Core Viewpoint - The Zhongzheng 2000 Enhanced ETF has achieved a nearly 30% return in the first half of the year, outperforming its benchmark index by approximately 14% [1] Group 1: Performance Metrics - As of July 1, the Zhongzheng 2000 Enhanced ETF (159552) rose by 0.77%, reaching a new high [1] - Over the past five days, the ETF increased by 3.99%, by 5.67% over the past ten days, and by 8.16% over the past twenty days [1] - Year-to-date, the ETF has accumulated a return of 30.16% [1] Group 2: Market Insights - The effectiveness of small-cap stocks has been validated globally, attributed to investors' general aversion to small-cap stocks due to difficulties in obtaining accurate information [1] - This aversion leads to lower prices for small-cap stocks compared to larger stocks, resulting in higher expected returns [1] Group 3: Investment Strategy - The fund under China Merchants uses a multi-factor model for stock selection and portfolio optimization, incorporating traditional fundamental, technical, and advanced machine learning factors [1] - The fund aims for long-term stable excess returns while maintaining a balanced and conservative portfolio allocation, with strict control over tracking error [1] - The quantitative team at China Merchants has extensive experience in the index enhancement field, with a history of stable and high long-term excess returns from various enhanced funds [1]

Group 1 - The article highlights that there are approximately 600 stocks in the A-share market with a market capitalization of less than 2 billion yuan, some of which have high growth potential despite low performance [1] - It emphasizes the importance of a discerning approach to small-cap stocks, suggesting that companies with potential should be bought and held in a diversified manner, while poorly performing companies should be avoided [1][2] - Examples of promising small-cap companies include those in the biopharmaceutical sector that are overcoming technological challenges and those in emerging tech services that provide intelligent solutions for traditional industries [1] Group 2 - The article warns that some small-cap stocks are struggling due to poor management, intense competition, and lack of core competitiveness, leading to declining performance and stock prices [2] - It stresses the need for investors to conduct thorough research on a company's fundamentals, including financial health, industry position, core competitiveness, and management capabilities [2] - The article advocates for a diversified investment strategy to mitigate risks associated with small-cap stocks, suggesting that investors should not concentrate their funds in a few stocks but rather spread them across multiple small-cap stocks from different industries [3] Group 3 - Overall, the article presents small-cap stocks as a field filled with both opportunities and risks, urging investors to adopt a balanced perspective and engage in rational analysis and decision-making to identify truly valuable investment targets [3]