Core Viewpoint - The third phase of the public fund industry fee reform has officially started, with a particular focus on the adjustment of redemption fees for bond funds, which is attracting significant market attention [1] Group 1: Market Trends - The bond ETF market is experiencing structural optimization and ecological reshaping, presenting historic development opportunities due to market conditions and policy support [1] - As of September 19, the total market size of bond ETFs exceeded 570 billion yuan, an increase of nearly 400 billion yuan compared to the end of 2024, representing a growth rate of over 220% [1] Group 2: Local Government Bonds - Local government bonds are showing unique allocation value and growth potential due to the rapid development of the underlying local bond market, which has become the largest category of interest rate bonds [1][2] - As of September 18, 2025, the outstanding scale of local government bonds exceeded 53 trillion yuan, accounting for 44.15% of interest rate bonds, significantly surpassing national bonds and policy bank bonds [1] Group 3: Investment Opportunities - The emergence of local government bond ETFs has significantly lowered the entry barrier for individual investors, allowing for more efficient and convenient participation in local bond investments [2] - There are currently four local government bond ETF products available in the market, covering different duration ranges, with the largest being the Penghua 5-Year Local Government Bond ETF and the Penghua 0-4 Year Local Government Bond ETF, with sizes of 3.691 billion yuan and 1.770 billion yuan respectively [2][3] Group 4: Product Features - The Penghua 0-4 Year Local Government Bond ETF is designed for short-term local bonds, offering low volatility and stable returns, suitable for short-term fund management and low-risk investors [3] - The Penghua 5-Year Local Government Bond ETF targets medium to long-term local bonds, providing relatively higher yield potential while maintaining low credit risk, making it a suitable alternative for mid-duration interest rate bond index funds [3] - Both Penghua local government bond ETFs support T+0 trading and can be used for pledged financing, with an annual comprehensive fee rate of only 0.2% [4]