Encountering a "Late Spring Freeze"! Total ETF Market Scale Shrinks by Nearly 150 Billion Yuan in One Week

Source: Daily Economic News Author: Peng Shuping

Last week (March 16–20), A-shares experienced volatility and adjustments. Except for the ChiNext Index, which rose 1.26% for the week, all major indices declined. The Shanghai and Shenzhen 300 Index fell 2.19%, the CSI A500 Index dropped 3.18%, and the STAR Market 50 Index declined 4.03%. Hong Kong stocks also surged and then pulled back last week, with the Hang Seng Index down 0.74% and the Hang Seng Tech Index down 2.12%.

Last week, both A-shares and Hong Kong stocks rose and then fell back, once again playing out the “stock-bond double kill” scenario. Against this backdrop, the ETF (Exchange-Traded Fund) market faced a “late spring cold spell,” with total scale dropping nearly 150 billion yuan in one week. The once-favored gold ETFs staged a “free fall,” transforming from the “increment king” in recent weeks to the “shrinkage king” last week, providing investors with a vivid lesson on risk.

Under the dual pressures of stock market volatility and commodity asset adjustments, investors’ risk appetite significantly decreased. Funds withdrew from high-volatility products and returned to cash-equivalent ETFs for safety.

Cash ETF Grows Against the Market

Last week, the market experienced a “stock-bond double kill,” and commodity ETFs also saw significant weekly adjustments. In this context, excluding cash ETFs, which grew by 3.059 billion yuan, all other major categories of ETFs declined. The total ETF scale shrank by nearly 150 billion yuan, returning to 5.1 trillion yuan. According to Wind data, as of March 21, eight new ETFs were launched last week, including seven stock ETFs and one cross-border ETF. The total number of listed ETFs reached 1,456.

In terms of scale changes, stock ETFs and cross-border ETFs shrank by 110.251 billion yuan and 14.220 billion yuan respectively, with continued outflows from equity products. Previously favored safe-haven commodity ETFs also shrank by 27.749 billion yuan last week, as many funds realized substantial gains. Bond ETFs saw a slight decrease of 756 million yuan. Cash ETFs were the only major category to grow last week, increasing by over 3 billion yuan, as funds moved into safer, less volatile assets.

Since the beginning of the year (up to March 21), the total ETF scale shrank by over 926.5 billion yuan, with stock ETFs down 896.045 billion yuan, bond ETFs down 95.148 billion yuan, and cross-border ETFs down 17.955 billion yuan. Notably, despite last week’s deep adjustments, commodity ETFs still grew by 81.719 billion yuan year-to-date, and cash ETFs increased slightly by 899 million yuan.

“Increment King” Turns into “Shrinkage King”

Regarding ETFs linked to indices, the scale of ETFs tracking major indices shrank again last week, with only four of the top 20 index ETFs seeing growth.

Specifically, the four leading index ETFs that increased last week were those tracking the SSE 50, China Internet 50, Low-Volatility Dividends, and Hong Kong Stock Connect Innovation Drug Index, with only the SSE 50 ETF growing by more than 1 billion yuan.

It is worth noting that last week, the SGE Gold 9999 ETF linked to gold shrank by over 24 billion yuan, moving from the “increment king” to the “shrinkage king” of the week, providing a vivid lesson: gold as a safe-haven asset is not risk-free, and its volatility can be significant.

Additionally, two other index ETFs shrank by over 10 billion yuan: the CSI A500 Index ETF (down 13.825 billion yuan) and the segmented chemical industry index ETF (down 11.974 billion yuan). The segmented chemical index ETF also experienced its first major weekly adjustment after a continuous increase this year, largely aligning with gold products. The CSI 300 ETF linked to the Shanghai and Shenzhen 300 Index also shrank by over 6 billion yuan last week.

