(Yicai Global) July 27 -- Covid-19 has changed Chinese investors' wealth management habits, and they now markedly prefer to invest in funds rather than stocks in the post-pandemic era.
Chinese households' deposit willingness index was 102.7 in the second quarter, down 8.4 percentage points from 111.1 in the first, according to the second-quarter Chinese household wealth index report Alibaba Group Holding financial arm Ant Group Research Institute and China's Southwest University of Finance and Economics jointly published yesterday.
The stock allocation willingness index was 90, while the fund allotment readiness index was 96, per the report. This gap between the two readings is more apparent among families with over CNY10,000 (USD 1,428.88) in financial assets, with 97.16 in the stock index and 103.91 in the fund one.
Economic recovery, assets and incomes were not factors driving families' increased investments in funds, and the group buying more into funds is younger and better educated, the study found. Rising fund investments are highly likely to be a mid-to long-term move for these families, said Gan Li, director of the university's China Household Finance Survey and Research Center.
Of the newcomers to China’s fund market this year, 52.9 percent are aged below 30. Shunning shares in favor of funds shows individual investors are becoming more rational, said Wang Jun, general manager of Ant Group's digital financial wealth business division.
Chinese families' home-buying willingness has spiked post-pandemic, and those with several residences are more willing to buy a new unit in the next three months, the report concluded. House investment willingness among families with several properties was 105.2 in the first quarter, much higher than in other groups, and this trend held steady in the second quarter.
The outbreak has rattled global financial markets, meaning Chinese families are now less inclined to consign their nest eggs into assets abroad. The overseas investment willingness indexes of all kinds of households dropped from the first quarter, per the report.
Editors: Xu Wei, Ben Armour