Securities Times reporter Wu Qi

　　Recently, the topic of tens of billions of star fund managers in charge of "mini funds" has attracted the attention of all parties in the market.

The focus of the market is that the latest size of the "mini fund" is only 2 million yuan, while the management scale of star fund managers has exceeded 10 billion yuan as early as 2020.

　　Some analysts believe that changing coaches is often a mainstream way for fund companies to achieve shell preservation or revive "mini funds".

　　The phenomenon of "mini base" has already existed

　　The market generally refers to funds with a net asset value of less than 50 million yuan as "mini funds".

After the open-end fund contract takes effect, if the net asset value of the fund is less than 50 million yuan for 60 consecutive working days, or if the number of fund share holders for 60 consecutive working days does not reach 200, the fund company may initiate a liquidation.

Fund liquidation due to insufficient size is a relatively common reason for fund liquidation.

　　At present, the number of public funds is around 10,000, and the Matthew effect has gradually increased the absolute number of "mini funds".

Wind data shows that as of July 8, there were 1,010 funds with a scale of less than 50 million yuan, accounting for 10% of the total number of funds, and 198 funds with a scale of less than 10 million yuan.

For a public fund with a management scale of nearly 100 billion yuan, a quarter of its products are "mini funds" with a scale of less than 50 million yuan.

　　In fact, the phenomenon of "mini funds" has always existed.

In 2014, the number of funds with a net asset value of less than 50 million yuan exceeded 100 for the first time; in 2018, the market was sluggish, and the number of "mini funds" increased significantly, accounting for 15% of the total number of funds in the entire market.

After the market improved in 2019, the number of "mini funds" has shrunk significantly, but the number of new fund issuance has also increased sharply since 2019, and the public fund industry has ushered in rapid development.

With the number and scale of public fund products hitting new highs, the number of "mini funds" is also increasing.

　　Why is the "mini base" so high

　　There are many reasons for the high number of "mini funds".

A product-related person of a fund company revealed that the poor performance of funds is the main reason for the emergence of "mini funds", and the serious homogeneity of products has exacerbated the degree to which some products are at a disadvantage in the competition. Funds with blind issuance and unclear positioning Products can also easily be reduced to "mini funds".

　　From the perspective of issuance, fund companies hope to improve product lines, such as deploying various types of funds such as bonds, equity, indices, and FOF, and expand the management scale by providing holders with more choices.

Some fund companies choose to issue multiple products under the hot profit-making effect of A-shares, hoping to increase the scale with the "Dongfeng" of fund issuance.

　　Even if these funds are successfully issued, but their characteristics are not outstanding and their performance is not out, it will be difficult to obtain financial support through follow-up continuous marketing. If they catch up with the bad market conditions, they will easily face the situation of liquidation.

Recently, a new fund that has just been established for less than a month has issued an announcement that may trigger the termination of the fund contract, becoming a "mini fund".

At the same time that the new fund issued a scale warning, many funds that had been established for less than a year went directly into the liquidation process.

Wind data shows that 21 new funds established last year were liquidated this year, and last year was the peak of new fund issuance.

　　Although the total number of domestic public funds is quite large, the product structure is still being optimized, and some innovative products are emerging one after another.

Domestic small and medium-sized public fund companies hope to achieve corner overtaking by deploying these innovative products, but the results are not ideal.

For example, just over three years after the birth of the domestic pension target fund, a public fund announced the liquidation of its only pension target fund, which is also the first pension target fund product to be liquidated in China.

　　After "deadly carrying", he won the championship

　　In mature overseas markets, fund liquidation is a common phenomenon, while the domestic capital market has a short development time. Both holders and fund managers have a great rejection of fund liquidation in the early stage.

　　Holders have cognitive biases on fund liquidation, and there will be a fear of liquidation that is liquidation, believing that liquidation represents a substantial loss of assets.

In fact, the main reason for fund liquidation is that the scale is too small. There are many liquidation funds in the market whose accumulated net value is profitable.

The liquidation of the fund is equivalent to a mandatory redemption, and the net assets of the fund are converted into cash and returned to the holder, and there is no overall loss.

　　"The reason why the liquidation of funds is excluded is that, on the one hand, the liquidation has a bad impact on the company's reputation, and on the other hand, there is still hope for the market to improve." A fund executive told a Securities Times reporter.

　　The market generally believes that the "mini fund" has a small net asset value and cannot contribute too much profit to the fund company, because a series of maintenance such as fund settlement and daily operations will become a burden to the operation.

　　In the early days, fund companies disapproved and would rather bear these costs than not liquidate.

Even if the "mini fund" meets the liquidation standards, many fund companies choose to "deadly carry it" and insist not to liquidate.

　　In 2018, the market was extremely sluggish. The number of "mini funds" was close to 800, accounting for 15% of the total number of funds in the market. Many fund products have already met the conditions for liquidation.

However, the decision-making power of fund liquidation rests entirely with the fund company. Even the mandatory liquidation standards written into the fund contract can be modified and relaxed as long as the holders agree.

Data show that at the end of 2018, 137 mini funds with a scale of less than 50 million yuan had grown to more than 200 million yuan a year later.

　　Fund companies are not liquidated, and there are also windfalls in "deadly carrying".

For example, in the "mini funds" in 2018 and 2019, two products have won the annual champions of stocks and hybrid funds respectively in recent years, and the latest size has increased sharply to more than 10 billion yuan.

　　Of course, most "mini-funds" were not so lucky and had to be liquidated after the fund company rescued itself many times.

Some fund companies have a large number of "mini funds", which have not been brought back to life, but have become a burden to the company.

　　"Mini base" liquidation normalized

　　This year, the number of "mini funds" exceeded 1,000 for the first time in history. In addition, the news of liquidation kept coming, making the market hotly debated about "mini funds".

　　As early as 2012, the market called for the issue of promoting the withdrawal mechanism of "mini funds" through supervision. After that, there have been many reports that the regulators strictly regulate the number of "mini funds", but no clear public official documents have been formed.

　　Until the end of the first quarter of 2014, the total number of "mini funds" exceeded 100 for the first time, making them stand on the cusp.

After that, the news of China Universal Financial's 28-day bond-type securities investment fund voluntarily terminating the fund contract officially opened the prelude to the voluntary delisting of domestic "mini funds".

　　Only the survival of the fittest can ensure the healthy development of the industry.

Wind data shows that based on the start date of fund liquidation, from 2017 to 2021, the number of funds liquidated were 108, 431, 137, 171, and 266, most of which were "mini funds".

As of July 9, the number of fund liquidations this year has approached 100, and the total number of fund liquidations since 2014 has exceeded 1,200.

　　At present, the liquidation of "mini funds" is gradually normalized.

The "Notice on Institutional Supervision" issued by the China Securities Regulatory Commission this year also pointed out that in order to implement the "Opinions on Accelerating the High-quality Development of the Public Fund Industry" and promote the high-quality development of the public fund industry, there are "weak product development capabilities, mini funds, Fund managers in situations such as fund liquidation, failed fundraising, and a large number of approved but unfunded products have been changed and registered” shall take prudential measures such as suspending the application of the fast-track registration mechanism, prudent assessment, and on-site inspection within the statutory registration period.

　　In the future, public offering products will become more diversified, and innovative products will continue to emerge. Accompanying this, the competition among homogeneous fund products will intensify, and the number of "mini funds" liquidation will also increase significantly, eventually realizing the public offering fund market. The healthy development of ecology.