Talking about Yu’ebao

A blog post by CCTV commentator, once again pushed Yu’s treasure to the public’s sight. Yu’e Bao is a “vampire”; Yu’ebao has impacted China’s normal financial order; Yu’ebao should be banned; the author’s words are fierce, and the views are glaring, so that the majority of the balance treasure investors do not know for a while. What the hell is going on? Is Yu Bao so terrible?

Speaking of the essence of Yu’ebao, it is actually a money fund. The combination of Tianhong’s money fund and Alipay’s account, a package, the balance of treasure was born. Some of the CCTV commentators are still reasonable. Yu’ebao is not a financial innovation, because the nature of its money fund has not changed, and the way of financial asset management has not changed. However, Yu’ebao is indeed an innovation of Internet finance. It is an innovation of the Internet concept to repackage the money fund, and it is also an innovation in user consumption and financial management experience! Speaking of this, there may be a user who will ask everyone about this model of innovation? Not modest to say, the investment and financial management of everyone’s loans is really both financial innovation and Internet innovation. In finance, Renren has created a large number of personal credit financial assets, which are high-yield and high-quality financial assets that cannot be obtained in the traditional investment field. On the Internet, Renren has built a trading platform through the Internet to become a transaction, credit certification, and information. Clearing settlement intermediary, this is the Internet’s innovation in trading methods and places.

Closer to home, return to the balance treasure. When a user invests money in Yu’ebao, it is equivalent to purchasing a money fund. Has the money fund such as Yu’ebao robbed the bank’s funds, and has it caused an impact on China’s financial order? Generally speaking, the Monetary Fund mainly invests in the less risky money market. The main investment object is the bank agreement deposit. The popular point is that the deposit group buys, and the monetary fund can obtain a higher bank deposit interest rate than the individual. Therefore, the funds of the IMF eventually returned to the banking system, but this part of the funds invisibly made the bank’s capital acquisition cost higher. However, regardless of the amount of money in the bank or the right to speak, banks have sufficient control over interest rates compared to money funds. Bank-deposited deposits are also the asset providers for the money fund to obtain income, so there is no money foundation. Forcing banks to raise interest rates, the current high interest rates on agreed deposits are the result of tighter macro-banking and inter-bank competition. In fact, if banks reduce the interest rate of the agreement deposits, the income of the money fund can be reduced, the income of the balance will be reduced, and the attractiveness to users will naturally decline. It can be seen that the fundamental factor that is the decisive factor is the agreement deposit rate, which is determined by the bank’s own control. Through the above analysis, the so-called balance of the treasures on the impact of China’s financial order is naturally not established.

So for investors, is Yubao a 100% safe and good product? Among many fund products, the money fund has the characteristics of high security, high liquidity and stable profitability. Yu’ebao provides investors with more choices, and also allows many domestic savers who are accustomed to depositing money directly into banks to understand the money fund and become the first step for many people to manage their money.

However, in a strict sense, money funds are also risky. On the one hand, they are asset risks. This is relatively small, because the probability of default on similar deposits, repurchases, and government bonds is extremely small. On the other hand, liquidity risk can also It is considered to be the risk caused by centralized redemption. This point may be more obvious on the balance treasure. The scale of Yu’ebao is said to have reached more than 400 billion. If there is a redemption of 2.5%, it is 10 billion. To manage such a large-scale monetary assets, overnight lending on the market. The amount may gradually fail to meet the redemption demand of Yu’ebao, then Yubao must set aside a certain cash position to deal with redemption. The liquidity management of funds is greatly improved, there is a certain liquidity risk, and it is vulnerable to liquidity. Shock. There have been money fund runs in foreign countries, and there have been cases of money fund losses in China. Although the probability of occurrence is very low, it is indeed real.

Finally, I will talk about the benefits of the balance treasures. Since the beginning of the year, various treasures including Yu’ebao have been shrinking. This is because market liquidity tension has improved. At the end of the year, market funds were in a relatively tight situation. Banks are willing to pay higher agreement deposit rates in order to guarantee deposits and meet various indicators. After the holiday, the funds are loose, and the income of the money fund naturally declines. This is also confirmed by the previous view that the agreement deposit interest rate determines the income of the money fund. In general, 3% to 5% is the usual annualized income of the money fund. However, at the end of each month, the end of the quarter, and the end of the year, the income will increase significantly, and investors can pay special attention to these points in time.

PS: Interested friends can pay attention to the “Gu” public number of the week: Allen_Gu_yzygs