Institutions Predict That Trillion Incremental Funds Will Enter The Market In 2021

In 2020, the issuance of new funds will set a new record. As of December 31, 2020, the issuance scale of new public funds in 2020 has exceeded 3.1 trillion yuan, reaching 3.16 trillion yuan. This figure has exceeded the total issuance of new funds in the past three years (2017-2019) (about 3 trillion yuan). In particular, it is worth mentioning that in 2020, the scale of partial share funds will exceed 2 trillion.

After the massive issuance of funds in 2020, the industry began to worry about whether the hot issuance of new funds in 2021 could continue, and whether the new funds could drive incremental funds into the market.

According to the statistics of 21st century economic report, there are 401 funds approved to be issued from June 30 to December 31, 2020.

Assuming that the average issuance scale of RMB 2.2 billion in 2020 is calculated, only 401 funds are being issued and approved to be issued, and it is expected that the new funds will still reach trillion yuan in the first quarter to the second quarter of 2021.

According to Xun Yugen, chief strategic analyst of Haitong Securities, the scale of public funds entering the market in 2020 is expected to be about 1.5 trillion yuan, while that of public funds in 2021 is expected to reach 2 trillion yuan. The public funds support the stock market to continue to move.

"In 2021, it is estimated that the issuance of funds will exceed 2 trillion yuan, bringing incremental funds to the A-share market, and the differentiation of funds will be more serious. New funds issued by star fund managers will still be hot money, but new funds of non-star funds after being cut may be small in scale, which will be more obvious in the future." Yang Delong, chief economist of Qianhai open source fund, said.

"In 2021, the issuance scale of public funds will remain relatively high." Zhang Ting, chief strategist of GESHANG financial management, believes that investors need to be treated differently, because the differentiation of fund companies and fund scale will be more and more big, and the differentiation of fund investment performance is also obvious.

In 2021, will the public raise 2 trillion yuan?

Compared with previous years, the issuance of new funds in 2020 is very hot.

According to wind data statistics, by December 30, 2020, the total number of public funds issued in 2020 is 1431, with 3.16 trillion shares, and the average share is 2.207 billion.

In 2019, 2018 and 2017, the issuance shares of the new funds were 1.42 trillion, 0.89 trillion and 0.69 trillion, respectively, with a total of 2.99 trillion shares in three years.

In 2020, the issuance scale of new funds has exceeded the sum of the previous three years.

In 2020, there are 234 equity funds, with 371.6 billion shares issued, accounting for 11.77%, with an average share of 1.588 billion;

There were 680 hybrid funds, with 1.66 trillion shares issued, accounting for 52.48%, with an average share of 2.437 billion;

That is to say, in the issuance of new funds in 2020, the shares of stock funds and hybrid funds alone will reach 2 trillion, accounting for 64%.

In 2020, 477 bond funds were issued, with 1.11 trillion shares issued, accounting for 34.99%. The rest of the monetary funds, QDII and other funds issued a very small proportion.

At the end of 2020, wind data shows that, from June 30 to December 31, 2020, the number of funds to be issued is still as high as 401. In addition, there are 46 public offerings under issuance, while 313 new funds have been successfully issued in the second half of 2020.

Based on this, it is estimated that the issuance of new funds in the first quarter to the second quarter of 2021 is still expected to reach trillion yuan.

So, after the issuance of new funds in 2020, how much money will flow into the stock market in 2021?

Xun Yugen estimates mainly through the declaration of fund products. According to its logic, it takes 5-6 months for a fund to complete its position. It believes that at present, there are more than one trillion yuan of potential capital entering the market. Considering the omission of wind's caliber, it estimates that more than 700 funds are on the way. Assuming that the average issue share of each fund is 2.5 billion, and assuming that the stock position of each fund is 80%, the funds entering the market in the first quarter or even the first half of the second quarter of 2021 is expected to exceed 1.4 trillion.

"It is expected to exceed 2 trillion yuan in 2021. Generally speaking, although the macro liquidity of the stock market will be slightly tightened in 2021, the micro liquidity is very abundant, and the stock market will continue to be bullish." According to Xun Yugen.

The issuing logic of fund companies

At present, there are still 401 approved funds to be issued. At this time, what pace does the fund company take to issue?

"Whether you want to grab the rhythm or press the rhythm depends on what kind of product it is. If it is in a relatively smooth market cycle, for example, at this point in time, such as some stock funds or new funds managed by good fund managers, they should all go to catch up with the good start in 2021, and most of the new funds issued with a good start will be active equity funds. " A fund company brand Department personage told reporters.

