Margin trading balance on A-shares breaks 3 trillion for the first time.

The margin balance of A-shares has crossed a new milestone. Data shows that as of June 23, the margin balance of A-shares reached 3.00971 trillion yuan, surpassing 3 trillion yuan for the first time. This comes after the margin financing balance exceeded 2.8 trillion yuan in May this year, giving another strong signal of leverage funds in the market. The latest data also shows that on June 23, the margin balance as a percentage of the A-share market value was 2.83%, lower than historical peak levels, but still at a relatively high level since the 924 market; the margin trading volume as a percentage of A-share turnover was 10.25%, also lower than historical peak levels, overall still in a relatively reasonable range. Another data point that reflects activity is the percentage of investors with margin financing and securities lending liabilities, which has reached 24.56%, with an average margin financing balance of about 1.46 million yuan per account, both at relatively high levels since 924. This means that the core contradiction in the current margin market is not just "excessive leverage" but rather "increased participation, highly concentrated structural increase in holdings, and continued expansion of brokerage credit operations." It is worth noting that since April, leverage funds have continued to focus on the technology sector, especially on hardware devices, semiconductors, and AI technologies. The trend of net capital inflows into these sectors has continued in June, with even greater concentration; since June, nearly all of the net capital inflows have gone to the hardware devices and semiconductor industries, accounting for 95% of the total net capital inflows. While the new milestone of 3 trillion yuan in scale has been reached, the leverage ratio is still lower than historical peak levels. Determining whether the level of leverage is too high should not be based solely on the absolute value of the balance, but also on its relationship with market capacity, trading activity, and investor participation. This logic still applies to the current 3 trillion yuan mark. Compared to ten years ago, the total market value, free market value, number of margin trading targets in A-shares has significantly increased, indicating that the market's capacity to support leverage funds is significantly different now. When the margin balance exceeded 2.8 trillion yuan, the ratio of financing balance to free market value was approximately 2.6%, while at the historical peak in 2015, it reached 4.72%. Now this ratio has risen to 2.83%, indicating that the marginal leverage continues to rise but is still below historical extreme levels. On the trading front, a similar pattern is observed. On June 23, the margin trading volume accounted for 10.25% of A-share turnover, indicating that margin funds are actively participating in pricing the market, especially exerting significant influence in hot sectors. However, this ratio has not exceeded historical highs and mainly reflects increased activity. In terms of investor participation, the percentage of investors with margin financing and securities lending liabilities reached 24.56%, with an average margin financing balance of about 1.46 million yuan, indicating that the number of margin financing clients, usage frequency, and individual account size are all increasing. In other words, the margin balance crossing 3 trillion yuan is not just a result of an increase in existing funds but also a reflection of margin trading becoming a mainstream tool for active funds. What are margin funds buying? Technology hardware remains the main battleground. Looking at the flow of funds, margin funds have not been spread out evenly since June. The net margin balance has increased by 88 billion yuan, with 70% going to the hardware devices industry. Wind data shows that the leading industries in terms of net margin inflows since June have mainly been in hardware devices and semiconductors. Among them, the net margin inflow for hardware devices is around 60.747 billion yuan, semiconductors around 29 billion yuan, non-ferrous metals around 14.58 billion yuan, and chemicals around 11.706 billion yuan. The net margin inflow for hardware devices and semiconductors combined has exceeded 83.6 billion yuan, making it the most concentrated direction for margin funds. Historically, the rush of margin funds often accompanies a rise in technology stocks. The logic behind this is not complicated; technology stocks have high elasticity and volatility, making them preferred targets for leveraged funds, and this time is no exception. Since April, the enthusiasm of margin funds for technology stocks has continued to rise. The trend of margin funds increasing their positions in technology, especially in hardware devices, was evident in April and May, and this trend has continued into June. In other words, this round of margin balance crossing 3 trillion yuan is a reflection of leveraged funds making highly concentrated bets around the AI hardware, semiconductor, and computational power chain; technology