Summary of China Housing Survey Insights Industry Overview - The document discusses the current state of the **Chinese housing market**, based on the **UBS Evidence Lab's China Housing Survey** conducted from **October 28 to November 18, 2025**, with **2,500 respondents** across mainland China [2][8]. Key Insights Housing Market Sentiment - **Housing purchase intention** and overall sentiment have shown a slight improvement but remain subdued compared to historical norms. The percentage of respondents planning to buy properties in the next two years increased to **30%**, up from **27%** in the previous year [8]. - **Selling intention** has also strengthened, with **17%** of homeowners planning to sell in the next 1-2 years, compared to **10%** previously [8]. Price Expectations - Over **50%** of respondents reported a decline in property prices over the past six months, with **tier 1 cities** experiencing the most significant deterioration [3][17]. - **42%** of respondents expect housing prices to decline further in the next 12 months, while only **19%** anticipate an increase [18]. - The average new and secondary residential prices fell by over **12%** and **21%** from peak levels by December 2025, respectively [17]. Divergence Among City Tiers - There is a notable divergence in sentiment among different city tiers. **Tier 1 cities** reported the sharpest price declines and increased paper losses, while **tier 3 cities** saw a slight improvement in sentiment due to previous sharp declines in prices [4][10]. - **11%** of respondents in tier 3 cities reported stronger confidence compared to **0%** in tier 1 cities [10]. Economic Factors Influencing Sentiment - Concerns over stalled projects have eased, but they remain a significant factor depressing sentiment. Respondents indicated that further property policy easing, including mortgage rate cuts and improved salary growth, are crucial for boosting confidence [5][34]. - The **People's Bank of China (PBC)** is expected to cut policy rates by **10-20 basis points** in 2026, potentially leading to **30-40 basis points** in mortgage rate cuts [6][39]. Wealth Effect and Consumption - The negative wealth effect is likely to continue impacting household consumption, with **52%** of homeowners reporting paper losses [22]. The average mortgage servicing burden is **27.1%** of monthly income, slightly higher than previous surveys [22]. - The combination of increased paper losses and a high debt servicing burden suggests ongoing constraints for household consumption, although a recent equity market rally may provide some offset [22]. Future Outlook - The property downturn in China is expected to persist into **2026-2027**, albeit with smaller declines in property sales and investment (projected **5-10%** decline in 2026 compared to **-9%/-17%** in 2025) [6][39]. - The sustainability of the marginal improvements in sentiment, particularly in tier 3 cities, remains questionable given the latest weak market data [10][19]. Additional Considerations - The survey indicates that **government assistance** in cash or coupons is viewed as a significant boost to confidence, with **23%** of respondents citing it as important [9]. - The shift from pre-sale schemes to completed-only projects is expected to continue, which may alleviate concerns over project delivery [29]. This summary encapsulates the key findings and insights from the UBS Evidence Lab's China Housing Survey, highlighting the current challenges and potential future developments in the Chinese housing market.

Summary of J.P. Morgan's Research on China's Housing Market Industry Overview - The report focuses on the **Chinese housing market**, highlighting a broad-based weakness at year-end 2025 and projecting a continued downturn into 2026 without significant policy changes [1][6]. Key Indicators and Trends - **Housing Activity Index**: J.P. Morgan's housing activity index showed a slight increase at year-end, but most indicators are still contracting sharply. Key metrics include: - New home sales down **18.9%** year-over-year - New starts down **18.8%** - Completions down **20.6%** - Real estate fixed asset investment (FAI) down **36.5%** - Funding sources down **28.1%** [1][4]. - **Price Trends**: - New home prices fell **0.37%** month-over-month (non-seasonally adjusted) in December, a slight improvement from **-0.39%** in November. - Secondary home prices dropped **0.70%**, with larger declines in tier-2 and tier-3 cities. - New home prices are down **12.6%** from the 2021 peak, while secondary prices have decreased by **21.3%** [1][2]. - **Inventory Levels**: - New homes under construction equate to **72.3 months** of sales, while completed unsold units stand at **6.7 months** [1][2]. Demand and Supply Dynamics - The equilibrium demand for housing in China is estimated at around **1 billion square meters** annually. However, both demand and supply are expected to remain below this equilibrium in the near term due to weak income and price expectations [2][6]. - The market is characterized by curtailed demand, widespread incomplete projects, and rising inventories of unsold units, leading to a collapse in housing transactions and investment [2][6]. Policy Measures and Market Outlook - Recent policy measures, including relaxed home purchase restrictions and lower mortgage costs, have been introduced to support the market. However, these measures are viewed as insufficient to halt the ongoing correction or revive the market [3][5]. - A comprehensive rescue package is deemed necessary to stabilize the housing market, which may include a large-scale real estate stability fund and removal of purchase restrictions [5][6]. Future Projections - Without major policy changes, the downturn in the housing market is expected to persist into 2026, with key indicators continuing to contract, albeit at a slower pace. A further **10%** decline in real estate FAI is anticipated, contributing to a macro drag on GDP growth [6][5]. - Critical indicators for the outlook include house price trends and new home sales by state-owned enterprise (SOE) developers. Price stabilization is essential for demand recovery, while faster declines could pose additional risks [6][4]. Conclusion - The Chinese housing market is facing significant challenges, with ongoing declines in key metrics and elevated inventories. Without substantial policy reforms, the market is likely to continue its correction, impacting broader economic growth and household wealth [2][6].

