Core Conclusions - The public fund market in 2025 saw an increase in both scale and share, with significant changes in structure, as fixed income and active equity funds experienced net redemptions, while fixed income+ and index equity funds were net subscribed [1][3] - Global equity markets strengthened, with domestic stocks outperforming bonds, leading to overall gains in funds, particularly in active funds outperforming passive products, with notable performance in technology and cyclical theme funds [1][2] - For 2026, it is expected that equities will continue to have upward potential, with a recommendation to maintain a balanced allocation between growth and reversal strategies, while flexibly seizing short-term opportunities [1][4] Market Development: Total Growth and Structural Changes - The total scale of public funds surpassed 35 trillion yuan, with stock funds growing by over 1 trillion yuan, indicating a robust market expansion [13] - The number of public funds increased to 13,300, with significant growth in stock and REITs funds, while money market and alternative investment funds saw a decline [13][25] - Active equity funds grew by 21%, with a notable recovery in new fund launches, particularly in technology theme funds, which saw a growth rate exceeding 50% [1][2][29] Performance Analysis: Strong Equity and Weak Bonds - The performance of various asset classes showed that equities outperformed bonds, with gold reaching new highs and equity assets experiencing a broad rally [2][9] - Active funds outperformed passive funds, with specific themes such as TMT, cyclical, and advanced manufacturing showing strong results [9][2] - Fixed income+ funds demonstrated superior performance, particularly those with high allocations to fixed income and convertible bonds [9][20] Investment Strategies: Balanced Allocation and Trend Following - The report suggests a balanced allocation strategy for equity funds, emphasizing the importance of flexibility in capturing phase-specific market opportunities [4][3] - For fixed income funds, the emergence of the fixed income+ era is highlighted, with a focus on asset and strategy characteristics based on risk preferences [5][39] - The report advocates for a global multi-asset allocation approach, emphasizing the value of overseas and commodity funds, with recommendations to follow QDII quotas and focus on mutual recognition funds and southbound ETFs [6][32]

Group 1 - The public fund investment strategy shows robust growth in both scale and number, with active equity funds achieving an average return of 29.69% in 2025, outperforming major indices [2][23][27] - The top three sectors for active equity fund holdings are technology, manufacturing, and cyclical industries, indicating a strong focus on growth-oriented sectors [2][28] - The market outlook for 2026 suggests continued structural opportunities in A-shares, with technology growth remaining a key theme, while Hong Kong stocks are seen as undervalued [2][3] Group 2 - The index fund market has reached a historical high in both scale and number, with total assets amounting to 6.14 trillion yuan, reflecting a significant increase of 32.27% from the previous year [2][37][40] - The ETF segment dominates the index fund market, accounting for 76.10% of total assets, with a notable increase in industry-themed ETFs [2][38][40] - The performance of thematic funds, particularly in technology, has been outstanding, with technology-themed funds achieving an average return of 44.06% in 2025 [2][27][28]