Bangalore Investment:How to do asset allocation in the current low interest rate environment?

How to do asset allocation in the current low interest rate environment?

Source: Snowball APP, Author: Two Bird said, (

Recently, with some Yu’ebao as a representative, the annualized return on the 7th has fallen below 1.5%.Looking back, when Yu’e Bao was launched in 2013, the annualized return on the 7th exceeded 6%.This means that in 2013, it deposited 100,000, almost earned about 6,000 yuan a year. Now it can only get about 1,500 yuan, and it is less than 4,500 yuan (equivalent to a monthly salary in the small county).

In recent years, with the continuous decline in market interest rates, the yields of high -stabilization products such as deposits and Yu’ebao are getting lower and lower, and wealth preservation and appreciation is very difficult.In order to seek a little more income, the phenomenon of "deposit and moving" is obvious, and funds have begun to flow into areas with high expected returns such as wealth management products, funds or stock markets.As of the end of May 2024, the bank’s wealth management market continued to survive 29 trillion yuan, and the scale of public fund asset management exceeded 31 trillion yuan.(Source: Mumbai Securities News, Fund Industry Association)

However, investors full of hope of making money were given a stuffy stick by reality.The stock market has been adjusted since 2021. At the end of 2022 and at the end of 2023, the bond market claiming to be stable in the bond market has occurred twice, so that investors who were used to the period of deposit and buying Yu’ebao to make money have tasted the taste of losing money and felt that they had obtained high high.The difficulty of benefits.

This fully shows that after entering the era of low interest rates, we have to face many challenges, and a wealth defense war has quietly launched.Rather than sitting, it is better to take the initiative.So how do you get satisfactory benefits in the era of low interest rates?How to do asset allocation to get "free lunch"?Below we will learn from the experience of the low interest rate era experienced by the United States and Japan to explore the answers to these questions.· 1. In the era of low interest rates, new challenges faced by asset allocation

The low interest rate environment puts forward higher requirements for asset allocation from various perspectives such as revenue expectations, asset supply, risk preferences, and investment strategies.

1. The revenue is expected to stay in the past, it is difficult to accept the present

The era of low interest rates means a decline in risk -free yields, and the overall decline of many assets’ actual yields. This is a fact that investors cannot stop and have to be passively accepted.Due to the existence of "investment memory" or "anchoring effect", it is easy to measure the current product with high returns (mainly referred to from 2000 to 2018, the same below).Revenue expectations.Bangalore Investment

2. If you want to get the same income as before, you have to pay more

As market interest rates continue to reduce and start from the laws of risk returns, investors want to obtain the same income as before, they must be exchanged for more risks and fluctuations.This is a huge challenge for investors’ risk tolerance and pressure resistance. If you don’t pay attention, you will be caught by the market.

For example, in the storm of the debt market at the end of 2022, wealth management products (mainly bonds) have just fluctuated in the net worth, and most of these products holders have not experienced such a huge shock., Treating the negative feedback of "panic-selling-price decline-re-panic-sell again".

3. In order to pursue higher returns, the speculative mentality increases

When pursuing higher returns, some investors choose to perform better asset allocationNagpur Investment. This requires more assets and needs to learn how to use various strategies (such as dumbbell strategies, core-satellite strategies).The slow and rich way of victory; some investors choose to take risks and take the risk, the speculative mentality is worse, and the high income is obtained by increasing leverage, chasing up and killing, frequent transactions, etc., and excessively bear the risks. These behaviors are short -term or game.Often lost more.

4. "Asset Waste" disturb the balance between risks and benefits

In the era of low interest rates, the phenomenon of "asset shortage" is serious.On the one hand, "deposit and moving" leads to a large amount of funds looking for better assets. On the other hand, the economic growth rate of investment has decreased, and the overall investment returns decreased. The high return and stable high -quality assets are more scarce.The competition for high -quality assets of various funds to be fixed, leading to high price and high risk.For example, in the first half of this year, long -term long -term national bonds in the first half of this year due to the high price of funds, the corresponding yields continued to lower. After the central bank repeatedly prompted the risk of no risk, it directly intervened, causing a large fluctuation of the price.

5. The difficulty of implementation of many strategies increases

Many asset allocation strategies with both offensive and defensive assets need to configure low -risk stable assets as bottom warehouses. Due to the overall reduction of yields, the basic income provided by the bottom warehouse assets is becoming more and more limited.The mouth needs strict management, otherwise it will easily lead to enhanced benefits into negative returns.

It can be seen that in the era of low interest rates, if you want to obtain the income of satisfying yourself through asset allocation, you must not only bear more risks, but also learn more knowledge, and the difficulty instantly increases several positions.Let’s learn from overseas experience to seek response.2. Drawing on overseas experience and exploring asset allocation in the low interest rate era

Many overseas countries have experienced a long -term low interest rate environment, providing us with rich reference experience.Let ’s take the United States and Japan as an example to see how the asset allocation in the process of interest rates change.