growth remains the core direction of margin funds, making this extreme market trend highly noteworthy. At the individual stock level, the preferences of margin traders are also clear. Since June, Zhongji Innolight has a net margin inflow of 11.02 billion yuan, leading the pack; Eoptolink Technology Inc. has net inflows of about 5.164 billion yuan, GigaDevice Semiconductor Inc. around 3.286 billion yuan, Contemporary Amperex Technology around 2.431 billion yuan, Hengtong Optic-Electric around 2.27 billion yuan, Shandong Sinocera Functional Material, Biwin Storage Technology, Sharetronic Data Technology, Cambricon, and Suzhou Dongshan Precision Manufacturing have all entered the top list in terms of net inflows. This combination is not unfamiliar. As early as May, it was mentioned that the direction margin funds were taking was highly aligned with the technology market, especially focusing on high elasticity sectors such as semiconductors, computational power, optical modules, and hardware devices. The latest data suggests that this trend has not waned in June, with margin funds continuing to strengthen the market's most powerful narrative with leverage. At the same time, the net selling side of margin trading also reflects adjustments in funds within crowded trades. Since June, stocks such as Anhui Jianghuai Automobile Group Corp., Ltd., Chongqing Sokon Industry Group Stock, Guotai Haitong, Sungrow Power Supply, Zhejiang Sanhua Intelligent Controls, WuXi AppTec, Kuang-Chi Technologies, Foxconn Industrial Internet, Hebei Changshan Biochemical Pharmaceutical, and Unigroup Guoxin Microelectronics have been among the top in terms of margin net selling. These include not only previously popular stocks but also stocks in the brokerage, pharmaceutical, and new energy sectors, indicating that margin funds are not just increasing but also quickly shifting within a structural market. After the increase in margin ratios, leverage funds are now being tied with a safety belt. Another important background for the margin market this year has been the re-adjustment of the financing margin ratio to 100%. At the beginning of the year, the three major stock exchanges in Shanghai and Shenzhen simultaneously raised the minimum financing margin ratio for investors buying securities on margin from 80% to 100%, officially implemented on January 19. Media outlets have described this as a "regulator valve" for counter-cyclical adjustments, not changing the direction of the market but reducing the leverage multiplier for new margin financing during the heating of leverage funds. The effects of this policy adjustment are already seen in the data. After the margin ratio was increased, the growth rate of margin balance slowed down at one point, and the daily margin buying amount and the margin buying amount as a percentage of turnover both declined from their highs. While the margin balance has now exceeded 3 trillion yuan, it indicates that there is a real demand for margin financing in the market, but the leverage multiplier for new financing has been lowered. At the same time, brokerage risk control mechanisms have also been advancing. Since May, some brokerage firms have added or strengthened indicators such as immediate liquidation lines, emergency liquidation lines at around 115%, and early margin call lines to compress the risk response time in extreme market conditions and prevent the risk of positions being breached during rapid declines. Therefore, this round of margin expansion is more like an increase in scale under a more stringent risk control framework. While the record balance reflects an increase in risk appetite, the margin ratio, maintenance guarantee ratio, liquidation line, and internal credit management within brokerage firms are all changing the risk curve of margin trading. Brokerages still need to answer for "increased volume without increased revenue". For brokerages, the margin balance exceeding 3 trillion yuan is undoubtedly good news for their credit business, but it does not necessarily simultaneous high profit growth. It has been observed that the brokerage margin business is displaying characteristics of "increased volume without increased revenue". After the market rebound in 2025, the total margin balance in the market has steadily increased, the number of investors opening credit accounts has continued to rise, and the funds lent out by many brokerage firms have grown significantly; however, the growth in margin interest income has lagged significantly behind the growth in scale. The core reason for this is the continuous decrease in margin interest rates and increased low-price competition among top brokerages. This contradiction may be more pronounced in the era of 3 trillion yuan. The higher the balance, the higher the requirements for net capital, liquidity, risk control systems, and customer segmentation management for brokerages; however, if margin interest rates continue to decrease, the income elasticity brought about by the expansion of scale will be compressed. This article is from "CaiLian Press", written by Wang Chen; GMTEight edited by Xu Wenqiang.