Core Viewpoint - The Guangdong Provincial Finance Department has issued the "Guangdong Provincial Government Investment Fund Management Measures," which outlines the investment strategies and performance evaluation criteria for government investment funds [1]. Group 1: Investment Strategies - Government investment funds can invest through either a mother-fund and sub-fund structure or direct project investments [1]. - Sub-funds are primarily expected to invest in direct projects, including single-project special funds, to control fund levels and prevent excessive layering that could hinder policy objectives [1]. Group 2: Performance Evaluation - The performance evaluation of the funds will focus on the comprehensive achievement of policy objectives rather than profit maximization [1]. - There will be no internal benchmark return rate set, and evaluations will not be based on the profit or loss of individual projects or single fiscal years [1]. - Generally, there will be no penetration assessment of individual investment projects within sub-funds [1]. Group 3: Management Fees - Management fees for government investment funds will be determined through market-based negotiations and will be allocated based on the results of fund evaluations [1]. - Management fees should generally be calculated based on the actual contributions or investment amounts, with reasonable standards for fee determination [1]. - Fees will be paid from fund earnings or interest, and it is generally not allowed to charge fees against the principal; however, if the fund has not yet generated earnings or interest, fees may be advanced from the principal and later reimbursed once earnings are available [1].

Core Viewpoint - The public fund products in 2024 achieved significant profitability, with a total profit of 1.28 trillion yuan, driven largely by the performance of passive index funds, while management fees have decreased due to ongoing fee reduction reforms [1][2][3]. Fund Performance - In 2024, public funds overall made a profit of 1.28 trillion yuan, with stock funds contributing 444.51 billion yuan, marking a substantial turnaround from previous losses [2][3]. - The majority of stock fund profits came from passive index funds, with active equity funds only contributing 868.09 billion yuan, accounting for less than 7% of total profits [2][9]. - Bond funds also performed well, achieving profits of 410.19 billion yuan, a year-on-year increase of 72.29% [3]. Fund Company Analysis - Out of 161 fund companies, 147 reported profits in 2024, with E Fund and Huaxia Fund leading with profits exceeding 140 billion yuan [4]. - The top ten fund companies collectively earned 703.91 billion yuan in profits, significantly higher than the 60.86 billion yuan in 2023 [4]. - Huatai-PB ranked third in profitability with 72.917 billion yuan, showcasing the success of non-head public funds that focus on stock ETFs [4]. Management Fees - Despite the overall profitability of fund products, management fees for public funds decreased by 6.54% in 2024 compared to 2023 [6][7]. - E Fund's management fee was 8.218 billion yuan, down from 9.274 billion yuan in 2023, while Huaxia Fund saw a slight increase in management fees [6][7]. - The top ten fund managers' total sales service fees reached 12.312 billion yuan, showing an increase from the previous year [7]. Cost Structure - Customer maintenance fees are a significant part of management fees, with many mid-sized and smaller public funds having ratios exceeding 30% [8]. - High customer maintenance costs can weaken the operational capabilities of fund companies, indicating a disparity in bargaining power between large and smaller firms [8]. Active Equity Fund Insights - Active equity funds recorded a total profit of 868.09 billion yuan, with mixed performance across different fund types [9][10]. - The management fees for active equity funds fell by 32.33% in 2024, totaling 41.062 billion yuan [10].