1. 2007-2015, the revelation of the low interest rate era in the United States

In the era of low interest rates in the United States from 2007 to 2015, assets with outstanding performance were stocks, gold and bonds.The stock index (including dividends) cumulatively increased by nearly 70%, the gold index increased by 58.1%, and the cumulative increase of bond indexes (including ticket interest) increased by 44.6%.During the period in the United States, the real estate bubble rupture, the revenue of real estate (excluding rent) failed to win inflation.From the perspective of different interval, the performance of different large categories of assets is obvious in different stages.

In the rapid downward period of interest rates (2007-2008), the stock price and house prices fell sharply, and the performance of gold and bond assets was better. Especially the gold yields obviously won other assets. The annualized increase of nearly 20%. The main driving force behind it is financialDuring the crisis, risk aversion.

In the early stage of the low interest rate era (2009-2012), the performance of gold and bonds is still good. As the economy continues to pick up and interest rates continue to be low, the stock market has also begun to rise stabilized.Essence

In the later period of low interest rates (2013-2015), the stock increase was significantly ahead of other assets.House prices have recovered, but until 2015, it has not returned to 2007.The return on bond investment declined, and the price of gold was adjusted.

Picture: US 10 -year government bond yield trend

Source: Wall Street

Table: Different assets in the low interest rate era in the United States

Source: Bloomberg,

2. Since the 1990s, the enlightenment of Japan’s low interest rate era

After the breakdown of the Japanese economic bubble in the 1990s, the Bank of Japan began to gradually cut interest rates, lowered bank deposit loan interest rates, and implemented various quantitative easing policies. In the era of long -term zero interest rates and even negative interest rates, the 10 -year Treasury yield was lower than many countries.It was not until March of this year to raise interest rates to 0 ~ 0.1%for the first time that it ended for 8 years.

Figure: 10 -year Treasury yields in some countries in the world

Source: Choice, SDIC Securities, the Red Line is a 10 -year Treasury yield in Japan

In terms of property market, the Japanese house price index fell sharply after reaching its peak in the early 1990s. It did not gradually stabilize until 2010. So far, there is still a big gap between the house price index and the peak in 1990.The main reason behind this is that the Japanese population has continued to grow negatively since 2008.

In terms of stock markets, from 1990 to 1992, it entered a period of rapid decline. After reaching a high point at the end of 1989, it fell rapidly, and the interval declined more than 50%.From 1993 to 2012, it entered a period of shocks. During the period, there was a strong rebound. However, due to the death of the global financial crisis that broke out in 2007, the Nikkei 225 index fell more than 30%.Since 2013, the Japanese stock market has entered a period of strengthening its shock. The Nikkei 225 Index hit a record high in February 2024, and it took 34 years to recover the land.(Source: Choice, SDIC Securities)

Figure: Japanese house price index and trend

Source: choice, SDIC Securities

In terms of bond market, since 1990, the Japanese real economic department has increased deleveraging, the scale of credit bonds has been shrinking, and the proportion of government bonds has always maintained a higher level.As of the end of 2023, the scale of the Japanese bond market was 13.64 trillion yen, its Indian bonds accounted for 83%, corporate bonds accounted for only 6.6%, and financial bonds accounted for only 0.34%.And due to the low interest rate era and low yields in daily bonds, the Bank of Japan has become the most important investor in the bond market, while banks, insurance and other institutions tend to hold overseas bonds.(Source: China Merchants Securities)

In the long -term low interest rate environment, the asset allocation of the Japanese residential department is conservative, tending to increase deposits and reduce leverage. The proportion of cash and deposit allocation is about 50%for a long time.Trust (fund).

Figure: The configuration preference for financial assets of Japanese residents

Source: choice, SDIC Securities

Judging from the above analysis, after entering the era of low interest rates, the price operation trend of many assets will change, and even the underlying investment logic will change huge changes.These require us to perceive and adapt, otherwise it will seriously affect the income level of asset allocation.

For example, after the price of real estate fell from a high point, the recovery process was relatively slow. If the black swan incident (such as the subprime crisis) was encountered again, it was difficult to return to the early high point;After that, with the recovery of the economic fundamentals, the cost -effective increase, coupled with the abundant liquidity in the low interest rate environment, it is expected to attract the inflow of funds, gradually strengthening, and it is not impossible to create a record high.It is better, mainly driven by risk aversion, and performs poorly in the late period of low interest rates.Three or five methods to deal with the era of low interest rates

If referring to the situation in the United States and Japan, the downlink of interest rates down the property market and the stock market fell as the beginning of the low interest rate era, then the era of low interest rates in China can start from 2021. It is currently at the end of the rapid downward period of interest rates and the beginning of the low interest rate era.Alternate (for reference only, not the professional definition of authoritative agencies).There are risks and opportunities. As long as we respond properly, we still hope to achieve investment goals smoothly.Let’s introduce five response methods.

