The Zhitong Finance App learned that Zhongtai Securities released a research report saying that debt conversion remains low and is a right-side game waiting for the changes to arrive. In this dimension, properly participating in some individual vouchers from the bottom up may be more comfortable than opening large contracts from the top down, and the configuration of nodes may be delayed until late October. In terms of debt conversion packages, it is recommended to focus on: 1) Actively promoting stock conversion: Jingrui, Huitian, Zhengyuan, etc.; 2) The industry trend is improving, or varieties with better coupon card slots, such as small metals (Zhen 26, Sith), innovative drugs (Tevao), medical devices (Sanxin), Pioneer (semiconductor equipment), transport aircraft, etc.; 3) repair opportunities brought about by theme rotation, such as energy storage, power grids, innovative drugs, etc., following the emotional recovery of Jin Yang, Shang Tai, Microchip, Changgao, etc.
The debt conversion index continued the low volume adjustment process before and after the National Day, and only followed the equity index to form an intraday V-shaped reversal on Friday. Overall, the five-day bond conversion index closed down 1.34%, while the equity equivalent index closed down 2.23% during the same period. In terms of style, the high price/low price style is divided. The overall high price has been adjusted a lot, and the 100 yuan premium rate is still in the process of being compressed. From an industry perspective, TMT bonds were significantly adjusted over the five trading days. The middle and downstream sectors of consumption and manufacturing were repaired to a certain extent, and the market style changed. At the ETF level, convertible bond ETFs were dominated by small net outflows throughout the five trading days, while SSE convertible bond ETFs turned into net inflows.
External disturbances are relatively complex. The equity market continued to rise limited against the backdrop of transactions not recovering: 1) Oil prices returned above $100 during the holiday period, and the short-term high pressure on oil prices was not low; 2) US debt was pressured by non-agricultural data. Against the backdrop of falling probability of interest rate hikes in October, US debt still broke through a new high during the holiday period, and the 30y US debt high hit above 5.6%; 3) The NASDAQ was decoupled from US bonds during the same period, and overseas technology capital companies still maintained an upward trend in the short term. Positive feedback on expenses; 4) Domestic holiday turnover declined, superimposed After the sharp rise and fall in the first half of the year, technology was more sensitive to negative events in the short term (FCC, overseas research reports discussing optical module control, etc.), and there was a sharp correction after the holidays. Overall, after passing the critical juncture in September (the US, Iran, China, the US, etc.), since the narrative has not changed significantly (oil prices are still high, pressure on US debt, etc.), the short-term market is still waiting for sentiment to reverse, because under defensive considerations, more attention is being paid to marginal changes in policy and industrial narratives, such as real estate, six networks, etc.
For participants in debt conversion, they seem to have emotionally entered a state of “wrapped up” adjustments and position adjustments. The premium rate has undergone a continuous process of compression. Zhongtai Securities believes that it is mainly due to the unresolved “two price comparisons” problem:
1. Compared with the allocation price of pure debt, the current medium-term bullish logic of pure debt has not changed. The pre-holiday correction of pure debt was mainly due to the acceleration of early transactions. Although there are still some trading disruptors at the micro level, it still provides an extremely generous safety cushion in this year's fixed income + portfolio, especially since September (average yield of 0.36% for medium- to long-term bonds, -1.13% for the same period, the statistical scope is products issued before the end of last year). If the comparison of stocks and bonds is still quite complicated in August, the market has to admit that the strengthening (equity+bond conversion) part requires more refined operation.
2. Furthermore, in the price comparison between stocks and debt conversion, the short-term cost performance ratio of debt conversion is also relatively limited. Looking at the performance of the bond conversion index since this year (even if the annual income has turned negative), bond conversion completed the task of improving earnings to a certain extent before July — completing the style enhancement and valuation process in the first half of the year, and passing the style switch in July. Low-cost varieties are also profitable. However, when all of the product responsibilities were overdrawn, and the variety began to be adjusted and compressed, debt conversion once again confirmed the position of Zhongtai Securities at the beginning of the year — a phased sharpness tool. Therefore, compared to historical quantiles, debt conversion requires joint efforts on the equity and debt side, and gradual improvement in supply to eventually form a new steady premium rate state, rather than simply discussing whether the “30%” premium is reasonable.
Are the varieties completely useless? Some marginal improvements have been seen, and not entirely due to the “must be configured” logic:
1. The low price index has once again returned to the bottom of the range in the short term, and demand such as debt support may have some similarity with recent considerations of the dividend sector; 2. The premium rate for high-priced products declined, and the standard deviation also declined during the same period (in early September, due to a game of terms, the standard deviation of the high price premium rate rose in the short term, and gradually declined as transactions gradually declined), which means that as premium differences are cleared, the short-term consensus may also be being restructured.
Therefore, in the process of marginal changes, Zhongtai Securities believes that in the process of marginal changes, changes in time points may become a catalyst for sentiment stabilization. Standing at the current point: 1) the pace of announcement of the third quarter results is relatively fast, and basically begins in late October; 2) the Federal Reserve meeting, including the subsequent midterm elections, will settle in October-November; 3) Pure debt assets may repeatedly test high points and rebounds in the middle of Q4, forcing everyone to re-evaluate the difficulty of operation and price-performance ratio in the middle of Q4; 4) the terms of some core securities are settled.