Dismantling The "Market Path" Of Northward Funds: Rush To Collect 10 Billion Yuan And Add 3400 Points To Brake "Sudden Change Of Painting Style"

On July 8, under the background of almost one round of hot plate rotation, the brokerage plate rose again in the afternoon, driving the index higher.

But in the year profit quite abundant quantification organization, appears to be at a loss in these days sudden outbreak market.

"The model did not give a hint of capital changes. It could only say that there were some signs on July 6. As a result, the market has suddenly turned these days, and it is still unclear where the wind comes from." When referring to the recent A-share market, a buyer from East China described it as "muddled".

The northward fund is not in good time. On June 30 and July 1, Shanghai, Shenzhen and Hong Kong stock exchanges were closed, and the capital from the North was "late set". Therefore, since July 2, the activity of northward funds has been greatly increased, and the daily trading volume has doubled to the previous level, and the trading volume for consecutive days has exceeded 150 billion yuan.

In the meantime, the inflow speed is also accelerating. From July 2 to July 6, the net inflow scale for three consecutive trading days exceeded 13.6 billion yuan, and the scale of single day inflow capital ranked among the top six since this year.

However, against the background of no relay of new sectors in the market on July 8, the willingness of northward funds to chase up the price was greatly reduced, and the daily inflow scale was significantly reduced from 10 billion yuan to 1.153 billion yuan.

Northward fund "catch up late"

This round of A-share rise really started on June 30, when the wind all a index closed above the high point in March this year.

However, in the initial stage, the northbound capital was closed due to the Shanghai and Shenzhen stock exchanges, and did not participate until July 2. As a result, on that day, the northward capital, which had been suppressed for two days, suddenly went into large quantities.

On July 2, the total trading volume of northbound funds was 149.47 billion yuan, compared with 82.22 billion yuan on the previous trading day for which data are available. Before that, the transaction scale of RMB 70 billion to RMB 80 billion has been maintained for nearly three months.

At the same time, the scale of northward capital inflow on that day reached 17.12 billion yuan, second only to February 3 and June 19 this year, ranking the third since the opening of Shanghai and Shenzhen Stock connect.

In the following trading days, the northward capital inflow also maintained a daily rate of more than 10 billion yuan, until the closing of July 8, and its inflow scale dropped sharply from 9.8 billion yuan the previous day to 1.153 billion yuan.

Accompanied by that, the A-share market weakened in the morning of July 8, and the main plate has been up again.

In this process, northbound funds have also increased positions in some securities companies and insurance industry leaders, such as increasing the holdings of about 30 million shares of CITIC Securities and 12 million shares of China Life Insurance.

However, due to its large shareholding base, during the continuous rise of the stock prices of the above companies, the northward funds will not excessively pursue the rise, and the overall increase in position is relatively limited.

In contrast, by tracking the stock holding data of Shanghai and Shenzhen stock exchanges, we can screen out the stocks with more obvious northward fund intervention in the near future.

In terms of the proportion of northward funds in A-share circulating shares, from June 30 to July 2, the largest increase in proportion was in cycle stocks such as automobile, electrical equipment and nonferrous metals, as well as some subdivided industries, such as in vitro diagnostic enterprises in the pharmaceutical field.

Among them, automobile is more concentrated in northward capital holdings. During the period of liberation, the proportion of shares increased to 95.2.2% to 95.2% of FAW power.

In addition, such as Luxi Chemical Industry, China Nuclear titanium dioxide and Valin steel and other traditional industries cycle stocks, during the above period also obtained northward capital holdings.

On the other hand, the proportion of the above-mentioned shares of northbound funds has doubled. For example, the number of walkers increased by more than 12 times. However, this kind of target is disturbed by the low base number, and the reference value of shareholding change is low.

In contrast, the original shareholding ratio of northbound capital exceeded 1%, and the shares increased by more than 1 times, including Laibao hi tech, dongfangtong, tianbang shares and prebiotics shares in the aquaculture industry, with an increase of more than 1.2 times.

Different painting styles of foreign funded institutions

The northward fund is regarded as a market vane by many market people, but there are many variables in this reference frame.

In the same period, the shares held by the former three banks, namely, Huibei bank, Standard Chartered Bank and JPMorgan Chase & Co., Ltd., were also the top three stocks held by the former Bank of Guizhou and Standard Chartered respectively in the same period.

This has also raised some investors' doubts. "The foreign-funded institutions with the highest shareholding are highly similar, holding a large number of leading shares in the industry. Can they really represent foreign capital? Is there any case of domestic capital borrowing?"

Some people in the industry pointed out that the reference value of the shares held by the above-mentioned foreign-funded institutions is relatively limited, and HSBC itself is only a trading seat. The shareholding includes its own funds and customer funds, and the customer funds may come from overseas or domestic.

As for the composition of funds, there is no way to judge. This is the same as the daily announcement of the stock index futures position, only represents the position change of seat funds.

In contrast, some domestic funded institutions, or "non mainstream" foreign-funded institutions, are more valuable.

On July 2, Tianqi lithium increased 12.24 million shares in a single day of northward capital holdings, with limited changes in the shares held by the top foreign seats. However, CICC, which had a relatively lower number of shares, added 5.5 million shares on the same day, and JP Morgan's brokerage added 3.63 million shares.

In the next few days, the company's share price rose along with the overall market, up 18.38% to July 8.

However, the above-mentioned foreign seat operation is also very flexible, and the short-term operation is very frequent, which makes it difficult to track down.

Take the brokerage seat of JP Morgan as an example. After its shareholding rose to 5.5 million shares on July 3, it continuously reduced its holdings of Tianqi lithium, which was reduced to 657500 shares on July 6.

The same is true for hot stocks. On July 3 and 6, CITIC's northbound capital decreased by 6.8 million shares and 5.92 million shares respectively, and increased by 1.94 million shares on July 7.

However, if we lengthen the time cycle, we can see the more obvious trend behavior of northward funds.

On July 8, 2019, the shareholding ratio of northbound capital in CSCI was 0.44%, and rose to 3.56% on June 18 this year. Since then, CSCI has been rising continuously.

In addition, there are some highly representative foreign-funded institutions, such as the Abu Dhabi Investment Authority, whose capital source is Abu Dhabi's oil earnings. They mainly undertake the responsibility of prudent investment for the state-owned assets of the UAE and create long-term value.

The strategy team of Societe Generale Securities summarized the institutional style, "from a long-term perspective, ABI prefers cyclical industries."

Up to now, Yanzhou iron and Steel Co., Ltd. and petrochemicals Co., Ltd. have held 115 shares in China's petroleum machinery and chemical industry for a long time, and the remaining stocks have been invested in China's non-ferrous metals industry for a long time, including China's construction machinery and chemical industry.

Undoubtedly, the reference value of shareholding changes in such foreign-funded institutions is more obvious.