Figure: Indian 10 -year government bond yield rate

Source: Wall Street

1. Carry out a large -scale global asset allocation

At present, domestic has gradually entered the era of low interest rates. However, after the interest rate hike cycle, the interest rates are at a high position after the interest rate hike cycle, which differentiates with the domestic economic situation and the capital market environment.The trend of some large categories of assets is not affected by a certain country, which is determined by global supply and demand.Therefore, the impact of domestic asset price fluctuations can be reduced through global large -scale asset allocation.

For example, U.S. stocks and European stocks are mature and stable in the market. At present, the interest rate hike cycle is entering the interest rate reduction cycle; the Indian stock market and the Vietnamese stock market belong to emerging markets, GDP has a higher growth rate, and the stock market has performed well in recent years.As a global risk shelter, gold often performs better during the rapid decline in interest rates.

2. Carefully conduct investment in the property market

According to statistics, about 70%of domestic residential asset allocation is real estate.It is worth noting that domestic housing prices have fallen from high in 2019 and have not yet confirmed the bottom. The future configuration value needs to be restarted.

With reference to the experience of the United States and Japan, the underlying investment logic of domestic real estate has changed.On the one hand, the policy adheres to the "housing and not frying", forcing the property market to reduce investment attributes and return to rigid demand. In the future, housing prices will be mainly promoted by real housing demand; on the other hand, our population situation will begin to face the problem of growth.Gradually entering an aging society, the demand for housing is declining; there are also residents’ expectations for future revenue, and their willingness to buy houses is not high.Therefore, investors may need to change the asset allocation of houses and gradually allocate more funds into financial assets.

3. Do a good job of investing in low -risk assets

In the early stage of the low interest rate, market risk appetite fell sharply, and the asset allocation should mainly adopt defense strategies.For example, in the early stage of interest rates and early periods of interest rates, the performance of gold and domestic bond markets is bright, which is consistent with our current situation, that is, interest rates are still in the process of decline, the stock market and property market perform poorly, and the price of gold continues to rise.The debt market continues to go cattle.

4. Pay attention to equity assets

Judging from the past experience in the United States and Japan, in the early stage of the low interest rate era, the price of equity assets was mainly adjusted, but in the late period of the low interest rate era, the performance of the stock market was expected to be stronger to strong.After years of repair, the profitability of the enterprise will continue to increase and the cost -effectiveness of the stock market will increase. In addition, the low -interest rate environment is abundant, which is expected to attract funds to continue to inflow.

In the early days of the low interest rate, you can focus on high dividend stock stocks.For example, the Japanese MSCI high dividend index achieved long -term excess returns from 1990 to 2012, reflecting good allocation value; A -share high dividend sector has also continued to strengthen the trend since 2021.

Secondly, in order to get rid of economic development, the state will vigorously promote scientific and technological innovation and find new growth points.At present, many fields such as domestic, photovoltaic, and 5G have gradually gained global competitive advantages, and technology stocks are also worthy of attention.For example, after the United States entered the low interest rate in the early stage, the stock market bottomed out, which opened a round of slow bulls dominated by technology stocks.

5. Make good use of investment advisors, index funds, etc. to make investment

After entering the low interest rate era, the difficulty of investment has improved. Investors can consider the use of the strength of professional institutions, or use efficient and convenient products to invest, such as more and more investors choose fund investment consulting products and enjoy one -stop typeProfessional investment services, some investors use index funds to lay out a package of stocks in specific industries and specific fields. Several index funds can be used to achieve globalized asset allocation.Fourth, conclusion

According to overseas experience, the era of low interest rates is as less as eight or nine years, as many as decades. During the period, the prices of different large categories of assets have changed, making the value preservation and appreciation of wealth facing difficulties.

Those who do not seek the overall situation are insufficient.The era of low interest rates experienced by the United States and Japan will help us grasp the laws and rhythm of various large -scale asset prices in the global situation, so as to achieve the number of wealth, and to adjust the asset allocation strategy, adapt to the low interest rate environment to provide the basisEssenceI hope that this article can help everyone face the challenges of the low interest rate era and achieve investment goals smoothly.

Disclaimer: The research and analysis of fund and fund investment advisory portfolios does not constitute investment consulting or consulting services. The remarks released by this account only represent personal views and do not use the basis for buying and selling.Fund investment is risky. The past performance of the fund and fund investment advisory group does not indicate its future performance. The income created for other customers does not constitute a guarantee of performance.The fund investment advisory business is still in the pilot stage, and the fund investment advisory pilot agency has the risk of unable to continue providing services due to the cancellation of the pilot qualification.Please read relevant legal documents and risks to reveal the statement carefully, and make rational investment based on your own risk tolerance.

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