Group 1 - The rapid development of ETFs has led to many products facing issues of homogenization and poor management, resulting in significant share reductions and liquidity problems for some smaller products [1][5] - Several public funds have announced the addition of brokerages as market makers for their ETF products to enhance liquidity in the secondary market [1][2] Group 2 - On August 1, Guolian Fund announced an agreement with Ping An Securities and Great Wall Securities to act as market makers for its ETF, effective from August 1, 2025 [2] - Other funds, such as Huatai-PineBridge and E Fund, have also added brokerages as market makers for their ETFs, with over 40 announcements made in July alone [2] Group 3 - The presence of market makers is crucial for maintaining active trading in ETFs, with data showing that as of June 30, 2025, the Shanghai Stock Exchange had 20 primary market makers and 12 general market makers covering 746 fund products [3] - The Shenzhen Stock Exchange reported having 27 liquidity service providers for 491 ETF products as of mid-2023 [3] Group 4 - Analysts suggest that increasing the number of brokerages as primary market makers can significantly improve trading efficiency and quality, ensuring quick and accurate responses to large fund inflows and complex transactions [4] - The growing role of liquidity service providers in the ETF ecosystem is emphasized, with wealth management platforms increasingly using liquidity metrics to select quality ETFs [4] Group 5 - The "Matthew Effect" in the ETF industry is becoming more pronounced, with some ETFs facing shrinking scales and liquidity crises, particularly among previously popular products [5][6] - Statistics indicate that the number of ETFs choosing to liquidate has increased, with 20 index funds opting for liquidation as of August 1, including some high-performing thematic funds [6]

Core Viewpoint - The ETF market is experiencing a significant disparity, with some ETFs showing high trading volumes while many others face low liquidity and potential liquidation risks [1][5]. Group 1: ETF Market Performance - On June 10, certain ETFs like the Hong Kong Innovative Drug ETF and the Hang Seng Technology ETF had trading volumes exceeding 10 billion yuan, while over 500 ETFs had trading volumes below 10 million yuan [1]. - A total of 513 ETFs had trading volumes below 10 million yuan on June 10, with 129 ETFs trading below 1 million yuan [4][3]. - The concentration of market resources is evident, with the top ten ETFs accounting for nearly 40% of the total market size, while over 20% of ETFs have sizes below 100 million yuan [5]. Group 2: Liquidity and Risk Factors - The number of ETFs with net asset values below 50 million yuan has been increasing, indicating higher liquidity and liquidation risks [2][5]. - Analysts emphasize that low liquidity can lead to a vicious cycle where smaller ETFs struggle to attract investors, further diminishing their liquidity and increasing the likelihood of liquidation [5]. Group 3: Strategies to Enhance Liquidity - Fund companies are increasingly adding liquidity providers to improve ETF trading efficiency and attract more investors [7][8]. - The introduction of liquidity providers aims to reduce bid-ask spreads and enhance trading volumes, which can lead to scale effects [7][8]. - Improving liquidity is seen as essential for enhancing investor experience and attracting long-term capital [9]. Group 4: Recommendations for ETF Companies - Companies are advised to focus on product differentiation to avoid homogeneous competition, including not launching new ETFs in crowded index spaces and innovating product offerings [12][13]. - Providing value-added services, such as investment strategy reports and interactive investor engagement, can enhance investor experience and loyalty [13][14]. - Companies should also consider lowering management fees through increased ETF scale and exploring new themes like ESG and digital economy ETFs to meet diverse investor needs [14].

Core Viewpoint - The ETF market is facing significant challenges due to low liquidity and a high number of ETFs struggling to maintain their scale, leading to potential liquidation risks for many funds [2][3][4]. Group 1: Current Market Situation - Over 180 ETFs have daily trading volumes below one million yuan, with some even below ten thousand yuan, indicating a liquidity crisis [2][3]. - As of June 5, among 1179 ETFs, 147 have assets below 50 million yuan, and 39 have assets below 20 million yuan, with some ETFs having only a few hundred thousand yuan [3][6]. - The liquidity of ETFs is critical, especially during market volatility, as low liquidity can lead to "liquidity exhaustion" [4][5]. Group 2: Competitive Landscape - The ETF market exhibits a significant disparity in scale, particularly among core broad-based indices like the CSI 300 ETF, where the top four ETFs exceed 100 billion yuan, while many others struggle to reach 10 million yuan [6][7]. - The head effect is pronounced, with larger ETFs attracting more capital, while smaller ETFs often go unnoticed, leading to a continuous decline in their scale [7][8]. - Many fund companies are facing intense competition and are unable to cover costs, with a significant portion of ETFs operating at a loss [8]. Group 3: Need for Differentiation - Industry experts emphasize the necessity for fund companies to pursue differentiated strategies rather than blindly entering the ETF market [8][9]. - There is a call for innovative product designs that cater to specific investor needs, such as stable income products for insurance funds, and the development of thematic ETFs [9]. - The potential for innovation in ETF products is vast, with strategies like options for downside protection and transparent active ETFs gaining traction in overseas markets [9].