Where did the foreign capital pouring into a shares come from recently?
The trading volume of a shares is enlarged, and the “credit” of foreign capital has to be mentioned. Since the big sale on August 20, funds have made great progress all the way north. Among the 15 trading days after that, only one trading day was net sale, with a total net purchase amount of nearly 60 billion yuan and a total transaction amount of 2.2 trillion yuan. During this period, the overseas market was not peaceful, and the three major indexes of US stocks even showed obvious signs of weakness. According to past experience, under such circumstances, the performance of foreign capital is somewhat abnormal. So, is there a “fake foreign capital”?
Recently, a Hong Kong fund manager exclusively disclosed to the Chinese reporter of the securities times and securities companies that in the Hong Kong industry, an information has been widely spread recently. That is, there are two 10 billion mainland head quantitative private placement, 5x leveraged capital allocation in Hong Kong, using long short strategy and frequent operation in the A-share market. The income is quite good, and the pullback is very small, and their scale expansion speed is also very fast. But he declined to disclose the names of the two quantitative private placements.
So, how high is the authenticity of this information? How big will the impact be?
Sudden spread of “fake foreign capital”, 10 billion is the protagonist?
A Hong Kong fund manager exclusively disclosed to the Chinese reporter of the securities times and brokerage that according to the information he received, the main foreign capital in the A-share market is not overseas funds, but mainland quantitative fund giants licensed in Hong Kong. These funds decentralize 5x leveraged high-frequency trading of a shares in Hong Kong’s low interest environment. It is said that the transaction frequency is changed once a week, and the capital interest rate on the quantitative fund allocated by the management is lower than 2% (the leverage level is much higher than that of the two financial institutions in the mainland, and the capital cost is also much lower than that in the mainland).
According to the above Hong Kong fund manager, if a 10 billion product, add five times the leverage to 60 billion. These quantitative funds generally change their targets once a week, so their transactions may be as high as 60 billion a week. Then, at the same time, completely short the stock indexes such as Shanghai and Shenzhen 300, which is market neutral in strategy, so there has been almost no big pullback since this year. So far, the yield this year is about 30%. Although it is not too high, the victory is that there is no retreat.
The fund manager also disclosed that: “After more than a year in Hong Kong, the scale will soon increase from 10 billion to 100 billion. It is relatively easy to allocate funds in Hong Kong. At present, when mainland funds come to quantify, they need to apply for a license. This is difficult, but it is not particularly big. Finding knowledgeable people can be done in more than half a year, just like ordinary licenses, but they need to find people. At present, they are more famous in Hong Kong The higher is mainly the two private placements in the mainland, “but he declined to further disclose the names of the two private placements.
It is not without precedent to speculate on a shares with capital allocation in Hong Kong. In 2019, the market had a great discussion on capital allocation in Hong Kong. At that time, senior officials of the Hong Kong Stock Exchange said that capital allocation in Hong Kong was not easy. However, it was also reported that major Hong Kong securities companies started capital allocation business in 2015, of which yaocai securities was the most radical. The margin interest rate offered by the latter was as low as 3.88% It is free of Commission for half a year and provides 10000 yuan of transportation fees for mainland investors who open accounts.
At the height of the bull market, a middle head securities firm in Hong Kong completed a margin interest income of nearly HK $1.3 billion that year, which is the highest of all income items. In contrast, its traditional brokerage business income is only about HK $750 million. Various signs show that the difficulty of capital allocation in Hong Kong is much smaller than that in the mainland, the leverage ratio is much higher, the cost of capital is much lower, and the cost of capital is very low The source is much richer.
Reprint indicated source：Shine Trader Limited Live information