Group 1 - The A-share brokerage sector has significantly underperformed the market this year, with the CSI All Share Securities Companies Index rising only 1.8% compared to the over 25% increase in the Wind All A Index [1] - The Hong Kong Securities ETF has surged over 41% this year, while the A-share Securities ETF has only increased by 5% [2] - The net profit of listed brokerages is expected to grow by 62.4% year-on-year in the first three quarters of 2025, indicating a divergence between performance and stock price [2] Group 2 - The brokerage sector is entering a configuration window with quantitative signals and capital resonance, suggesting a potential upward trend as main funds show significant inflow [3] - The sector is currently in a neutral to weak oscillation pattern, with limited downside risk and a potential for upward breakout if positive catalysts emerge [3] - The turnover rate in the brokerage sector has dropped to a historical low, indicating low trading willingness and a stable chip structure [3] Group 3 - Central Huijin's long-term stable allocation provides strong support for the sector, with no evidence of reduction in holdings and an increase in positions in key brokerages [4] - The brokerage sector's price-to-book (PB) ratio is only 1.36 times, indicating a significant undervaluation despite a surge in performance [4] - The securities industry has ample room for incremental business growth, with leading brokerages expected to strengthen through mergers and acquisitions [4]

Core Insights - The brokerage sector experienced a pullback after two days of significant gains, with the leading brokerage ETF (512000) declining by 1.03% to below the six-month moving average [1][9] - Individual stocks showed mixed performance, with Everbright Securities and CITIC Securities rising against the trend [1] Market Performance - As of December 8, the brokerage ETF (512000) tracked the CSI All Share Securities Companies Index, which only increased by 3.07% year-to-date, significantly lagging behind the Shanghai Composite Index (up 17.08%), Shenzhen Component Index (up 27.99%), and ChiNext Index (up 48.97%) [3][9] - The brokerage sector's underperformance is attributed to a contradiction between high earnings growth and low valuations, creating potential for future price elasticity [3][9] Valuation and Investment Opportunities - The current price-to-book (PB) ratio for the securities company index is only 1.5 times, which is at the 40th percentile of the last ten years, indicating ample room for valuation adjustments [11] - The brokerage ETF (512000) has a fund size exceeding 400 billion, with an average daily trading volume of over 10 billion, making it one of the largest and most liquid ETFs in the A-share market [11] - The ETF provides a concentrated investment in 49 listed brokerage stocks, efficiently balancing between leading and smaller brokerages [11]