Economic Growth - China's economy grew at 4.8% in the July-September quarter, marking the slowest annual pace in a year, attributed to trade tensions with the U.S. and weak domestic demand [1][2] - The World Bank predicts China's economy to expand 4.9% in 2025 and 4.4% in 2026, while S&P Global economists project a slip in GDP growth for 2026 [5][6] Trade and Exports - Despite U.S. tariffs, China's overall exports remained resilient, with global exports climbing 8.3% in September, although exports to the U.S. fell by 27% year on year [4] Monetary Policy and Economic Support - To counter the slowing economy, China may implement policy easing, including slashing the reserve requirement ratio and interest rates in 2026 to support liquidity and an easy money policy [7][8] - The central bank aims to boost domestic demand and improve supply while managing financial risks [8] Corporate Earnings Outlook - Goldman Sachs forecasts corporate profit growth to accelerate to 14% in 2026 and 2027, up from an expected 4% in 2025, driven by advances in artificial intelligence and supportive policies [12] - Interest in China ETFs is reviving due to policy easing and resilient exports, with expectations of earnings growth in tech and small-cap sectors [11] Market Projections - The MSCI China Index is projected to rise 20% to 100 by the end of 2026, while the CSI 300 Index is forecast to rally 12% to 5,200 [13] - Specific ETFs like Invesco China Technology ETF (CQQQ) and iShares MSCI China Small-Cap ETF (ECNS) have shown significant gains over the past year, indicating strong interest in the tech sector [14][15]

Core Insights - Precious metals, including gold, silver, and platinum, have reached record highs due to increased demand as a safe haven amid geopolitical tensions and economic uncertainty [1][4][9] - Gold surpassed $4,500 per ounce for the first time, with a year-to-date increase of approximately 70%, marking its strongest annual gain since 1979 [1][7] - Silver has outperformed gold with a year-to-date increase of about 140%, driven by high industrial usage and strong investment demand [8][9] Precious Metals Performance - Gold prices have surged, with SPDR Gold Trust (GLD) gaining 68.5% this year [1] - Silver prices rose 3.8% on December 23, 2025, with iShares Silver Trust (SLV) up 140.8% year-to-date [2] - Platinum and palladium also saw significant gains, with platinum up 145.9% year-to-date and palladium up 102% [2][10] Economic Factors Influencing Demand - Global economic uncertainty and policy shifts have increased the appeal of precious metals as safe-haven assets [4] - The trend of de-dollarization and a weaker U.S. dollar have further supported the rally in precious metals [4][6] - Ongoing tariff tensions contribute to economic discomfort, driving investors towards precious metals [5] Future Outlook - The Federal Reserve has implemented three rate cuts this year, with expectations for further easing, which could benefit metal prices [6] - Supply constraints in mining and expectations of stronger demand, particularly for palladium due to automotive applications, are expected to sustain price increases [9][10] - The European Commission's proposed easing of the 2035 combustion-engine ban may bolster palladium demand as it allows for continued use in gasoline and hybrid vehicles [11]

Core Viewpoint - The Meridian Hedged Equity Fund's third-quarter 2025 performance reflects a market more influenced by policy easing than weakening fundamentals, achieving a net return of 1.67% despite concerns over stagflation [1] Fund Performance - The fund's return of 1.67% in Q3 2025 is compared to the S&P 500 Index's return of 8.13% and the CBOE S&P 500 BuyWrite Index's return of 3.53% [1] Company Focus: Kenvue Inc. - Kenvue Inc. (NYSE:KVUE), a consumer health company with brands like Tylenol and Neutrogena, is highlighted as a key investment despite a one-month return of -0.06% and a 52-week loss of 21.06% [2][3] - Kenvue's stock closed at $17.02 on December 23, 2025, with a market capitalization of $32.609 billion [2] Investment Rationale for Kenvue Inc. - The fund sees potential for Kenvue to unlock value through reinvestment in underfunded brands, cost optimization, and margin improvement [3] - Recent market reactions to studies linking acetaminophen to autism risk during pregnancy are viewed as overblown, with minimal revenue impact expected from pregnant women, who represent less than 1% of Tylenol's global sales [3] Hedge Fund Interest - Kenvue Inc. was held by 73 hedge fund portfolios at the end of Q3 2025, an increase from 72 in the previous quarter, indicating growing interest [4] - Despite this interest, the fund suggests that certain AI stocks may offer greater upside potential and lower downside risk compared to Kenvue [4]

