Speech by SSE President Cai Jianchun at Index and Indexing Investment Forum
Distinguished Guests, Ladies and Gentlemen:
Our warm welcome goes to all the guests attending the 16th Index and Indexing Investment Forum. On behalf of the Shanghai Stock Exchange (SSE), I would like to extend sincere greetings to all the guests present, and express my gratitude for your care and support for the SSE and China Securities Index Co., Ltd. over the years.
Indexes are important resources for financial markets, and index products play a crucial role in optimizing investor structure and promoting the high-quality development of capital markets. The constant emergence of high-quality listed companies and the continuous improvement of listed companies' quality provide rich samples for index preparation. There is an increasingly reinforcing and positive cycle between "indexes – index products - listed companies' quality".
At the last forum, I reported that the SSE had formulated a Three-Year Action Plan for Index Business, which mapped out the development blueprint and implementation path of short, medium and long-term indexes, and promoted the critical role of indexes in guiding the concepts of long-term investment, value investment and rational investment. In the past year, under the leadership of the China Securities Regulatory Commission, with the objectives of building a complete and multi-level index layout, creating a global leading index investment market, and forming a sound indexing investment ecology, the SSE has steadily promoted relevant work in accordance with the plan, continuously optimized the index system, enriched the index varieties, promoted the issuance of index products, and achieved considerable results in serving national strategies, guiding medium and long-term funds, and promoting high-quality development.
I. Enriching the STAR Market's index and product system to serve the national strategy of innovation-driven development. With STAR 50 index as the core index, the SSE has comprehensively laid out strategic emerging industries and successively released 5 theme indexes of the STAR Market, namely information, biology, chips, high-end equipment and new materials. This has initially formed the STAR index system covering scale and themes, and fully manifested the "key and core technology" demonstration effect of sci-tech innovation enterprises. Recently, the STAR Growth Index has been released as well, which highlights the STAR Market's good growth potential, complements the positioning of STAR 50, and further broadens the coverage of the STAR Market's indexes. With excellent fundamentals, the STAR Market's performance growth is significantly ahead of other sectors, and its index products are widely favored by investors. Since this year, investors have been actively investing in the STAR Market through STAR 50 ETFs, with ETF share growing by 80%, net inflow exceeding 24 billion yuan, and product scale exceeding 66 billion yuan.
II. Developing green and low-carbon indexes and tracking products to support the national strategy of sustainable development. The SSE has actively implemented the concept of green development and developed green indexes to provide more green investment targets for the market. To date, we have released more than 120 green-related indexes with China Securities Index Co., Ltd. and listed 49 ETF products on the SSE, with a total volume of over 57 billion yuan, accounting for over 80% of similar products in China. With the inclusion of "carbon peaking and carbon neutrality" in the overall layout of China's ecological civilization construction, we have accelerated the launch of indexes targeting the reduction of carbon emission intensity. The CSI SEEE Carbon Neutral Index, CSI Carbon Neutral 60 Index, CSI 300 Carbon Neutral Index, etc. have been released successively to help achieve the carbon peaking and carbon neutrality goals.
III. Launching central SOEs series indexes to serve the strategy of state-owned assets and SOEs reform. As an important platform for listed central SOEs, the SSE has followed the direction of SOEs' reform and development and tapped value of central SOEs. In collaboration with China Reform Holdings Corporation Ltd., it has released the Central SOEs' Comprehensive Index and a number of central SOEs series indexes, such as technology leadership, shareholder return and modern energy, thus forming the "1+N" central SOEs index system. In line with the national strategy of SOE reform and the capital market's development trend, these indexes reflect the characteristics and investment value of representative central SOEs in multiple dimensions, further consolidate the market consensus of focusing on and investing in central SOEs, and support central SOEs to achieve high-quality development through the capital market. So far, there are 25 tracking products for indexes related to SSE and CSI SOEs and central SOEs, with a combined scale of over 27 billion yuan. The SSE accounts for more than 70% of these indexes, and its index products have brought about more than 19 billion yuan of allocation funds for SSE listed SOEs and central SOEs.
