1. Report Industry Investment Rating - Not provided in the content 2. Core Viewpoints of the Report - A-share market continued to rebound this week with an oscillating upward trend. The growth style performed well, driving up TMT-themed funds. However, many quantitative index-enhanced products still had mediocre excess returns. The weekly average daily trading volume of the two markets decreased by 10.63% week-on-week. If the trading volume continues to shrink, the chips in high-position sectors will loosen and differentiate, and the market will shift from a unilateral rise to a range-bound pattern. It is recommended to focus on the supplementary rise opportunities of low-position sectors. The basis of four types of stock index futures contracts showed differentiation, with the IM contract having a large discount and the IF contract having a large premium. In the upcoming week with a dense schedule of important macroeconomic events, the A-share market is likely to maintain a volatile and relatively strong market. It is recommended to focus on technology frontier tracks such as robotics and AI computing power, and also seize the rotation and supplementary rise opportunities of sectors such as securities, pig cycles, and games. After a deep adjustment, the national debt market has shown rare allocation value, and investors are advised to moderately increase the allocation ratio [1][11][16]. 3. Summary According to Relevant Catalogs 3.1 This Week's Market Review 3.1.1 Industry Index - The A-share market continued to rebound this week, with the growth style performing well and driving up TMT-themed funds. The weekly average daily trading volume of the two markets was 2.3 trillion yuan, a week-on-week decrease of 10.63%. The basis of four types of stock index futures contracts showed differentiation, and the average and median returns of neutral hedge funds this week were -0.06% and -0.08% respectively. This week, the electronics, real estate, agriculture, forestry, animal husbandry, and fishery, media, and computer sectors led the gains. The real estate and agriculture, forestry, animal husbandry, and fishery sectors had a relatively large increase in the weekly trading volume ratio compared with last week, while the trading activity of the comprehensive finance and national defense and military industry sectors decreased significantly. The real estate sector rose 5.82% this week, and the weekly trading volume ratio increased to a new high in the past four weeks at 1.50%. The power equipment and new energy sector only rose 0.50% this week, and the weekly trading volume ratio was a new high in the past four weeks at 9.04%, and the sector may face short-term adjustment pressure [11]. 3.1.2 Market Style - This week, the growth style index rose 3.56%, and the weekly trading volume ratio slightly decreased to 58.73%. The consumption style index rose 0.88%, and the weekly trading volume ratio increased to 11.85%. The financial style index performed weakly in the past month, rising only 0.24% this week, and the weekly trading volume ratio decreased significantly to a new low in the past four weeks at 5.59%. The cyclical style index rose 1.87%, and the weekly trading volume ratio increased to a new high in the past four weeks at 20.69%. The stable style index rose 1.14%, and the weekly trading volume ratio increased significantly to a new high in the past four weeks at 3.13%. Based on the CSI A-share index, the CSI 500 index led the gains this week, rising 3.38%, and the weekly trading volume ratio was a new high in the past four weeks at 19.03%, while the Shanghai and Shenzhen 300 index only rose 1.38%, and the weekly trading volume ratio decreased to 27.65%. In the past three months, the market has shown highly structured characteristics, and the CSI 500 index has performed strongly. In an environment with abundant liquidity, funds clearly prefer opportunities with certainty, driving the collective supplementary rise of high-quality leading stocks in various industries [15]. 3.2 Active Equity Funds 3.2.1 Funds with Excellent Performance in Different Thematic Tracks This Week - The report screened single-track and double-track funds based on six sectors: TMT, financial real estate, consumption, medicine, manufacturing, and cycle. Single-track funds are those with a position in a certain sector greater than 70% for multiple consecutive periods, and double-track funds are those with positions in two sectors both greater than 30% for multiple consecutive periods. The report listed the top five funds in each sector in terms of performance this week [20][21]. 