Year-to-date, the CSI 300 ETF linked to the index shrank by 619.071 billion yuan, with the latest scale at 566.486 billion yuan. The CSI 1000 and SSE 50 index ETFs shrank by 135.664 billion yuan and 106.969 billion yuan respectively this year. Despite large reductions last week, ETFs linked to SGE Gold 9999, segmented chemicals, and the Hang Seng Tech Index still grew by over 100 billion yuan each year, at 66.138 billion yuan, 23.943 billion yuan, and 17.479 billion yuan respectively.

Institutional Management Scale Changes

Regarding management institutions, among the top 20 managers, only two saw ETF scales grow last week, while seven institutions experienced outflows exceeding 10 billion yuan. In rankings, BOCOM Fund, Hua An Fund, and Penghua Fund dropped one position each due to significant shrinkage. GF Fund surpassed BOCOM Fund to rank 8th, Hwabao Fund overtook Hua An Fund to re-enter the top 10, and Huitianfu Fund replaced Penghua Fund at 15th.

In scale changes, two institutions saw growth. Notably, HFT Fund’s ETF scale surged by 5.453 billion yuan last week, and Yinhua Fund’s ETF scale increased slightly by 170 million yuan, performing relatively well.

Last week, Hua Xia Fund’s ETF scale shrank by 22.856 billion yuan. Six other institutions also saw reductions exceeding 10 billion yuan, including Guotai Fund, E Fund, Hua An Fund, Penghua Fund, Southern Fund, and BOCOM Fund, which hold relatively large gold ETF scales. Additionally, GF Fund and Harvest Fund also experienced significant scale reductions last week.

Year-to-date, Guotai Fund, HFT Fund, BOCOM Fund, and Hua An Fund’s ETF scales increased by over 100 billion yuan each, at 27.731 billion yuan, 22.086 billion yuan, 13.235 billion yuan, and 13.023 billion yuan respectively. Conversely, Hua Xia Fund, E Fund, and Huatai-PineBridge Fund saw reductions exceeding 200 billion yuan each, at 253.642 billion yuan, 231.114 billion yuan, and 206.815 billion yuan; Southern Fund and Harvest Fund also shrank by 128.622 billion yuan and 113.496 billion yuan respectively.

Gold ETF Collective Shrinkage

In terms of top ETF products, last week saw a scene of chaos, with only two products among the top 20 seeing growth. Due to varying degrees of shrinkage, the rankings of the top 20 products changed significantly last week, with many gold ETFs dropping in rank. For example, the Bosera Gold ETF fell from 11th to 13th place, and the Guotai Gold ETF dropped one position; the GF Hong Kong Internet ETF also fell from 7th to 9th.

Specifically, the China Asset Management SSE 50 ETF and E Fund’s China Concept Internet ETF increased by 1.3 billion yuan and 201 million yuan respectively, becoming the only two ETFs in the top 20 to see positive growth last week.

Gold ETFs shrank significantly last week, with Huaxia Fund’s Gold ETF shrinking by 10.667 billion yuan, the only product to shrink by over 10 billion yuan. Other gold ETFs such as Guotai, Bosera, E Fund, and GF Hong Kong Internet ETF all shrank by over 3 billion yuan.

Year-to-date, despite the overall decline last week, three gold ETFs still grew by over 100 billion yuan: Huaxia Gold ETF, Guotai Gold ETF, and Bosera Gold ETF, with increases of 23.37 billion yuan, 13.518 billion yuan, and 10.322 billion yuan respectively. E Fund’s gold ETF increased by 8.702 billion yuan this year.

It is noteworthy that five products have shrunk by over 1 trillion yuan this year: CSI 300 ETF Huatai-PineBridge, CSI 300 ETF E Fund, CSI 300 ETF Huaxia, SSE 50 ETF Hua Xia Fund, and CSI 300 ETF Harvest, with reductions of 2,166.72 billion yuan, 1,594.45 billion yuan, 1,367.43 billion yuan, 1,053.52 billion yuan, and 1,021.83 billion yuan respectively.