Yuebao, the first decline in AUM. Larger online finance trend? Not really.

Written by Fiona Zhao || October 28 2014

Like a piece of delicious cake, all good things come to an end and after robust growth since the launch, Yuebao has seen the first decline in 2014Q3. According to the data from financial news website East Money, although Yuebao has achieved 5.69 Billion in net profits, Yuebao AUM has declined 6.84% for the first time, reaching RMB 534.89 Billion. Is this part of a larger trend?

The decline is firstly likely due to decreasing returns in Yuebao itself which was about 4% over the past 7 days as compared to 7% a year ago. Secondly, the recently returned growth in the Shanghai A-share market has also attracted investors. The Shanghai Composite Index has maintained 15.10% growth in 2014Q3, while Shenzhen Component Index has jumped 10.07%, which is pretty much the most upside that those markets have seen in the past 5 years.  Finally, competition has increased in terms of new products. Zhaocaibao, a financial products platform under Ant Financial, Jack Ma’s financial holding company has rolled out several new products this year and attracted new funds. 

Yuebao AUM and growth rate