1. Report Industry Investment Rating No relevant content provided. 2. Core View of the Report - The report focuses on Li Yulu, a fund manager at Manulife Fund, who adheres to the principle of absolute return and aims to navigate complex bull - bear markets smoothly. Li Yulu has formed a comprehensive investment framework and achieved good results in the management of representative products such as Manulife Jili and Manulife Juli [3]. 3. Summary According to the Table of Contents 3.1 Macro - view of Manulife Fund Manager Li Yulu - **Personal Background**: Li Yulu holds a master's degree in International Banking and Monetary Studies from the University of Birmingham, UK. She has worked in credit rating, insurance, and pension companies before joining Manulife Fund in April 2021. Currently, she manages mainly fixed - income plus and pure - bond funds, with representative products including Manulife Jili and Manulife Juli [3][9]. - **Investment Framework** - **Systematic Asset Allocation**: The company's fixed - income investment committee sets the annual strategic position, and adjusts the quarterly and monthly tactical positions dynamically. The fund manager and researchers determine specific allocations and select individual stocks and bonds. A multi - department team manages investment concentration, risk, and monitors product net value daily [12]. - **Pure - bond Investment**: Adopt a "core + satellite" strategy. The core position focuses on high - coupon, low - credit - risk financial - like bonds, and the satellite position targets trading opportunities in local government bonds. Avoid credit downgrades and continuously track bond credit changes [13]. - **Stock Investment**: Based on the absolute return target, use dividend - paying stocks as the base position, moderately allocate AI and new - tech stocks, and reserve some positions for excess returns through sector rotation. Adjust stock positions dynamically according to market trends, economic data, and policies [13]. - **Convertible Bond Investment**: In first - tier bond funds, convertible bonds are used to enhance pure - bond returns; in second - tier bond funds, they provide certain returns. The convertible bond portfolio has a "stable base + enhanced flexibility" structure, with a focus on in - depth research and bottom - up stock selection [13][14]. 3.2 Second - tier Bond Fund Representative: Manulife Jili - **Risk - return Characteristics** - **Annual Positive Returns**: Since Li Yulu took office, Manulife Jili has achieved positive returns in every full year, outperforming second - tier bond funds in various risk - return indicators [15]. - **Outperformance Against Peers**: Compared with other medium - position second - tier bond funds, it leads in cumulative returns, maximum drawdown control, Sharpe ratio, and Calmar ratio [18]. - **Asset Allocation Strategy** - **Dynamic Position Adjustment**: The "plus" assets are mainly stocks, with a relatively small convertible bond investment ratio. The fund manager adjusts positions based on the accumulation of safety margins and significantly reduces positions during extreme market conditions [20]. - **Stock Position Timing**: The fund manager is a moderate timer, making large - scale position adjustments only in extreme market conditions and small - scale adjustments in normal times [22]. - **Pure - bond Investment Style** - **High - grade Credit Bonds**: The bond investment uses a coupon - based strategy with some interest - rate bond trading. It prefers high - grade medium - term notes, corporate bonds, and policy - bank bonds [27]. - **Diversified Portfolio**: The bond portfolio is relatively diversified, with the top five heavy - position bonds accounting for no more than 20% of bond assets. The duration center is 3 - 4 years, showing significant duration timing characteristics [30][34]. - **Convertible Bond Investment Style**: The convertible bond portfolio is concise, with a small number of bonds (no more than 20 during the reporting periods). It mainly consists of large - cap bank convertible bonds, with a low equity - like position, focusing on stable returns [36]. - **Stock Investment Style** - **Sector Rotation**: The fund manager mainly allocates to dividend and technology sectors, adjusting the allocation ratio according to market conditions. Since 2024, the weight of the technology sector has increased [44]. - **Style and Concentration**: The fund manager follows market trends in terms of market - value and fundamental styles. The stock portfolio was relatively diversified before 2024 and has become more concentrated since then. The turnover rate is 2 - 3 times, and some technology stocks are held for the long term [48][50]. 