Our View on Chinese Assets: April 2026

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Last month, we launched Baiguan Pro—our monthly view on Chinese assets, themes, and sectors we are closely following, as well as insights from our own data at BigOne Lab.

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Each month, we pair macro data and BigOne Lab’s proprietary indices with a structured, directional read on where Chinese assets stand and what we’re doing about it.

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This Month: Our View on Chinese Assets

Our directional view on China equity allocation remains consistent with last month. Importantly, our proprietary China Resident Risk Appetite Index (CRRAI) shows continued improvement in Chinese households’ risk appetite.

In the March 2026 reading, the CRRAI composite index recorded -0.08, a further recovery from -0.17 in February. This marks several consecutive months of improvement in resident risk appetite, which is now just a fraction away from the 0-line (the historical mean/neutral level).

CRRAI quantifies Chinese household financial confidence and risk-taking appetite, and consists of the following components. 1) Macro & Business Confidence (15%): Tracks liquidity and growth using M1-M2 spreads, government bond yields, and PMI data. 2) Household Leverage & Credit (35%): Measures willingness to borrow, mortgage/consumer loan growth, and deposit trends. 3) Real Economy Foundations (35%): Monitors asset values and income security through second-hand housing prices, transaction volume, and employment. 4) Capital Market Sentiment (15%): Captures “animal spirits” via financing ratios, valuations (P/E), trading intensity, and new account openings. All indicators Z-score standardized against the 2014–2026 history.

Recent data also shows that foreign institutional investors’ confidence in allocating capital to Chinese assets has entered a phase of stabilization following the volatility seen in late 2025. While the Sentiment Index for A&H Shares retreated slightly from its March peak of approximately 0.54, it continues to hold steady above the 0.50 neutral threshold, ending April near 0.51.

Data is sourced from research reports from a selection of top global investment banks. The tracking monitors their analyses of capital flows into Chinese assets, macro policy outlooks, sector-level developments, and individual stock perspectives, while identifying shifts in cross-border asset allocation toward China, directional sentiment (bullish/bearish), and overall market confidence levels.

These data points back up our confidence in Chinese assets.

A-shares still preferred over HK. Three specific reasons: (1) the national team floor mechanism is a genuinely unusual feature with no real global analog; (2) in an elevated geopolitical risk environment, A-shares’ domestic-anchored dynamics offer more insulation from global risk-off moves; (3) the composition of A-shares — AI and tech supply chain, heavy industrials, domestic manufacturers — is a better fit for the China themes we find most compelling right now versus HK.

Data is sourced from China’s major retail stock communities, with high-frequency, full-spectrum tracking of individual investors’ sentiment toward specific Chinese assets and the broader market. The sentiment index is constructed by fitting post-level semantic analysis, discussion volume, posting frequency, and directional (bullish/bearish) tone. (Historical analysis shows that every time the index reaches a standard-deviation extreme, the market has subsequently experienced a mean-reverting correction—either cooling from excessive optimism or warming from excessive pessimism.)

That said, our team has been increasing exposure to Hong Kong-listed assets.