"But if there are some new funds managed by relatively unknown fund managers, and when the market is not very good, the rhythm may be suppressed, but generally speaking, it will not exceed 6 months at most. Otherwise, it will be more troublesome to restart the approval documents." The Fund said.

"At present, the market is OK, so from January 4 to January 6 after new year's day, there are many active equity funds that want to be issued and established quickly." "The market should be OK before the Spring Festival. I think it may be OK in the first quarter, but it's hard to say after the first quarter."

According to reports, if the funds are issued quickly, some of them will be issued within a few days after receiving the approval documents. The issuance within a week is no problem, such as Kechuang 50ETF and other funds.

"There is no law about the time when a fund is issued. There are no rules. It's not who gets the approval first. It depends on the relationship between you and the channel. Of course, there are also some factors, such as large powerful fund companies and star funds. When new funds are cut, their bargaining power must be higher. It is related to the scale, and the schedule will be given priority." The source said.

In fact, channels hold the fate of the new fund.

A person from a fund company in Shenzhen said, "fund issuance needs to be communicated between the company and sales channels, such as banks, securities companies and mutual fund platforms. The schedule is determined only after both parties have negotiated. The schedule is not necessarily carried out according to the approved order, and then the market situation will also be considered."

"The most important thing is to see the intention of the sales channel. If there is no intention of selling in the channel, the product may not be released recently." Said the Shenzhen fund company.

Yang Delong, chief economist of Qianhai open source fund, said, "there are still a lot of new funds to be issued, which mainly depends on the schedule of banks and other channels, not that fund companies can issue funds if they want to, but also make an appointment with banks. In addition, when the fund issues, many fund companies will also choose a certain time window, because when the market is good, the scale of the hair may be larger. "

"At the beginning of the year, the fund issuance rhythm will be faster, and the market will not be short of funds at the beginning of the year. At the end of the year, the issuance rhythm will slow down, because many investors are short of money at the end of the year." Yang Delong said.

In fact, before the end of 2020, some fund companies with demand for offsetting scale will be issuing bond funds and fixed income funds. The issuance shares of these funds can be very large, which can meet the demand of fund companies to offset the scale in a short period of time.

A large number of ETFs enter the market

At the end of 2020, a large number of passive funds will be issued, many of which are ETF funds.

In this regard, industry insiders explained that ETF had been approved for a while before and was approved in succession by the end of 2020.

"In 2020, ETFs will basically be issued as soon as they are received. Because the market is relatively good, we should lay out ETFs as soon as possible. Under the rotating market, who knows whether the wind will blow to the industry ETFs you issue, so we should issue them as soon as possible. But in 2021, it may not necessarily be such a rhythm of issuance, because if everyone gets a lot of ETF approval at once, they may not be able to schedule in the bank. If the scale of the issuance is also relatively ordinary, then the issuance may depend on the timing. " The Fund said.

Industry insiders believe that the rise of fixed income + in 2020 will usher in great development in 2021.

The logic is that the market generally expects that the equity market in 2021 will not be as good as the previous two years, or even pessimistic. At this time, the fixed income + which can bring "stable happiness" will be very popular. In addition, in 2021, there will be a large number of bank financial products that cannot be converted, and investors with low risk preference may turn to fixed income plus products.

Zhang Ting believes that in 2021, the issuance of public funds will present the following characteristics: first, the issuance scale will remain at a relatively high level, and investors' willingness to conduct asset management through professional institutions will be greatly improved. In particular, under the background of high average performance of public funds in 2020, the attractiveness of public funds to investors will be enhanced. In addition, under the background of P2P explosion, breaking the rigid exchange and housing speculation In the future, there will still be more incremental funds in the equity market, while ordinary investors will buy more and more products from professional managers. Secondly, the differentiation of fund companies and fund size will be more and more. In 2020, the scale of equity funds will increase significantly, mainly focusing on the products managed by the top fund companies and star fund managers, while many small fund companies and their performance On the contrary, the management scale of weaker fund managers is shrinking, and the differentiation between February and August is serious. This phenomenon will continue in 2021.

"In 2021, it will be more difficult for fund managers to operate. In the face of a substantial increase in scale in 2020 and a structurally overvalued market environment in 2021, how to maintain a relatively stable excess return is a problem faced by many fund managers. The yield space in 2021 will be smaller than that in 2020." Zhang Ting said.

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