3.2.2 Funds with Excellent Performance in Different Strategy Classifications - The report improved the growth, BP, and profit factors to obtain growth, valuation, and quality factors, and divided the funds into different types such as deep undervaluation, high growth, high quality, quality growth, quality undervaluation, GARP, and balanced cost-effectiveness. It also listed the funds with relatively excellent performance in different types of funds this week [22]. 3.3 Index-Enhanced Funds 3.3.1 Distribution of Excess Returns of Index-Enhanced Funds This Week - This week, the Shanghai Composite Index rose 1.52%, the Shenzhen Component Index rose 2.65%, the ChiNext Index rose 2.10%, the STAR 50 rose 5.48%, and the Beijing Stock Exchange 50 fell 1.07%. The representative indexes of the value style sector, such as the Shanghai 50, CSI 100, and Shanghai and Shenzhen 300, rose 0.89%, 1.54%, and 1.38% respectively, while the representative indexes of the growth style sector, such as the Small and Medium 100, CSI 500, CSI 1000, and CSI 2000, rose 3.66%, 3.38%, 2.45%, and 2.16% respectively. The report also listed the average and median excess returns of different index-enhanced funds and the top three funds in terms of excess returns in each category this week [25][26][30]. 3.4 This Week's Fund High-Frequency Position Detection - After excluding funds with high positions in Hong Kong stocks and Beijing Stock Exchange stocks, funds with a scale of less than 200 million yuan, industry-themed funds, and quantitative funds, the results showed that active equity funds significantly increased their positions in the basic chemical (0.61%), machinery (0.24%), and power equipment and new energy (0.19%) industries this week, and significantly reduced their positions in the electronics (0.55%), computer (0.41%), and national defense and military industry (0.19%) industries. From a one-month perspective, the positions in the electronics (2.12%) and communication (0.97%) industries increased significantly, while the positions in the banking (1.11%) and automobile (1.04%) industries decreased significantly [3][43].

Overall Performance - The equity market is active, with major stock indices generally rising. As of August 20, the year-to-date increases for the CSI 1000 and CSI 500 indices are 22.62% and 17.51%, respectively, while the Shanghai Composite Index and CSI 300 Index have increased by 12.37% and 8.55% this year [4]. Mixed Fund Performance - The short-term mixed public funds have shown strong performance, with an average net value growth rate of 1.66% and an average maximum drawdown of 0.26% over the past three months. All products in this category recorded positive returns [5]. - Notably, Ningyin Wealth Management, Xingyin Wealth Management, Minsheng Wealth Management, and Hangyin Wealth Management have performed well, with average net value growth rates exceeding 3% [5]. Highlighted Products - Xingyin Wealth Management's "Fuli Xingyi Zhi Xiang Quantitative Index Increase 3-Month Shortest Holding Period 1A" achieved a net value growth rate of 12.69% over the past three months, ranking first among products. This product is rated R4 (medium-high risk) and is benchmarked against a composite of the CSI 1000 and CSI 500 indices [6]. - The second-ranked product, "Xingrui Preferred Progress," primarily holds mixed public funds, with investments in military and Hong Kong stock themes. The top holdings of "Yangguang Orange Preferred Fund Treasure" from Everbright Wealth Management include major stocks like Tencent Holdings, SMIC, and WuXi AppTec [7].

Group 1 - The core viewpoint of the article emphasizes the importance of performance benchmarks in the mutual fund industry, as outlined in the "Action Plan" released by the China Securities Regulatory Commission, which aims to enhance the quality of public funds through specific measures [1] - The article discusses the historical performance of active equity funds in the U.S. compared to their benchmarks, noting that the average tracking error for U.S. active equity funds is around 5%, while domestic equity funds in China have a tracking error close to 15% over the past five years, indicating a weaker benchmark awareness in China [1][2] - The article highlights the need for domestic active managers to adjust their investment strategies under the constraints of performance benchmarks, suggesting two potential adjustment plans: one based on quantitative index enhancement and another involving a split investment strategy [3][4] Group 2 - The first adjustment plan involves using a quantitative index enhancement framework to control the investment proportions of constituent stocks, industry weight deviations, and