Geopolitical risk mitigation, non-banking assets remain in the undervalued range, highlighting their allocation value

As of 13:40 on April 8th, the non-bank financial sector experienced a comprehensive rebound, with the Securities and Insurance ETF E-Fund (512070) rising 4.31%, and trading activity significantly increasing. Related individual stocks also strengthened simultaneously, with core targets such as Ping An Insurance (601318.SH), East Money (300059.SZ), CITIC Securities (600030.SH), GF Securities (000776.SZ) all gaining over 3%, and China Pacific Insurance (601601.SH) and New China Life Insurance (601336.SH) approaching a 6% increase.

Looking at recent market trends, the non-bank financial sector experienced sustained adjustments earlier, with increased bullish and bearish battles since April. As tensions between the U.S. and Iran eased, market risk appetite gradually recovered. Non-bank assets that had previously fallen sharply now have valuation repair opportunities, and capital deployment willingness is warming.

Currently, the valuation of the non-bank financial sector is at a historic low, with pessimistic expectations fully priced in, offering extremely high allocation value. From a valuation perspective, the PB and PE ratios of the A-share securities sector are at the 8% and 4% percentiles over the past decade, respectively, placing them at historical lows; Hong Kong-listed securities firms’ consensus dividend yields for 2025 are close to or exceeding 5%, with limited downside risk and ample safety margins.

Meanwhile, the sector has clear upward elasticity, with multiple positive factors expected: easing U.S.-Iran tensions driving market risk appetite recovery, potential upward movement of the A-share index, and the implementation of innovative securities business. Coupled with the gradually improving pessimistic outlook on insurance capital investment, the non-bank financial sector is expected to achieve valuation and performance resonance, leading to a Davis double play. Additionally, the fundamentals of the securities industry continue to improve, with listed securities firms generally growing in performance in 2025, and active trading in the first quarter of 2026 further supporting subsequent sector rebounds.

E-Fund (512070) Securities and Insurance ETF is the largest securities and insurance-themed ETF in the A-share market, with a latest size of 15.4 billion yuan as of April 8th, demonstrating prominent liquidity advantages. This ETF closely tracks the CSI 300 Non-Banking Financial Index, with a balanced holdings structure, including 60% in securities companies and 39% in insurance companies. It is the ETF with the highest insurance content in A-shares, capable of comprehensively covering high-quality core targets in the non-bank financial sector, making it an excellent tool to grasp the valuation repair trend of non-bank assets.