Financial Knowledge Base

Looking back at this on Beijing Time June 9, 2026—the line from June 5 is no longer sufficient. On June 8, the A-share market failed to digest last Friday’s retracement of tech stocks; instead, the ChiNext board, STAR 50, CPO, and semiconductors continued to decline sharply. Simultaneously, US stocks also saw intraday pullbacks on June 8, with QQQ, SOXX, and a group of AI chip stocks exhibiting obvious rebounds. When looking at both markets together, the conclusion is even less straightforward: A-shares are continuing to dismantle crowded trades, while US stocks are performing high-elasticity rallies intraday. Neither of these events serves as concrete evidence that “clearing has been completed.”

When the A-share semiconductor and AI hardware chains surge rapidly, two extreme reactions tend to emerge: one type of person feels that missing out on gains (FOMO) is more painful than actually incurring losses, while another believes that excessive rises necessarily signal a bubble.

Both of these are too fast. In areas like semiconductors, computing power, optical modules, and storage, the industrial logic might be true. AI training and inference will indeed boost hardware demand, and domestic substitution has certainly provided narrative space and order opportunities for local companies. The problem is that just because the industrial logic holds true does not mean that the probability of investing in it now is good.

Similar market trends have occurred repeatedly in history: the liquor sector (Baijiu), new energy, pharmaceuticals, core asset grouping, and TMT. Each time, there was real logic behind it. When these sectors decline, it doesn’t necessarily mean the logic has disappeared; rather, the timing/rhythm between valuation, positioning, earnings realization, and liquidity was off.

For a platform, what is most damaging from regulatory crackdowns on illegal cross-border activities is not the stock price for one or two days, but the potential reassessment of its entire historical growth model. Fines are one account; whether the retained domestic customer base can continue to contribute transactions, financing, assets, and conversions is another, much longer-term concern.

The greatest strength of internet brokers like Futu and Tiger is their ability to make Hong Kong and US stock trading a low-friction product. The problem is that when this experience faces mainland users, it encounters barriers related to licensing, foreign exchange regulations, suitability assessment for investors, data handling, and the boundaries of cross-border financial services.

Therefore, the third section should focus only on the business model and institutional stratification. Although the product capability of cross-border securities firms remains strong, if regulatory boundaries re-enclose the largest and most readily available user base, its valuation can no longer be predicated on old growth stories.

After regulatory news breaks, what ordinary users are most concerned about is not the brokerage firm’s stock price, but whether they can still operate their own accounts: whether they can buy, sell, withdraw funds, or transfer positions. The phrase that is easiest to misunderstand here is “the two-year focused cleanup period.”

If only new account openings are restricted, the perceived experience of existing users will not change immediately. However, if current transactions are further restricted, users will encounter entirely different issues. The mildest approach might be a sell-only mandate; the most restrictive could require fund transfers, capital withdrawals, or the revocation of certain trading permissions.

This piece only discusses the user side. What truly needs preparation is not speculating whether regulations will loosen, but rather separating and analyzing “the length of historical buffers granted” from “what these public statements currently require.”

Investigations into Hong Kong and US stockbrokers caused initial price drops, with account issues only truly pressing upon users later. The most critical change this time is not the issuance of another regulatory statement, but rather the boundary shifting from “don’t allow new entrants” to focusing on “how existing players should exit.”

During the last inspection, many understood that domestic users could no longer arbitrarily open new accounts, but those who already had accounts could continue trading. This boundary provided both the platform and the users with a buffer zone, making the existing accounts appear as a gray but maintainable historical burden.

This set of articles should be split into three parts: The first article will only focus on regulatory boundaries, the second will cover how accounts can be operated/affected, and the third will discuss how platforms and other brokerage firms should re-price. We must clarify the boundaries first; otherwise, we risk mixing user operations, company valuations, and industry rectification all together.

After Zhipu and MiniMax were included in the Hang Seng Tech Index, the most common question that arises is: Since they have not yet reached their first lock-up period, are index funds compelled to buy shares?

This question cannot be answered directly based on emotion.

Inclusion in the index must first adhere to publicly disclosed methodologies. Delisting will affect future supply and stock price pressure, but it is not a hard threshold within the Hang Seng Tech Index methodology. Passive funds buy before and after the index takes effect because their goal is to track the index, not because the index company is arranging exits for existing shareholders.

When many people first see US Treasuries, the easiest thing to do is misread a number.

When you see 4.5% advertised in the market, it’s easy to mentally fill in a simple phrase: “If I invest now, I will reliably earn 4.5% every year and continue receiving it until maturity.”

This statement is only half right.

4.5% often aligns more closely with an “annualized yield metric,” and does not mean that you receive cash of 4.5% every year. What actually reaches your account is the result calculated from three factors combined: coupon payments, the purchase price, and principal repayment at maturity.

Bottom line first.

As of May 20, 2026, the strength of A-shares and the weakness of Hang Seng Tech are not due to one asset pool having lagging components; rather, it is a divergence between two sets of pricing logics. On May 20, 2026, the Shanghai Composite Index closed at 4162.19 points, still fluctuating near 4200; meanwhile, on its most recently available closing date of May 19, 2026, the Hang Seng Tech Index closed at 4857.46 points, which is still short of the phase historical high point of 10945.22 recorded on February 17, 2021, by 55.6%.

If your statement that the “CSI 300 ETF has matched its historical peak” refers to the most common 510300, the closing price I captured on 2026-05-20 was 4.871. This still represents about a 16.1% drawdown from the 5.807 recorded on 2021-02-10, and has not reached an all-time high. It is highly likely that various calculation bases were mixed here: Price, Net Asset Value (NAV), Adjusted NAV, Total Return Index. They look like they are the same thing, but they actually are not.

Allow me to correct a name. The “China Golden Dragon Fish Index” you mentioned usually refers to the Nasdaq Gold Dragon China Index, whose English name is Nasdaq Golden Dragon China Index, not “Golden Dragon Fish.”