2.323 billion yuan. The CBRC recently announced the balance of insurance fund utilization by the end of 2021. As an increasingly important institutional investor, the every move of insurance capital has also attracted special attention from the market.
Facing the complex global political and economic trends and market environment, what challenges does venture capital investment face? How to allocate assets? Industry insiders generally believe that during China's economic transition, China's monetary policy is mainly stable and appropriately loose, which will be the core starting point for formulating a large category of asset allocation plan this year.
what are the challenges faced by venture capital investment
"The gradual decline of global liquidity easing and the disturbance of covid-19 epidemic still exist, which puts forward higher requirements for the allocation capacity of major categories of assets of insurance asset management institutions." This sentence of the asset allocation Department of Guoshou asset management represents the idea of most insurance asset managers.
According to the view of people in the comprehensive insurance asset management industry, the low interest rate superimposed by the market environment, asset shortage, credit pressure, policy compensation and the successive implementation of the second generation and the new accounting standards are the main challenges faced by insurance investment in recent years.
"For the use of insurance funds, the low interest rate environment is the biggest challenge in the future." Taiping asset team said. As interest rates continue to fall, the pressure on new capital allocation and reinvestment is increasing. The liability side of insurance companies has a certain rigidity, and the adjustment of scheduled interest rates has a certain viscosity, which makes it more difficult to match assets and liabilities, and is prone to the risk of "spread loss".
At the same time, the downward movement of the interest rate center often superimposes the shortage of high-quality assets, which makes the asset side of venture capital investment face greater difficulties.
Jia Biao, President of China Insurance Investment Co., Ltd., analyzed that in the process of transforming economic growth from high-speed to medium and high-speed, the use of insurance funds is facing a shortage of structural assets, and the demand for the allocation of high-quality assets can not be met. According to the data of China Insurance Asset Management Association, the allocation proportion of insurance funds and financial products in 2020 was 14%, a decrease of nearly 4 percentage points over the previous year. Among them, the allocation gap of creditor's rights plan and trust plan was the largest.
The continuous accumulation of credit risk will lead to higher debt investment risk, which has also become the risk most concerned by insurance enterprises in the previous research of the insurance asset management association. Jia Biao said that with the increasing uncertainty of the external macroeconomic environment and the downward pressure of the internal economic growth center, the business operation and financial situation of enterprises are facing certain challenges, the default of the bond market has become normalized, and the credit risk has developed to the subject of high rating. The inherent concept and "belief" of fixed income investment are being gradually broken, which will further test the investment and research ability of insurance institutions in the macroeconomic environment, the development of meso industries and the operation of micro enterprises.
In terms of regulatory policies, after the implementation of the second generation of compensation phase II, asset allocation needs to pay more attention to the impact of solvency consumption. Taiping assets believes that the second phase of compensation generation II focuses on the essence of asset risk, and the basic factors of almost all assets have increased to varying degrees. In particular, the risk factors such as investment real estate, trust plan and asset management products related to real estate may increase significantly, and there are higher regulatory requirements for nested products and investment concentration, The asset allocation structure has a greater impact on the solvency of insurance companies.
In addition, insurance companies may fully implement the new accounting standards (IFRS9) from 2023, and market fluctuations will be directly included in the income statement. Unlike before, it can be "hidden" in owner's equity, which is bound to increase the fluctuation of investment income of insurance funds. At the same time, the provision for impairment of credit losses of financial assets under the new standards will be changed from the actual accrual basis to the expected accrual basis, which will increase the impact of credit risk on the income statement. "2022 is the last year of the transition period. We need to actively make corresponding preparations to effectively connect the changes before and after the accounting classification of investment assets." Taiping assets said.
The recent situation in Ukraine has caused some shocks to the global financial market, and the evolution of geopolitical conflicts is also one of the risks to be considered in venture capital investment. "Geopolitical risks will indeed cause some turbulence for a period of time, but generally the impact is relatively short. As a long-term fund, insurance funds pay more attention to the fundamentals of the invested assets. Of course, the situation in Ukraine is still changing, and we will also pay attention to its progress to evaluate the impact of this event on our investment assets." An executive of a large insurance asset management institution told the first financial reporter.
bonds: increase the allocation of long-term bonds
Because insurance funds have high requirements for investment duration and income stability, bonds have always occupied the largest proportion of insurance funds. According to the data of China Banking and Insurance Regulatory Commission, by the end of 2021, bonds accounted for nearly 40% of the balance of 2.323 billion yuan of insurance funds.
