Core Insights - Real World Assets (RWA) are becoming a hot trend, bridging traditional finance and the crypto world through tokenization of physical assets like real estate and art [2][3] - The market for tokenized assets is projected to reach $45 trillion by 2030, but current engagement levels are low, with many RWA tokens having fewer than 10 active addresses monthly [2][4] Definition and Market Overview - RWA refers to physical assets that are tokenized and entered into the blockchain, including financial assets like government bonds and tangible assets like real estate and art [3] - The tokenization of non-liquid assets could create a market worth $16 trillion, representing nearly 10% of global GDP by 2030 [3] Market Growth and Composition - As of mid-2025, $24 to $25 billion of RWA has been successfully migrated to blockchain, a significant increase from under $5 billion in early 2023 [4] - Private credit and tokenized U.S. government bonds dominate the RWA market, with BlackRock's BUIDL token valued at $2.42 billion and Ondo Finance's OUSG token at $1.76 billion, together accounting for nearly 20% of the market [4] Liquidity Challenges - Despite the impressive market size, liquidity remains a significant issue, with BlackRock's BUIDL token having only 85 holders and 30 active addresses monthly [6] - Tokenized real estate and art face severe liquidity constraints, often being illiquid "digital specimens" with minimal trading activity [4][6] Driving Factors Behind RWA Interest - The recent surge in interest for RWA is driven by yield differentials, with U.S. Treasury yields rising from 0.3% to 5%, attracting capital to safer, higher-yielding assets [5] - Traditional financial institutions are increasingly entering the RWA space, providing legitimacy and support for the market [5] Structural Barriers to Development - Regulatory challenges exist, as many RWA tokens are classified as securities, limiting market participation to accredited investors and complicating cross-border transactions [8] - The market is fragmented, with various decentralized exchanges and platforms creating liquidity "islands," hindering efficient price discovery [9] Future Development Pathways - A hybrid market structure combining centralized and decentralized elements may be the best approach, allowing for compliant issuance and trading of tokenized assets [12] - Emphasizing collateralized lending as a means to enhance liquidity, allowing RWA holders to access funds without selling their assets [13][14] Ecosystem Improvement Strategies - Regulatory innovation and the establishment of standardized asset disclosure and valuation frameworks are essential to reduce information asymmetry [15] - Industry self-regulation and the involvement of rating agencies can enhance market credibility and transparency [15] Investment Strategies - Investors should focus on liquid asset classes and compliant platforms, recognizing the inherent risks and diversifying investments across different RWA categories [16] - Advanced investors may consider participating in the foundational aspects of the RWA ecosystem, such as market-making or governance [17]

Summary of ABS Market Analysis Industry Overview - The Chinese ABS market is divided into interbank and exchange markets, with credit ABS previously dominant, now followed by the rise of exchange ABS and ABN. [1][7] - Currently, enterprise products dominate the market, influenced by macroeconomic factors and real estate, leading to an overall decline in scale. However, consumer finance products are performing strongly, with an annual issuance of approximately 2 trillion RMB and a total stock of about 3.5 trillion RMB. [1][7] Key Insights and Arguments - **Growth Areas**: - General consumer finance ABS is expected to become a growth segment, benefiting from policies aimed at expanding domestic demand and promoting consumption. [1][10] - Accounts receivable/supply chain finance ABS are expanding into emerging fields such as new energy, data, and overseas supply chain notes. [1][10] - Leasing ABS activity is increasing with new entities emerging, while city investment assets are decreasing in supply. [1][10] - Non-performing ABS is growing rapidly, primarily driven by banks' off-balance-sheet needs, and is expected to continue increasing in the short to medium term. [1][10] - **Market Dynamics**: - The ABS market is transitioning from a phase of rapid growth to one of high-quality development, with limited growth in CNBS but active participation from city investment entities. [2][7] - The liquidity of ABS has improved, attributed to the stability of products and the expansion of trading investors, although monthly turnover rates remain lower than traditional bonds. [12][13] - **Investment Opportunities**: - Current investment opportunities in the ABS market include basis spreads in general consumer finance, term spreads in leasing and fee income rights, seasonal premiums, new issuance premiums, and discounts from bundled sales rules. [19][21] Important but Overlooked Content - **Risk and Return Characteristics**: - Different types of ABS products have unique risk-return profiles, and investors should assess them based on specific circumstances. [21][22] - Retail ABS performance shows a divergence, with lower default rates in mortgage and auto loans compared to higher rates in consumer loans and microloans, yet small diversified assets remain stable. [15][22] - **Challenges**: - The ABS market faces challenges such as valuation pricing difficulties and trading complexities. Investors need to conduct in-depth research on cash flow models and underlying asset performance. [21][22] - **Investor Preferences**: - The main investors in ABS include banks, public funds, bank wealth management, and insurance companies, each with different preferences based on their investment strategies and risk appetites. [24][22] This summary encapsulates the key points from the ABS market analysis, highlighting the current state, growth opportunities, and challenges within the industry.

