Boshi Fund Education ETF "Born In A Bad Time" For More Than A Month, Net Worth Fell By Nearly 50%

This year's most miserable ETF fund is the BSI Global China Education (qdii-etf) (513360) (hereinafter referred to as "education ETF"), more than a month after its establishment, the net value decline has nearly halved.

Affected by the adjustment of the education industry, recently, many domestic funds investing in education stocks have been affected, and the net value has been reversed. Should these funds no longer hold education stocks? Should fundamentalists copy the bottom of education funds or escape from education funds?

More than a month after the establishment of the net worth cut

As the first education ETF in China, this fund was issued by Boshi fund and was only established on June 8, 2021. So far, the net value of ETF has nearly halved. On July 27, the net value dropped to 0.5106 yuan. Among the 149 QDII funds in the same category, the performance ranked the bottom.

In the secondary market, education ETF has fallen for five consecutive trading days, of which three trading days have a one word limit. On July 29, the latest closing price was 0.5430 yuan / share. Due to the domestic ETF funds set a daily rise and fall of 10%, so its floor trading price is currently higher than the net value, the latest discount premium rate of 6.35%.

If you look back on the growth of this fund, you will find that this fund was born at a bad time. When the fund was raised (June 8), education stocks had fallen for a round. On the first day of listing (June 17), it closed at 0.899 yuan / share, down 9.92%, close to the 10% limit.

The education ETF tracks the global China education theme index (hereinafter referred to as the China Education Index). The index selects 50 education related securities with good liquidity and large market value to form an index sample. These include new Oriental Education, which is listed on the New York Stock Exchange, Shiyuan shares in Shenzhen Stock Exchange and China Education holding company in Hong Kong stock exchange, which reflect the overall performance of securities of Chinese education companies around the world.

Affected by the adjustment of the education industry, recently, many domestic funds investing in education stocks have been affected. Visual China

At that time, it was reported that the education ETF evenly covered China's education sector of a shares, Hong Kong shares and US stocks, and was no longer limited to a single market, which was conducive to the distribution of global Chinese education enterprises. Specifically, among the 43 constituent stocks, 21 companies are listed on the Shanghai and Shenzhen stock markets, 16 companies are listed on the Hong Kong market, and 6 companies are listed on the US market.

According to the wind data, since the base date, as of April 16, 2021, the growth rate of China's education index has been ahead of that of Shanghai and Shenzhen 300 index, reaching 172.63% since December 31, 2014, exceeding 45.63% of the CSI 300 index. In terms of historical performance, China Securities Global China education theme index is significantly better than the main broad base index, with relatively large advantages and market performance.

It is worth mentioning that at that time, the propaganda also said: the index is currently in a low position for nearly a year after a round of adjustment, and has good allocation value.

As a matter of fact, at the time of the establishment of the education ETF, the education sector in the three markets fluctuated violently under the influence of market fluctuation and stricter industry supervision. However, as the first education ETF in China, the education ETF still attracted a large number of investors' attention, which was known as "icebreaker".

However, the development of things is not as imagined "opportunities fall out", but fall again and again. Among the 43 components of China's education index, most of them have fallen this year, only three have risen. Tal and gaotu have fallen by more than 90% since this year, and 16 stocks have fallen by more than 50%.

As of July 29, China's education index has fallen 63.56% this year. Among them, since the establishment of education ETF on June 8, China's education index has fallen by 48.38%, and the decline of education ETF does not deviate from its tracking index.

As a passive index fund, there is no doubt that education ETF chose the worst time to go public. Education stock has always been a beautiful track in history, but when it comes to standardization, the impact is unexpectedly fierce.

On the evening of July 24, the general office of the CPC Central Committee and the general office of the State Council printed and issued the opinions on further reducing the burden of students' homework and off campus training in the stage of compulsory education (hereinafter referred to as the "opinions"), which clearly stipulates that the existing discipline training institutions are uniformly registered as non-profit organizations; Discipline training institutions are not allowed to list for financing and capital operation is strictly prohibited; Online training institutions are not allowed to provide and disseminate bad learning methods such as "taking photos to search questions", which can indoctrinate students' thinking ability, affect students' independent thinking, and violate the laws of education and teaching; It is strictly forbidden to employ foreign personnel abroad to carry out training activities.

The implementation of the "opinions" shocked the capital market. On July 26, the education stocks of us, Hong Kong and a shares suffered heavy losses after the market opened. New Oriental, tal, gaotu, Netease Youdao, doushen education and Zhonggong education all showed a downward trend.

The stock prices of XRS and New Oriental, two major off campus training giants, plummeted by more than 50% on the same day, while doushen education fell by 20%. Tal, listed in the United States, fell by more than 70% in a single day, and continued to fall by 26.67% on the 26th.

Since July 26, education ETF has been trading on the floor for three consecutive days. As of July 29, education ETF continued to fall by 2.16%. In fact, China Education stocks in the US stock market have rebounded to a certain extent, but the education ETF fund has not stopped falling.

