Group 1: Report's Core Questions - The report addresses recent significant valuation adjustments in some science and technology innovation corporate bonds, with individual increases exceeding 20bp [4][11] - It analyzes the reasons for the valuation callback, which may be due to the convergence of trading spreads and issuance spreads [4][11] - It warns about the risk of catch - up decline caused by the convergence of China Securities valuation towards ChinaBond valuation [4][11] Group 2: Investment Highlights - Recently, many exchange - traded science and technology innovation corporate bonds have undergone significant valuation increases. From November 14 to 26, over 90% of the 603 valid science and technology innovation bond component bonds had valuation increases, with an average increase of about 6.6bp [6] - The reasons for the valuation increase may be the significant narrowing of the trading spread between science and technology innovation bonds and non - science and technology innovation bonds since November (from a peak of 25bp to 6bp on November 21) and the convergence of the issuance cost difference between the two (from about 10bp in September to less than 5bp as of November 14, 2025) [6] - The convergence of trading spreads and issuance coupons may have led to the valuation callback. As the ETF scale expansion slows, the demand - side support for science and technology innovation bonds weakens. There is a risk of catch - up decline when China Securities valuation converges towards ChinaBond valuation, and uncertainty in actual trading prices due to valuation differences [6] Group 3: Section - by - Section Summary 1. Recent Significant Valuation Increases in Some Science and Technology Innovation Corporate Bonds 1.1 Significant Convergence of Component Premiums in Science and Technology Innovation Bond ETFs - Many exchange - traded science and technology innovation corporate bonds have had valuation callbacks, with some samples having a callback of over 20bp in mid - to - late November. As of November 26, the median component premium of science and technology innovation bond ETF component bonds was 6.3bp, showing a large compression [13] - The valuation adjustment of bilateral science and technology innovation bond component bonds was greater and earlier. From November 14 to 26, the median component premium decreased from 10.7bp to 6.6bp, a compression of about 7.9bp from the peak [14] 1.2 Which Individual Bonds Have Larger Valuation Adjustment Amplitudes? - From November 14 to 26, the average valuation increase of 603 valid science and technology innovation bond component bond samples was about 6.6bp. 93.4% (563 bonds) had valuation increases, and 24.0% (145 bonds) had an increase of over 10bp [15] - After excluding outliers, the component bond with the largest valuation increase had a cumulative increase of over 20bp, and 11 other component bonds had an increase of over 15bp [20] 2. Reasons for the Valuation Increase of Science and Technology Innovation Corporate Bonds 2.1 Significant Narrowing of the Trading Spread between Science and Technology Innovation and Non - Science and Technology Innovation Bonds in November - Since November, the trading spread between science and technology innovation bond component bonds and non - component bonds has significantly narrowed, from a peak of 25bp to 6bp on November 21, and about 11bp compared to November 14, the lowest since August [25] 2.2 Convergence of Issuance Costs between 5 - Year Science and Technology Innovation and Non - Science and Technology Innovation Bonds - As of November 14, the weighted average coupon rate of 5 - year implied AAA science and technology innovation public - offering corporate bonds was about 1.90%, and that of non - science and technology innovation public - offering corporate bonds was 1.94%, with a difference of about 4bp, a significant convergence compared to previous months [27] 3. How to View the Valuation Callback of Science and Technology Innovation Bonds - The convergence of trading spreads and issuance coupons, along with the weakening demand - side support due to the slowdown of ETF scale expansion, may have led to the valuation callback of previously over - rising component bonds [30] - The valuation callback mainly occurs in ChinaBond valuation, while China Securities valuation has not adjusted significantly. As of November 26, China Securities valuation of component bonds was lower than ChinaBond valuation in major intervals, with the largest deviation of 5.9bp for bonds within 1 - year maturity [31] - Institutions using ChinaBond valuation for net - value calculation face net - value fluctuation risks, while those using China Securities valuation need to be aware of the catch - up decline risk when the two valuations converge and the uncertainty of actual trading prices [31]