Ten fund firms have recently filed in a batch for the first over-the-counter index funds tracking tech innovation bonds, just over a year after the first batch of such ETFs hit the market. In June 2025, the Lujiazui Forum called for "vigorously developing tech innovation bonds and accelerating the launch of tech innovation bond ETFs," prompting ten fund companies, including E Fund, to file for the first batch of products that same month, which were approved and listed in July. By September 2025, the second batch of tech innovation bond ETFs had also been rolled out, bringing the total number of these ETFs to 24 across the market.

According to Wind data, capital is accelerating into tech innovation bond ETFs. From August 1 to September 22, the 24 ETFs saw combined net inflows exceeding RMB 36 billion, with E Fund Tech Innovation Bond ETF (551500) posting some of the strongest net inflow gains. The total assets under management for all tech innovation bond ETFs now approach RMB 350 billion. As the product category expands and the number of offerings grows, investors face the challenge of choosing among them, with factors like fund management quality, returns and drawdowns, and trading convenience becoming key considerations.

Performance and drawdown control both stand the test

Looking first at returns, E Fund Tech Innovation Bond ETF (551500), one of the first-batch products, tracks the CSI AAA Technology Innovation Corporate Bond Index. According to Galaxy Securities data, from its inception on July 10, 2025 through September 22, 2026, the ETF has delivered a cumulative return of 2.56%, ranking first among the first-batch tech innovation bond ETFs tracking the same index.

Beyond returns, drawdown control reveals a bond ETF's true skill. Galaxy Securities data shows that over the same period, E Fund Tech Innovation Bond ETF recorded a maximum drawdown of just 0.58%, smaller than the other five ETFs tracking the same index that launched simultaneously, also ranking first in drawdown control. Taken together, these two "number-one" rankings indicate that the fund achieves gains while maintaining a smoother net value curve. E Fund's tech innovation bond ETF product has managed to lead its peers in both returns and drawdown control simultaneously.

Liquidity hinges on the order book, beyond net asset value

Liquidity is another dimension that is often overlooked but directly shapes the user experience. Trading volumes in credit bond ETFs include "obligation trades" executed by market makers to fulfill their quote duties. Since market makers must keep both bid and ask quotes available at all times, this generates significant turnover, making volume-based liquidity measures potentially misleading. The order book itself offers a truer picture of real liquidity: the narrower the bid-ask spread, the lower the trading friction cost; the deeper the order book, the better it can absorb large capital flows.

Looking at bid-ask spreads for August 2026, based on tick-by-tick calculations from exchange market data snapshots and taking the daily median of intraday values, E Fund Tech Innovation Bond ETF's median bid-ask spread averaged RMB 0.0017, a very narrow spread equivalent to roughly 0.1 to 0.2 basis points in yield, meaning the cost of entering or exiting positions is almost negligible. As for order book depth, again using daily medians of intraday values, the ETF's five-level two-sided order book depth averaged RMB 79.54 million in August, also leading among tech innovation bond ETFs, providing ample capacity to absorb large orders.

Narrow spreads mean lower transaction costs; deep order books mean the ability to handle large capital flows. For institutional investors, the combination of these two factors is a key sign that a tool-type product is "user-friendly." On both dimensions, E Fund Tech Innovation Bond ETF stands out as a leader.

Note: Calculated tick-by-tick from exchange market data snapshots, covering August 2026.

Where does the leadership come from?

Putting the two sets of data side by side, the fund ranks first in both returns and drawdown control, while also leading in both bid-ask spread management and order book depth. Having all four metrics excel in a single product is no coincidence. The answer lies in E Fund's approach to bond index management.

In the view of Li Yishuo, General Manager of E Fund's Bond Index Investment Department, a bond index fund as a tool-type product should deliver "what you see is what you get," presenting investors with the risk-return profile corresponding to the underlying index. For bond ETFs in particular, their distinctive value lies in converting underlying bond assets that trade discretely over the counter into an investment vehicle that can be traded continuously on the exchange.

The real challenge in achieving "what you see is what you get" comes down to the fact that bond index products can rarely replicate the index through full replication. E Fund employs a layered sampling and dynamic optimization approach, selecting representative and liquid constituent bonds from the target index to construct a portfolio that closely matches the index's risk-return characteristics. Leveraging algorithmic sampling, portfolio tracking management, indicator control, and portfolio balancing functions within its proprietary investment management system, the firm keeps tracking error within a very narrow range. This refined management approach is precisely what enables the simultaneous leadership in both returns and drawdown control.

Taking a longer view, the multi-dimensional excellence of E Fund Tech Innovation Bond ETF is merely a reflection of over a decade of accumulated expertise in E Fund's bond index business. As early as 2012, E Fund launched its first bond index product, the E Fund ChinaBond New Composite Index Fund. Over the following decade-plus, E Fund's bond index product line gradually expanded to cover rate bonds, credit bonds, and comprehensive bond indices. In 2025, its Corporate Bond ETF and Tech Innovation Bond ETF both launched as the first of their kind in the market. Today, E Fund offers 11 bond index products with coverage across multiple varieties and all maturities, uniformly priced at an annual management fee of 0.15% and custody fee of 0.05%.

This strategic layout aligns with the broader "indexation" wave in bond investing. In a low-interest-rate era, the downward shift in bond yield benchmarks makes it increasingly difficult for active management to generate excess returns, and fixed income investing is shifting from "whale hunting" to "seashell gathering." Bond index products, with their clear risk-return profiles, lower costs, greater transparency in holdings, and better liquidity, are emerging as cost-effective tools for capital to participate in the bond market.

A table of E Fund's bond index product lineup is as follows:

E Fund ChinaBond 1-3 Year China Development Bank Bond Index Fund, launched 2019/04/29, Class A: 007169, Class C: 007170, short duration.

E Fund ChinaBond 0-3 Year Policy Bank Bond Index Fund, launched 2024/03/20, Class A: 020295, Class C: 020296, short duration.

E Fund ChinaBond 1-3 Year Policy Bank Bond Index Fund, launched 2019/12/03, Class A: 007364, Class C: 007365, short duration.

E Fund ChinaBond 3-5 Year China Development Bank Bond Index Fund, launched 2019/07/08, Class A: 007171, Class C: 007172, medium duration.

E Fund ChinaBond 1-5 Year Policy Bank Bond Index Fund, launched 2024/06/05, Class A: 021325, Class C: 021326, medium duration.

E Fund ChinaBond 3-5 Year Treasury Bond Index Fund, launched 2015/07/08, code 001512, medium duration.

E Fund ChinaBond 7-10 Year China Development Bank Bond Index Fund, launched 2016/09/27, Class A: 003358, Class C: 009803, Class D: 022359, long duration.

E Fund Premium Investment Grade Credit Bond Index Fund, launched 2023/10/25, Class A: 018996, Class C: 018743, credit bonds.

E Fund SSE Benchmark Market-Making Corporate Bond ETF, launched 2025/01/16, code 511110, credit bonds.

E Fund CSI AAA Technology Innovation Corporate Bond ETF, launched 2025/07/10, code 551500, credit bonds.

E Fund ChinaBond New Composite Index Fund, launched 2012/11/8, Class A: 161119, Class C: 161120, Class D: 021606, comprehensive bonds.