Sector index hits an all-time high, with a YTD total return of 7.25%; we expect total return to rise to 10-15% in 2021e  We forecast USD40-45bn of issuance in 2021e and 80% y-o-y decline in net issuance to USD5bn, due to tighter regulations  Strong “single-B” names to retest 2017 tights; buy CHINSC’25, PWRLNG’25, YUZHOU’25s/ 26s, ZHPRHKs; buy CSCHCNs, JIAYUAs, KAISAGs, MOLANDs, REDPROs among high betas China’s property USD high-yield (HY) bonds had a roller-coaster ride in 2020. Despite the sharp correction in March triggered by COVID-19, the Markit iBoxx USD Asia ex-Japan China Real Estate High-Yield Total Return Index had recouped all the losses by June. It then hit a new high on 1 December after shrugging off the China Evergrande Group saga in September and the sell-off in China Fortune Land and Greenland Holding Group’s USD HY bonds in November. From 1 January to 7 December, China property HY bonds generated a total return1 of 7.25%, in line with our forecast for 2020 of 6-8% (see China Property HY: 2H20 Outlook: from “V” t o “✔”, 23 July 2020). We expect 2021e to be even better, with total returns of between 10% and 15%. The main driver should be a drought in USD HY net issuance; we forecast 80% y-o-y fall in net issuance to USD5bn in 2021e as developers limit the growth in their debt to comply with tighter regulations – the game-changing ‘three red lines’ policy. In particular, we think strong “single-B” names will retest their all-time tights set in 2017. We also see attractive risk-reward in selected high-beta bonds in 2021. These are among the six key themes we highlight for 2021 in this report.