In the current wave of bond index investment sweeping the fixed income market, tool-based products that combine clear risk-return characteristics and liquidity are increasingly becoming the &#34;new favorites&#34; for investors' asset allocation. As a representative of this trend, local government bond ETFs have emerged as a strong contender in the bond ETF segment due to their unique credit endorsement and trading convenience, gradually becoming an important choice for investors' core allocations.
On-market cash management tool: Penghua 0-4 Year Local Government Bond ETF becomes the largest local government bond ETF in the market
According to Wind data, as of March 13, 2026, among the only four local government bond ETFs in the market, two products created by the cash investment department of Penghua Fund occupy half of the market share. Among them, the Penghua 0-4 Year Local Government Bond ETF (159816.SZ) has reached a latest scale of 9.602 billion yuan, making it not only the largest product managed by Penghua Fund in the local government bond sector but also the largest local government bond ETF in the entire market, reflecting the strong demand from investors for quality allocation tools.
The Penghua 0-4 Year Local Government Bond ETF was established in July 2020 and primarily tracks the CSI 0-4 Year Local Government Bond Index. As the only short-duration local government bond allocation tool in the market, the product is positioned as an &#34;on-market cash management tool,&#34; allowing T+0 trading and leveraged financing through pledging, precisely filling the gap for short-term cash management tools in the market, providing investors with a configuration choice that combines safety, liquidity, and yield.
In the current low-interest-rate environment, the difficulty for traditional actively managed bond funds to achieve excess returns has increased, leading to a growing demand from investors for transparent holdings, diversified risks, and high liquidity tool-based products. With its unique advantages of &#34;low volatility, high liquidity, and stable returns,&#34; the Penghua 0-4 Year Local Government Bond ETF has become a &#34;ballast stone&#34; choice for on-market funds seeking a safe haven.
In addition to leading in scale, the long-term performance and operational capability of the Penghua 0-4 Year Local Government Bond ETF have also received authoritative recognition. According to the fund's regular reports, since its establishment in 2020, the Penghua 0-4 Year Local Government Bond ETF has achieved positive net value growth for five consecutive calendar years, with drawdown control levels basically on par with the 0-3 Year National Development Bank ETF. With continuous stable returns and strict risk control, the Penghua 0-4 Year Local Government Bond ETF has been rated as a three-year and five-year five-star/AAAAA rating by two authoritative rating agencies, Tianxiang Investment Consulting and Jiaan Jinxin (as of the end of 2025). This means that over a five-year period, this fund has outperformed the vast majority of similar products in multiple dimensions such as return capability and risk control, creating sustained and stable value for its holders.
Combining long and short durations, &#34;Penghua Local Government Bond ETF Twin Stars&#34; builds a complete allocation matrix
It is worth noting that Penghua Fund's layout in the local government bond ETF field is not a solo effort but has formed a &#34;twin star&#34; of local government bond ETFs that combines both long and short durations, providing investors with different term allocation choices:
On-site cash management tool: Penghua 0-4 Year Local Government Bond ETF (159616.SZ) focuses on short-duration, suitable for investors with liquidity management needs and seeking stable returns, and can serve as a monetary enhancement tool or core allocation.
Mid-duration tool: Penghua 5 Year Local Government Bond ETF (159972.SZ) is the first 5-year local government bond ETF in the entire market, targeting a mid-duration strategy, dedicated to providing investors with relatively high return potential, filling the market gap for mid-term local government bond tools. Since its establishment in 2019, the Penghua 5 Year Local Government Bond ETF has achieved positive net value growth for six consecutive calendar years. As of March 12, 2026, its scale reached 4 billion yuan. This fund also performed excellently, rated as a three-year five A rating by Tianxiang Investment Advisors and a five-year five-star/five A rating by Tianxiang Investment Advisors and Jiaan Jinxin.
Different duration local government bond ETFs with different functions meet the varying allocation needs of different types of clients for on-site fund liquidity and yield, collectively forming a complete local government bond ETF product line, making Penghua Fund the largest fund manager in terms of local government bond ETF management scale in the entire market.
Configuration value highlighted, T+0 trading + pledge financing + low fees
For investors, the two local government bond ETFs under Penghua also have multiple trading advantages, providing flexible operational space that ordinary bond funds find difficult to achieve.
Firstly, both local government bond ETFs have been included in the Shenzhen Stock Exchange's pledged repurchase targets. Currently, some bond ETFs in the market can conduct pledge financing, and both local government bond ETFs can conduct repurchase transactions according to regulations, meaning investors can pledge their held local government bond ETFs on the Shenzhen Stock Exchange to borrow new funds for further investment, thereby improving investment efficiency, while ordinary bond funds only hold returns.
Secondly, both local government bond ETFs support T+0 round-trip trading, allowing ETFs purchased or subscribed on the same day to be sold, redeemed, or immediately pledged on the same day, with the funds available for use that day. Compared to off-market bond fund redemptions, which typically take T+2 days to settle, local government bond ETFs have a clear advantage in fund flow efficiency, better meeting investors' liquidity needs.
In addition, the on-site trading cost advantages are prominent. Currently, investors' demand for swing trading of funds has significantly increased, and bond ETFs do not charge subscription and redemption fees, which is relatively favorable for investors with strong on-site trading needs.
In summary, Penghua local government bond ETFs not only meet investors' asset allocation needs like ordinary bond funds but can also serve as flexible tools for short-term swing trading and intraday arbitrage, achieving a dual function of &#34;allocation + trading.&#34; This unique tool-like attribute makes it a powerful assistant for investors to optimize their portfolios in the current volatile market.
In the vast blue ocean of bond index investment, the Penghua 0-4 Year Local Government Bond ETF, with a scale exceeding 9.6 billion yuan, sets an industry &#34;weather vane,&#34; not only showcasing the meticulous management and forward-looking layout of Penghua Fund's fixed income team but also reflecting the market's trust in high-quality tool-like products with &#34;real money.&#34;
For conservative investors, this local government bond ETF, which combines safety, liquidity, and yield, may serve as a better &#34;ballast&#34; choice in asset allocation.
Risk Warning: Funds carry risks, and investment should be approached with caution

511060

511580

511270

159816

Penghua CSI 0-4 Year Local Government Bond ETF is the largest and only short-duration local government bond ETF in the market, established in 2020, primarily tracking the CSI 0-4 Year Local Government Bond Index. This product is characterized by low volatility, high liquidity, and stable returns, meeting investors' needs for cash management and swing trading. According to Wind data, as of March 13, 2026, the scale of Penghua CSI 0-4 Year Local Government Bond ETF reached 9.602 billion yuan, demonstrating strong demand from investors for quality allocation tools. Since its establishment, this ETF has achieved positive net value growth for five consecutive years and received a five-star rating from authoritative institutions

腾讯新闻 - 财经

HFT SSE 5 Years Local Government Bond ETF

China Merchants CSI Treasury and Policy Bank Bond 0-3 Years ETF

HFT SSE 10-Year Local Government Bond ETF

Penghua CSI 0-4 Year Local Government Bond ETF

"Penghua Local Government Bond ETF Twin Stars": Combining different duration characteristics to meet diverse needs for cash management and swing trading