IV. Optimizing the dividend index system to provide investors with investment options of low risks and stable returns. By fully utilizing the high dividend and low volatility characteristics of dividend indexes and their products, the SSE provides investors with stable investment returns and guides the formation of long-term investment and value investment concepts. Since this year, we have revised 32 dividend indexes, including SSE Dividend Index. The revised indexes have seen enhancement in both dividend continuity and investment capacity, and have been well received by the market. With investors continuing to make net subscriptions to related products, the SSE Dividend Index has outperformed other major A-share indexes this year. Up to now, the domestic market dividend indexes have a product size of about 30 billion yuan, making it the most heavily tracked strategy-product segment in the domestic market. Among them, products tracking SSE Dividend Index and CSI Dividend Index rank first and second in scale respectively, together accounting for about 90% in total.
Moreover, we have promoted the allocation advantages of SSE ETF market and the development trend of indexing investment to nearly 200 international investment institutions around the world, in the hope of showcasing the good prospects of China's economy and allocation opportunities in the Chinese market.
Dear guests and friends! In recent years, the domestic index market has gradually strengthened its development foundation and embraced important strategic opportunities. The SSE has profoundly grasped the market trend and striven to pool industry efforts to create a new situation of index development. So far, together with China Securities Index Co., Ltd., we have released 364 main indexes of SSE series and 1,791 main indexes of CSI series, forming an index system covering scale, industry, theme, strategy and style across asset classes. Meanwhile, the indexing investment concept has gradually gained recognition and incremental funds have continued to flow into the market through index products. Since this year, the scale of SSE and CSI index tracking products has been increasing and exceeded 1.6 trillion yuan. The share of SSE ETFs rose more than 30% to a record high. Next, the SSE will carry forward the spirit of the 20th CPC National Congress, further improve the index system, optimize the indexing investment ecology, promote the high-quality development of the capital market, and serve the construction of a new development pattern.
I. Accelerating the building of an index system that meets the needs of high-quality development. We will continuously attach importance to promoting high-quality development of the real economy and speed up the building of an index system that serves the strategic deployment of a manufacturing power, aerospace power, transportation power and digital China. Around the strategy of green development, we will actively promote work related to the ESG information disclosure of listed companies, make CSI ESG evaluation an authoritative standard in China, further enrich the sustainable development index system, and guide the quality improvement of listed companies with ESG practices.
II. Accelerating the cultivation of an indexing investment ecology based on long-term value investment. We will grow various medium and long-term investment forces and encourage asset allocation through indexing investment. There will be publicities and promotions in a variety of forms, as well as continuous guidance on long-term investment, value investment and rational investment concepts. Based on the launch of Fund Connect 2.0 and the function of one-way selling of public REITs shares, we will look into opening up bilateral trading functions and ETF transfer functions to facilitate more individual and institutional investors' participation in indexing investments.
III. Accelerating the improvement of international influence and competitiveness of local indexes. We will improve the global market index system and play the role of indexes in international factor allocation. Efforts will be made to expand the scale of licensing overseas products, push for more products tracking local indexes to be launched overseas, and improve the indexes' overseas product ecosystem. We will strengthen cross-border index cooperation, explore new models of international cooperation on indexes with overseas exchanges and asset management institutions, and guide foreign funds to allocate quality Chinese assets.
Dear guests and friends! At present, China has entered a new development stage of building a modern socialist country in all respects, moving towards the second Centenary Goal, and comprehensively promoting the great rejuvenation of the Chinese nation through Chinese modernization. As a bridge between listed companies, financial products and investors, index is crucial for the high-quality development of the capital market. The SSE will further study and implement the spirit of the 20th CPC National Congress, work with all parties to persevere with integrity and innovation, forge forward with courage, constantly explore the development and growth of the index business, and jointly take indexing investment to the next level.
I wish this forum a great success! Thank you!