Report Overview - The report is titled "Benchmark Deviation Consideration: How Public Funds Allocate Industries - Asset Allocation Special Report" and was released on May 19, 2025 [3][1] Report Industry Investment Rating - No industry investment rating is provided in the report Core Viewpoints - The China Securities Regulatory Commission's "Action Plan for Promoting the High - quality Development of Public Funds" aims to shift fund companies from "emphasizing scale" to "emphasizing returns" and address the issue of fund style drift [5][13] - Style - stable funds generally perform better in the medium - to - long term than style - drifting funds, and style stability helps investors form stable investment expectations [6][14] - There is no significant correlation between the industry deviation of active equity funds and their returns, and industry drift does not contribute to excess returns [7][19] - If the industry allocation of funds moves closer to the performance benchmark, the financial sector may experience a resonance of fundamentals and capital flows [7][28] Summary by Directory 1. The Formal Release of the "Action Plan for Promoting the High - quality Development of Public Funds" - On May 7, the CSRC issued the plan, which includes 25 measures to promote the transformation of fund companies and address style drift [13] - Due to factors such as rapid market style changes, short - term performance pressure, and the pursuit of channel attention, the problem of fund style drift in China remains unsolved [14] - The plan includes measures such as establishing a floating management fee collection mechanism linked to fund performance, strengthening the constraint of performance benchmarks, enhancing transparency, reforming performance assessment mechanisms, and strengthening regulatory classification evaluation [15] 2. Current Industry Deviation of Active Equity Funds from the Benchmark - The average comprehensive industry deviation of active equity funds is 101%, and the average comprehensive industry deviation scale is 6.66 billion yuan, indicating a large deviation from the performance benchmark [7][18] - Most funds' industry deviations fall within the [80%, 120%) and [120%, 160%) intervals [7][18] - According to the 2024 annual reports, the most under - allocated industries are banks (-7.03%) and non - banks (-6.65%), while the top three over - allocated industries are electronics (+5.15%), machinery and equipment (+2.20%), and automobiles (+1.84%) [7][28] - There is more than 100 billion yuan of under - allocation in the bank and non - bank sectors compared to the benchmark index. If the allocation moves towards the benchmark, about 300 billion yuan may flow into the financial sector [28]

Core Viewpoint - The release of the "Action Plan for Promoting the High-Quality Development of Public Funds" has become a focal point in the industry, emphasizing the need to enhance the stability of fund investment behavior and address issues like "style drift" and "inconsistent products" [1][2] Group 1: Performance Benchmarking - The Action Plan strengthens the role of performance benchmarks as a "lifeline" for public fund products, establishing clear guidelines for setting, modifying, disclosing, and evaluating these benchmarks [2][3] - Fund companies are expected to be more cautious in setting performance benchmarks, potentially shifting the evaluation logic from beta returns to alpha returns [3][4] - The emphasis on performance benchmarks aims to constrain fund managers' investment behavior, ensuring they adhere to the agreed-upon industry or style, thereby reducing arbitrary deviations [2][3] Group 2: Theme Fund Regulation - The Action Plan proposes stricter registration and self-regulatory rules for theme funds, enhancing monitoring and analysis of fund investment transactions [4][5] - Historically, theme funds have been prone to style drift, with instances of funds misaligning their investments with their stated themes, which the new regulations aim to address [4][5] - The plan encourages clearer definitions of investment directions in fund names and contracts to prevent misleading practices [4][5] Group 3: Long-Term Assessment Mechanism - The Action Plan introduces a long-term assessment mechanism, mandating that at least 80% of the evaluation weight be based on performance over three years or more [5][6] - This mechanism is designed to reduce short-term market fluctuations' impact on investment performance evaluations, promoting a shift from a focus on scale to a focus on returns [6][7] - By encouraging a long-term investment approach, the plan aims to attract more stable capital into the stock market, enhancing market stability and resource allocation efficiency [6][7]