Core Insights - The UK is experiencing a surge in GBP-denominated leveraged loans, with issuance reaching £21.2 billion (approximately $27.9 billion) this year, setting a record with two months remaining in the year [1] - Major private equity transactions involving UK assets have increased, with notable deals including KKR's £4.2 billion acquisition of a precision testing equipment manufacturer and Advent International's $4.8 billion acquisition of a consumer goods company [4] - The demand for GBP loans is driven by the relative cheapness of UK assets and the high yields they offer compared to Euro and USD loans, which are currently under pressure [1][4] Group 1: Market Dynamics - The leveraged loan market in the UK is benefiting from a favorable position due to high borrowing costs and inflation, which has led to increased acquisition activity [1] - Private equity firms such as Apollo Global Management, Ares Capital, Blackstone, and KKR are allocating private capital to GBP leveraged loans, indicating strong demand from buyers [1] - The liquidity premium for GBP loans is at least 100 basis points higher than similar Euro and USD assets, making them attractive to investors [11] Group 2: Economic Context - Post-Brexit, UK assets have become more appealing to US acquirers due to lower valuations and simpler privatization rules compared to continental Europe [5] - Despite economic challenges, UK GDP and other economic indicators remain relatively strong, suggesting that pessimism about the UK's economic outlook may be overstated [12] - The issuance of GBP bonds remains a small portion of the overall bond supply, but the demand for collateralized loan obligations (CLOs) has increased, with Ares issuing the first GBP CLO since 2018 [6][11]

Global Monetary Policy Shift Tracking - The Federal Reserve has lowered interest rates by 25 basis points to a range of 3.75%-4% in September 2025, aligning with market expectations. Seven out of 26 major economies tracked have cut rates, with the European Central Bank (ECB) maintaining a hawkish stance despite not changing rates for the third consecutive time [2][11] - There is uncertainty regarding further rate cuts by the Federal Reserve within the year. Initially, there was a strong expectation for cuts in October and December, but this has since cooled, with only a 70% probability for a December cut as of late October [3][17] - China's real interest rate has slightly decreased from 3% at the end of September to 2.9% in October 2025, remaining relatively high compared to 13 other economies [3][26] Global Liquidity Tracking - The Federal Reserve's reserve balance has decreased to $2.83 trillion, with a nominal GDP ratio of approximately 12%, indicating that redundant liquidity is nearly exhausted. The ONRRP balance has significantly shrunk to $19.5 billion [4][30] - Various liquidity spreads have shown significant increases, with the EFFR-IOER spread narrowing from -7 basis points to a minimum of -3 basis points, reflecting tightening liquidity conditions [5][37] - The U.S. Treasury bond bid-ask spread has remained stable, indicating that the bond market has not experienced significant widening despite the liquidity tightening from the Fed's balance sheet reduction [7][43] Financial Market Liquidity Tracking - The Libor-OIS spread has risen sharply, reaching a maximum of 110 basis points, indicating tightening liquidity conditions in the U.S. dollar market. However, offshore dollar swap points remain low, suggesting ample liquidity in offshore markets [8][45] - Credit risk premiums in the U.S. have remained low despite recent regional banking credit events, with investment-grade credit default swap (CDS) prices showing only slight increases [8][51]

