Guotai Haitong has released a research report stating that market sentiment recovered from a low level in August, while household risk appetite remained divergent. On one hand, household allocation to equity-related assets continued to slow in August and enthusiasm for entering the market cooled; on the other hand, new issuance of private equity funds and private asset management products stayed elevated, indicating that some high-net-worth clients still have relatively high risk appetite. The brokerage sector has strong certainty of profit growth in the third quarter, and investors should watch for allocation opportunities in the sector. In terms of stock selection, the report suggests focusing on distinctive brokers that hold or co-hold leading public fund management companies, that make a leading profit contribution, or that are gaining retail market share, as well as leading head brokers with an edge in international business.

Main views from Guotai Haitong

Household asset allocation in August 2026 was mainly directed toward fixed-income assets. By the end of August 2026, the total market stock of wealth management products available to households reached RMB 374.9 trillion, up 0.7% month-on-month and up 10.4% year-on-year, with net value increments reaching 2.6 trillion units, a month-on-month change of -2.4%. Among these, the increments in the scale of public funds, private funds, private asset management, bank wealth management products, and deposits were RMB 529.3 billion, RMB 13.4 billion, RMB 321.9 billion, RMB 214.9 billion, and RMB 36.6 billion respectively, contributing +20%, +1%, +12%, +8%, and +1% of the increment.

Equity market swung and recovered in August, with household risk appetite diverging

In August 2026, leverage risks in overseas markets were cleared and regulatory signals for stabilizing the market became clear, leading to a swinging recovery in the equity market. In August, the stock fund index, mixed fund index, bond fund index, and money market fund index posted gains or losses of +4.07%, +5.89%, +0.25%, and +0.09% respectively. As the equity market continued to swing, household risk appetite diverged. On one hand, the pace of household allocation to equity-related assets slowed and enthusiasm for entering the market cooled, with 2.397 million new A-share accounts opened in August, down 9.7% month-on-month. On the other hand, private funds grew rapidly and new issuance of private asset management products remained at a high level, indicating that some high-net-worth clients have relatively high risk appetite.

Equity fund shares of public funds saw net outflows, while money market funds were the main direction of increased allocation. By the end of August, the total scale of public funds in the whole market reached RMB 39.6 trillion, up 1.4% month-on-month, with an average unit net value of RMB 1.17, up 1.3% month-on-month. Fund shares at period-end stood at 33.9 trillion units, up 0.0% month-on-month, among which the increments in shares of equity funds, mixed funds, bond funds, money market funds, and QDII were -78.91 billion, -5.26 billion, -54.23 billion, +155.35 billion, and -5.44 billion units respectively. In terms of new issuance, new fund shares issued in the market in August totaled 59.36 billion units, down 25.4% month-on-month, among which new issuance of equity products fell 32.4% month-on-month and new issuance of bond funds fell 17.9% month-on-month.

Private fund and private asset management scale grew steadily, while new issuance declined. By the end of August, the stock scale of private funds stood at RMB 25.7 trillion, up 0.1% month-on-month, and the newly filed scale of private funds was RMB 72.4 billion, down 40.7% month-on-month. In August, the stock scale of private asset management reached RMB 13.5 trillion, up 2.4% month-on-month, among which the scales of equity, fixed-income, commodity and financial derivatives, and mixed categories changed by +3.3%, +1.1%, +13.1%, and +6.5% month-on-month respectively. New issuance of private asset management products in August reached RMB 98.59 billion, down 19.7% month-on-month and up 16.1% year-on-year.

Wealth management, insurance, and deposits

In August, the stock scale of bank wealth management products reached RMB 31.9 trillion, up 0.7% month-on-month, among which the scales of fixed-income, equity, and mixed categories rose 0.7%, 1.2%, and 1.0% month-on-month respectively. In the first eight months of the year, premium income of the insurance industry reached RMB 4,819.2 billion, up 0.4% year-on-year, among which life insurance premium income fell 0.2% year-on-year and property insurance premium income rose 2.2% year-on-year. RMB household deposits stood at RMB 172.9 trillion, up 0.02% month-on-month, with an increment of RMB 4 billion.

Risk warning: Large swings in the equity market.