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What happened to shareholders of listed companies suddenly abandoning ETFs?

NavInfo’s new shareholders abandon ETF purchases: HKUST News and so on?

Sheguangfa Penghua and other listed company shareholders suddenly abandoned the purchase of ETFs!

what happened?
  China Fund News reporter Li Shuchao’s frequent exchange of stock exchange-type open index funds (ETFs) by listed companies’ shareholders has ushered in variables.

On November 4, Beijing Siweitu New Technology Co., Ltd. issued an announcement saying that the company’s shareholders intend to abandon the subscription of the Wells Fargo CSI 50 Strategy ETF. This is the first step in the industry after the supervisory guidance of the redemption ETF and the regulation of excess redemption.The phenomenon of buying stock ETFs is now abandoned.

  NavInfo’s new shareholders abandon their share of ETF conversions Recently, NavInfo has issued an announcement saying that the company has received notice. For other reasons, NavInfo’s Vice Chairman Sun Yuguo and the director, and General Manager Cheng Peng have decided to abandon the shares held by the companyParticipate in subscribing for fund shares. Funds that have not yet subscribed for subscription will no longer be subscribed during the subscription period.

  Public information shows that on October 22 this year, NavInfo has disclosed that NavInfo Vice Chairman Sun Yuguo intends to hold no more than 930,000 shares of the company. Director, general manager Cheng Peng intends to holdNo more than 1.05 million shares of the company participated in the subscription of the Wells Fargo CSI 50 Strategy ETF, that is, the offline stock subscription method.

  According to the closing price of the announcement date 14.

At 45 yuan / share, Sun Yuguo, vice chairman of NavInfo, and director and general manager Cheng Peng of the company are planning to exchange for 1343.

850,000 yuan and 1517.

250,000 yuan, the total redemption amount is 2861.

10,000 yuan.

  According to the CSI 50 Strategy ETF Tracking Index of the CSI China Securities Technology 50 Index, the dimensional map new index accounted for about 1.

3%. Based on the average initial fund raising of US $ 1 billion for technology explosion funds, the maximum amount that NavInfo shareholders can redeem is about 13 million, and the average amount of NavInfo shareholders who intend to redeem exceeds this limit.
  The Wells Fargo CSI 50 Strategy ETF has been raised on October 15 this year, and the original subscription termination date was November 6, 2019.

However, on October 19 this year, Wells Fargo issued an announcement to extend the fundraising period of the fund, saying that in order to fully meet the investment needs of investors, according to the relevant regulations of the China Securities Regulatory Commission and the relevant provisions of the fund contract, prospectus and other documents, the fund was decidedThe recruitment period was extended to November 8.

  Standardizing excessive redemption is beneficial to the long-term development and reorganization of ETFs, and the value of trading ETFs for stocks has become prominent. The size of this type of fund has continued to increase, and more and more listed company shareholders have joined the trend of holding ETF shares for stock exchangesShareholders of some listed companies have experienced over-proportion exchanges.

  According to a reporter from the Securities Times, the supervisors’ ETF guidance for stock exchange transactions, the code of conduct for excess purchases, requires that the size of the stock exchange not exceed the weight of the constituent stock in the index, and requires listed company shareholders to comply with the relevant reductions in shareholder holdingsRegulations.

  The phenomenon of NavInfo’s new abandonment of stock ETFs is the first time that after the guidance of some windows, shareholders of listed companies have voluntarily waived their subscriptions.

  An official from the large-scale public offering department in Beijing said that due to the sudden changes in stock ETF products and serious product homogeneity, the initial launch of this type of product was originally easy. The formulation of regulations for excess redemption may cause difficulties in issuing this type of product in the short term.

However, in the long run, the funds for the redemption will soon leave, and the excessive redemption will cause the fund to passively sell over-proportioned stocks, resulting in changes in the price of the relevant underlying stock, rather than conducive to the long-term development of the product.

  In fact, in addition to NavInfo, NetSuite and Hytera’s company shareholders have recently issued an announcement to exchange for stock ETFs.

  On October 17th of this year, Wangsu Technology announced that Liu Chengyan, a shareholder, chairman and general manager of the company, sent a “Notice on 北京夜网 Proposal to Participate in the Subscription of Fund Shares by Holding the Company’s Shares of the Company”.Someone’s company shares did not exceed 24 million shares in the subscription of Wells Fargo CSI 50 Strategy ETF.

  Earlier on October 11, the listed company Hytera also accepted the “Notice Letter Regarding Participation in the Subscription Fund Allocation of Shares of the Company by the Shareholders of the Company” signed by the company’s directors Jiang Yelin, Zeng Hua, and Wu Mei, respectively. Three listed companiesShareholders intend to participate in the subscription of the Wells Fargo China Securities Technology 50 Strategy ETF with no more than 750,000 shares, 3 million shares, and 1.4 million shares of their holders.

  Calculated based on the closing price of the listed company’s announcement on the day of the announcement, the upper limit of the exchange amount of the shareholders of Netsu Technology and Hytera is 2 respectively.

4.1 billion, 5170.

60,000 yuan, if the rich fund of China Securities Technology 50 strategy ETF first raised is not large enough, the shareholders of the listed companies may exceed the company’s weight in the China Securities Technology 50 strategy index.

  The manager of a large public equity fund in Beijing said that the current ways of shareholders of listed companies to reduce their holdings are mainly secondary market reductions, block reductions, exchangeable debt, and equity pledges.

In comparison, the stock exchange ETF reduction has a small impact on increasing the holdings, simple processes, and reduced benefits.

In terms of information disclosure, shareholders need to disclose before the stock exchange for ETFs, but shareholders will not need to disclose when they realise their ETFs, which makes more and more listed company shareholders prefer stock exchanges for ETFs.

  The fund manager said: “Supervisors’ code of conduct for excess redemption may cool down the redemption of ETFs this year.