Report Summary 1. Report Industry Investment Rating No specific industry investment rating is provided in the report. 2. Core Viewpoints - The current round of precious metals upward trend since late August may extend to 2026 due to factors such as the Fed's potential interest - rate cuts, high geopolitical risks, and the acceleration of the global trade - currency system restructuring. Investors are advised to maintain a long - position mindset, and short - hedgers can appropriately reduce the hedging ratio. However, the current high price - earnings ratio of gold requires strong safe - haven demand, and long - position investors need to control their positions and be aware of short - term adjustment risks [4][5]. 3. Summary by Relevant Catalogs Precious Metals Market Analysis - **Intraday Market**: Sino - US trade tensions show signs of easing, weakening safe - haven demand and pressuring London gold to around $4080 per ounce. But the US federal government shutdown and Fed rate cuts support precious metals. It is necessary to observe whether London gold can stabilize between $3950 - $4050 per ounce. This week, focus on Sino - US trade talks, China's September economic data, the progress of the US government shutdown, and the Fourth Plenary Session of the 20th CPC Central Committee [4]. - **Medium - term Market**: The US employment and inflation situation supports the Fed's rate - cut restart. Global trade - currency system restructuring and high geopolitical risks continue to drive gold demand. The upward trend of precious metals since late August may extend to 2026. The six - month and one - year target prices for London gold are $4500 and $4800 per ounce respectively, and for London silver are $58 and $63 per ounce respectively. However, the current high price - earnings ratio of gold requires strong safe - haven demand, and long - position investors need to control positions and beware of short - term adjustments. The support levels for London gold are $4130 and $3975 per ounce, and for London silver are $50.31 and $47.76 per ounce [5]. Precious Metals Market - Related Charts The report provides multiple charts related to precious metals, including Shanghai gold and silver futures indices, London gold and silver spot prices, the basis of Shanghai futures indices against Shanghai gold T + D, and gold and silver ETF holdings, etc., but no specific analysis of these charts is given in the text [6][7][9]. Major Macroeconomic Events/Data - Russian President Putin stated that Moscow will never yield to external pressure and will respond overwhelmingly if its deep - seated targets are attacked. He also said that US and Western sanctions have little impact on Russia's economic well - being [17]. - The EU included two Chinese refineries (Liaoyang Petrochemical and Shandong Yulong Petrochemical) and PetroChina's trading unit (PetroChina Hong Kong) in the sanctions list against Russia, claiming they are major buyers of Russian crude oil. It also sanctioned a Chinese trading company for its role in Russia's sanctions - evasion [17]. - The US is preparing to investigate China's compliance with the trade agreement signed during Trump's first term [17]. - The Kuwaiti oil minister said that OPEC is ready to increase oil production by further canceling production cuts if necessary after the US imposed new sanctions on Russian oil giants, expecting demand to shift to the Gulf and Middle East regions [17].

Core Views - The market is experiencing a narrow consolidation near its peak, with increased investor caution. Low-valuation blue-chip stocks are expected to gradually lift the market's focus, while high-valuation stocks face performance tests and shareholder reduction pressures, indicating a potential narrowing of high-valuation stock activity [1][7][8] - Attention should be paid to the effects of economic stabilization policies on the A-share market, which may provide positive impacts [1][7][8] - Continuous monitoring of precious metal price fluctuations is necessary due to their spillover risks to other financial markets [1][7][8] A-share Market Overview - On Wednesday, the market showed a narrow consolidation trend, with short-term rebound momentum weakening. Despite optimistic macro policy expectations, external funds remain cautious about future policy strength and fundamental improvements, leading to a lack of significant participation from outside investors [2] - The Shanghai Composite Index closed at 3913.76 points, down 0.07%, while the Shenzhen Component Index fell 0.62% to 12996.61 points. The total trading volume was 16903 billion [3] Sector Performance - The banking sector continued to rise, with a year-to-date increase of 8.13%, ranking 22nd among A-share industry sectors. The banking sector's performance has been relatively stable, attracting long-term funds during periods of market uncertainty [4] - The non-ferrous metals sector faced a pullback, declining by 1.36% on Wednesday, influenced by the drop in international precious metal prices. However, the sector has seen a year-to-date increase of 67.39%, the highest among industry sectors [5][6] Future Market Outlook - The market is expected to continue its narrow consolidation, with low-valuation blue-chip stocks playing a stabilizing role. Investors are advised to adjust their portfolio structures by increasing allocations to dividend assets [1][7][8]

