Core Viewpoint - The public fund industry is undergoing significant transformation with the release of the "Action Plan for Promoting High-Quality Development of Public Funds," which aims to shift the focus from scale to returns, enhancing investor experience and aligning interests between fund companies and investors [1][2]. Group 1: Key Measures of the Action Plan - The plan emphasizes the establishment of a performance-based floating management fee system to bind the interests of fund companies and investors, moving away from the traditional fixed fee model [2][3]. - Fund companies are required to report the first batch of innovative fee structure funds, which will charge management fees based on the performance of the fund during the holding period [2][3]. - The plan mandates that leading fund management firms issue at least 60% of their new active management equity funds as floating fee products within a year [3]. Group 2: Performance Evaluation and Incentives - The plan introduces a performance evaluation system that prioritizes investment returns, reducing the weight of operational metrics like scale and profit in assessing fund companies [5][6]. - Fund managers will be evaluated with a focus on long-term performance, with at least 80% of their assessment based on returns over three years [6][7]. - A salary management mechanism linked to fund performance will be established, ensuring that fund managers' compensation reflects their investment success [6][7]. Group 3: Innovation and Market Development - The plan encourages the innovation of equity funds, including the development of products that link fees to performance and promote long-term holding [8][9]. - A rapid registration mechanism for equity funds will be implemented, allowing for quicker market entry of new products [9]. - The expansion of equity funds is expected to enhance market liquidity and stability, attracting long-term capital into the stock market [9][10]. Group 4: Investor Services and Compliance - The plan calls for improved investor service capabilities and the establishment of a classification evaluation mechanism for fund sales institutions [11][12]. - It emphasizes the importance of risk control and compliance, aiming to create a stable and self-regulating industry environment [13]. - The plan outlines measures to enhance internal management and accountability within fund companies, ensuring adherence to regulatory standards [12][13].

Group 1 - The new model floating management fee funds are steadily advancing, with the first batch demonstrating significant effects, leading to the launch of a second batch of funds that have already attracted over 1.2 billion yuan in subscriptions on their first day [1][3] - The first batch of 26 new model floating management fee funds has seen a rapid increase in stock positions, with 22 funds achieving positive returns since their establishment, and several funds reporting returns exceeding 6% [2][1] - The cautious approach of the first batch of funds, which have not yet opened for regular subscriptions and redemptions, reflects a strategy to stabilize fund sizes and encourage long-term investment from investors [2][1] Group 2 - The second batch of funds has notable design features, including a focus on Hong Kong stock allocations and detailed performance benchmarks that incorporate relevant indices [3][4] - Specific performance benchmarks for the new funds include combinations of various indices, such as the CSI 800 Index and the Hong Kong Stock Connect Composite Index, indicating a strategic approach to performance measurement [3][4] - Some funds have introduced innovative features like "quarterly distribution upon meeting targets," allowing investors to receive cash dividends without redeeming their shares, enhancing the comfort and satisfaction of long-term holding [4][3]

Core Viewpoint - The management fee structure in the venture capital (VC) and private equity (PE) industry is undergoing significant changes, moving away from the traditional "2% management fee + 20% performance share" model to more diversified and performance-linked fee arrangements [1][2]. Fee Reduction Trend - The management fee has been reduced from the standard "2%" to "1.5%" in many cases, with some government-guided funds even charging as low as "1%" [3][4]. - Feedback from investment professionals indicates that the downward adjustment of management fees is becoming a trend, with many general partners (GPs) relying on management fees and performance compensation as their main income sources [4][5]. Changes in Fee Calculation Methods - The industry is shifting from charging based on committed capital to charging based on actual paid-in capital, with some funds adopting a "project-based deduction" model where fees are only charged after project approval [5]. - A performance extraction mechanism is being implemented, linking management fees to investment progress, returns, and policy objectives, which can lead to reduced fees if performance targets are not met [5][6]. Changes in Limited Partner (LP) Contribution Structure - The structure of LP contributions is changing, with institutional LP contributions declining for four consecutive years, and government funds now dominating the LP structure, accounting for approximately 88.8% of contributions [8][9]. - The shift towards government and state-owned capital as primary LPs is driving the evolution of management fee rules, as these funds require a balance between economic returns and social benefits [9][10]. Impact of Fee Reduction on GP Viability - The reduction in fees and the lengthening of exit cycles are raising concerns about the sustainability of GPs that rely heavily on management fees [6][11]. - The current financial environment, including salary reductions in financial institutions, is influencing the fee structures in the VC/PE sector [11]. New Balance Between GP and LP - The government is introducing measures to stimulate GP activity, such as profit-sharing, relaxed reinvestment standards, and risk compensation mechanisms, creating a new equilibrium of "low fees + diversified compensation" [13][14]. - Policies aimed at improving GP incentives are emerging, with a focus on enhancing the professional requirements for GPs and aligning their services with actual returns [15].

