Core Viewpoint - The article discusses the ongoing reforms in the public fund industry in China, focusing on the introduction of innovative products like floating fee rate funds and the implementation of a high-quality development action plan by the China Securities Regulatory Commission (CSRC) [1] Group 1: New Product Launches - The floating fee rate fund has been approved and is expected to become a regular product in the public fund industry, with the first batch of 26 funds raising approximately 25.9 billion yuan [2][3] - The approval process for floating fee funds is expected to normalize, with discussions on whether to extend this model to other types of funds ongoing [3][5] - The rapid registration mechanism for various fund types is set to be implemented, with specific timelines for different fund categories [7][8] Group 2: Fee Rate Reforms - The third phase of fee rate reforms is anticipated to be implemented soon, following two previous phases that resulted in a reduction of management fees by 20.286 billion yuan and trading commissions by 4.136 billion yuan [9] - The upcoming reforms may include adjustments to subscription fees and sales service fees, with a focus on reducing costs for investors [9] Group 3: Performance Benchmarking - A performance benchmark library is expected to be launched by the end of Q3, which will help standardize performance comparisons across funds [10] - The adjustments to performance benchmarks will allow fund companies to tailor them to their specific situations while maintaining core investment parameters [10] Group 4: Evaluation and Compensation Reforms - The reforms emphasize a shift away from "star fund managers" towards a more team-based approach, particularly in public REITs and index funds [11][13] - Fund managers will be evaluated based on long-term performance metrics, with a significant weight placed on investment returns [11] Group 5: Transparency in Disclosure - New regulations are expected to enhance transparency in fund disclosures, including investor profit and loss information, which may be implemented next year [14] - The industry is discussing the reduction of disclosure costs to improve overall transparency [14]

Core Viewpoint - The recent meeting of the Central Political Bureau emphasized enhancing the attractiveness and inclusiveness of the domestic capital market, which is crucial for consolidating the positive momentum of the capital market [1] Group 1: Public Fund Industry Growth - The total scale of public funds reached 34.48 trillion yuan by the end of July, indicating robust vitality in the asset management industry and a strong signal of asset allocation changes [1] - The public fund industry is optimizing its internal structure, with a strong emphasis on increasing the scale and proportion of equity investments [1][2] - As of July 31, 2023, 835 new fund products were established, with a total issuance scale of 645.716 billion yuan, leading to a total public fund scale of 34.48 trillion yuan [2] Group 2: Policy Support and Market Environment - Recent policies have focused on encouraging long-term capital to enter the market and enhancing the scale and stability of equity investments [2][3] - The improvement in market conditions, such as declining interest rates, has accelerated the transfer of household wealth to financial markets, making equity funds a core option for asset allocation [3] - The second quarter of 2025 saw equity-type funds maintaining high stock positions, with equity funds holding approximately 90.1% of their portfolios [3] Group 3: Fund Management Strategies - The public fund industry is shifting from a focus on initial scale to emphasizing sustainable marketing effects, reflecting a transition from scale-driven to quality-driven strategies [7] - The introduction of differentiated strategies in fund management is becoming essential, with a focus on long-term performance and stability [8][10] - Fund managers are increasingly adopting a "hold and nurture" strategy to enhance product scale and influence, supported by investor education and tailored services [8][9] Group 4: Challenges and Opportunities - The development of equity funds is crucial for providing stable long-term funding to the real economy and optimizing the investor structure in the capital market [9] - The industry faces challenges such as market volatility affecting investor acceptance of new equity products and the increasing dominance of larger fund companies [9][10] - Fund managers are actively addressing these challenges by focusing on differentiated competition and enhancing research and investment capabilities [10]

