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[Guide] To meet the business needs of third-party distribution platforms, many funds have lowered their subscription thresholds

China Fund News reporter Zhang Yanbei and Sun Xiaohui

In order to better meet the financial management needs of investors, funds have recently intensively adjusted the subscription amount threshold, with the minimum reduced to 0.01 yuan.

Industry insiders analyzed that the substantial reduction in the subscription threshold is mainly to meet the needs of third-party fund sales business, especially investment consulting business. Under market fluctuations, investors pay more attention to investment consulting business, so the subscription threshold of the funds held by the portfolio is correspondingly lowered, which can attract more customers and meet the configuration needs of the portfolio at the same time.

Funds intensively lowered the subscription threshold

Starting from 1 cent

Recently, the subscription thresholds for many funds have been quietly lowered.

On August 20, Huabao Fund announced that in order to better meet the financial management needs of investors, in accordance with relevant regulations, it has decided to adjust the minimum subscription amount (including fixed investment) for Huabao Medium- and Short-term Bonds in the fund manager's direct sales e-finance and other sales institutions to 0.1 yuan from August 21, 2024.

On August 19, Taikang Fund also announced that according to relevant regulations, starting from August 19, 2024, the minimum subscription amount, additional subscription minimum amount, redemption minimum share and holding minimum limit of Taikang Steady Income Bond Class C Fund shares in some sales institutions will be adjusted, and the minimum amount and share will be reduced to 0.01 yuan and 0.01 share respectively.

According to the announcement, the measure to lower the subscription threshold is applicable to fund sales institutions such as JD Kentrey Fund Sales Co., Ltd. and Shanghai Hua Xia Wealth Investment Management Co., Ltd.

In addition, China Merchants Fund also stated that starting from August 16, the minimum subscription amount for A/C shares of China Merchants Xinyue Medium- and Short-term Bond Fund will be adjusted from the original minimum of 1 yuan to a minimum of 0.1 yuan.

The announcement also stated that fund sales institutions may, on the premise of complying with the above settings, raise the minimum limit for fund business handling according to the circumstances. The specific details shall be subject to the announcement of the fund sales institutions, and investors must follow the relevant settings of the sales institutions.

Starting from August 15, ICBC-RBC Securities will adjust the minimum single subscription amount and regular fixed investment amount of Class E shares of ICBC-RBC Securities Gold ETF Link Fund to 0.01 yuan.

Starting from August 14, BOC Fund will adjust the minimum amount of single subscription, additional subscription, and fixed investment, as well as the minimum single redemption and minimum holding of A and C shares of BOC Shanghai Gold ETF Link Fund. Among them, the minimum amount of the first subscription (including subscription fee) for investors through the fund manager's electronic direct sales platform or other designated sales institutions is RMB 0.1, the minimum amount of additional subscription is RMB 0.1, and the minimum amount of fixed investment is RMB 0.1; when fund unit holders redeem fund units at sales institutions, each redemption application for this fund shall not be less than 0.01 fund units.

Lowering the threshold may be to meet the needs of investment advisory business

According to industry insiders, lowering the subscription and redemption thresholds for funds, especially reducing the minimum subscription amount to 0.01 yuan or 0.1 yuan, is often a business need for third-party fund sales channels.

"Products that lower the subscription threshold are generally the target products of the investment advisory portfolio. Because the investment advisory portfolio has a certain allocation ratio for different products in the portfolio when investing, when a customer purchases an investment advisory portfolio of a lower amount, such as 100 yuan, the specific investment ratio and investment amount of a single product may be very small. Therefore, in order to better implement the investment advisory strategy and meet the allocation needs of investors, the fund manager lowers the subscription starting point." said an informed source.

The person believes that in the current context of still great market uncertainty, individual investors are more concerned about the investment advisory service model that provides both investment and advice than before, which may be the main factor behind the recent frequent lowering of subscription thresholds by funds.

Another fund company believes that lowering the subscription threshold is mainly to provide more convenient services to investors. "As the disposable income of ordinary investors decreases, the investable funds are also decreasing. Some investors tend to wait and see at first and do not want to subscribe a lot. The lower threshold can make everyone less restricted and buy as much as they want." In addition, fund conversions will be more accurate.

It is worth mentioning that most of the funds that have recently lowered their subscription thresholds are bond funds.

In fact, since August, in addition to a number of QDII funds gradually relaxing the upper limit of large-scale subscriptions, many bond funds have also adjusted the large-scale subscription limits for individual investors.

For example, Dongwu Dingtai Pure Bond, which has suspended large-scale subscriptions (including regular fixed amounts) and large-scale conversion and transfer-in businesses of more than 10,000 yuan since March 19 this year, will adjust the limit to 20,000 yuan from August 12; Bose Zhizhen Pure Bond, since July 26, the cumulative amount of subscription, conversion and regular fixed investment for each fund account per day should not exceed 500,000 yuan, but the limit will be adjusted to 2 million yuan from August 9.

Looking ahead to the bond market, Great Wall Fund believes that from a fundamental perspective, weak data is still the current reality, and the market's attention to the policy of stabilizing growth has increased, but the implementation effect remains to be further observed. From the perspective of the central bank's expectation management, the consensus center point of this round of regulation is gradually becoming clear, but it may be in dynamic changes in the future. In addition, overseas recession trading has disturbed the Fed's expectations of rate cuts, and domestic discussions on regulatory policies such as public bond funds have also gradually increased. Overall, the short-term influencing factors of the bond market are more complex, and it may enter a period of consolidation, waiting for new directional signals to appear.

As for A-shares, Wang Li of Great Wall Fund said that the current micro liquidity has shrunk significantly, but the market's downward trend has eased marginally, and the market may gradually enter a state of bottom confirmation. In the medium term, after the liquidity problem has been greatly alleviated, the risk appetite of overseas markets has rebounded significantly, and major asset classes may rise together. The market has returned to the expected trading of interest rate cuts, which is expected to drive the risk appetite of A-shares to rebound simultaneously.

Editor: Captain

Audit: Wooden Fish

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