individual stock weight deviations to minimize performance divergence from the benchmark [4][5] - The article presents a simulation using the CSI 300 index as a benchmark, showing that when the investment proportion in constituent stocks is set at 80%, the probability of outperforming the index over three years remains close to 100%, regardless of industry and stock weight deviations [6][7] - As the investment proportion in constituent stocks decreases to 50% and 30%, the likelihood of underperforming the index increases significantly, indicating that maintaining a higher proportion of constituent stocks is crucial for performance [8][9][10] Group 3 - The article discusses a second strategy that involves a combination of passive index tracking and active management, where a portion of the portfolio is allocated to index investments while the remainder is actively managed [15][18] - A simulation using the top 50 constituent stocks of the CSI 300 index shows that this approach can yield excess returns while effectively tracking the index, with a historical annualized return of 4.36% compared to the CSI 300 index's 2.36% [18][19] - The article emphasizes that the proportion of passive index investment should not fall below 20% to minimize the risk of underperforming the index, especially when the active manager's performance is at the market average [20][21] Group 4 - The article draws on international experiences, noting that successful active management products in the U.S. maintain clear viewpoints on individual stocks while adhering to benchmark constraints, with examples of funds that have significantly deviated from their benchmarks yet achieved strong performance [28][29] - It highlights that even with a focus on benchmark adherence, active managers can still express distinct views on individual stocks, as seen in the performance of funds like Fidelity Contrafund and JPMorgan US Equity Fund [30][34] - The article concludes that while the new regulatory framework imposes stricter performance benchmarks, it does not eliminate the potential for active management to express unique investment perspectives [28][29][47]

Core Viewpoint - The rapid growth of index-enhanced funds in the market is driven by the evolution of market conditions and the increasing demand from investors for more sophisticated investment tools, with a total scale exceeding 200 billion yuan by the end of Q1 2025, representing an increase of over 80% since the end of 2020 [1]. Group 1: Definition and Characteristics of Quantitative Index Enhancement - Quantitative index enhancement involves tracking benchmark indices while using quantitative models to optimize stock selection and portfolio management to pursue excess returns (Alpha) [1]. - Unlike traditional index funds that passively replicate constituent stocks, index-enhanced products allow fund managers to adjust holdings within certain constraints to achieve returns that exceed the index [1]. - The average return of index-enhanced funds based on the CSI 300 index was 25.48%, compared to 6.07% for ordinary CSI 300 index funds, indicating the effectiveness of the index enhancement strategy [5]. Group 2: Performance Comparison - Over the past decade, the index-enhanced fund index has shown significant excess returns, with a gain of 24.88% compared to -18.05% for the CSI 300 index and 2.26% for stock index funds [2][3]. - The performance of index-enhanced products is particularly notable during periods of market recovery, as they benefit from both beta returns from the underlying index and alpha returns from active management strategies [7]. Group 3: Mechanisms of Index Enhancement - The enhancement is achieved through two core components: modeling stock returns and optimizing the portfolio relative to the benchmark index [8]. - Three primary methods for achieving index enhancement include: 1. Multi-factor stock selection models that assess various factors such as value, momentum, growth, sentiment, and quality to improve stock selection accuracy [10]. 2. AI stock selection techniques that utilize machine learning and deep learning to uncover patterns in historical data and enhance stock selection efficiency [11][12]. 3. Fundamental enhancement strategies that analyze a company's financial health and operational efficiency to identify investment opportunities [13]. Group 4: Key Indicators for Index Enhanced Funds - When selecting index-enhanced funds, important indicators to consider include annualized excess returns, tracking error, information ratio, maximum drawdown, daily and monthly win rates, all centered around the core metric of daily excess returns [13].

