Core Viewpoint - The Hong Kong Innovation Drug ETF (159570) has shown significant market activity, with a recent inflow of nearly 2.6 billion RMB over 11 days, leading to a total scale exceeding 6.5 billion RMB, outperforming similar funds [1][3]. Group 1: Market Performance - The Hong Kong Innovation Drug ETF (159570) experienced fluctuations, initially rising over 1% before slightly declining, with a trading volume exceeding 1.3 billion RMB [1]. - The top ten weighted stocks in the ETF mostly experienced declines, with notable drops from WuXi Biologics, CSPC Pharmaceutical, and King’s Flair International, while Hansoh Pharmaceutical saw an increase [3]. Group 2: Investment Sentiment - Dongwu Securities attributes the recent strength in innovative drugs to strong fundamental support and a funding-driven approach, with a "FOMO" (Fear of Missing Out) sentiment accelerating market activity [3]. - The long-term outlook remains positive for innovative drug companies, particularly in a low-interest-rate environment, as they enter a phase of commercial realization [4]. Group 3: Industry Trends - The biotech industry in China is at a turning point, with leading companies beginning to achieve profitability, marking a transition into a new phase of business model validation [4]. - There is a growing trend of international collaboration, with domestic upfront payments for licensing deals exceeding 2.5 billion USD, indicating a robust market for business development (BD) [4]. - Continuous technological innovation is driving the industry upward, with new drug development in areas such as ADCs and dual antibodies leading to increased valuation of early-stage pipelines [4]. Group 4: Index Performance - The Hong Kong Innovation Drug ETF has shown superior performance compared to other medical indices, with a cumulative return of 104.46% from August 2020 to June 2021, significantly outperforming A-share medical indices [7]. - The ETF's underlying assets are exclusively in Hong Kong stocks, allowing for T+0 trading, which enhances liquidity and investment flexibility [12].