3.3 First - tier Bond Fund Representative: Manulife Juli - **Risk - return Characteristics** - **Stable Positive Returns**: Since the strategy reform in 2023/11/20, Manulife Juli has maintained a relatively low position and continuously provided stable positive returns for investors [60]. - **High Quarterly Win - rate**: Since 2024, it has achieved positive returns in 7 consecutive quarters, with a quarterly win - rate of 100% and 85.71% of quarters achieving excess returns over the first - tier bond fund index [60]. - **Time - enhanced Earnings Effect**: The holding - period returns show a "time - enhanced" characteristic, with the average return, median return, and probability of positive returns increasing with the holding time [63]. - **Higher Sharpe Ratio**: Compared with first - tier bond funds with the same position, it has a better Sharpe ratio, indicating a higher risk - return ratio [67]. - **Asset Allocation Strategy** - **Low - risk Convertible Bond Allocation**: The average convertible bond allocation ratio in the recent four periods is about 14.63%, with a low risk exposure, which is in line with the goal of low - volatility and absolute return [68]. - **Contrarian Position Adjustment**: The convertible bond position changes significantly, following a "buy - low, sell - high" strategy and implementing a temporary empty - position strategy in extreme market conditions [68]. - **Pure - bond Investment Strategy** - **Financial Bonds and Local Government Bonds**: Since the end of 2023, the fund has focused on financial bonds as the core position and local government bonds for trading. The position management of local government bonds is flexible, based on the spread between local government bonds and treasury bonds [73]. - **Flexible Duration Strategy**: The duration strategy is flexible, increasing duration when interest rates are expected to fall and reducing it when necessary. The bond portfolio is becoming more diversified, with the top five heavy - position bonds accounting for no more than 30% of bond assets [76]. - **Convertible Bond Investment Strategy** - **Concise Portfolio**: Similar to Manulife Jili, the convertible bond portfolio is concise, with the number of bonds usually between 10 - 40. - **Stronger Return - enhancement**: Compared with Manulife Jili, it has a lower proportion of bank convertible bonds, a higher equity - like position, a lower bond - like position, and more small - and medium - cap convertible bonds, showing a stronger return - enhancement property [82][85].

Core Viewpoint - The article discusses the emergence of multi-asset investment products driven by macroeconomic changes, highlighting the need for higher yield products in a low-interest-rate environment and the evolution of fund management practices to meet investor demands for absolute returns [1][2]. Group 1: Macro Environment and Trends - Three long-term forces are driving the development of multi-asset investments: the need for higher yield products due to low interest rates, the shift towards high-quality public fund development, and the establishment of competitive advantages by fund companies through team specialization and product design [2]. - The past decade has seen significant growth in various fund types, such as money market funds and actively managed equity funds, driven by changing macroeconomic conditions [1]. Group 2: Addressing Absolute Return Needs - The investment goal of the multi-asset management team at the company is to achieve absolute returns for investors, addressing behavioral biases caused by high volatility in fund products [6][7]. - The team has identified two main factors affecting absolute returns: investor behavior influenced by product volatility and the limitations of single-asset investment strategies across economic cycles [6]. Group 3: Product Design and Risk Management - A strict risk budget mechanism is implemented in product design, with maximum drawdown targets set at 2%, 3%, or 5% to define product characteristics clearly [7]. - The team employs strategic and tactical asset allocation across stocks, bonds, and convertible bonds to adapt to different macro environments, enhancing the confidence in achieving absolute returns [7]. - The risk management approach emphasizes proactive measures to avoid passive losses, with a focus on maintaining risk budgets and ensuring that fund managers are aware of their risk exposure [13][14]. Group 4: Enhancing Product and User Fit - The company recognizes the need for diverse product offerings to match varying investor risk preferences and investment horizons, moving away from a one-size-fits-all approach [9][25]. - A standardized product framework is established to ensure that product characteristics take precedence over individual fund manager styles, allowing for consistent risk management [9][10]. Group 5: Effective Team Assessment - The assessment of fund managers incorporates both return and volatility metrics, ensuring that managers are incentivized to maintain a balance between risk and return [16][18]. - A unified risk accountability system is in place, where both equity and bond fund managers share responsibility for risk, promoting collaboration and reducing the tendency to take excessive risks for short-term gains [16]. Group 6: Providing Rational Income Expectations - The multi-asset management team aims to provide stable risk-return profiles through systematic asset allocation, leveraging the long-term negative correlation between stocks and bonds [20][21]. - The team employs a modular strategy approach, diversifying investment strategies across various asset classes to enhance the sources of excess returns [21][22]. Group 7: Meeting User Needs with Multi-Asset Products - The company has developed a differentiated product line based on maximum drawdown, investment style, and distribution channels to better align with user needs [25][26]. - By understanding the distinct preferences of different investor segments, the company aims to create a sustainable product line focused on absolute return objectives [26].