1. Report Industry Investment Rating There is no information regarding the industry investment rating in the provided content. 2. Core Views of the Report - The "Action Plan" issued by the China Securities Regulatory Commission on May 7, 2025, emphasizes strengthening the binding effect of performance comparison benchmarks. This is to address the weak benchmark awareness in domestic public - offering funds and avoid widespread underperformance [6]. - Two adjustment strategies are proposed for domestic active managers under the constraint of performance comparison benchmarks. The first is to refer to quantitative index enhancement by controlling the proportion of constituent stocks and industry constraints to reduce deviation. The second is to adopt a split - position investment approach, with part of the position for benchmark index investment and the other part for active management [2][8]. - Overseas high - performing active management products still express clear views on individual stocks. They deviate from the benchmark to some extent in industries while maintaining distinct style characteristics [2][36]. 3. Summary by Relevant Catalog 3.1 《行动方案》强化业绩比较基准的约束作用 - The "Action Plan" proposes 25 specific measures in seven major areas to promote the high - quality development of the public - offering fund industry, with a clear emphasis on strengthening the binding effect of performance comparison benchmarks. Fund company evaluation, executive assessment, and fund manager assessment will be closely related to these benchmarks [6]. - In the past 10 years, the average annualized tracking error of US active equity funds relative to their performance comparison benchmarks was mostly between 3 - 6%, with an average of less than 5%. In contrast, the average tracking error of domestic equity - biased funds in the past 5 years was close to 15%, indicating weak benchmark awareness [6]. 3.2 参考量化指数增强：通过成分股比例、行业约束来降低偏离 - A conventional quantitative index enhancement constraint framework includes constraints on the proportion of constituent stocks, individual stock weight deviation, industry weight deviation, style factor deviation, and tracking error deviation. For active managers, the focus is on adjusting the proportion of constituent stocks, industry deviation, and individual stock deviation [10][11]. - Taking the CSI 300 as an example, when the investment proportion of constituent stocks is 80%, the portfolio is likely to outperform the index within three years at any time point, and industry deviation has little impact. When the proportion drops to 50%, it is recommended that the industry deviation be within 3%. If it further drops to 30%, the probability of underperforming the index by more than 10% within three years increases significantly [2][14][19]. 3.3 跟踪与主动管理并重：用多大仓位主动管理更合适？ - An approach of split - position investment is considered, with part of the position for benchmark index investment (using the top 50 constituent stocks for sampling replication) and the other part for active management. The Shenwan Hongyuan Active Equity High - Position Fund Index is used to represent the average performance of the market's active funds [24]. - When the investment performance of active fund managers is at the market average level, to avoid underperforming the price index by more than 10% within three years, the index investment position should not be less than 20%. To ensure not underperforming the index, a 50% replication position is recommended. For managers in the top 30% of performance, they can have more active management space [29][30]. - For funds with obvious style and industry biases, such as advanced manufacturing funds, at least 50% of the position should be invested in the index replication portfolio to avoid underperforming by 10% within three years [35]. 3.4 海外经验参考：绩优主动管理产品在个股上仍有明确观点 - US high - performing active equity products in different styles (large - cap core, large - cap growth, large - cap value) still maintain distinct active management characteristics. They deviate from the benchmark in industries while keeping clear style features and express clear views on individual stocks, with individual stock deviations generally reaching 3% [36][56]. - For example, Fidelity Contrafund has significant over - allocation in communication services and finance and under - allocation in technology and consumption. It over - allocates Meta by more than 10% and Berkshire by more than 8% [42].

Core Viewpoint - The rapid growth of index-enhanced funds in the market is driven by the evolution of market conditions and the increasing demand from investors for more sophisticated investment tools [1] Group 1: Market Overview - As of the end of Q1 2025, there are 327 index-enhanced funds with a total scale exceeding 200 billion yuan, representing an increase of over 80% since the end of 2020 [1] - The demand for index-enhanced strategies is rising due to the maturation of investors and the deepening of capital markets [1] Group 2: Definition and Strategy - Quantitative index enhancement involves tracking benchmark indices while optimizing stock selection through quantitative models to pursue excess returns (Alpha) [2] - Index-enhanced funds combine passive tracking of indices with active management strategies, such as multi-factor models and AI stock selection, to achieve superior performance [3][4] Group 3: Performance Comparison - Over the past decade, index-enhanced funds have demonstrated significant excess returns, with the Wind index-enhanced fund index achieving a 24.88% increase, while the CSI 300 index and stock index funds saw returns of -18.05% and 2.26%, respectively [3][4] - As of May 12, 2025, the average return of CSI 300 index-enhanced funds is 25.48%, compared to 6.07% for regular CSI 300 index funds, indicating the effectiveness of the index enhancement strategy [7] Group 4: Mechanisms of Enhancement - Quantitative index enhancement typically involves two core components: modeling stock returns and optimizing the portfolio relative to the benchmark index [9] - The three main methods for achieving index enhancement include: 1. Multi-factor stock selection models that assess various factors such as value, momentum, and quality [10] 2. AI stock selection techniques that utilize machine learning and deep learning to identify patterns in historical data [11] 3. Fundamental enhancement strategies that analyze a company's financial health to optimize the investment portfolio [12] Group 5: Key Indicators for Selection - When selecting index-enhanced funds, important indicators to consider include annualized excess returns, tracking error, information ratio, maximum drawdown, and win rates [13]