"I recently received a bonus and was planning to use it to invest, but I've seen many investment products terminated early these past few days, and some people are saying that the net asset value has dropped, so I'm hesitant to invest." Many investors have been facing similar dilemmas recently.
A Financial Times reporter noted that as the year draws to a close, the weakening bond market has led to fluctuations in the net asset value of some wealth management products, and even a wave of premature terminations, raising market concerns. Wind data shows that the bond market has been undergoing a continuous adjustment since November. As of December 8, the 30-year Treasury bond futures contract fell by 3.72% in the quarter, and the 10-year Treasury bond futures contract fell by 0.54%.
"Bonds are the main asset class for wealth management products, especially fixed-income products," China Everbright Bank's Beijing branch recently explained in a statement. "The decline in bond prices has directly led to a drawdown in the net asset value of some wealth management products."
At the same time, there has been a surge in the early termination of wealth management products. Between November 1st and December 9th, nearly 100 wealth management products announced their early termination. Several other institutions have also recently issued related announcements.
On December 23, BOC Wealth Management issued an announcement regarding the early termination of the "BOC Wealth Management - Stable Foreign Exchange Fixed Income Enhancement (USD Annual Open) 05" product. The product will enter the early termination process on December 30, 2025 (the early termination date), and BOC Wealth Management will complete the asset realization of the wealth management product before the early termination date.
On December 24, China Post Wealth Management issued an announcement stating that one of its RMB wealth management products has been terminated early on January 6, 2026, due to its total units falling below 100 million for 10 consecutive trading days. The product's original maturity date was January 5, 2032.
In addition, since December, nearly 10 institutions, including Ningyin Wealth Management, Hengfeng Bank, and Sichuan Bank, have issued announcements regarding the early termination of their wealth management products.
According to industry insiders, the recent overall weakness in the bond market is the result of a combination of factors, including tightening liquidity and adjustments in policy expectations.
"The recent shift of the central bank's open market operations to net withdrawal, coupled with increased year-end funding demand, may trigger bond selling and increase liquidity pressure. At the same time, the central bank's bond purchases in November fell short of expectations, further weakening market confidence and jointly driving adjustments in the bond market," analyzed the Beijing branch of China Everbright Bank.
"Rumors of new regulations on public fund fees have also disturbed market sentiment in the bond market," according to an analysis by ICBC Wealth Management. The analysis suggests that the new regulations may reduce the cost-effectiveness of bond funds for institutional investors, potentially triggering redemptions. Coupled with the weak performance of pure bond funds this year, year-end adjustments to "fixed income+" funds, and the delayed implementation of the new regulations, market concerns about bond fund redemptions have been amplified.
However, most industry insiders believe that the current bond market adjustment is a short-term phenomenon, and there are no significant negative factors in the fundamentals and policies, so investors do not need to panic excessively.
"Bond market volatility often stems from congested trading, policy shifts, or changes in risk appetite, but volatility is also an inevitable part of market self-regulation," said an analyst from China Post Wealth Management. In the short term, the fundamental logic supporting the market has not reversed, the sustainability of this round of adjustments is weak, and there are already signs of overcorrection in the current bond market. Combined with the improved cost-effectiveness of long-term bonds, their allocation value is expected to gradually emerge. However, investors still need to pay close attention to short-term risk signals.
ICBC Wealth Management holds a similar view, believing that institutional demand for asset allocation remains strong against the backdrop of a continued asset shortage. The market may experience short-term volatility, but there is no need to be overly pessimistic in the medium to long term.
Amidst bond market volatility, the performance of wealth management products has diverged significantly. How should investors adjust their investment strategies in the face of fluctuations in the net asset value of wealth management products?
China Post Wealth Management stated that maintaining asset stability and liquidity is particularly important during the current period of market volatility. Cash management products combine the low risk of PR1 and convenient liquidity, and appropriately increasing the allocation of cash management products is a rational defensive strategy.
"Regardless of the type of product chosen, investors are advised to focus on the underlying assets, the manager's capabilities, and the product's liquidity, avoiding focusing solely on returns while ignoring risks," advises the Beijing branch of China Everbright Bank. "Short-term market fluctuations are normal, but clear financial planning and appropriate product selection are key to achieving financial goals."
