Amid intensified volatility in the commodity markets, several gold, crude oil, and other bulk commodity LOF funds have recently announced密集 restrictions on large purchases, with individual products even setting daily subscription limits as low as 2 yuan.
Industry insiders indicate that the purchase restrictions are primarily intended to ensure the healthy growth of fund performance and scale, thereby protecting investor interests.
Regarding the significant adjustments in gold and silver, multiple industry professionals have stated that both gold and silver are currently overheated. Before the sharp decline, trading had become extremely crowded, with substantial price gaps between futures and spot markets, indicating that significant risks had accumulated. They caution that short-term volatility is increasing, advising vigilance against corrections and warning against blindly chasing the rally.
On the evening of January 30, Harvest Gold LOF announced that, starting February 2, the limit for subscription (including regular fixed-amount investments) would be adjusted: the cumulative subscription amount per fund account on any single open day must not exceed 5 yuan. Amounts exceeding 5 yuan may be rejected by the fund manager.
That same evening, Harvest Crude Oil LOF also announced that, effective February 2, it would suspend large subscriptions and large regular fixed-amount investments, setting a daily cumulative investment limit of no more than 5 yuan. This fund had previously announced on January 29 that, starting March 18, the cumulative subscription amount per fund account on any single open day would be limited to 100 yuan. Merely one day later, the purchase restrictions were tightened further.
HuaBao Oil & Gas LOF also announced that, starting February 3, it would suspend large subscriptions and large regular fixed-amount investments, reducing the daily cumulative investment limit to 200 yuan.
HuaAn Petroleum Fund LOF implemented even stricter limits. On the evening of January 29, HuaAn Fund announced that, starting January 30, it would lower the daily cumulative subscription and regular fixed-amount investment limit per fund account for each share class of the Petroleum Fund LOF, reducing it from 10 yuan to 2 yuan.
On the same day, GF Fund also announced that, effective January 30, the subscription (including regular fixed/variable amount investments) and conversion-in limit for the RMB share class of its Oil LOF would be 10 yuan per fund account per day.
Wind data shows that on January 30, the premium rates for HuaAn Petroleum Fund LOF and GF Oil LOF reached 32.84% and 32.57%, respectively.
Prior to implementing these purchase restrictions, several gold, crude oil, and other commodity LOF funds issued consecutive announcements warning of on-market premium risks. Some declared trading halts from market open until 10:30 AM, while others announced full-day trading suspensions.
Industry insiders stated that the suspension of large subscriptions by multiple LOF funds serves two purposes: to curb high on-market premiums, and to address the situation where, during a market plunge, these funds might experience a short-term influx of capital. However, constrained QDII quotas could lead to idle excess funds or cause the fund's net asset value to deviate from the index, potentially harming investor interests.
On January 30, gold experienced a 'Waterloo' moment, with the spot gold price falling by over 12% at one point, hitting a low of $4,682 per ounce. By the close, spot gold was down 9.25%, settling at $4,880 per ounce.
Spot silver plummeted by over 36% at one point, recording its largest intraday decline in history, and falling to a low of $74.28 per ounce. By the close, spot silver was down 26.42%, settling at $85.259 per ounce.
Analyzing the sharp decline in the gold and silver sectors, China Asset Management opined that in the absence of a historical price anchor, the faster the ascent of gold and silver prices, the greater the corresponding risk of a technical correction. With the Fed holding rates steady in January and the announcement of the new Fed Chair, gold prices are highly likely to enter a consolidation phase within the current historically high range, potentially even experiencing a correction at the daily chart level or higher.
A commodity fund manager in Shanghai stated that the precious metals market is in a short-term overbought state, with significantly amplified volatility and intensified profit-taking pressure. Due to its smaller market size and lower liquidity, silver exhibits greater price elasticity, is more susceptible to short-term speculative flows, and carries higher downside risks than gold. Exchanges have already raised margin requirements, sending a signal to cool the market and warning investors against the risky behavior of 'snatching profit from the fire' by chasing the rally.
A non-ferrous metals fund manager in Shenzhen also cautioned that China will enter the Spring Festival holiday in mid-February, during which exchanges will be closed for two weeks. This period could serve as a critical test for the silver market, revealing the role of short-term traders in the price surge. High prices ultimately destroy demand, but this effect takes time to materialize. Industrial users of silver will seek alternatives, and Chinese photovoltaic module manufacturers have already announced relevant measures; price-sensitive jewelry buyers will reduce consumption. Investors participating in this historic rally should be aware that, at some stage, silver prices will inevitably retreat. Investors should remain rational and avoid blindly chasing the highs!
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