Core Viewpoint - The retirement of He Yanping, the general manager of Western Lide Fund, has drawn significant attention in the industry, marking the end of an era as the company transitions to new leadership under He Fang, the current chairman [1][3]. Group 1: Leadership Change - He Yanping retired on October 4, 2025, after nearly ten years as the general manager, during which the fund's public offering scale exceeded 100 billion yuan [1][6]. - He Fang, who has been with Western Securities and has served as chairman of Western Lide Fund since March 2019, will temporarily assume the role of general manager [1][5]. - The company is expected to conduct a formal selection process for a new general manager while He Fang serves in the interim [7]. Group 2: Company Performance - As of the end of the second quarter of this year, Western Lide Fund's public offering management scale reached 116.13 billion yuan, with a significant focus on bond funds, which accounted for over 700 billion yuan [1][9]. - The fund's product structure is heavily weighted towards bond-type funds, which made up over 65% of the total scale, with specific figures for various types of bond funds: 40.57 billion yuan for medium- and long-term bond funds, 23.27 billion yuan for mixed bond funds, 11.39 billion yuan for index bond funds, and 3.66 billion yuan for short bond funds [9]. Group 3: Challenges Ahead - The new management team will face challenges in continuing to grow the fund's scale and diversify its product offerings while also enhancing risk management practices [10]. - Recent issues related to personnel management and risk control have raised concerns, particularly following the detention of a fund manager due to gambling-related activities [9][10].

Core Viewpoint - The article emphasizes the importance of enhancing investor experience and trust in the public fund industry, aligning with the regulatory framework set by the China Securities Regulatory Commission (CSRC) to promote high-quality development of public funds [1][3]. Group 1: Company Philosophy and Strategy - Changxin Fund has established a core value of "customer interest first," focusing on customer needs, experience, and trust as the foundation of its operations [3][4]. - The company has integrated the absolute return philosophy into its management, product, and investment strategies since 2015, aiming to create a clear path for achieving this goal [3][5]. - The management mechanism respects customer needs and product positioning, ensuring that fund managers develop skills that align with these requirements [5][9]. Group 2: Systematic Construction - Changxin Fund's systematic construction is designed to be customer-centric, aiming to enhance customer experience and trust through comprehensive management and product strategies [8][9]. - The company has built a three-tiered structure encompassing management, product, and research, embedding compliance and risk control throughout the process [9]. Group 3: Research and Investment Practices - The quantitative team at Changxin Fund, established in 2008, has developed a comprehensive investment research platform that enhances the efficiency of transitioning research into investment [11][12]. - The team employs a three-layer factor architecture to create a factor library, ensuring that qualitative logic aligns with quantitative validation [11]. - Changxin Fund has successfully launched various index-enhanced products, achieving stable excess returns over the past five years, with several products ranking in the top 15% of their categories [12]. Group 4: Future Outlook - As the systematic construction continues to evolve, Changxin Fund anticipates broader implementation of its absolute return philosophy, ultimately enhancing customer experience and trust [13]. - The company aims to redefine the role of public funds as a means of inclusive finance, focusing on building trust and delivering real value to investors [13].

