Valuation and performance mismatch, Huaxia Securities ETF presents strategic allocation opportunities

On March 19, driven by hawkish comments from the Federal Reserve, the three major A-share indices declined sharply. The securities and fintech sectors all fell. By midday, the Securities ETF Huaxia (515010) dropped 0.86%. The holdings showed mixed gains and losses, with First Venture leading at +1.98%, Hongta Securities up 0.49%, and Zhongtai Securities up 0.32%. Huatai Securities, Guotai Haitong, and Changjiang Securities led the declines, while the Fintech ETF Huaxia (516100) fell 0.69%.

Huatai Securities analysis pointed out that, based on past cycles, securities companies’ performance tends to grow in pulses with high volatility, causing market concerns about sustained growth. However, in recent years, market capacity has significantly increased, with more investors and listed companies entering the market. Medium- and long-term funds continue to flow in, and securities firms’ various business lines are performing well. Business diversification, along with the quality improvement of international business, has notably reduced performance volatility. Looking ahead, under the policy tone supporting capital market development, a slow bull market environment is expected. We believe securities firms will continue to diversify their businesses, shifting from pulse-like growth to steady growth, with improved performance stability. The valuation and performance mismatch also provide strategic allocation opportunities.

From a valuation perspective, the latest PE-TTM of the CSI All Share Securities Index tracked by the Huaxia Securities ETF is only 15.97 times, placing it in the 5.02% percentile over the past 10 years, meaning it is below 94.98% of the valuation levels in the past decade, at a historical low.

The Huaxia Securities ETF closely tracks the CSI All Share Securities Index. As of February 27, 2026, the top ten holdings are Oriental Fortune, CITIC Securities, Guotai Haitong, Huatai Securities, China Merchants Securities, GF Securities, Orient Securities, Industrial Securities, Shenwan Hongyuan, and CICC, accounting for a total of 60.15% of the weight.

The Huaxia Securities ETF (515010) and the Huaxia Fintech ETF (516100) have management fees of 0.15% and custody fees of 0.05%, the lowest among comparable funds, helping investors easily position themselves in the sector.

(The stocks listed above are only index components and do not constitute specific recommendations.)

Huaxia Securities ETF (515010) is connected to the over-the-counter market via Huaxia CSI All Share Securities Company ETF Link A (007992), Link C (007993), and Link D (023766).