The true face of grade a
Share A is the part of the sub-share of the graded fund with relatively low risk and high expected annualized expected return, and share B is financed by share A and pays the agreed interest of share A. A shares have bond attribute+put option (applicable to perpetual stock classification):
The discount clause of graded fund determines the nature of graded A bonds, which implies that the center of expected annualized expected rate of return is near AA-rated 10 corporate bonds.
The discount clause and discount premium of graded funds make Grade A have binary options value.
Grade A is usually the "dish" of institutions, such as insurance institutions, but at some nodes, especially when the unilateral bull market ends, more and more retail investors realize the value of Grade A and join in the investment of Grade A. ..
The main source of expected annualized expected income of Grade A: implied expected annualized expected income.
1. Agreed expected annualized expected rate of return: the leveraged share (Class B) borrows from the preferred stock (Class A) and pays the interest reflected by the net value every day, ranging from 5.75% to 7.25% in historical annualization.
2. Discount redemption price difference: Grade A is usually a discount transaction in the secondary market, and there is a price difference between the purchase price and the net value of A, which can be obtained by cashing in the net value.
3. Implied expected annualized expected rate of return: the difference between the agreed expected annualized expected rate of return and discounted cash is isomorphic to the source of A's expected annualized expected rate of return. By calculating A's implied expected annualized expected rate of return, the intrinsic value of A in different grades can be compared.
Implicit expected annualized expected rate of return: the calculation formula is the agreed expected annualized expected rate of return/[price-(net value-1)]. For details, please refer to Thoughts Set-Real-time Investment Data.
Experience shows that the implied expected annualized expected rate of return exceeds the investment value; More than 7%, very suitable for investment;
The implied expected annualized expected rate of return is lower than the numerical value.
A-level rotation strategy: looking for an undervalued and discounted A-level.
Rotation strategy: Calculate the discount rate and implied expected annualized expected rate of return of the parent fund at terminal A of graded funds every weekend, and select Grade A with high implied expected annualized expected rate of return and high discount rate of the parent fund at terminal A.. Buy three Grade A with high ranking and good liquidity every week, and rotate every week.
The following is the net value change chart tracked by this strategy:
Possible risk points of rotation strategy:
The market is short of funds, especially at the end of June, the end of 65438+February or other periods when money shortage may occur. It is expected that the short-term annualized interest rate increase will suppress the price of A.
How enthusiastic the market is, the parent fund will maintain a high premium level for a period of time, and the premium arbitrage funds will suppress the price of A.
Discount strategy of Grade A against gambling: Buy Grade A with discount expectation to obtain expected annualized expected return.
The discount of A shares is the realization of its option value: A is traded at market price, converted into net value, and the discount difference constitutes the source of option value.
Participate in the discount process:
Take coal A, which was triggered to discount on July 8, as an example. If it is bought on the 9th, the expected annualized expected rate of return can reach about 30%.
Risk of gambling discount classification:
1. Downward risk of the parent fund: Discount means that about part of the A-level net value is converted into a new A-level, and the rest is converted into the parent fund. According to the conversion rules, the converted parent fund can be redeemed on T+2 at the earliest (T- 1 is the discount trigger date), and the actual expected annualized expected return is subject to the market fluctuation on the 2nd.
2. Redemption liquidity risk: There is a risk that it is difficult for the fund company to pay the redemption fee when there is a huge redemption in extreme market conditions, but it seems that the probability of the fund company refusing to redeem is very small.
3. Risk of market rebound leading to discount failure: Usually, when there is discount expectation, many people will buy A to bet on the expected annualized expected return. If the parent fund no longer falls, but rises, and Grade B leaves the discount area, then Grade A will fall back to its original value, with a great decline.