On October 16, new ETFs from fund companies including GF Fund, Huabao Fund, and China Merchants Fund all issued announcements extending their subscription periods. This is not an isolated case. Amid weak market conditions, declining investor risk appetite, and an oversupply of index products with intense homogenized competition, new ETF issuance is facing clear headwinds. The good news is that the China Securities Regulatory Commission recently released the "Administrative Measures for the Operation of Publicly Offered Securities Investment Funds (Draft for Comment)," which proposes lowering the establishment threshold for equity funds from 200 million yuan to 50 million yuan, giving fund companies more patience to address the problem of products that "never grow up."
Three Announcements, Three Different Extension Timelines
Among the products that extended their subscription periods, the shortest extension was 3 days and the longest was 42 days. The GF CSI Dividend Low Volatility ETF extended its subscription by 7 days. The fund received CSRC approval on June 29, with an original subscription period from October 12 to October 16. An October 16 announcement showed the subscription period was extended to October 23, with no further subscription applications accepted from October 24, and a first-round fundraising cap of 3 billion yuan. As the only one of the three explicitly stating that it would stop accepting subscriptions from October 24, this date suggests it will most likely conclude fundraising on or before October 23. The other two did not specify a closing date, leaving room for possible further adjustments.
According to a China Merchants Fund announcement, the China Merchants Guozheng Grain Industry ETF began fundraising on October 12, with its original deadline pushed from October 16 to October 20, a 4-day extension. In addition, the China Merchants CSI Hong Kong Stock Connect Mainland Financial ETF began fundraising on October 8, with its original deadline extended from October 16 to November 27, a 42-day extension. According to the fund contract stipulating that "the fundraising period shall not exceed 3 months from the date of sale," the legal upper limit counting from October 8 is January 8, 2027, leaving approximately 40 days of buffer between November 27 and that cap. Another product, the Huabao ChiNext Battery ETF, began fundraising on September 28, with its original deadline extended from October 16 to October 19, a 3-day extension.
From the actual subscription side, these four products face different sales pressures. Although the Huabao ChiNext Battery ETF only extended by 3 days, it had the longest fundraising window among the group, suggesting channels had largely gathered subscription intentions by the final stage. The China Merchants Guozheng Grain Industry ETF had a similar 4-day extension, but this fund explicitly stated during its offering announcement period that it would "temporarily not open offline cash subscription or offline stock subscription services," offering only online cash subscription.
Extending subscription periods is a routine measure for fund companies coping with weak fundraising, essentially trading time for space to attract more channel funds and ensure successful product establishment. However, an extension itself also signals to the market that demand has cooled.
Behind the Extensions: Homogenized Competition and the Head-Siphoning Effect
Data shows that in the first three quarters, the market issued a total of 206 announcements extending fund product subscription periods, of which 110 came from ETFs. Extension announcements were highly concentrated in the third quarter, reaching 127 in a single quarter, accounting for more than 60% of the total for the first three quarters. By month, July saw 51 extensions, the single-month peak in 2026, followed by 28 in August and 48 in September.
During the same period, another set of reverse data emerged: 98 ETFs and feeder funds concluded fundraising ahead of schedule in the first three quarters, including 66 in the first half and 32 in the third quarter. Extensions and accelerated sales occurring simultaneously show that the degree of unevenness across the industry is more complex than the numbers suggest. Products that ended fundraising early were mainly concentrated in physical assets and high-dividend directions, such as non-ferrous metals and financials, power and utilities, batteries and dividend quality, and dividend low volatility themes, which highly overlap with the products that extended on October 16, indicating sharp divergence within the same track.
The phenomenon of second extensions is also increasing. In the first three quarters, 32 products issued two or more extension announcements, of which 17 were ETFs. At the market level, volatility has increased since 2026, and the ETF market has shifted from rapid advancement to a period of oscillation, making it increasingly difficult for new products to acquire and retain investors. The ETF product that Huabao Fund extended this time was the Huabao ChiNext Battery ETF. Prior to this, the company had at least 4 ETF products announce subscription extensions, covering sectors such as oil and gas, STAR Market 200, STAR Chip Design, and ChiNext Battery, making it one of the head public fund managers with more extended products. GF Fund had three products that previously extended subscription periods: the Industrial Software ETF, Petroleum ETF, and Financial Technology ETF. With the two recently announced extensions, GF has had 5 ETFs extend fundraising this year.
