A500ETF funds are increasing on high volume, institutions suggest taking advantage of the long buying window.

On May 12th, the A500ETF fund saw a significant increase in volume, with a 0.75% gain as of the time of writing and a trading volume of 34.25 billion yuan. Guotai Haitong Securities stated that looking ahead, the Chinese stock market is expected to continue to rise. The adjustment and strong recovery of the stock market in March and April marked another important turning point after September 24th. This indicates that investors' doubts about the decision-making level's determination to reverse the situation have diminished, serving as both risk release and touchstone. Looking ahead to the next stage, maintaining an optimistic view of the Chinese stock market, the risk premium of the Chinese stock market is expected to systematically decrease, while the decrease in risk-free rates and reforms in the capital market system will be key forces for incremental market entry, seizing the window of opportunity for long positions. Firstly, after the impact, investors' understanding of the economic situation is already sufficient, including the clearing of trading structures, which is an important prerequisite for the stock market's turnaround. Secondly, despite remaining uncertainties, the intense friction in the first phase of overseas disturbances has come to a conclusion, creating a favorable window for long positions. Thirdly, the key of the stock market's expectations lies "internally not externally". The Central Political Bureau meeting and the State Council meeting have both released positive signals of using internal certainty to respond to external uncertainty, with existing policies being deployed rapidly and incremental policies ready to be implemented. Compared to the past, policy expectations and prospects are more continuous and stable. In terms of allocation, emerging technology is the main theme, with the financial cycle being the dark horse. It is recommended for investors to pay attention to three main themes: 1) financial institutions with high dividends such as securities companies/insurance/banks, as well as central state-owned enterprises with dividend and stable operating advantages, such as telecom operators/highways/public utilities. 2) Hong Kong-listed emerging technology growth companies in internet/media/gaming/technology/intellectual property/semiconductors/medicine; 3) cyclical industries such as real estate/metals/chemicals/building materials/snacks/cosmetics. Investors can utilise A500ETF funds and their affiliated funds for allocation.