If you are an investor, whether you are a stockholder, a citizen, or you have bought wealth management, you must be familiar with social security funds. That’s right, because social security funds can be described as a”god existence” in China’s capital market.
On September 11, the National Council of Social Security Fund issued the”Annual Report on the Operation of the Basic Pension Insurance Fund of the National Council of Social Security Fund (2019)”, which attracted market attention.
The report data shows that In 2019, the social security fund equity investment income amounted to 291.18 billion yuan, and the investment rate of return was 14.06%. Among them, the realized income was 94.48 billion yuan (realized return rate of 4.64%), and the fair value of transaction assets changed to 197.238 billion yuan.
So how does the social security fund make money? How much did you make?
The difference between pension and social security fund
Pension fund is what we often call pension insurance in social security. The full name of social insurance is called Social Insurance Fund. The full name of the social security fund in the”social security fund entering the market” that we often hear is National Social Security Fund.
In the stock market, you can often see the words”National Social Security Fund” and”Basic Pension Insurance” in the shareholder list of listed companies.
Where does the social security fund come from?
As can be seen from the above chart, the funds of the social security fund mainly come from the central government, state-owned capital transfer and investment income. For example, in 2019, 46.493 billion yuan was allocated to the National Social Security Fund financially, including 10 billion yuan from the central budget; 36.449 billion yuan in lottery public welfare funds; and 44 million yuan in state-owned shares reduction funds.
How much does the social security fund make?
From the income statement of the social security fund, you can see its source of income very intuitively:
1, income from changes in the fair value of trading assets It is the largest source of income for social security funds, accounting for 62.45%. The so-called income from changes in fair value is one of the profit and loss accounting subjects. In short, it is the floating profit or loss of assets (generally referring to financial assets). In the chart, floating profit is positive and floating loss is negative.
2, Interest income is an important source of social security funds. This part of interest mainly comes from bank deposits, settlement reserves and bonds, accounting for 18.28%.
3. Long-term equity investment and dividends contributed about 12%to income.
But just looking at the numbers on the report, you can’t see anything famous. When looking at accounting statements, you must look at them together.
First, it is the income from changes in the fair value of trading assets. To put it bluntly, it is the floating profit or loss of the stocks, bonds, funds and other securities held by the social security fund at the end of the year. The corresponding subjects in the balance sheet are”transaction financial assets” and”available-for-sale financial assets”. Such assets are held for a short period of time and are often prepared for sale, such as stocks. As the A shares appeared in the rare Xiaoyangchun market in the first quarter of last year, it will basically be volatile throughout the following year, which can be achieved The 14.06%yield is already very good.
Next is interest income. The corresponding subjects in the balance sheet are”bank deposits” and”settlement reserve funds”. There is no need to explain bank deposits. Settlement reserve refers to the temporary liquidity deposited in securities trading and non-trading settlement fund settlement accounts, which is equivalent to funds on prepaid cards such as bus cards. I have talked about it in detail in the previous article. The money in the bank will generate corresponding interest. After all, the principal amount is huge, and the interest is normal.
Furthermore, there are various investment income subjects and dividend subjects. The corresponding subjects in the balance sheet are”hold-to-maturity investment” and”long-term equity investment”.”Hold-to-maturity investment” generally refers to treasury bonds, corporate bonds, financial bonds, etc., and”long-term equity investment” refers to an equity investment that can be distributed annually for a certain company. In addition,”long-term equity investment” also includes the transfer of part of the state-owned capital. According to regulations, in the case of a state-owned enterprise IPO, the state-owned equity part needs to be transferred to the social security fund, which means that the social security fund can enjoy the benefits of these new shares. .
How does the social security fund make money?
The National Social Security Fund was established in August 2000. In June 2003, the Social Security Fund formally signed an authorization agreement with 6 fund management companies including Southern, Boshi, and China. The prelude to the social security fund’s entry into the market. That year, the social security fund achieved a profit of 3.407 billion yuan, with a return rate of 2.71%.
In the next 20 years, except for 2008 and 2018, the social security fund has negative returns, and other years have achieved positive returns, and it perfectly interprets the bull-bear conversion through bargain hunting:
Wind information data shows that from July 2004 to June 2005, the Shanghai Composite Index fell from 1340.75 points to 998 points, down about 20%, but the social security fund’s shareholding increased from 432 million shares to 2.614 billion shares. In the five years from 2004 to 2008, the A-share bulls and bears changed greatly, and the social security fund repeatedly successfully increased positions and escaped the top. Since then, the social security fund has been hailed as the vane of stock market investment. Among them, in the big bull market of 2007, in April of that year, the Social Security Fund announced that it was selling stocks. In the end, the Social Security Fund submitted a perfect answer sheet with an investment income of 145.35 billion yuan and a yield of 43.19%.
Even during the stock market crash from the second half of 2015 to 2016, the social security fund still achieved positive returns of 15.19%and 1.73%, respectively. In 2013, A-shares fluctuated and fell, closing down 6.75%that year, and the social security fund realized an investment yield of 6.2%that year; in the first half of 2014, it fluctuated and fell, and it entered a bull market in the second half of the year. The investment yield of the social security fund that year was 11.69%.
Is the social security fund a god? No, but why can we win each time? I think the following points are very important:
1. Capital advantage. I have to admit that as long as the Social Security Fund takes the lead in increasing its holdings, all sources of funds will buy in one after another, thereby pushing up the stock price. To be precise, this is not an”advantage”, but it is a fact.
2, management advantages. Of course, the fund managers of social security funds are all top in the industry, but more importantly, their investment methods are called distributed increase and lightening.
No one is stupid in the stock market, everyone knows that stocks are expensive. But they all think they can run away in front of others, but the leeks always forget that their opponents are called institutions. This is the reason why the Social Security Fund began to lighten its position amidst the optimism in the stock market in 2007. Distributed plus and minus positions can leave enough buffer time, and you will be ready before the market reacts.
From the beginning of this year to the present, the A-share index has risen a lot. It seems that this year is another bumper year for social security funds. Of course, for ordinary people, the higher the investment income of social security funds, the more Okay, so that our pension and medical money can be guaranteed.
This article comes from Xiaobaidu Finance