Core Insights - The article discusses the evolution and characteristics of floating management fee funds, highlighting their historical development and the emergence of new products in the market [2][3]. Historical Development of Floating Management Fee Funds - Early exploration occurred before 2013, with initial scaling from 2014 to 2022, product trials from 2023 to 2024, and a basic formation expected by 2025 [2]. - The first batch of 26 new floating management fee funds primarily focuses on stock selection across the market, with performance benchmarks often aligned with major indices such as CSI 300, CSI A500, CSI 500, or CSI 800, and some involvement in Hong Kong stocks and bonds [2]. Analysis of Key Fund Managers - The article examines how long-term outperforming funds are developed, using Dongzheng Asset Management's Zhou Yun as an example, emphasizing a combination of undervaluation and trend analysis, balanced and diversified portfolio construction, and accurate benchmark selection [3]. - It highlights the importance of selecting performance benchmarks that closely reflect actual investment situations, noting that growth-style fund managers may show slightly less stability in excess returns compared to value-style managers [3]. - The significance of performance benchmarks is expected to increase due to the "asymmetric" fee structure of new floating management fee products, suggesting that investors are effectively paying for enhanced returns based on specific indices [3].

Group 1 - The first batch of 26 new floating rate funds has officially launched, with 16 funds from companies like Huatai-PB, GF, and Ping An leading the way [1] - The performance benchmarks for these floating rate funds primarily target mainstream broad-based indices such as CSI 300, CSI A500, CSI 500, and CSI 800, with a focus on equity investments [3] - The equity portion of these funds typically maintains a stock allocation around 80%, with A-shares accounting for 55% to 80% of the performance benchmarks and Hong Kong stocks ranging from 5% to 20% [3] Group 2 - The new floating rate funds feature a more refined management fee structure, which is expected to be charged based on each investor's holding time and annualized return [3] - The floating management fee mechanism is designed to be linked to fund performance, with specific conditions for fee increases and decreases, emphasizing the need for significant outperformance against benchmarks [4] - For example, the management fee for the Jiashi Growth Win-Win Mixed Fund can only increase if it significantly exceeds the performance benchmark and achieves positive absolute returns [4]

Core Viewpoint - The first batch of new floating-rate funds has received approval from the China Securities Regulatory Commission (CSRC) and will be launched on May 27, 2025, indicating a strong push for high-quality development in the public fund industry [1][3]. Group 1: Fund Launch Details - A total of 16 floating-rate funds have been disclosed, with subscription dates starting from May 27, 2025, and varying end dates, most concluding in mid-June [1][3]. - The funds are predominantly equity mixed funds, with both A and C share classes available [3]. - The maximum fundraising cap for these funds varies, with the highest being 8 billion yuan for Guangfa Value Steady Progress A and the lowest at 2 billion yuan for Dongfanghong Core Value A [3]. Group 2: Fee Structure and Performance Metrics - The floating management fee structure is linked to performance, with three tiers of management fees: 1.2% (base), 1.5% (high performance), and 0.6% (low performance) [4][5]. - The performance benchmarks for these funds primarily reference major indices like the CSI 300 and the CSI 800, with some funds also investing in Hong Kong stocks and bonds [4]. - The fee structure aims to align the interests of fund managers and investors, potentially reducing the risk of poor performance while enhancing the predictability of returns for investors [5]. Group 3: Industry Implications - The rapid approval process for these funds reflects the CSRC's commitment to fostering innovation in the public fund sector, which may attract more capital into the market [3]. - The floating fee model is expected to create a "survival of the fittest" mechanism in the market, where high-performing funds attract more investments while underperforming funds may exit [5]. - Future developments may include an increase in the number of floating-rate funds and diversification into various themes and strategies, driven by advancements in financial technology [5].