Report Summary 1. Report Industry Investment Rating No information provided on the industry investment rating. 2. Core View of the Report The report suggests that factors such as Fed rate cuts, geopolitical risks, and the accelerated restructuring of the international trade and monetary system continue to provide hedging demand and liquidity premiums for precious metals. The current upward trend in precious metals may continue until 2026. Investors are advised to maintain a bullish stance, while short - hedgers can appropriately reduce their hedging ratios. However, short - term adjustment risks should be noted, and heavy - position chasing at current prices is not recommended [4][5]. 3. Summary by Directory 3.1 Precious Metals Market Conditions and Outlook - **Intraday Market**: Uncertainties in Sino - US trade and the Russia - Ukraine conflict, along with adjustment risks from previous price surges, led to a significant drop in gold and silver prices overnight, followed by a notable rebound in the Asian session. It is necessary to observe whether London gold can stabilize at the $3950 - 4050 per ounce level. Key events to watch this week include the fifth round of Sino - US economic and trade consultations, China's September economic data, the progress of the US government shutdown, and the Fourth Plenary Session of the 20th CPC Central Committee [4]. - **Domestic Precious Metals Market Data**: The Shanghai Gold Index closed at 954.55, down 4.18%; the Shanghai Silver Index closed at 11,415, down 3.41%; Gold T + D closed at 947.30, down 4.01%; Silver T + D closed at 11,377, down 3.25% [5]. - **Medium - term Market**: From late April to early August, London gold oscillated widely between $3100 - 3500 per ounce to digest high - valuation pressures. Since August, factors such as the Fed's potential rate cuts, the restructuring of the international trade and monetary system, and geopolitical risks have driven a new round of upward trends in precious metals. London gold soared to $4380 per ounce, and London silver reached a new record high of $54.47 per ounce. Although the upward trend is expected to continue, short - term adjustment risks should be noted [5]. 3.2 Precious Metals Market - Related Charts The report presents multiple charts, including those of Shanghai gold and silver futures indices, London gold and silver spot prices, the basis of Shanghai futures indices against Shanghai Gold T + D, gold and silver ETF holdings, the gold - silver ratio, and the correlation between London gold and other assets [7][9][11]. 3.3 Major Macroeconomic Events/Data - **US - Russia Relations**: The planned summit between US President Trump and Russian President Putin was postponed due to Russia's rejection of the immediate cease - fire proposal in Ukraine. Russia's conditions for a peace agreement with Ukraine conflicted with Trump's current plan [17]. - **EU - China Trade**: The EU Trade Commissioner invited Chinese Commerce Minister Wang Wentao to visit Brussels to address China's tightened rare - earth export restrictions. China hopes the EU will urge the Netherlands to resolve the impasse around Nexperia. Discussions also covered the EU's anti - subsidy case against Chinese electric vehicles [18]. - **Japan's New Prime Minister's Stance**: Japan's new Prime Minister Takamori Sanae hopes the Bank of Japan's monetary policy can achieve a 2% inflation target in a sustainable manner, accompanied by wage growth [18]. - **Canada - US Steel and Aluminum Trade**: Canadian Prime Minister Carney was cautious about reports of a potential steel and aluminum trade agreement with the US, warning against over - interpretation [19].

Report Industry Investment Rating No relevant content provided. Core Viewpoints - Since the third quarter, the 30 - 10 spread has widened rapidly, which is related to the marginal changes in the factors compressing the spread. The macro - narrative has changed, and the tax policy adjustment in August had a more obvious impact on the 30 - year Treasury yield. Looking ahead, the 30 - 10 spread is expected to compress again. The spread has adjusted significantly, the 30 - year Treasury still has liquidity advantages, and the demand for the 30 - year Treasury will improve with the bond market rebound [2]. Summary by Related Content 1. Widening of the 30 - 10 Spread since the Third Quarter - From late July to mid - September, the 30 - 10 spread rose from 20BP to 30BP. From mid - September to October 14, it further widened by 13BP to 43BP, returning to the level in September 2022 [3]. 2. Long - term Characteristics and Historical Performance of the 30 - 10 Spread - The 30 - 10 spread shows a long - term mean - reversion trend. From 2006 - 2023, the average spread was 56BP, with an upper limit of 70 - 80BP (maximum over 90BP in early 2009) and a lower limit of 20 - 30BP (minimum less than 20BP in mid - 2007). In most cases, it moves inversely to the 10 - year Treasury yield. In 2024, it broke through the historical low, compressing to around 10BP and oscillating in the [10BP - 30BP] range from 2024 to the first half of 2025 [6][7][8]. 3. Reasons for the Extreme Compression of the 30 - 10 Spread in the Past Two Years - The increase in the trading volume and proportion of 30 - year Treasuries led to a liquidity premium, which supported the spread compression. The reasons for the increased activity of 30 - year Treasuries include investors' increased demand for long - duration bonds due to economic concerns, the preference of insurance institutions for long - duration bonds, the large - scale issuance of 30 - year Treasuries, and the issuance of 30 - year Treasury ETFs [12][13]. 4. Marginal Changes in Factors Supporting Spread Narrowing in the Third Quarter - The macro - narrative has changed, with better - than - expected economic performance, reduced deflation expectations, and a strong equity market suppressing the bond market, weakening the demand for 30 - year Treasuries. The tax policy adjustment in August had a greater impact on the 30 - year Treasury yield. The trading volume proportion of ultra - long Treasuries has declined since August [20]. 5. Outlook for the 30 - 10 Spread - In the short term, the 30 - 10 spread is expected to compress again. The spread has adjusted significantly, the 30 - year Treasury still has liquidity advantages, and the demand for the 30 - year Treasury will improve with the bond market rebound. In the long - term, the probability of the spread returning below 20BP is small as the market's economic expectations improve and 20BP is at the lower limit of historical fluctuations [21].