Core Viewpoint - The China Securities Regulatory Commission (CSRC) emphasizes the importance of risk prevention, strong regulation, and promoting high-quality development in the capital market, outlining seven key directions for future efforts [1] Group 1: Market Stability - The CSRC aims to consolidate the market's recovery and positive trend by enhancing market monitoring and risk response mechanisms, as well as improving expectation guidance [2] Group 2: Reform and Market Vitality - The focus is on deepening reforms to stimulate the multi-tiered market, including the implementation of measures for the Sci-Tech Innovation Board and a comprehensive package for the Growth Enterprise Market [3] Group 3: Strengthening Foundations - Several measures are outlined to solidify the asset and funding sides, such as promoting listed companies to enhance investment value, preventing interest transfer and financial fraud, fostering long-term capital, and advancing public fund reforms [4] Group 4: Regulatory Effectiveness - The CSRC will enhance regulatory enforcement effectiveness by focusing on major violations, improving regulatory collaboration, and increasing technological oversight capabilities [5] Group 5: Risk Prevention - Key areas for risk prevention include addressing real estate company bond defaults, managing financing platform debt risks, and cracking down on illegal private fund activities [7][8] Group 6: Open Market - The CSRC plans to steadily advance high-level institutional openness, focusing on the overall layout and implementation paths for capital market openness, and promoting cross-border cooperation [9] Group 7: Research and Integrity - The meeting emphasizes the importance of authoritative research on major capital market issues to better serve national strategies and regulatory needs, alongside a strong focus on integrity and anti-corruption measures [10]

Core Insights - The report emphasizes that the capital market is stabilizing at the bottom, with multiple funding sources supporting bullish sentiment, suggesting a potential upward breakthrough in equities. The brokerage sector is expected to lead the market rally, recommending early positioning and waiting for breakout opportunities [1]. Industry Overview - The total market capitalization of the industry is 6,179.1 billion, with a circulating market value of 5,901.2 billion, representing 1.8% and 7.2% of the total market, respectively [2]. - The performance of the non-bank financial sector shows a 1-month, 6-month, and 12-month absolute performance of 9.0%, 16.0%, and 59.5%, respectively, with relative performance of 5.8%, 10.5%, and 42.0% [4]. Market Trends - The report indicates that the equity market has stabilized despite initial shocks from U.S. tariffs, with significant institutional investments leading to a recovery. The overall trend remains positive, with major indices showing an average increase of 1.1% as of June 30, 2025 [8]. - The bond market has experienced fluctuations, with the China Bond Index rising by 1.1% year-to-date as of June 30, 2025 [8]. Business Performance - In Q1 2025, listed brokerages reported total revenues of 1,259 billion, a year-on-year increase of 19%, and a net profit of 522 billion, up 78% year-on-year. The brokerage income was 327 billion, reflecting a 43% increase year-on-year [25]. - The report highlights a significant increase in the revenue of self-operated businesses, which reached 486 billion, marking a 46% year-on-year growth [30]. Strategic Directions - The report outlines a shift towards internal consolidation and external breakthroughs, with a focus on wealth management transformation and the integration of financial technology to enhance efficiency [6]. - The investment banking sector is expected to see a marginal recovery in equity financing, particularly benefiting from the expansion of the Sci-Tech Innovation Board and ongoing mergers and acquisitions [6]. Future Outlook - The report forecasts that the industry will achieve total revenue of 4,741 billion in 2025, representing a 5% year-on-year increase, and a net profit of 1,825 billion, up 9% year-on-year [6]. - The brokerage sector is anticipated to lead the market rally, with specific recommendations for stocks that are likely to benefit from policy catalysts and ongoing market trends [6].

Core Viewpoint - The second batch of new floating-rate funds has been officially submitted for registration, following the first batch's successful fundraising, indicating a significant reform in the public fund industry aimed at enhancing investor returns and aligning fund management fees with actual long-term performance [1][2][4]. Group 1: Fund Registration and Types - On July 4, the China Securities Regulatory Commission (CSRC) announced that 11 public fund companies, including E Fund and Huatai-PB, have submitted applications for the second batch of floating-rate funds [1][2]. - Unlike the first batch, which consisted entirely of all-market funds, the second batch includes industry-themed products such as Huatai-PB's manufacturing theme mixed fund and Invesco Great Wall's high-end equipment stock fund [2]. Group 2: Fund Performance and Fundraising - As of July 4, 24 out of 26 funds from the first batch have completed fundraising, totaling approximately 22.68 billion yuan, with an average fundraising size of about 944.5 million yuan per fund [4]. - Notably, three funds exceeded 1.5 billion yuan in fundraising, while 14 funds raised between 500 million yuan and 1 billion yuan, indicating a strong market response [4]. Group 3: Fee Structure and Investor Alignment - The floating-rate fund model aims to enhance the alignment of interests between fund managers and investors by linking management fees to the actual long-term returns achieved by investors [3][7]. - The new fee structure is designed to encourage a long-term investment perspective among investors, moving away from a focus on short-term gains [3][7]. Group 4: Future Trends and Industry Impact - The CSRC plans to promote the floating management fee model for newly established actively managed equity funds, aiming for at least 60% of such funds to adopt this model within a year [7]. - This shift is expected to transform the public fund industry from a focus on scale to a focus on investor returns, marking a significant trend in supply-side reform [7][8].

