Small and Medium-sized Insurance Funds Reduce Positions Leading to A-share Pullback? Industry Says Impact is Limited, Overall Adding Positions is Main Trend

Gelonghui March 23 | According to Yicai, A-shares have recently experienced a pullback, and there are rumors that the main reason is that small and medium insurance companies are reducing their holdings due to the new solvency regulation. In response, several insurance investment managers denied this claim. “Insurance funds are definitely not the main cause of the market decline,” said Sun Ting, Chief Strategy Officer of Dongwu Securities and Chief Analyst of Non-bank Financials. Several analysts also expressed similar views. They generally believe that there is no new solvency regulation at present. Some small and medium insurance companies may have recently reduced holdings due to solvency or performance pressure, but their share in overall insurance funds is very low. Large insurance companies are not under significant reduction pressure, and the impact on the market is limited. In fact, the overall trend for insurance funds this year remains mainly to increase holdings.