Several fund companies announced: Termination!
China Fund News reporter Zhang Yanbei
Recently, more than 10 fund companies intensively announced to stop some securities companies from providing liquidity services for their ETF products, which attracted market attention.
According to the industry analysis, this phenomenon is mainly due to the stricter requirements and standards of the new liquidity service regulations issued at the end of last year, which led some securities companies no longer meet the conditions for providing relevant services. The relevant adjustments of liquidity service providers will become more and more normalized, boosting the liquidity of the ETF market.
ETF intensive termination liquidity service provider
Recently, more and more ETF products announced the termination of their cooperation with liquidity service providers, which is ushering in a peak period.
On April 27, Tianhong Fund issued several announcements announcing that, according to the Shenzhen Stock Exchange Securities Investment Fund Business Guidelines No. 2 - Liquidity Services and other relevant provisions, the company will terminate on April 29, 2024 Huatai Securities It provides liquidity services for ETF products of multiple companies, such as CSI 500ETF Tianhong, medical equipment ETF, entrepreneurship and innovation leading ETF, and dividend low fluctuation ETF.
The day before, E Fund announced that the company would terminate on April 26, 2024 gf securities Provide liquidity services for the CSI 2000 Index ETF.
On the same day, Penghua Fund announced that since April 26, the company has terminated Huatai Securities from providing liquidity services for Penghua's oil and gas ETF, Hong Kong stock technology ETF, biological vaccine ETF, media ETF, etc. Huitianfu Fund also announced that from now on, the company will stop GF Securities from providing liquidity services for CSI 2000ETF Tianfu and Donghai Securities from providing liquidity services for Battery 50ETF. Yinhua Fund also terminated on April 26 Zheshang Securities Provide liquidity services for 1000 enhanced ETFs.
In addition to the above four fund companies, there have been more than 10 public offerings recently, including China Merchants, Dacheng, Harvest, Guangfa, Fuguo, Hua'an, Huaxia, Ping An, Jingshun Great Wall, Tibet Dongcai, ICBC Credit Suisse, etc., announcing that some of the company's ETF products have terminated cooperation with liquidity service providers.
According to incomplete statistics, this wave of "termination tide" of liquidity service providers began in late March and early April, and reached its peak in the middle of this month, involving more than 60 ETF products listed.
Originated from new regulations on liquidity services
Referring to the phenomenon of intensive termination of liquidity service providers, the industry said that, as indicated in the announcement, this was mainly due to the newly revised Shenzhen Stock Exchange Securities Investment Fund Business Guidelines No. 2 - Liquidity Services (hereinafter referred to as the "Guidelines"), namely the new regulations on liquidity services, issued on December 8 last year.
Article 7 of the Guidelines clearly stipulates that the fund manager shall apply to Shenzhen Stock Exchange to terminate the liquidity service provided by the liquidity service provider for the relevant funds if one of the following six circumstances occurs: the liquidity service provider no longer meets the conditions specified in Article 3 of the Guidelines; The agreement with the fund manager expires, changes or is terminated in advance; The liquidity service provider is unable to provide normal liquidity services for single or multiple funds for some reason, and has reached an agreement with the fund manager; During the annual evaluation cycle, the number of times that the regular evaluation result of providing liquidity services for specific funds is D accounts for 1/3 or more of the number of regular evaluations (excluding annual evaluations) of the Exchange throughout the year; Violation of laws and regulations, seeking illegitimate interests or other acts that may damage the legitimate rights and interests of investors.
It can be seen that for securities companies, the regular evaluation results of liquidity services are very important, which may affect whether they can continue to provide relevant services for funds.
A public fundraiser in Shenzhen said, "The new liquidity service regulations came into effect on December 21 last year and have been in effect for three months as of late March this year. The fund manager adjusted them based on the performance of the past three months, as well as the results of regular evaluation last year and other factors."
Another person in charge of the market department of the fund company said that the regular evaluation results of liquidity services of securities companies in 2023 will be released in January this year, and the fund company needs to judge whether the cooperation relationship with the liquidity service providers will continue according to these results.
"According to the regulations, fund managers should submit an application letter to the Exchange when they apply to terminate the liquidity services provided by the liquidity service provider for the relevant funds. It may take about two months from the submission of the application letter to the approval of the Exchange and then to the release of the announcement, so April ushered in a wave of termination of cooperation peak." He said.
Normalization of "mobility" of mobile service providers
In addition to some ETF terminated market makers, ETFs are also intensively selecting liquidity service providers and designating mainstream dynamic service providers, and fund companies are increasingly regularizing their adjustment to liquidity service providers.
For example, on April 26, Huaxia Fund issued an announcement, according to the Guidelines and other relevant provisions appoint Guojin Securities It is the mainstream dynamic service provider of China Securities 1000ETF 。
On the same day, GF announced that, in order to promote the market liquidity and stable operation of GF China Securities All Index Energy ETF, from April 26, 2024, the company selected Orient Securities For its liquidity service provider 。
The above public fundraiser said frankly that if there is no market maker for ETF, it will lose the guarantee of liquidity. With the scale of ETF reaching a new high, the liquidity of ETF is obviously insufficient. By establishing more gradient rules, the Exchange can more objectively evaluate the quality of liquidity service and carry out rewards and punishments, which is conducive to activating the exchange fund trading of Shenzhen Stock Exchange.
"According to the new regulations on liquidity services, fund managers should timely announce to the market the selection, addition and termination of liquidity service providers, as well as the designation and adjustment of mainstream dynamic service providers. Therefore, relevant announcements will become more and more common," he said.
Editor: Captain
Reviewed by: Xu Wen
Massive information, accurate interpretation, all in Sina Finance APP
Editor in charge: Li Tiemin