A large number of highly similar sector-themed ETFs in the same track being approved and issued simultaneously has severely diluted channel resources and capital. Combined with head ETFs continuously siphoning funds through their scale, liquidity, and investor base, latecomer homogenized products face sharply increased fundraising difficulty. The China Merchants Guozheng Grain Industry ETF is even more typical: the Guozheng Grain Industry Index saw multiple fund companies including E Fund, Guotai Fund, Invesco Great Wall, ChinaAMC, Southern Fund, Bosera Fund, Fullgoal Fund, and China Universal Fund densely file or issue similar products in 2026 alone. The Huabao ChiNext Battery ETF extended by Huabao Fund is a typical case of companies including Bosera, Yinhua Fund, and China Universal Fund filing ChiNext Battery Index ETF products in September, rushing toward the same new index during the same period. Huabao secured a 3 billion yuan fundraising cap. Unlike dividend low volatility, the market for new themed ETFs like ChiNext Battery is not yet saturated, leaving room for new entrants to grow, though some capital diversion has already occurred. However, Huabao only extended this fund by 3 days, indicating relative satisfaction with its fundraising situation.
Wind data shows that on the evening of September 29 alone, 9 fund companies simultaneously filed for the first batch of CSI Dividend Growth ETFs, with approval progress all showing "materials received." This index was launched in December 2017, selecting 50 listed companies with good historical dividend growth and high potential, adding growth attributes on top of high dividends, with low overlap with CSI Dividend, Dividend Low Volatility, and Dividend Quality samples. Once these products launch, dividend strategy ETF products will approach 100. What GF Fund is joining is a fiercely competitive track. From a fee perspective, the CSI Dividend track has an average management fee of 0.275%, with E Fund, China Merchants Fund, and Bosera Fund already entering the 0.15%-0.2% low-fee range, while traditional large indices like Dividend Low Volatility remain mainly at 0.5%. For new entrants, lower fees mean thinner profit margins.
The "Dual Life" of Head Public Fund ETF Products
Head companies are also under pressure from subscription extensions. As a "major active equity player," GF Fund also holds an important position in passive investing. As of the end of September, GF Fund managed 87 ETFs totaling 264.777 billion yuan, ranking 6th in the industry. GF's ETF product line spans seven major categories: broad-based, sector-themed, dividend strategy, cross-border, bond, commodity, and money market, covering A-share, Hong Kong, and US markets, with billion-yuan-level cross-border ETFs such as the Nasdaq ETF GF, Hong Kong Innovative Drug ETF, and Hang Seng Tech ETF, as well as a biopharmaceutical industry ETF portfolio exceeding 40 billion yuan.
The awkward side is that new ETFs are experiencing difficulties. GF Fund established 15 new ETFs this year, of which 10 had fundraising scales between 200 million and 300 million yuan, barely meeting the 200 million yuan minimum establishment threshold. Even after some ETFs were established, their subsequent operations have been less than satisfactory. As of the end of September, 8 of these 15 newly established ETFs had scales below 100 million yuan, and 7 saw share counts drop by more than 50% from issuance.
Huabao Fund faces dual pressures of talent and scale. On February 12, Huabao Fund's Index Investment Director Hu Jie stepped down from all 16 managed products at once and joined Tianhong Fund 12 days later. Before her departure, she managed 101.362 billion yuan, accounting for nearly 80% of Huabao Fund's non-money-market ETF management scale. The departure of a core talent may have caused some fund investors to waver in their choices.
Notably, the CSRC's "Administrative Measures for the Operation of Publicly Offered Securities Investment Funds (Draft for Comment)" is currently open for public comment: the establishment threshold for equity and FOF products would drop from 200 million yuan to 50 million yuan, and the clause requiring initiated funds to "automatically terminate if net asset value falls below 200 million yuan 3 years after the fund contract takes effect" would be deleted. This means the 200 million yuan scale anxiety for ETFs will soon receive institutional relief. As of October 16, among the 1,713 ETFs in existence across the market, 894 were established after 2023, accounting for nearly 60%. Among these 894 funds, 387 equity ETFs have scales under 300 million yuan. Among equity ETFs established from 2023 to 2025, the proportion with scales under 300 million yuan was 33.61%, 44%, and 39.81% respectively, jumping to 70.79% in 2026.
When the establishment threshold drops to 50 million yuan, the question the public fund industry truly needs to answer may no longer be how to get products issued, but how to keep a product alive and growing throughout its entire lifecycle. Lowering the threshold solves the problem of "not being able to issue," but what happens after issuance? The draft for comment also proposes that if fund managers choose to continue operating mini funds, they must bear the fixed costs of fund operations, and requires managers to strengthen counter-cyclical layout management, not switching investment styles for short-term gains or scale rankings. These two points are the real watershed: the former gives "never-growing" funds a lifeline, while the latter clearly tells the market that sowing seeds during weak markets through counter-cyclical strategies is not always an encouraged approach.
When "staying alive" is no longer the only threshold, "staying alive for long" becomes the new threshold. On shelves already crowded with 1,713 products, how is your ETF performing? Share your thoughts in the comments.
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