Core Viewpoint - The China Securities Regulatory Commission (CSRC) has released an action plan aimed at promoting the high-quality development of public funds, focusing on deepening reforms, enhancing the stability of investment behaviors, and improving services for investors [1] Group 1: Reform Measures - The action plan includes 25 reform measures across six areas, emphasizing a shift from "scale" to "investor returns" to achieve high-quality development in the industry [2] - A performance evaluation system centered on fund investment returns will be established, incorporating benchmarks and profit margins that directly affect investor interests [2][3] - The plan aims to strengthen the constraints of performance benchmarks, addressing issues such as style drift and excessive pursuit of market trends in actively managed equity funds [3] Group 2: Implementation Details - The CSRC will issue regulatory guidelines for performance benchmarks and establish a benchmark library, detailing the setting, modification, disclosure, and evaluation mechanisms [4] - A floating management fee model linked to fund performance will be introduced for actively managed equity funds, allowing for differentiated fees based on performance relative to benchmarks [5] - Fund companies will be required to adjust their existing products gradually, with a focus on ensuring that new registrations meet the floating fee structure [5][6] Group 3: Compensation and Governance - The action plan emphasizes aligning the interests of fund companies, executives, and fund managers with those of investors, with a significant weight on investment returns in performance evaluations [6][7] - Fund managers with underperformance relative to benchmarks will see a decrease in performance-based compensation, while those exceeding benchmarks may receive increases [7] - The plan encourages a higher proportion of personal investment by fund executives in their managed products to strengthen alignment with investor interests [7] Group 4: Support for Smaller Firms - The action plan includes measures to support the development of small and medium-sized fund companies, promoting their unique operations and enhancing their competitiveness [8] - It proposes to broaden the investment scope of risk reserves and reduce operational costs for smaller firms, facilitating their growth and efficiency [8] - The CSRC will provide a timeline for the implementation of these reforms, ensuring that the industry has adequate time to adapt [8]

