Group 1 - The report indicates that trading sentiment is warming up, with asset linkage indicators showing a recovery from historical lows. The equity risk premium (ERP) is currently below one standard deviation, suggesting improved relative value for stocks compared to bonds [2][19]. - The overall A-share index PE valuation stands at 20.4, with most broad-based indices having PE valuations above the 50% historical percentile, while the ChiNext index is at a low historical percentile of around 15% [2][20]. - The report highlights a rise in trading activity, with turnover rates and transaction volumes increasing compared to the previous month, indicating sustained market enthusiasm [2][27]. Group 2 - The report notes that the proportion of stocks above the 50-week moving average has increased to 82.58%, indicating a positive trend in individual stock performance [38]. - The buyback scale has risen to 14.837 billion, reflecting a trend where companies are repurchasing shares, often seen as a sign of confidence in their valuation [41]. - The net reduction in industrial capital reached 30.359 billion, indicating a widening scope of capital reduction compared to the previous month, which may reflect concerns about stock valuations [45]. Group 3 - The report states that the equity risk premium (ERP) is at 3.20%, which is below the historical average and indicates a potential for upward movement in stock valuations [19]. - The market configuration indicators show a high degree of valuation dispersion, with the valuation variation coefficient at 0.835, suggesting a relatively high risk environment [24]. - The report emphasizes that 90% of industries are showing positive monthly trends, indicating a broad-based recovery in market sentiment [35].

Core Insights - The report emphasizes the integration of AI in asset allocation, enhancing the predictive capabilities of stock and bond performance through a dynamic weighting system [2][3] - The AI-driven model has successfully predicted market trends, including the recent performance of value stocks outperforming growth stocks in March and April [3] - Predictions for 2025 indicate that bond assets will maintain relative advantages, while stock market performance is expected to stabilize at the bottom in Q3 and slightly recover in Q4 [3] Asset Allocation Framework - The AI-enabled research system combines five major cycles to predict stock and bond performance, with a current high weighting of 55% on the monetary credit framework [2][3] - The allocation for domestic assets in July shows: 12.64% in equities, 3.58% in dividends, 76.45% in bonds, and 7.33% in gold, with adjustments compared to traditional risk parity models [4] - For overseas markets, the allocation includes: France 15.62%, Germany 14.85%, the US 20.24%, Japan 16.44%, Hong Kong 11.50%, and India 22.35%, with slight adjustments in France, Germany, and Hong Kong [4] Industry Rotation Strategy - The AI-driven industry rotation strategy has significantly improved performance metrics, achieving a 420% increase in the Sharpe ratio and a 41% reduction in maximum drawdown compared to traditional strategies [5] - The latest industry outlook for Q3 suggests overweight positions in machinery, comprehensive sectors, and electronics, while maintaining standard positions in automotive, communication, and construction, and underweighting banking and retail [5]

Core Viewpoint - BlackRock Jianxin Wealth Management is exploring new innovations in the pension finance sector, having previously launched the first ten-year pension wealth management product and the first joint venture personal pension wealth management product in China [1][2]. Group 1: Product Innovations - The latest product, "Beijia Intelligent Heart," aims to enhance returns by introducing rare stock assets into the R2 low-risk personal pension product, utilizing AI for stock-bond allocation [3]. - This product is notable for filling the gap in stock allocation within R2 pension products, which typically focus on fixed income or similar assets [8]. Group 2: Performance Metrics - As of June 30, the total scale of pension wealth management products exceeded 1,040 billion yuan, with personal pension wealth management products surpassing 12 billion yuan [5]. - "Beijia Anxin," launched on May 10, 2022, achieved an annualized return of 5.30%, ranking first among 51 pension wealth management products [6]. - "Beijia Intelligent Heart," launched on April 15, 2023, reported annualized returns of 3.84% for A shares and 3.93% for L shares, ranking second among newly established personal pension wealth management products this year [7]. Group 3: Systematic Investment Strategy - The BSYS platform, a flagship strategy of BlackRock, employs machine learning and big data analysis to capture valuable investment signals, managing over 256 billion USD globally [9]. - "Beijia Intelligent Heart" utilizes a systematic approach for asset allocation, dynamically adjusting stock-bond ratios based on risk and return targets, while integrating various market indicators for timing decisions [10][11].

