Asset End Yield Is Declining, Can Private Equity Funds Counter Attack?

Since the adjustment of the stock market in June this year, the risk preference of investors has generally declined, but at the same time, there is a scarcity of investment products with healthy and higher returns in the market.

Against this background, the advantage of private equity funds gradually appears, or becomes the new favorite of funds after the "Stock Exchange" of stock market.

The rise of the stock market in the first half of this year is partly due to the boost of leveraged funds, and the firm "deleveraging" of the regulators has made it difficult to reproduce the high yield from the stock market.

As a result, all kinds of investment in the direction of the stock market are also dragged down.

According to statistics, since the start of the stock market in 2014, bank financing has gradually increased investment in equity.

According to the statistics of the China Banking Association, as of the first half of 2015, the financial management scale of banking financial institutions was close to 33 trillion yuan, of which the bank financing scale exceeded 18 trillion and 400 billion yuan.

Due to the decline of the stock market, the equity products of bank financing funds have been greatly reduced, and investment income has also declined significantly.

According to statistics, the average expected rate of return of RMB financial products has fallen below 5% in July, and has dropped to 4.66% in the near future. Compared with the same period in 2013, the average expected rate of return of bank financial products is still 5.1%.

In June 2013, the highest expected yield of some bank financial products was as high as 7%.

At the same time, bank financial products are also subject to the impact of lowering interest rates.

After several interest rates cut this year, the current one-year deposit benchmark rate has dropped to 1.75%, compared with the CPI index of 2% in August, which is already "negative interest rate".

In August 26th, the expected rate of return on bank financial products also declined following the cut in interest rates.

Data show that between September 12th and September 18th, 138 commercial banks issued a new non structural Renminbi.

1099, the average expected rate of return is 4.57%, a decrease of 0.05 percentage points.

High yield investment channels have been reduced, and earnings of all kinds of Internet financial products, including P2P and all kinds of "treasure" products, are also declining.

Data show that in August 2015, the net loan industry's comprehensive annualized rate of return dropped to 12.98%, while in July 2013, the highest yield reached 26.35%, or more than half.

In those P2P platforms with high reputation and asset safety, the yield is even more conservative.

From the "treasure" products, the balance of treasure in September 21st, the 7 annual yield has dropped to about 3.16%.

Two years ago, its annual yield reached 6%.

This year

Prior to obtaining the qualification of independent issuance, trust was the main distribution channel and carrier of sunshine private placement, and the umbrella trust was an innovation to solve the limitation of trust securities account. It has greatly promoted the development of the sunshine private placement fund with flexible investment tools, and is an ideal distribution channel for the leveraged investment product of the structured product.

However, in the recent actions of regulators to clean up the allocation of funds, they are in a dilemma of liquidation.

According to CIC online research center, trust products in the past 10% or even higher annual yield is very common, and government guarantees and rigid payment, now it is difficult to see 10% of the products in the market, about 7% of the annual yield is becoming the normal product of trust products.