1. Report Industry Investment Rating - Not mentioned in the provided content 2. Core View of the Report - Since the third quarter, the 30 - 10 spread has widened rapidly, which is related to the marginal changes in the factors compressing the spread. Looking forward, the 30 - 10 spread is expected to compress again. After the previous adjustment, the spread has returned to the level of the third quarter of 2022. The 30 - year treasury bond still has liquidity advantages, and the demand for 30 - year treasury bonds will improve marginally with the bond market rebound, which is conducive to the phased compression of the 30 - 10 spread [2] 3. Summary by Relevant Catalog 3.1 Third - quarter widening of 30 - 10 spread - From July to mid - September, the 30 - 10 spread rose from 20BP to 30BP. From mid - September to October 14, it further widened to 43BP, returning to the level of September 2022 [3] 3.2 Long - term characteristics of 30 - 10 spread - The 30 - 10 spread shows a long - term mean - reversion trend. From 2006 to 2023, the 30 - 10 spread averaged 56BP, with an upper limit of 70 - 80BP and a lower limit of 20 - 30BP. In most cases, it moves in the opposite direction to the 10 - year treasury bond rate. In 2024, it broke through the historical extreme, once compressing to around 10BP and oscillating in the range of 10BP - 30BP until the first half of 2025 [6][7][10] 3.3 Reasons for the extreme compression of 30 - 10 spread in the past two years - The increase in the liquidity premium of 30 - year treasury bonds, driven by supply and demand factors, is the main reason. Factors include increased demand from fixed - income investors and insurance institutions, increased primary supply, and active trading of 30 - year treasury bond ETFs. In 2025, the weekly average trading volume of ultra - long treasury bonds reached 700 billion yuan, and the proportion in all treasury bond trading volume rose to 40% [12][13] 3.4 Marginal changes in factors supporting spread narrowing in the third quarter - The macro - narrative has changed, including better - than - expected economic performance, the dissipation of deflation expectations, and the suppression of the bond market by the stock market. The tax policy adjustment in August had a more obvious impact on the 30 - year treasury bond yield. Since August 2025, the trading volume proportion of ultra - long treasury bonds has declined [20] 3.5 Spread outlook - In the short term, the 30 - 10 spread is expected to compress again. In the medium - to - long term, the probability of the 30 - 10 spread returning below 20BP is small [21]

Core Viewpoint - Goldman Sachs predicts further prosperity in the Chinese stock market driven by valuation and liquidity, maintaining "overweight" ratings for A-shares and H-shares, with an expected 8% upside for A-shares and 3% for H-shares over the next 12 months, recommending investors to increase positions during market corrections [1][3]. Group 1: Market Drivers - The strong performance of the Chinese stock market this year is attributed to "re-inflation" expectations and advancements in artificial intelligence technology, with ongoing valuation recovery and liquidity improvement expected to provide upward momentum [3]. - Goldman Sachs emphasizes that corporate earnings are fundamental for sustained market growth, while liquidity is essential for bull market formation, noting that the current "slow bull" pattern in the A-share market is more stable compared to historical trends [3]. Group 2: Valuation and Liquidity - Current valuation levels indicate that most metrics show large-cap stock valuations are still within a reasonable range, with the index price-to-earnings ratio at a moderate level, suggesting attractive liquidity premium space for both A-shares and H-shares [3]. - The adjusted "A-share investor sentiment index" indicates a current market risk preference composite index of 1.3, suggesting consolidation risks but no trend reversal yet [3]. Group 3: Institutional Investment Potential - If the domestic institutional holding ratio increases from the current 14% to the emerging market average of 50% or the developed market average of 59%, the potential increase in domestic stock holdings could reach between 32 trillion to 40 trillion RMB [4]. - The investable funds available to Chinese households, including 160 trillion RMB in savings and 330 trillion RMB in real estate investments, present significant potential for future capital allocation adjustments, although this process is expected to be gradual [4]. Group 4: Investment Themes - Goldman Sachs is optimistic about investment themes such as the "Prominent 10" private enterprises, artificial intelligence, anti-cyclical sectors, and shareholder returns [4].