Core Viewpoint - The article emphasizes the increasing importance of trading ability in bond investment as the market transitions into a low-interest-rate environment and the era of credit expansion comes to an end [1][4]. Group 1: Investment Framework Characteristics - The investment framework of Chen Sixing is characterized by a strong ability to judge investor behavior and sentiment, utilizing trading spreads to gauge market emotions [3][16]. - Chen identifies a single main contradiction in the market at each stage, which is crucial for refined trading strategies [3][18]. - The framework includes flexible portfolio management, adjusting bond duration exposure based on the characteristics of equity assets [3][35]. Group 2: Career Development and Learning - Over 15 years, Chen has developed her investment philosophy through various roles, learning to balance profit maximization with risk management across different investment types [6][11]. - The transition from proprietary trading to pension fund investment allowed her to establish a macroeconomic cycle and asset allocation system [9][10]. - Joining Huatai Fund introduced the necessity of managing liabilities and liquidity constraints in investment decisions [10][11]. Group 3: Market Dynamics and Trading Strategies - The bond market has shifted from being influenced by macroeconomic data to being driven by micro-level factors such as trading structures and investor behavior [13][14]. - Chen's investment framework has evolved to incorporate a micro-level database for assessing investor sentiment, moving beyond traditional macroeconomic indicators [14][30]. - The identification of the main contradiction in the market is essential for forming effective trading strategies, with a focus on the most impactful data at any given time [19][20][30]. Group 4: Portfolio Management and Risk Control - The management of bond portfolios requires an understanding of the correlation between equity styles and bond performance, leading to differentiated management strategies [32][35]. - Chen emphasizes the importance of adjusting bond positions based on the performance of equity assets, particularly during periods of market volatility [36][37]. - The team at Huatai Fund operates with a specialized division of labor, enhancing collaboration and efficiency in investment strategies [39][41]. Group 5: Market Outlook - The outlook for bond assets remains optimistic, with expectations of continued downward pressure on interest rates, although the absolute returns may be lower due to increased market volatility [44][45]. - The market is currently in a phase of re-evaluating lower funding costs, with future directions uncertain until new signals emerge [45].

Report Summary 1. Investment Rating No investment rating for the industry is provided in the report. 2. Core Views - Since 2024, the significant decline in interest rates to historical lows is difficult to explain by nominal GDP changes. In the long - term, Chinese interest rates move within a non - parallel range, with the "upper limit" determined by the entity's investment return rate and the "lower limit" by the scale of "rigid financing" demand. The key force behind the current interest rate decline is the opening of the lower limit, i.e., the rapid clearing of financing demand [2]. - After a major bull market in the bond market in the previous year, it often enters an oscillatory transition phase in the next year. In 2025, the interest rate has shifted from a unilateral bull market to range - bound oscillations, as the financing cycle turns to expansion while the economic cycle lags behind and declines, and the interest rate digests the combined forces through sideways movement [2]. - High - frequency signals indicate a relatively high "winning rate" for the bond market. Market trading sentiment is not extreme, fundamental high - frequency indicators and interest rates are mutually verified, and both the volatility and trend terms in the timing model have returned to the long side [2]. - The market is mainly concerned about the odds constraint. However, the leading - lagging relationship between the long - end and short - end may have changed, and the term spread is not a reasonable basis for judging market space [2]. - Although interest rates are in a downward channel, the three - year cyclical adjustment pattern still exists. In 2025, there is a seasonal pattern of cyclical rebound in financing, which is the main driving force for the bond market correction. If viewed from the perspective of broad social financing, the bond market correction in the first quarter conforms to the characteristics of cyclical downward pressure release. If there is no increase in new government bond quotas or spontaneous stabilization of corporate leverage, broad social financing may peak in the second quarter, and interest rates may start a new round of decline [3]. 3. Summary by Related Content Interest Rate Movement and Driving Factors - Long - term, Chinese interest rates show a "triangular convergence" trend, with the upper limit moving down and the lower limit remaining stable. The current interest rate decline is due to the opening of the lower limit, resulting in a deviation between interest rate trends and many economic indicators while strengthening the relationship with financing growth [2]. Market Oscillation and Macro - background - After a major bull market in the bond market in the previous year, it often enters an oscillatory phase in the next year. In 2025, the interest rate shift from a unilateral bull market to range - bound oscillations is due to the expansion of the financing cycle and the lagging decline of the economic cycle [2]. High - frequency Signal Analysis - Market trading sentiment is at a neutral - low position, with room for further fermentation; fundamental high - frequency indicators and interest rates are mutually verified; both the volatility and trend terms in the timing model have returned to the long side, indicating a relatively high "winning rate" for the bond market [2]. Market Odds Constraint - The market is worried about the odds constraint, mainly due to the extremely flat yield curve. However, the leading - lagging relationship between the long - end and short - end has changed, such as the relative "insensitivity" of capital costs, the long - end amplitude becoming larger than the short - end, and the long - end trading volume rising, so the term spread is not a reasonable basis for judging market space [2]. Cyclical Adjustment of Interest Rates - Despite the downward trend in interest rates, the three - year cyclical adjustment pattern remains. In 2025, there is a seasonal cyclical rebound in financing, which is the main cause of the bond market correction. From the perspective of broad social financing, the bond market correction in the first quarter conforms to cyclical downward pressure release. If there are no special circumstances, broad social financing may peak in the second quarter, and interest rates may decline again [3]. Economic Indicator Analysis - Ten interest rate synchronization indicators are provided, including enterprise medium - and long - term loan balance growth rate, building materials composite index, etc., with their latest values, previous values, qualitative judgments, and relationships with interest rates [49]. Social Financing and Interest Rate Relationship - The relationship between social financing and interest rates is analyzed. If not considering new government bond quotas or spontaneous stabilization of corporate leverage, broad social financing may peak in the second quarter, and interest rates may start a new round of decline [3]. Policy - related Financial Tools - A comparison is made between the 2022 policy - based development financial tools and the 2025 new policy - based financial tools in terms of announcement time, policy goals, funding scale, operating entities, main investment fields, and project subjects [126].