5 - year secondary capital bonds respectively, and ICBC issued 40 billion yuan of 5 + N - year perpetual bonds [44] - In the secondary market, the yields generally increased by 1 - 7bp, and the 2 - 5 - year large - bank varieties performed weaker. The trading sentiment weakened significantly, with the proportion of TKN and low - valuation transactions decreasing [44][45][48]