Overseas markets saw a high-level adjustment on Thursday, followed by increased volatility in cross-border ETFs on Friday. QDII products such as the Nasdaq Technology ETF, the US 50 ETF, and the Nikkei ETF in the A-share market fell sharply.

The most bullish cross-border ETF in recent times, Asia Pacific Selection, fell more than 6% on July 12, and fell nearly 15% in three days, with a latest premium discount rate of 1.62%.

The Nasdaq Technology ETF, Nikkei ETF, and Nasdaq ETF fell by 5.26%, 5.08%, and 5.05%, respectively. Statistical data shows that the number of cross-border ETFs that fell more than 3% in a single day reached 18.

Since the beginning of this year, overseas stock markets have continued to soar, and cross-border ETFs that deploy overseas markets in the A-share market have gone bullish. Data shows that 51 cross-border QDII ETFs have achieved positive returns, among which 20 ETFs such as the Nasdaq Technology ETF, the US 50 ETF, and Nasdaq ETF have risen more than 20% this year.

Due to limited foreign exchange quotas for fund companies, QDII funds will generally suspend off-market purchases when quotas are exhausted, and investors will buy relevant on-market products instead. Therefore, the on-market fund net value> off-market fund net value, leading to a surge in the premium rate.

Take the Asia Pacific Selection ETF as an example. As of July 9th, this ETF had cumulatively rose by more than 22% in four trading days, and the premium rate soared to more than 22%. Other similar cross-border ETFs have also experienced different degrees of high premium rates.

Fund companies have also successively issued risk premium warnings. According to incomplete statistics, such risk warnings have been issued hundreds of times, but they still cannot conceal the market's enthusiasm for chasing them. Some investors chasing higher on-market ETFs also make the premium rate remain high.

The US stock market saw a correction on Thursday, and the market sentiment has cooled in recent times, which is expected to alleviate the situation of cross-border ETF premiums in the short term. As of July 12th, only one fund in the cross-border ETFs has a premium rate over 5%.

Last week, the US stock market experienced an adjustment, and a detail also aroused market discussion. Technology stocks fell sharply on Thursday, while small-cap stock indexes rarely rose against the trend, and differences began to appear in the market.

The current debate mainly concentrates on whether several major technology giants can continue to perform well. Data shows that several major technology giants have contributed most of the gains in this round of the US stock market bull run.

In the first half of this year, nearly 60% of the gains in the US stock market were contributed by only five tech giants, among which only Nvidia's gains contribution reached 31%. In the second quarter, Nvidia, Apple, and Microsoft contributed more than 90% of the gains in the large-cap stock index.

In other words, if you did not hold these major giants before, you would basically have missed the bull market. Recently, some well-known institutions in the market are also worried that the capital investment of technology giants in this wave of AI may not be transformed into profits.

Can these technology giants have the last laugh? Recently, the world's largest hedge fund wrote a report by studying the history of the US stock market for over 120 years, which contains a lot of valuable information.

In the report released in June by Bridgewater Fund, the rise and fall of different leaders in the US stock market since 1900 was reviewed, and some valuable information was given:

1. A significant feature of the current US stock market environment is that a few companies are leading the market trend.

The top 10 companies with the largest market capitalization in the United States account for nearly one-third of the market value of US stocks, and this concentration level is unprecedented in decades.

The reason why these leading companies occupy such a large share in the market is because they have achieved amazing achievements, and the market also believes that this situation will continue.

2. Although the duration of strong performance of the leaders in the US and China stocks in different periods is different, the commonality is that most of the leaders will be defeated by new rising competitors, and some companies have already declined; some companies still have influence now, but are declining.

We can be very sure that after losing creativity, companies will find it difficult to maintain their leading position, and for a long enough period of time, only a few companies can continue to achieve success.

Starting from 1900, we showed the market share changes of each batch of leading companies in the following years. In the next two decades, about half of the market leaders performed worse than the market and fell out of the top 15. If the time span is longer, almost all the leading companies will be eliminated.

Throughout history, there have always been market leaders in companies: more than a century ago, the US railroad company also occupied more than one third of the market share, and dominated the US economy until the rise of autos and airplanes broke the monopoly of the railroad leader; chemical giants are also the same, rising with the invention of plastics, but slowly declining with innovation failures and changes in demand patterns; another typical example is the oil giants of the past century, which now face challenges from the rise of the new energy fund and the shale oil boom in the USA.

Bridgewater Fund concludes that the different leading stocks in the USA over the past 120 years often have two main factors for their rise: first, having a first-mover advantage in high-growth industries and able to innovate quickly and continuously; second, having a strong moat.

Bridgewater points out that if a company loses its innovation capacity and cannot maintain its moat, it may cause the leading enterprise to fall from grace. Moreover, government regulations often affect the fate of leading enterprises.