CITIC Construction Investment released July's convertible bond market outlook: Supply and demand continue to be imbalanced, focusing on new bond listings.

CITIC Securities releases outlook for July convertible bond market: Supply and demand continue to be imbalanced, focus on new bond listings. The mismatch of supply and demand leads to a sustained overvaluation of convertible bond assets, and there is also a local risk of asset quality deterioration in convertible bond assets. In summary, in terms of certainty ranking, it is recommended to focus on the following: 1) trading opportunities in the initial stage of new bond listings: with no strong redemption risk in the short term, and the mismatch of supply and demand, buying demand may be much higher than selling pressure, also, there are a large number of recently issued bonds awaiting listing, so it is advisable to continue monitoring; 2) individual convertible bonds with growth characteristics: low allocation of individual convertible bonds can control the overall risk of the portfolio while gaining good elasticity, but strong redemption risk should be noted; 3) traditional dual-low/index-like allocation strategies: it is recommended to give more weight to the remaining time factor, avoiding rapid decay of the time value of convertible bond options before maturity.