Goldman Sachs: Chinese residents' stock allocation is still relatively low compared to their long-term potential. Stocks and insurance are expected to be the main beneficiaries in the medium term.

Goldman Sachs China macroeconomic team recently released a research report stating that Chinese residents' asset allocation is at the early stage of structural transformation. As the role of real estate in wealth accumulation gradually weakens and deposit rates remain low, savings may gradually shift towards a wider range of financial assets, with stocks and insurance expected to be the main beneficiaries in the medium term. "Chinese residents' allocation to stocks is still relatively low compared to their long-term potential." The Goldman Sachs report stated that the proportion of stocks in residents' assets is less than 10%, indicating that there is a large potential for further asset reallocation as residents gradually expand their investment areas. Goldman Sachs also stated that considering the cautious risk appetite of residents and the uneven distribution of financial wealth, this adjustment is unlikely to be linear or cover a wide range of people. Nevertheless, if resident confidence stabilizes and capital market returns are attractive, stocks may occupy a larger share in the future savings of residents.