Global central banks cut interest rates

 

24Q3 saw a flurry of significant events in the global financial markets. The Federal Reserve cut interest rates in September, ending the most intense three-year rate hike cycle. The People's Bank of China followed suit, releasing a series of policies to stimulate the stock and real estate markets. After the Federal Reserve announced a 50 basis point cut, investor optimism led to a strong rebound in the S&P500 from an initial 8.5% decline at the start of the quarter. This rate cut boosted the stock market, pushing the S&P 500 to gain over 40% within a year, reaching a new historical high.

 

On the other hand, a series of policy measures at the end of September boosted China's A-share market, leading to a substantial increase by the end of September, showing a positive trend. China's central bank announced another rate cut and a series of measures to stimulate the stock market. At the same time, fiscal policies were continuously advanced to resolve local debt.

 

Hong Kong stocks, affected by robust investment returns from US stocks and A-shares, rebounded quickly after a two-year slump.

 

 

AQUMON's investment portfolio achieved excellent performance in the third quarter

 

Thanks to the scientific allocation, our U.S. ETF flagship portfolio, Smart Global Max, has maintained impressive performance since its establishment. The aggressive portfolio (80% stocks and 20% bonds) achieving year-to-date, three-year and five-year returns of 20.32%, 6.07%, and 9.30%, respectively. Affected by the Fed's interest rate cut, the S&P 500 hit a historic high in the third quarter, and the SmartGlobal Max's third quarter return rate was 7.09%, still outperforming the market by 1.56%. The overall performance of the portfolio achieved positive returns.If we look at the annual returns of SmartGlobal Max over the past seven years, this year's performance is notably exceptional, exceeding the average.

 

In the Chinese market, our 'Hidden Gems' thematic portfolio exceeded the performance of the CSI 500 Index, the year-to-date return is 25.10%. During the third quarter of 2024, despite the CSI 500 index experiencing growth of 16.19%, our portfolio saw an impressive increase of 24.01%, surpassing the market by 7.82%.

 

 

Amid the resurgence of the stock markets in China and Hong Kong, our thematic investment portfolio 'Chinese Tech Stars' also made a swift comeback,the year-to-date return is 19.30%. In the third quarter of 2024, while the Hang Seng Index posted a growth of 19.27%, our 'Chinese Tech Stars' portfolio outshone it with a substantial increase of 30.46%, surpassing the market by a notable 11.19%.

 

 

Significant decisions lie ahead in the financial markets for Q4 2024

 

The results of the US election on November 5th and the Fed's interest rate meeting on November 6th will profoundly impact the upcoming financial market trends. The election race between Trump and Harris is nearing its end. Whether the Federal Reserve will choose to continue to cut rates on November 6th, be it 25bps or more conservative, remains to be seen. This series of significant events increases uncertainty in US stocks;

 

Whether China's policies can keep stock market sentiment continuously high is still an unknown factor. We saw considerable fluctuations in October, reflecting market polarization. However, the government's comprehensive shift allows us to see the continuity of policies, and we can optimistically see that the economy will also improve accordingly.

 

In terms of industries and regions, AI still leads the pack. Stock markets in India and Japan show some decline due to the revival of A-shares. However, with the United States' rate cut, carefully selected thematic investment portfolios will benefit.

 

 

About us

AQUMON is a Hong Kong based award-winning financial technology company. Our mission is to leverage smart technology to make next-generation investment services affordable, transparent and accessible to both institutional clients and the general public. Through its proprietary algorithms and scalable, technical infrastructure, AQUMON’s automated platform empowers anyone to invest and maximize their returns. AQUMON has partnered with more than 100 financial institutions in Hong Kong and beyond, including AIA, CMB Wing Lung Bank, ChinaAMC, and Guangzhou Rural Commercial Bank. Hong Kong University of Science and Technology, the Alibaba Entrepreneurs Fund, affiliate of BOC International Holdings Limited, Zheng He Capital Management and Cyberport are among AQUMON's investors. 

 

The brand is held under Magnum Research Limited and is licensed with Type 1, 4 and 9 under the Securities and Futures Commission (SFC) of Hong Kong. AQUMON is also licensed by the U.S. Securities and Exchange Commission (SEC) and the Asset Management Association of China (AMAC).

 

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