Core Viewpoint - The first batch of 26 new floating-rate funds has seen 13 established with a total fundraising scale exceeding 12.6 billion yuan, indicating strong market interest and a shift towards performance-based fee structures [1][3][6]. Fund Establishment and Performance - As of June 24, 13 out of 26 new floating-rate funds have announced their establishment, raising over 12.6 billion yuan in total [1][3]. - The top three funds by fundraising scale are: - Dongfanghong Core Value managed by Zhou Yun at 1.991 billion yuan - E Fund Growth Progress managed by Liu Jianwei at 1.704 billion yuan - Ping An Value Enjoy managed by He Jie at 1.322 billion yuan [3][4]. Fee Structure and Investor Alignment - The floating-rate funds implement a tiered management fee structure with a "reward for excellence and punishment for poor performance" mechanism, aligning the interests of fund managers with those of investors [1][6]. - If a fund's annualized return lags the benchmark by more than 3 percentage points, the management fee is halved to 0.6%. Conversely, if excess returns exceed 6 percentage points, the fee increases to 1.5% [6]. Investment Strategies and Manager Profiles - Fund managers are divided into three styles: growth, value, and balanced strategies, with a focus on A-shares and Hong Kong stocks for diversification [6][7]. - Growth-style managers focus on sectors like technology and emerging consumption, while value-style managers prefer low-valuation, high-return on equity companies [7][10]. Market Trends and Opportunities - Fund managers are encouraged to identify investment opportunities amid uncertainty, with a focus on sectors such as AI and pharmaceuticals [11]. - The dynamic adjustment of investment strategies is emphasized, with a slower pace in bullish markets and an accelerated approach in bearish conditions [11].

Economic Performance - In May, the general public budget revenue growth rate was 0.1%, a significant drop of 1.7 percentage points from the previous month[4] - Tax revenue decreased by 1.4 percentage points compared to the previous month, marking the first negative growth since 2024[4] - Government fund income in May fell by 7.8% year-on-year, a decline of 15.5 percentage points from the previous month[5] Fiscal Policy and Market Impact - The decline in fiscal growth in May is expected to negatively impact total demand, with potential economic downtrends due to reduced exports and fiscal spending[6] - Government fund expenditure growth in May was 9.1%, down 35.2 percentage points from April, indicating a significant reduction in fiscal strength[6] - The low inflation environment is likely to persist in the short term, adversely affecting corporate profits, household income, and consumption[11] Asset Allocation Insights - The bond market is expected to see yields decline further in a low inflation environment, while dividend stocks continue to outperform[10] - The current liquidity in the financial market is relatively abundant, driven by strong bank credit lending intentions[11] - The performance of different asset classes reflects market pricing in a low inflation environment, with a focus on policy responses to inflation[10] Geopolitical and Policy Considerations - Geopolitical risks and unexpected policy changes remain significant risk factors for the economic outlook[3] - The Federal Reserve's recent meeting maintained the federal funds target rate, reflecting a cautious approach amid economic uncertainties[15]