The fund was established on June 8 and listed on June 17, with 286 million yuan of listed trading shares. On July 28, there was only 146 million yuan left, which evaporated 140 million yuan in more than a month.

Boshi fund has issued the announcement of premium risk and net value fluctuation for 4 consecutive days since July 26, 2021.

The announcement on July 29 said that "the trading prices of some components of the underlying index fluctuated significantly in the secondary market, and the net value of fund units was also affected. On July 27, 2021, the net value of the fund units is 0.5106 yuan. On July 28, 2021, the closing price of the secondary market of the fund is 0.555 yuan. There is a deviation between the trading price and the reference net value of the fund units, and the trading price has a premium. At the same time, the net value of fund units of the fund may face large fluctuations in the future. We hereby remind investors to pay close attention to the reference net value of fund units and the trading prices of the underlying index constituent stocks in the secondary market, and pay attention to investment risks. "

At the same time, it also warned that "ETF has arbitrage mechanism. Investors need to pay attention to the risk brought by the narrowing of transaction price premium in secondary market. At the same time, the fund invests in domestic and foreign securities markets, and the trading rules and business rules of the overseas securities market are different from those of the domestic securities market, and investors need to pay attention to the risk of large fluctuations in the net value of fund units. "

The fate of Education Fund

In fact, more than one fund is affected by education stocks.

There are only two funds with "education" in the name of the fund. In addition to the education ETF tracking the education unit, there is also a southern modern education fund.

As of July 28, the income of the southern modern education fund was 10.34% this year. Why is the return so good, contrary to the result of the education ETF?

In the first quarter of 2021, only two stocks were involved in education, namely, public education and university education, accounting for 4.36% and 3.51% of net worth respectively. In the second quarter, there was only secondary and public education, accounting for 3.32%.

Heavy positions in the second quarter were concentrated in new energy, photovoltaic, medical and American, such as Ningde era, Yiwei lithium energy, Longji, etc.

According to wind data, there are 757 public funds (A / C shares are calculated separately) that have been recalled by the education stocks in the market. Among them, only 12 public funds with a net value of more than 5% are listed in the interim report of 2021, including the growth of Bank of communications a8.33%, the blue chip of BOCOM 8.30%, the reform of Dacheng state-owned enterprises 6.01%, the selection of BOC China 6.00%, the dynamic strategy of BOC 5.90%, and the annual opening of BOC's technological innovation by 5.81% Bank of China blue chip selection 5.80%, BOCOM quality life 5.70%, BOCOM new growth 5.57%, BOCOM select 5.55%, southern modern education 5.38%, BOCOM Schroder Ruifeng 3 years 5.08%.

As of June 30, 2021, among the stocks held by the fund, the total market value of the education industry was 7.8 billion, down 15.75% in the first half of the year. The market value accounted for only 0.03% of the net value, which ranked 17th and 3rd from the bottom among 19 industries, only higher than comprehensive and residential services.

In fact, affected by the general decline in education stocks, many funds investing in education stocks have been dragged down. Fund managers began to rethink whether and how to invest in education stocks.

"Looking back on my past judgment, I found many mistakes."“ Zhang Kun admitted in the second quarter.

Zhang Kun said in E Fund Asia's selected second quarter report that in the second quarter, due to the influence of policy expectations, the share price of teaching and training enterprises dropped significantly, which had a certain negative impact on the net value of the fund. It also made him reflect on some assumptions in the long-term investment framework, hoping to further improve it.

Zhang Kun has invested in education stocks and Internet stocks in Asia's select funds, both of which have been hit by policy adjustments recently. It also affected his performance.

Zhang Kun's second quarter of the top 10 positions have no education shares.

Wang Chunxiu, the manager of dongtuo investment fund, said, "it is suggested to stop loss by selling relevant teaching and training stocks whenever there is a rebound."

Wang Chunxiu believes that the collective transformation of K12 business based teaching and training industry is imperative. At the same time, those companies with adult training as the main business will also face the fierce competition brought by the collective transformation of K12 teaching and training institutions. Education ETF takes domestic and foreign listed education stocks as the main investment object, and the investment risk is far greater than the return. We suggest selling stop loss every rebound.

Liu Yan, chairman of anjue assets, also believes that for the whole k12 education sector, the Survival Logic of the industry has undergone fundamental changes. Investors should be cautious about this national strategic level policy orientation, and wait patiently for the stability of the industry fundamentals and the industry's bad luck before considering admission.

However, on the other hand, there are also potential opportunities for investment in education stocks.

Liu Yan believes that at present, the education industry companies have fallen to a historical low. Although the industry policy restrictions are more stringent, these enterprises have a large customer stock and a lot of resource accumulation, which does not rule out innovative changes in compliance with the policy in the later stage.

"Don't copy the bottom blindly." Jianhong times investment director Zhao Yuanyuan said.

Zhao Yuanyuan believes that at present, the rectification of off campus training and supplementary courses is still in progress. Reducing the cost of parenting is a strategic national policy to increase fertility, which will not change for a long time in the future“ The impact of this strategic national policy adjustment on the stock price will not be less than half a year. "