In February, the bond market experienced a significant adjustment, and the long-term yield decreased significantly. However, throughout the year, some venture capital investors still hold an "opportunity" attitude towards the bond market, and several people said they need to increase the allocation proportion of long-term bonds.
Zhu Xiaoyang, senior bond investment manager of Ping an asset management, said that 2022 is a year of "steady growth", and the main trading line of the bond market throughout the year will focus on the relevant policies and effects of "steady growth". In the first half of the year, the market may pay more attention to monetary policy and pay attention to whether there is room for further reduction of reserve requirements and interest rates; Whether the financing picks up and the economy stabilizes in the second half of the year will become the focus of the market.
"My overall attitude in 2022 is neutral, and the center of interest rate will move lower than that in 2021, but the space may not be large. In the first half of the year, there is a high probability that liquidity will remain loose, and opportunities in the bond market are greater than risks. I can grasp the deterministic coupon and leverage yield, and make some thickening through interest rate band trading." Zhu Xiaoyang said.
Feng Xiaohai, senior manager of the insurance investment management department, also expects that the money market interest rate and bond interest rate will continue to fall in 2022. We should increase the allocation proportion of long-term assets and reduce term mismatch.
Taiping assets also said that it would strengthen the allocation of long-term interest rate bonds, strengthen the duration management of assets and liabilities, and strengthen the fixed income + strategic allocation. Specifically, the allocation portfolio needs to grasp the allocation opportunities in the relatively high yield range. The allocation varieties are still dominated by ultra long-term local bonds and ultra long-term treasury bonds, and actively pay attention to the allocation opportunities of capital supplementary bonds of financial institutions. The trading portfolio focuses on stability, grasps the substantive risks, tamps the coupon income of high-grade credit bonds, and thickens the income by capturing the trading opportunities of interest rate bonds and selecting convertible bond varieties.
equity: grasp the structural market
"The pressure of overestimation in the equity market has been gradually digested in 2021. At present, the valuation of Shanghai and Shenzhen 300 index has returned to the average value, but the pressure of enterprise profit growth is still there. It may be difficult for the equity market to form trend opportunities and continue to show the characteristics of structural market and stage trading opportunities." Taiping assets believes that. The asset allocation Department of Guoshou asset management also said that while giving neutral allocation to equity assets this year, insurance companies should actively explore structural opportunities and look for sectors with upward industrial boom trend and in line with national policies.
In terms of specific sectors, Feng Xiaohai analyzed that high-quality economic development is the main line of future investment, and the high prosperity new energy track will still be the main line of the market in the future.
In addition to the heavy positions held in the secondary market, insurance funds, as long-term funds, should strengthen the support for scientific and technological innovation and green technology, encourage and attract more innovation investment institutions to participate in and support the development of green and low-carbon technology. "Insurance asset management institutions should break through the traditional cognition that the risk of equity investment must be greater than that of creditor's rights investment, and obtain operational returns from the underlying basic assets by means of shares, bonds and mezzanine, relying on their active management ability, and obtain asset appreciation by holding high-quality and scarce assets for a long time."
In the medium and long term, Taiping assets said that although it is difficult to form trend opportunities this year, with the transformation and upgrading of economic and industrial structure, the transformation of old and new drivers of economic growth, and the further improvement of the capital market, residents have increased the allocation of financial assets, and the low interest rate environment is also conducive to the relative allocation value of equity assets, The medium and long-term strategy will focus on equity market opportunities. Guoshou Security said that the medium and long-term market still focuses on the upgrading of technology industry, and is still optimistic about the configuration opportunities for the growth of new energy, semiconductors and other technologies.
"In the medium and long term, low interest rates and asset shortage are still the biggest challenges facing the asset allocation of insurance funds. However, we should also see that the transformation and upgrading of China's economic structure, the implementation of the 14th five year plan, the accelerated transformation of old and new driving forces, and the improvement of the multi-level capital market have brought asset allocation opportunities to insurance funds." Taiping assets said.
