Public funds "closed doors" frequently appear special proportion placements or appearances

Beijing, 20 Jan (Xinhua) -- On 20 January, "China Securities News" published an article entitled "Public Funds Frequently Appear in Special Proportions of Placements or Appearances." The article said that recently, under the pursuit of investors, many high-performing funds have increased the purchase restriction, and even a special continuous proportional placement method has emerged. Previously, in the public fund industry, the scale of management has always been regarded as a "sweet burden".

On January 19, Zhonggeng Value Quality One-Year Holding Period Fund was established for one year and officially entered the open period. China Securities News reporter learned that the fund may have continuous proportional placement during the resumption of subscription, which is also a rare proportional placement method in the industry.

(Data chart, issued by Xinhua News Agency)

(subtitle) Controls the scale

According to the announcement of Zhonggeng Fund, the fund shares that have held Zhonggeng Value Quality fund for one year for one year can be redeemed daily from January 19. At the same time, in order to meet the investment needs of the majority of investors and minimize the impact of centralized redemption or large subscription on the smooth operation of the fund that may occur during the open holding period, Zhonggeng Fund decided to resume the subscription (including conversion transfer and fixed investment) business from January 20 to January 26, 2022, and adjust the large subscription limit to a single-day single account cumulative subscription of no more than 5 million yuan.

The China Securities News reporter learned that there is a possibility of continuous proportional placement during the resumption of subscription of the fund, which is also a rare proportional placement method in the industry. Specifically, each working day during the resumption of subscription period will be used in the form of proportional placement to achieve effective control of the current stage of scale. If the total size of the fund on T Day exceeds RMB7 billion, the fund will partially confirm the valid subscription application on that day in accordance with the principle of proportional placement.

The reporter checked the relevant announcements and learned that the main reason why the fund adopted the above proportional placement method is that the scale of the fund has grown rapidly recently, close to the upper limit of 7 billion yuan set, and the fund is about to enter the open holding period, so Zhonggeng Fund has made the above prudent decision.

Avoid liquidity pressures

Lu Qiang, deputy general manager of Zhonggeng Fund, said that the one-year holding period of Zhonggeng Value Quality Fund was in the resumption subscription period from January 20 to January 26, because it was available for subscription continuously every day, and unlike the previous proportional placement, which was only affected by the subscription amount, the daily placement ratio of the fund was affected by the net value of the product on the day, the redemption amount and the subscription amount. At the same time, considering that if the proportional placement is triggered, the change in the large subscription fee may cause a poor purchase experience for the holder, and the single account of the resumption of subscription is limited to 5 million yuan per day.

As for why the redemption was arranged to start on January 19 and resume subscription from January 20 to January 26, Lu Qiang said that the proportional placement experienced in the past industry is generally more common in the last-day proportional placement of the initial offering period, and this time because the Zhonggeng Value Quality One-Year Holding Period Fund is a one-year holding period, all the initial subscription shares are liquid, considering the uncertainties such as large redemptions and uneven redemption behaviors that may be faced after the opening of redemption on January 19, in order to better protect the interests of investors. Therefore, it is necessary to continue to open subscriptions in the next few days to avoid liquidity pressure caused by possible large redemptions, which in turn will have an impact on investment.

(Subtitle) Intensive purchase restrictions

In addition to the resumption of subscription of funds to restrict subscription behavior, a number of star fund managers have recently intervened to further tighten the subscription limit of their open funds.

On the eve of New Year's Day, Yu Yang announced a new impetus to return to rich countries. Shortly after Yu Yang's return, on January 7, Liu Bo, the former fund manager of Wells Fargo New Power, announced his departure, explaining that it was due to "personal career development". On January 15, the fund announced a purchase limit of 5,000 yuan per day since January 18.

In addition, on January 4, the BOCOM Trend Priority Hybrid Fund announced that the cumulative subscription amount of a single fund account on a single day should not exceed 1,000 yuan, and the purchase restriction applies to direct sales institutions and non-direct sales agencies.

In addition to equity funds, bond funds have also entered the market. On January 17, Boshi Fund announced that the cumulative amount of subscription, conversion transfer and regular fixed investment in each fund account of Boshi Fushun Pure Bond and Boshi Fuxiang Pure Bond should not exceed 10 million yuan. Southern Fund also announced that its two funds, Southern Baoyuan Bond and Southern Tongli Bond, will suspend the acceptance of subscription applications accumulating more than 5 million yuan per fund account in a single day from January 14; Southern Dolly Enhancement will set the daily subscription limit at 1 million yuan.

As for the reasons for the purchase restriction, many fund companies have said: "In order to safeguard the interests of fund share holders and ensure the smooth operation of the fund." "Specific to the detailed reasons, industry insiders believe that the restriction of subscription on the one hand in order to prevent the influx of funds into diluted income, on the other hand, is out of consideration for market forecasting. (End)