Core Viewpoint - The article introduces the "China Securities Stock-Bond Constant Series Index," which combines stocks and bonds to provide investors with asset allocation tools with varying stock-bond ratios, emphasizing the importance of dividend, cash flow, and core broad-based categories in A-share asset allocation [3][4]. Group 1: Index Overview - The China Securities Index has released six series of stock-bond constant indices, totaling 24 individual indices, including the Shanghai Dividend Stock-Bond and the Dividend Low-Volatility Stock-Bond series [7][8]. - These indices adopt a higher bond ratio, leading to a more stable long-term performance, with expected returns close to "fixed income+" [8]. Group 2: Stock-Bond Allocation Strategy - The stock-bond allocation strategy is a common asset allocation approach, enhancing portfolio stability by balancing the high volatility of stocks with the stability of bonds [4]. - Common stock-bond ratios include Graham's recommended 50/50 strategy, a more aggressive 70/30, and a conservative 30/70 [4]. Group 3: Index Composition - The Shanghai Dividend Stock-Bond series consists of the Shanghai Dividend Index and the Shanghai 0-5 Year High-Grade Credit Bond Yield Strategy Index, with ratios of 10:90, 20:80, and 30:70 [9]. - The Dividend Stock-Bond series combines the China Securities Dividend Index with the China Securities 0-5 Year High-Grade Credit Bond Yield Strategy Index, also using the same ratios [10]. - The Dividend Low-Volatility Stock-Bond series includes the China Securities 800 Dividend Low-Volatility Index and the China Government Bond Index, maintaining the same ratios [11]. - The A500 Exchange Stock-Bond series uses the China Securities A500 Index and a combination of exchange government bonds and policy financial bonds, with five allocation levels [12]. - The Cash Flow Exchange Stock-Bond series employs the China Securities 800 Free Cash Flow Index and the same bond combination, also with five allocation levels [13]. - The Dividend Low-Volatility Exchange Stock-Bond series utilizes the China Securities 800 Dividend Low-Volatility Index and the bond combination, maintaining five allocation levels [14]. Group 4: Performance Analysis - All indices have achieved positive returns due to their higher bond ratios, indicating a favorable long-term holding experience [19]. - As the stock allocation increases, the returns of most indices tend to rise, although the increase in annualized volatility often outpaces the rise in returns [20]. - Recent performance of dividend, low-volatility, and cash flow indices has been strong, but past performance does not guarantee future results [21]. Group 5: Investment Considerations - The article suggests that for lower risk tolerance, the bond ratio can be adjusted to 70% or more, akin to a fixed income+ strategy, while those who can tolerate some volatility may increase stock allocations [23]. - It emphasizes the importance of diversifying stock selections across dividend, low-volatility, cash flow, and core broad-based indices [23]. - The construction of a government bond and policy financial bond combination is proposed as a strategy for bond asset selection, considering the level of risk-free interest rates [23].

Core Viewpoint - Foreign public funds have significantly increased their product layout in bond funds this year in response to ongoing market volatility [1][2]. Group 1: Product Launches and Market Response - Foreign public funds have launched a variety of new bond funds this year, including medium to long-term pure bond funds, first-level bond funds, and second-level bond funds, indicating a strong market recognition of foreign bond funds [2][3]. - Notable new products include the BlackRock Fuyuan Tianyi, a second-level bond fund that started subscription on April 7, focusing on quantitative investment strategies [3]. - Schroders launched a medium to long-term pure bond product, Schroders Tianyuan Pure Bond, with a first issuance scale close to 6 billion yuan, reflecting continued investor interest in stable bond products [4]. - Allianz Fund introduced the Allianz Anyu, a second-level bond fund emphasizing stable returns and flexible responses, enhancing its fixed income product line [5]. - Manulife Financial actively launched bond products, including the Manulife Yueli Rate Bond and Manulife Interbank Certificate Index 7-Day Holding, with first issuance scales of 6 billion yuan and 5 billion yuan respectively, indicating high market recognition [5][6]. Group 2: Market Outlook and Structural Opportunities - The bond market is expected to present structural opportunities, with credit bonds gaining relative attractiveness as the interest rate bond market may exhibit "small year" characteristics in 2025 [7][11]. - The market has seen fluctuations since the beginning of the year, with expectations of rapid interest rate cuts influencing long-term yield declines [8]. - After mid-March, the funding environment improved, leading to a short-term rebound in the bond market, with expectations that interest rate bonds may continue to decline [9][10]. - Investors are advised to focus on short-duration products in the city investment bond sector, while the credit bond market remains sensitive to policy changes [11][12]. Group 3: Investment Strategies and Flexibility - The current environment is seen as an opportune time for allocating to second-level bond funds, with expectations of a dual bull market in stocks and bonds in the medium term [13]. - The convertible bond market presents structural opportunities, with a reduction in new issuance and a focus on shorter remaining maturities, enhancing the value of convertible bond options [13].