Report Industry Investment Rating - The report is optimistic about the investment value of the non - banking financial sector, believing it can enjoy both Beta and Alpha [4]. Core Viewpoints of the Report - Policy interpretation: Since 2022, reform measures for public funds have been gradually implemented, focusing on fees, assessment, and compensation. Future reforms are expected to be fully rolled out in the next three years. Floating fees will expand coverage, and fee reform phases are about to be implemented. Benchmark constraints and assessment will influence industry allocation and investment focus [4]. - Impact on public funds: The industry pattern will be optimized, with benchmark constraints potentially forcing active equity funds to become "quasi - passive". Investment research will first follow the benchmark and then pursue excess returns. Passive products will continue to develop, and channels, talent, and back - end operations will face corresponding adjustments [4]. - Impact on securities companies: The profit contribution of publicly - held funds by securities companies will show greater differentiation, and the advantage of securities companies in selling equity index funds will expand [4]. - Investment analysis opinion: The non - banking financial sector is a sector that can enjoy both Beta and Alpha, and its investment value is promising [4]. Summary by Relevant Catalogs 1. Policy Interpretation: Promote the High - quality Development of the Public Fund Industry in Multiple Dimensions - Regulatory roadmap: Since 2022, the roadmap and schedule for the high - quality development of public funds have become clearer. Reforms started with fee reduction and are now being comprehensively rolled out. The "Action Plan" covers aspects not implemented in the 2022 "Opinions" [8][10][12]. - Comparison of 2022 and 2025 reform requirements: The 2025 requirements are more detailed and quantitative, covering aspects such as overall requirements, differentiated development, long - term incentive constraints, and product innovation [13]. - Key points of the "Action Plan": It includes establishing a floating management fee mechanism, reducing investor costs, increasing the scale and proportion of equity investment, establishing a performance - based assessment system, strengthening regulatory classification evaluation, and enhancing compensation management [14][15][16][18][19][20]. - Reasons for the "Three - Year Goal": Investor risk preferences have declined, leading to a slowdown in the growth of public funds, especially new equity funds. The "Long - term Capital Market Entry" has set a 10% quantitative requirement for public fund capital entry [27][25]. - Fee reform: It aims to establish a floating fee mechanism linked to performance and reduce investment costs. It also expands the scope of fee reduction and promotes the development of floating - rate funds [31][32][36]. - Differentiated competition: Fee reduction and classification supervision will optimize the industry pattern, benefiting public funds strong in equity and index products [44][48]. - Benchmark constraints and long - term assessment: In the short term, industry allocation will be adjusted; in the long term, the focus will return to fundamental research, and turnover will decrease [49][50]. - Product innovation: The development of equity and fixed - income + products will be promoted to meet market demand [53][57]. - Research and investment capabilities: The co - management model may become the future development trend of the industry [58]. 2. Impact on Public Funds: Analysis from Research and Investment, Products, Channels, Talent, and Back - end Operations - Research and investment: Benchmark constraints may force active equity funds to become "quasi - passive". The co - management model may be adopted to improve research and investment capabilities [63][58]. - Products: The passive trend will continue, and equity index products and fixed - income + products will have development opportunities [69][74]. - Channels: Public funds should strengthen self - sales and investment advisory channels to reduce dependence on代销 channels. The combination of fund investment advisory and direct sales platforms may bring opportunities for large public funds to enter the wealth management market [78][84]. - Talent: For researchers, the "department wall" between research and investment should be broken; for fund managers, hierarchical management should be implemented [90][93]. - Back - end operations: Fee reduction will raise the break - even point, and financial technology may be an effective means to cope with fee reduction in the short term [94][95]. 3. Impact on Securities Companies: Analysis from Public Fund Business, Sales, and Allocation - Public fund business: The "Action Plan" will directly impact the income of publicly - held funds by securities companies, potentially compressing their profit contribution in the short term [102]. - Sales: The similar classification evaluation mechanism will benefit securities companies' sales, and they will maintain their advantage in selling equity index funds [106]. - Allocation: Securities companies should strengthen research on high - weight benchmark targets and explore non - public fund customers [4]. 4. Investment Analysis Opinion - The non - banking financial sector can enjoy both Beta and Alpha, and its investment value is promising. The Beta logic lies in the promotion of the transformation of household savings into investments and the entry of long - term funds into the market. The Alpha logic is that the non - banking financial sector is under - allocated and has low valuations [4].

Core Viewpoint - The recent regulatory changes in the public fund industry signify a major shift towards performance-based fee structures and a focus on net asset value, marking the end of the "easy profit" era for actively managed equity funds [4][5][6]. Summary by Sections Regulatory Changes - The "Action Plan for Promoting High-Quality Development of Public Funds" targets the reform of floating fee rates and performance assessments for equity funds, indicating a significant overhaul of investment strategies [4][6]. - The new floating fee structure links management fees to performance against benchmarks, with penalties for underperformance and incentives for exceeding benchmarks [6][7]. Fee Structure Details - Under the new rules, management fees for funds that underperform by more than 3% compared to benchmarks will be reduced to 0.6%, while those that exceed benchmarks by 6% can increase fees to 1.5% [6][7]. - The average return of equity mixed funds was reported at 12.32%, with only 26.9% of funds outperforming their benchmarks by 6% [7]. Performance Assessment - The new regulations emphasize long-term performance, requiring that at least 80% of performance assessments for fund managers be based on returns over three years [10][11]. - The focus on benchmarks aims to correct previous issues of risk management and style drift among fund managers, enhancing accountability [11][12]. Industry Impact - The reforms are expected to lead to a significant reshaping of the fund industry, with a potential increase in the allocation towards underrepresented sectors, particularly dividend-paying assets [15][18]. - The new rules also encourage the rapid registration of index funds, which may lead to a surge in their popularity as they align with the new performance-driven focus [17][18]. Competitive Landscape - The changes are likely to benefit leading public fund companies, as the industry moves towards a more concentrated market structure, with the top firms expected to gain a larger share of the market [18][20]. - Smaller fund companies will need to develop differentiated research and investment strategies to survive in the increasingly competitive environment [20].

