Open Securities: Trading activity continues to rise, remains optimistic about opportunities in brokerage and financial technology sectors.

Open source securities released a research report stating that the Hong Kong Stock Exchange has adjusted the stock settlement fee from 0.002% of the transaction amount to 0.0042%, while also removing the minimum of 2 Hong Kong dollars and the maximum of 100 Hong Kong dollars limit. It is expected that the average trading fee will remain basically unchanged, while the trading costs for small transactions will decrease, which is beneficial for increasing the trading activity of retail investors. The surge in technology stocks is driving the increase in the activity of Hong Kong stocks, and the Hong Kong Stock Exchange is expected to benefit fully from this trend. Last week, the average daily trading volume of A-shares once again exceeded 2 trillion, combined with a low base, securities firms are expected to see a high year-on-year growth in performance in the first half of 2025. The valuation of the sector and institutional holdings are still at low levels, and there is optimism for leading financial information service companies, medium to large brokerage firms with outstanding retail advantages, and merger theme stocks. Recommended stock portfolio: East Money Information(300059.SZ), Hong Kong Stock Exchange(00388), Caitong(601108.SH), Industrial(601377.SH), Orient(600958.SH), Guolian Minsheng(601456.SH), China Life Insurance(601628.SH), Ping An Insurance(601318.SH), China Pacific Insurance(601601.SH), Jiangsu Financial Leasing(600901.SH). Beneficial stock portfolio: Beijing Compass Technology Development(300803.SZ), JF SMARTINVEST(09636), CMSC(600999.SH), Guosen(002736.SZ), Hithink RoyalFlush Information Network(300033.SZ), China Galaxy(601881.SH), New China Life Insurance(601336.SH). Weekly perspective: Deployment of financial institutions' DS benefits cost reduction and efficiency improvement, trading volume reaches new high within the year The average daily trading volume of stock funds reached 2.2 trillion last week, reaching a new high within the year. The market activity in February continued to increase. Combined with a low base, securities firms are expected to see high growth in performance in the first quarter of 2025. There is continued optimism for securities firms and the financial technology sector. Financial institutions are actively deploying DeepSeek, and there are significant application opportunities in areas such as investment advisory, customer service, investment research, and compliance risk control. Financial institutions with large customer and data bases, rich computing resources, and leading digital transformation are expected to gain significant benefits in reducing costs and increasing efficiency. At the same time, financial technology companies with AI advantages are expected to have more opportunities for incremental business in the B2B sector. On February 21st, HKEX adjusted the stock settlement fee from 0.002% of the transaction amount to 0.0042%, while also removing the minimum of 2 Hong Kong dollars and the maximum of 100 Hong Kong dollars limit. Open source securities expect the average trading fee to remain basically unchanged, while the trading costs for small transactions will decrease, which is beneficial for increasing the trading activity of retail investors. The surge in technology stocks is driving the increase in the activity of Hong Kong stocks, and HKEX is expected to benefit fully from this trend. Securities firms: Trading activity continues to rise, opportunities in securities firms and financial technology sector 1) The average daily trading volume of stock funds was 2.2 trillion last week, with a month-on-month increase of 10%. New shares/ non-monetary fund subscriptions were 44/163 billion shares, with a month-on-month increase of 750%/282%. 2) The Chairman of the China Securities Regulatory Commission, Wu Qing, chaired a party committee meeting to convey important speeches from the private enterprise symposium. The meeting emphasized the need to provide support for stock and bond financing for private enterprises, focus on serving the development of new productive forces, and implement policies such as the "Eight Regulations for the Science and Technology Innovation Board", the "Six Regulations for Mergers and Acquisitions", and the implementation opinions for "Five Large Financial Articles" in the capital market. 3) JF SMARTINVEST released a performance forecast on February 17th: The net profit attributable to the mother in 2024 is expected to be 2.6-2.8 billion RMB, a year-on-year increase of 36-47%, with an estimated order amount of approximately 3.509 billion RMB, a year-on-year increase of approximately 1.161 billion RMB. The company's business highlights high beta elasticity characteristics. 4) Trading activity in the market continued to increase in February. Wendell's full A shares turnover rate was 2.3%. Last week, the average daily trading volume of stock funds once again exceeded 2 trillion, combined with a low base, securities firms are expected to see high growth in performance in the first half of 2025. The valuation of the sector and institutional holdings are still at low levels, and there is optimism for leading financial information service companies, medium to large brokerage firms with outstanding retail advantages, and merger theme stocks. Insurance: Expected differentiation in January premium growth, bond allocation ratio increased in Q4 2024 1) Recently, some insurance companies disclosed their January policy data. It is expected that the growth of new single premiums in January will be somewhat differentiated, slightly lower than the previous expectations. Factors such as suspension of sales, reduction of guaranteed interest rates, and better expected returns on assets such as the stock market may pose challenges to individual insurance sales. The overall sales of participating insurance products are relatively good, and an increased share is beneficial for lowering long-term interest rate risk. The sales of bancassurance products are expected to have good growth on a low base. 2) The China Banking and Insurance Regulatory Commission disclosed on February 21st that as of the end of 2024, the balance of insurance company's fund utilization was 33.26 trillion RMB, with a financial investment yield of 3.43% in 2024, and a comprehensive investment yield of 7.21%. The percentage of bond assets at the end of the period for life insurance companies was 50.26%, an increase of 1.08 percentage points from the end of the third quarter, reflecting an early allocation strategy for bonds, with the stock and fund allocation ratio at 12.5%, a decrease of 0.47 percentage points compared to the previous quarter. 3) Insurance companies are expected to see robust growth in NBV in the first quarter of 2025, with an increased share of participating insurance products beneficial for lowering long-term interest rate risk. Focus on investment opportunities with outstanding equity flexibility.