Core Viewpoint - The effect of popular sectors siphoning off public fund core positions is gradually weakening as market dynamics shift [1][5][6]. Fund Performance and Rebalancing - As the market enters the semi-annual performance window, fund managers are accelerating their stock swaps, leading to noticeable deviations between fund net values and their major holdings [2][3]. - The net value of the Ping An Xinli Mixed Fund increased by over 1.4% on July 4, despite all of its top ten holdings declining, indicating a potential sell-off of these stocks by the fund manager [3]. - The Huafu Wenyu Flexible Fund saw a net value surge of nearly 4% on the same day, despite the A-share pharmaceutical index declining, suggesting a shift in investment strategy [3][4]. - The market remains divided, with some funds showing net value increases despite most of their holdings declining, reflecting a change in fund managers' strategies [4]. Sector Siphoning and Fund Strategy - The siphoning effect of certain popular sectors on public funds is diminishing, as evidenced by the drastic changes in sector performance and fund manager reallocation needs [5][6]. - The phenomenon of innovation drugs attracting institutional funds is decreasing, with a shift towards rebalancing across sectors as market conditions evolve [6]. - The Hang Seng Medical Care Index rose over 20% from May 1 to July 4, while the Hang Seng Technology Index only increased by less than 3%, indicating a return of funds to previously weaker sectors [6]. Investment Strategies and Market Sentiment - Fund managers are increasingly focusing on "three low" strategies—low-priced stocks, low-valuation stocks, and those with low institutional allocation—as a response to rising risk aversion [9]. - There is a notable shift in fund manager sentiment, with some expressing surprise at the continued investment in high-valuation stocks that have seen significant price increases [9]. - A Hong Kong fund manager managing 2 billion HKD noted that the recent performance of Hong Kong stocks has outpaced A-shares, emphasizing the importance of controlling drawdowns and maintaining a diversified investment strategy [10].

Group 1 - The core viewpoint of the articles indicates that fund managers are accelerating their portfolio adjustments as the effect of popular sectors attracting public funds diminishes and the market approaches the semi-annual performance reporting period [1][2][3] - Many funds are showing discrepancies between their net asset value (NAV) movements and the performance of their top holdings, suggesting that fund managers are likely engaging in stock replacements [2][3] - The trend of reallocating investments is evident as fund managers are gradually shifting their strategies for the second half of the year, moving away from previously popular sectors like innovative pharmaceuticals [4][5] Group 2 - The phenomenon of funds withdrawing from popular Hong Kong stocks began around June 11, with significant declines observed in previously high-performing stocks, indicating vulnerability in valuations as mid-term performance disclosures approach [5] - A focus on "three low" categories—low price, low valuation, and low allocation—has emerged as a key strategy for fund managers aiming to mitigate performance drawdowns amid rising risk aversion [6] - There are indications that the previously concentrated positions in high-valuation stocks are beginning to loosen, with fund managers expressing surprise at the continued high allocations to stocks that have seen substantial short-term price increases [7]