Why are large funds so keen on the CSI 300 ETF?

After several days of pressure on the A-share market, the "National Team" has made large-scale purchases of broad-based ETFs, while corporate share buybacks and public fund self-purchases have synergized with other incremental capital to support the market floor.

Among them, balanced broad-based ETFs represented by Huaxia CSI 300 ETF (510330.SH) are particularly favored by the large capital of the "National Team." The CSI 300 ETF saw a net inflow of nearly 50 billion RMB over the past two weeks, driven by three main reasons:

(1) Profit Growth Drive

According to consistent comparable estimates from institutions, the earnings growth rate for the mid-year reports of CSI 300 constituent stocks is expected to reach 90.9% in 2026. The clear trend of improving profitability in A-shares is expected to push the index from a valuation repair phase to a profit-driven stage.

(2) Counter-Trend Layout by Large Capital

Amid wide market fluctuations, related CSI 300 ETFs saw a weekly net inflow of nearly 40 billion RMB, ranking first across the entire market. As of July 20, the total scale of CSI 300 ETFs exceeded 270 billion RMB, offering large capital capacity and strong liquidity support.

(3) Prominent Valuation Cost-Effectiveness

The current rolling P/E ratio of the CSI 300 is approximately 14 times, significantly lower than major indices such as the S&P 500 (27.9 times). Further subdividing by sector, the total weight of industries with low/high valuations in the CSI 300 ranges from 25% to 35%, while industries with medium valuations account for 40%, indicating a relatively balanced overall industry valuation situation.

Finally, the low fee rates of broad-based ETFs like Huaxia CSI 300 ETF (510330.SH) are also an important consideration for large capital's steady market-buying activities.