Group 1 - The fund is named "Huaxia Rui Xiang Return Mixed Securities Investment Fund" and is a contract-based open-end mixed securities investment fund [12] - The fund management company is Huaxia Fund Management Co., Ltd., and the custodian is China Construction Bank [12] - The fund is open for subscription from May 27, 2025, to June 27, 2025, with a maximum fundraising period of three months [23] Group 2 - The initial fundraising target is set at RMB 5 billion, with a "last day proportion confirmation" method to control the fundraising limit [16] - The fund shares are categorized into A and C classes, with A class shares incurring front-end subscription fees and C class shares not incurring such fees [15][27] - Each share of both A and C classes has an initial value of RMB 1.00 [20][30] Group 3 - Management fees are determined based on the holding period and annualized return of each fund share, with different rates applicable depending on performance [13][14] - If the holding period is less than one year, a management fee of 1.20% is charged; if it exceeds one year, the fee varies based on performance metrics [13][14] - The fund may refuse subscription applications from single investors if their subscription exceeds 50% of the total fund shares [5] Group 4 - Investors must ensure that the funds used for subscription are legally sourced and comply with anti-money laundering requirements [3] - The fund's subscription process requires investors to open a fund account and a trading account with the sales institution [9][25] - The fund's effective subscription funds will generate interest during the fundraising period, which will be converted into fund shares for the investors [29][59]

Core Viewpoint - The first batch of performance-based innovative floating fee rate funds has been officially approved, marking a significant development in the public fund industry in China [1][5]. Group 1: Fund Approval and Structure - The first batch of funds was collectively submitted for approval on May 16, received acceptance on May 19, and was approved on May 23 [2]. - Multiple public fund companies, including E Fund, Fuguo, and Huaxia, will send their top-performing fund managers to manage these funds [1][2]. Group 2: Fee Structure and Management - The approved products feature a three-tier fee structure: 1.2% (base), 1.5% (upward adjustment), and 0.6% (downward adjustment) [3]. - The management fee is determined based on the holding period and the fund's performance relative to a benchmark, with specific conditions for each fee tier [3]. - This innovative fee model aims to align the interests of fund managers and investors, encouraging managers to enhance their investment capabilities and pursue stable, sustainable performance [3][4]. Group 3: Industry Impact and Future Outlook - The floating fee rate funds are expected to benefit long-term investors by optimizing fee structures and reinforcing the alignment of interests between fund managers and investors [3][4]. - The approval of these funds is part of a broader initiative by the China Securities Regulatory Commission to promote high-quality development in the public fund industry [5]. - The public fund industry in China has grown significantly, with a management scale exceeding 32 trillion yuan, indicating its integral role in the capital market and household finance [4].

Core Viewpoint - The first batch of 26 new floating fee rate funds has been approved, with fundraising expected to start by the end of May and largely complete by the end of June [1] Group 1 - The new products aim to guide investors towards long-term investments, enhancing their potential for better long-term returns [1] - The focus will not be on the scale of fundraising but rather on the quality of initial sales, avoiding the "high open low walk" phenomenon [1] - Fund managers will prioritize selecting fund managers and strengthening research support to improve the long-term investment experience for investors [1]

Group 1 - The core content of the "Action Plan for Promoting the High-Quality Development of Public Funds" focuses on guiding fund managers to return to the essence of "entrusted by others, managing wealth on behalf of clients," aiming for high-quality development in the public fund industry [1] - The main direction of the plan is to align with investor interests and enhance their sense of gain, emphasizing the importance of products that can track performance benchmarks with low volatility and controllable risks, rather than merely seeking excess returns [1] - Active equity funds with a turnover rate of 5-10 times, balanced stock and industry holdings, and a management scale of 500 million to 5 billion yuan are more likely to outperform performance benchmarks, while products with style drift show poor performance [1] Group 2 - Over half of the public active equity funds in the market use the CSI 300 index as their core benchmark, with 15% using the CSI 800 index, indicating a significant deviation from actual performance, necessitating changes in benchmarks or holdings [2] - The financial sector has a holding return amount of 264.9 billion yuan, accounting for 4.6% of the sector's free float market value, which is significantly higher than other industries, highlighting the need for attention in cyclical high-dividend sectors like coal, oil, and utilities [2] - As of the first quarter of 2025, active equity funds are mainly overweight in technology and manufacturing sectors, while being underweight in finance and infrastructure, with notable continuous overweights in pharmaceuticals and electronics since 2020 [2] Group 3 - Following the release of the plan, funds have begun to modify their performance benchmarks, with nearly 120 funds changing benchmarks this year, including various types such as equity mixed funds and flexible allocation mixed funds [3] - Performance benchmarks are considered an important reference for portfolio construction, with a focus on achieving stable risk-return characteristics over the long term rather than extreme short-term performance [3] - A new batch of floating management fee funds will be launched, adopting a performance benchmark-based fee model that adjusts management fees according to the fund's performance relative to the benchmark during the holding period [3]