Why are high premiums concentrated on cross-border ETFs?

[shapanwwuom]

Then the situation suddenly changed at the end of the trading day, and many cross-border ETFs with obvious gains collectively plunged in the end of the trading day, turning from a big rise to a big fall at the close.

In fact, as early as January 2024, cross-border ETFs experienced a rare surge. At that time, the US 50 ETF suddenly rose to the daily limit from 1.05 for several consecutive days. In just one week, it soared to 1.695 yuan, an increase of more than 60%. The premium also surged to more than 50%.

Since the beginning of 2025, cross-border ETFs have made british student data a comeback, and the premium rate has continued to rise. Currently, there are 19 ETFs on the market with a premium rate of more than 5%, all of which are cross-border ETFs.


ETFs have two prices. One is the net value at the time of subscription and redemption, which is basically similar to the rise and fall of the index. The other is the price of buying and selling in the secondary market, which is affected by the independent bids and transactions of investors in the entire market. Generally, it fluctuates around the net value. When the price is higher than the net value, it is called a premium, and when the price is lower than the net value, it is called a discount.

The state of high premium often reveals the signal of overheated market trading. Once the sentiment subsides or the fund opens for subscription, arbitrageurs will rush in and the fund price may immediately return to near the net value. The premium may shrink or even disappear. Investors who purchase at high prices may face capital losses caused by the decline in premium in the short term and pay the price for the high market sentiment.