Core Viewpoint - The recent regulatory changes in the public fund industry aim to enhance the quality of equity funds through floating fee rates and performance-based compensation reforms, leading to a significant reshaping of the market dynamics [1][2]. Fee Rate Reform - The new regulations mandate that actively managed equity funds adopt a floating fee rate model linked to performance benchmarks, effectively ending the previous model that prioritized scale and management fees [2][4]. - Funds that underperform by more than 3% relative to their benchmarks will see their management fees reduced from 1.2% to 0.6%, while those that outperform by 6% or more can increase fees to 1.5% [3][4]. - The average return of equity mixed funds was reported at 12.32%, with only 26.9% of funds outperforming their benchmarks by 6%, indicating increased pressure on fund managers to focus on performance [4][5]. Performance Evaluation and Growth Targets - The new rules also require public funds to increase their holdings in A-shares by at least 10% annually over the next three years, with a focus on boosting the proportion of equity funds, which currently lags behind global averages [5][6]. - The performance evaluation system will now place greater emphasis on long-term returns, with at least 80% of the assessment based on three-year performance [7][8]. Manager Compensation Changes - Fund managers' compensation will be closely tied to fund performance, with significant reductions in pay for those whose funds underperform their benchmarks by over 10% over three years [8][9]. - The new regulations aim to correct past issues of inadequate risk control and style drift by emphasizing the importance of performance benchmarks [9]. Industry Restructuring - The reforms are expected to lead to a major reshuffling in the fund industry, favoring top-performing firms and potentially disadvantaging smaller players who may struggle to adapt [12][14]. - The introduction of a fast-track registration mechanism for ETFs is anticipated to enhance the appeal of index funds, which may see increased demand as a result of the new performance-focused evaluation [12]. Investment Strategy Shifts - Fund managers may increasingly allocate to sectors that are underrepresented in their benchmarks to avoid underperformance, particularly in dividend-paying sectors [10][11]. - The focus on diversified asset allocation and risk management will become more critical, moving away from reliance on past performance of individual funds [9][12].

Core Viewpoint - The performance of Xingzheng Global Fund has significantly declined, primarily due to the departure of star fund manager Dong Chengfei and the subsequent drop in the management scale of its actively managed equity funds, leading to a substantial decrease in revenue and net profit [3][5][19]. Group 1: Financial Performance - In 2024, Xingzheng Global Fund reported operating revenue of 3.279 billion yuan and net profit of 1.413 billion yuan, marking a decline of over 50% in revenue and nearly 37% in net profit compared to 2021 [3][5]. - The fund's actively managed equity fund scale dropped from 218.729 billion yuan in 2021 to 124.12 billion yuan by the end of 2024, reflecting a significant reduction in management fees [7][19]. - The decline in revenue and profit is attributed to the overall decrease in the performance of actively managed equity funds and the regulatory changes that reduced management fees from 1.5% to 1.2% [5][19]. Group 2: Competitive Comparison - In contrast, E Fund's operating revenue only decreased by approximately 16% and net profit by about 14%, indicating that Xingzheng Global Fund's performance decline is more severe [4]. - The poor performance of Xingzheng Global Fund's actively managed equity funds is linked to the lack of competitive investment returns compared to peers, with many funds underperforming their benchmarks [19]. Group 3: Management Challenges - The departure of Dong Chengfei has led to a talent drain within the company, resulting in a significant drop in the performance of flagship funds like Xingquan Trend Investment Mixed Fund, which has seen losses of nearly 10 billion yuan over three years [7][15][19]. - The current fund managers, including Xie Zhiyu and Dong Li, have not been able to replicate the previous success, with their management periods yielding negative returns [15][19]. - The company faces challenges in attracting and retaining top talent, which is critical for improving fund performance and regaining investor confidence [19].