Core Viewpoint - The enhancement of investor satisfaction is a fundamental issue for the public fund industry, which is crucial for the long-term brand building of asset management companies [3][4][16]. Group 1: Investor Satisfaction - Investor satisfaction is the foundation of the fund industry and the core of asset management companies' long-term brand building [3]. - The industry has historically paid insufficient attention to investor satisfaction under the traditional relative return evaluation system, but this is changing with the implementation of the "Action Plan for Promoting the High-Quality Development of Public Funds" [4]. Group 2: Balancing Interests - The relationship between commercial interests and client interests is interdependent, akin to "fish and water," where the absence of investors would eliminate the platform and opportunities for managers [6]. - Ensuring client interests requires a combination of management capabilities and rigid mechanisms, rather than merely adjusting product strategies or service models [6]. Group 3: Investment Philosophy - The core of absolute return philosophy is to balance risk and return, focusing on investment win rates and stable returns [9]. - The asset management industry's primary function is to achieve asset preservation and appreciation through professional management, with absolute return assets directly reflecting this function [9]. Group 4: Professional Management - West China Fund emphasizes absolute return orientation, which aligns with matching client needs and being responsible for client trust [11]. - The sales process in the fund industry is ongoing, where the moment of purchase marks the beginning of service, necessitating professional guidance to help investors establish rational investment perspectives [11]. Group 5: Long-term Vision - The industry should integrate long-termism into daily operations, even at the cost of short-term scale expansion opportunities, as demonstrated by West China Fund's decision to limit purchases during high market sentiment [12]. - The regulatory framework aims to guide the industry towards a scientific, long-term, and professional development model [14]. Group 6: Institutional Development - The establishment of a first-class institution requires a correct understanding of the industry's development rules and cycles, along with the use of financial technology and robust risk management systems [14]. - Continuous diligence and review are essential for achieving excellence in asset management and research teams, emphasizing that investment is not merely a numerical transaction but also involves historical analysis and philosophical depth [14][16].

Summary of Conference Call Records Industry or Company Involved - The discussion primarily revolves around the fixed income and equity markets, with a focus on investment strategies for 2025, including sectors like banking, AI, robotics, and new consumption. Core Points and Arguments 1. **Fixed Income + Strategy Performance**: The fixed income + strategy has shown better performance compared to pure bond funds in the first half of 2025, with overall returns exceeding the median of pure bond funds [2][1] 2. **Economic Conditions**: The current economic momentum is insufficient, leading to a preference for longer duration bonds and a buy-on-dip strategy. Equity markets are expected to experience wide fluctuations and structural trends [1][4] 3. **Sector Rotation**: 2025 has seen accelerated sector rotation, with significant rebounds in small-cap stocks and new consumption since April. Robotics and deep learning have led the growth trend earlier in the year [1][6] 4. **Banking Sector Stability**: The banking sector remains attractive due to improved asset quality from national debt management, with dividend yields still appealing compared to deposits. Insurance funds favor dividend stocks, supporting bank stock performance [1][7] 5. **Extreme Asset Allocation**: There is a noticeable trend towards extreme asset allocation in 2025, with a focus on dividend stocks like banks and growth assets in AI and robotics. New consumption sectors are also gaining traction [1][8] 6. **Quantitative Models**: Quantitative models are crucial for controlling drawdowns and optimizing investment strategies, allowing for effective management of equity and bond positions [4][5] 7. **Market Dynamics**: The bond market is less risky, and the pricing efficiency of bonds is faster than that of stocks, leading to a reduced stock-bond seesaw effect [12][11] 8. **Investor Behavior**: Changes in investor structure, such as the entry of insurance and social security funds, can elevate stock market valuations, indicating a potential bullish trend for 2025 [17][18] 9. **Future Predictions**: The outlook for the Chinese economy and financial markets remains stable, with no significant risks anticipated in the near term. The focus will be on maintaining high positions in bonds and rotating sectors in equities [29][28] Other Important but Possibly Overlooked Content 1. **Absolute Return Philosophy**: The absolute return philosophy emphasizes stable and continuous growth in net asset value, aiming for a Sharpe ratio of at least 1.5 to 2, with maximum drawdown being about twice the annual return [3][10] 2. **Challenges in Hedging**: Domestic public funds face challenges in using government bond futures for hedging due to regulatory constraints and market capacity issues [21][22] 3. **Sector Opportunities**: Current investment opportunities include the banking sector, small-cap stocks, AI applications, and new consumption trends like pet economy and trendy toys, with potential rebounds in these areas [23][24] 4. **Impact of US-China Tariff Discussions**: Positive developments in US-China tariff discussions could enhance the performance of stable cash flow stocks, particularly in the banking sector [25][26] 5. **Monetary Policy Effects**: The Chinese central bank's recent policies, including rate cuts, are expected to support the bond market, while the US Federal Reserve's actions will significantly influence market dynamics [27][28]