Two Days To Spend 23 Billion 100 Million Yuan To Increase A Shares, Overseas Capital Shored Up To Make Up For The Tide.

Following the net inflow of nearly 18 billion 200 million yuan on the first trading day after the holidays, the A of the northern capital increased again in February 4th.

Data show that in February 4th, the net flow of north capital reached 4 billion 900 million yuan.

"In fact, most overseas investment institutions believe that the impact of the epidemic on China's economy is temporary and does not affect the sustained and steady growth of China's economy. Instead, the recent decline in A shares has created a good opportunity to bargain. A chief executive of Asia Pacific region, a European capital management agency that has continued to add A shares in the past two days, told reporters.

In his view, compared to the February 3rd northern capital influx of A shares to the bottom of the stock market, in February 4th, they continued to make a big increase in A shares with obvious "empty back to fill" means - the three days before the Spring Festival, the total net outflow of north capital has exceeded 10 billion, but as the overnight IMF and the world bank have strong resilience against the Chinese economy and enough to cope with the impact of the epidemic, many overseas investment institutions have made up for the previously sold A share positions.

Reporters learned that, despite two consecutive days of large A shares, North funds against the epidemic took a large number of risk prevention measures, one is the main increase in the performance of the relatively stable growth, and after the end of the epidemic, the performance of the blue chips faster, the two is buying the lower impact of the impact of the technology industry leading stocks, three is due to the A shares can not sell off temporarily, some overseas investment institutions turn short selling stocks, the Hong Kong stock market performance in the risk of risk arbitrage strategy hedge, four is that many have QFII or RQFII quota of overseas investment institutions at the same time increase the A shares, the corresponding increase in the stock index futures hedging positions.

"At present, the epidemic has not changed the trend of enhancing global asset allocation through continuous increase in A shares." The chief representative of the Asia Pacific region, a large European financial management agency, pointed out to reporters that, considering the undervalued value of the current A share decline, the agency headquarters is considering the short-term allocation of A shares to achieve a safer portfolio.

Overseas large capital management agencies fill in the blank

Reporters learned that, after the first trading day, the northern capital of A shares mainly came from emerging market investment funds and Chinese funded institutions overseas funds. In contrast, European and American macro hedge funds and large asset management institutions are cautious.

Nader Naeimi, head of Investment Department of AMP Capital, explained to reporters that in general, large and large European and American funds and macro-economic funds are risk averse. Once the uncertainty is found, they will choose a risk avoidance strategy and dare not rush to make short returns.

However, the continuous statements of the world bank and IMF undoubtedly injected them with a strong heart.

Georgi Ieva, President of the International Monetary Fund (IMF), said in social media that IMF supports the measures taken by the Chinese government to tackle the epidemic in the financial, monetary and financial sectors. The Chinese economy will continue to show great resilience.

Previously, the world bank said that the Chinese government has sufficient policy space to deal with the epidemic and to inject considerable liquidity into the market. These measures can alleviate the losses caused by the epidemic to China's economic growth.

"The position of these institutions will, to some extent, alleviate the concerns of overseas large capital management and macroeconomic hedge funds on the uncertainty of China's economic growth," he said. Nader Naeimi thinks. But the biggest booster for triggering their decision to make short returns is the overnight FTSE China A50 index futures took the lead.

As of the opening of A shares in February 4th, FTSE China A50 index futures rose more than 3%, greatly eliminating the concerns of these organizations, because they have always regarded FTSE China A50 index futures as an important vane of overseas institutions' collective bullish / buy down A shares.

The chief representative of the Asia Pacific region, a large European financial management agency, told reporters that after two days of opening, their share of A shares accounted for 3 of the emerging market share in the Asia Pacific region, rising from 4 to around 4 before the Spring Festival, which basically reached the level of positions held at the end of last year. The reason is that they noticed that after the fall of A shares, many of their preferred A shares were undervalued. Two, a series of stable financial market measures adopted by institutional headquarters that China's relevant departments were taking, were making A shares move out of the trough much faster than their original estimate.

Reporters noted that the cumulative outflow of north capital amounted to 19 billion 700 million yuan, but in the past two days, the net flow of funds to the north in the past two days amounted to about 23 billion 100 million yuan, indicating that most overseas investment institutions completed the short covering at the same time.

A number of overseas investment institutions equity asset traders told reporters that through the short complement, some overseas investment institutions also won a lot of low buying, selling and selling spreads.

"An emerging market fund has sold more than 60 million yuan A shares before the Spring Festival, and bought these stocks for two days to achieve a return of about 8%." An American macroeconomic hedge fund trader told reporters. In addition, over the past two days, foreign capital has increased A shares in large margin, and has a strong correlation with the lower RMB exchange rate. In February 3rd, the RMB exchange rate fell to the 7 integer pass, attracting many overseas investment institutions to quickly convert the US dollar into offshore renminbi and A shares through the land share channel. Behind this is that they believe that the RMB exchange rate is at the bottom of the interval. At this point, A shares can save a risk of RMB exchange rate hedging operation costs, thereby further enhancing the A share investment returns.

Differentiated risk prevention measures

Despite the huge influx of capital into A shares in the past two days, the epidemic still makes them dare not take it lightly.

"Unlike the previous top-down selection of stocks to obtain excess investment returns, the many overseas investment institutions mainly concentrated on the relatively stable performance, and the blue chips after the end of the epidemic, and the leading sectors of the technology industry, which were hit by the impact of the epidemic." The chief representative of the Asia Pacific region, a large European financial management agency, pointed out to reporters. In addition, some overseas investment institutions are concentrating on the potential stocks of online games, video platforms, online education, intelligent manufacturing and industrial automation, and take the form of tug of investment to win the desired return, because they believe that online games, video platforms and online education may become the beneficiary sector of the epidemic, and after a large number of enterprises have resumed their work, the development of intelligent manufacturing and industrial automation will have broader prospects.

"This is also a major risk precaution they favor." He pointed out.

At the same time, some large overseas information management institutions with RQFII and QFII quota are increasing A stock and increasing stock index futures hedging positions, so as to cope with short-term shocks of A shares.

Nader Naeimi told reporters, "on the whole, the trend of A shares in overseas investment institutions has not changed. It is only for the epidemic situation that each will take advantage of its own trading strategy advantage and choose a differentiated risk prevention transaction mode." The reason is that most overseas investment institutions worry that the volatility of A share's portfolio value is too high and the maximum withdrawal value increases sharply, which may cause LP accountability pressure.

Zhou Wenqun, chief investment manager and fund manager of China International Stock Exchange, said A share market volatility is inevitable. However, the relevant departments in China are taking various measures to provide support for the stock market to ensure stable growth in capital market and China's economy, thus increasing the confidence of overseas capital in stabilizing China's capital market.