(Yicai) Jan. 8 -- China's sales of bank-issued hybrid wealth management products in 2024 were almost twice that of the previous year, and the yield also climbed significantly, as investors’ appetite for these products, which offer a mixture of fixed-income and equity assets, grows amid the recent stock market rebound, according to the latest statistics.

The scale of hybrid wealth management products issued in China surged 95 percent at the end of 2024 from a year earlier to CNY85.6 billion (USD11.6 billion), according to figures recently released by PY Standard, a market research firm specializing in the asset management and wealth management markets.

Yields have also improved. The average annual return on hybrid wealth management products climbed 2 percentage points as of the end of December from a year earlier to 3.39 percent, while that of equity wealth management products soared 6 percentage points to 6.61 percent, according to data from PY Standard.

Since a hefty economic stimulus package was rolled out in September, the country’s stock markets have skyrocketed. The Shanghai Composite Index surged 17.9 percent on Dec. 31 from Aug. 30 to 3351.76, while the Shenzhen Component Index soared 24.7 percent to 10,414.61 and the ChiNext Index jumped 36.6 percent to 2,786.03.

Hybrid wealth management products are attractive for several reasons, said Liu Fengming, a researcher at PY Standard.

First, they provide stable returns through risk diversification via the reasonable allocation of fixed-income and equity assets, Liu said. Compared with single-asset products, they also have greater flexibility and diversity. And, in the context of increasing market uncertainty, they meet growing demand for product diversification which helps to improve competitiveness.

The number and size of hybrid wealth management products are set to increase this year, but their share of the wealth management product market is not likely to expand much and should stay at between three percent and four percent, said Zhou Yiqin, founder of Guanshao Consulting.

Despite the strong short-term performance, the stock market still needs the support of improved economic fundamentals to shift from rebound to reversal, said Zhang Jinghan, a researcher at PY Standard.

In previous rounds of policy stimulus, market sentiment did not undergo an effective turnaround. The medium- to long-term performance of the equity market will largely depend on whether the recent stimulus drive takes effect and whether economic fundamentals will improve, Zhang said.

Editor: Kim Taylor