Core Insights - The Meridian Hedged Equity Fund reported a return of 1.67% in Q3 2025, underperforming the S&P 500 Index which returned 8.13% and the CBOE S&P 500 BuyWrite Index which returned 3.53% [1] Company Overview - Liberty Broadband Corporation (NASDAQ:LBRDK) is a communication services provider based in Englewood, Colorado, with a market capitalization of $6.854 billion [2] - The company has a 26% ownership stake in Charter Communications and full ownership of GCI, a broadband and wireless provider in Alaska [3] Investment Case - Liberty Broadband's shares are trading at a significant discount to the value of its underlying assets, primarily its stake in Charter Communications, with a prospective merger between the two companies seen as a key catalyst for value realization [3] - The stock has underperformed due to negative sentiment in the cable sector following Charter's weaker second-quarter earnings [3] - Liberty completed the spin-off of its GCI subsidiary into a standalone entity in July, which saw GCI's shares rise approximately 20% post-listing, partially offsetting Liberty's earlier stock weakness [3] - Following the announcement of a definitive merger agreement with Charter, Liberty's shares have shown some recovery, allowing management to focus on maximizing value from its Charter investment [3]

Summary of China Property Market Conference Call Industry Overview - The conference call focused on the **China Property** market, highlighting significant declines in various metrics related to real estate investment and sales. Key Points Real Estate Investment (REI) Trends - **November REI** experienced a record drop of **30.3% YoY**, marking the sharpest decline on record, with a total of **RMB 0.5 trillion**, the lowest monthly figure since April 2012 [1][11] - **Completion rates** fell by **26% YoY** in November, slightly improved from **28%** in October [1] - **Starts** decreased by **28% YoY**, consistent with a **29%** decline in October [1] - **Residential sales** dropped by **28% YoY**, the largest single-month decline since May 2024 [1] - The **70-cities price index** for new homes decreased by **2.8% YoY** in November, while secondary homes saw a **5.7% YoY** decline [1] Market Dynamics - **Secondary market sales** in 18 key cities fell by **22% YoY** in November, with average weekly volume showing a **13% MoM** increase, driven by price cuts [2] - Listings in 39 cities remained stable, but cities like Shenzhen and Xi'an saw increased listings, putting pressure on prices [2] - A survey indicated only **9%** of depositors expect housing prices to rise in 2026, a historical low [2] Future Projections - The outlook for 2026 suggests a **structural decline** in the market unless liquidity improves, with expectations of: - **REI** down **13% YoY** - National sales down **11% YoY**, with residential sales projected at **RMB 6.8 trillion** [3] - New home average selling prices (ASP) expected to fall by **3% YoY** [3] - Starts anticipated to drop to levels last seen in 2003, with a **15% YoY** decline [3] Policy and Regulatory Environment - The **Central Economic Work Conference (CEWC)** indicated a more proactive policy tone, with potential demand-side easing measures expected in Q4 2025 [4] - Urban renewals and REIT approvals are likely to accelerate, but significant changes in home price expectations are not anticipated due to ample supply [4] - Monitoring for targeted monetary easing or pro-leverage initiatives is advised, though the likelihood remains low [4] Market Sentiment and Investment Recommendations - The sector's share prices corrected in early December amid debates over weak sales and expectations of policy-driven rebounds, particularly following Vanke's debt extension [5] - Anticipated earnings downgrades in December and January for well-known names in the sector [5] - Luxury mall retail sales are expected to maintain a positive trend in Q4 after outperforming in Q3 [5] - Recommended stocks include **Jinmao, C&D, and CRL** as top picks [5] Additional Insights - The **macro environment** shows mixed signals, with November exports beating expectations at **5.9% YoY**, while retail sales decelerated to **1.3% YoY** despite a higher CPI of **0.7%** [1] - Fixed Asset Investment (FAI) remains weak, down **12%** YoY, with a cumulative decline of **2.6%** for the first eleven months [1] This summary encapsulates the critical insights from the conference call regarding the current state and future outlook of the China property market, emphasizing the significant challenges and potential policy responses.

Core Insights - Michael Gray has extensive experience in capital markets and fixed income asset management, having founded Gray Capital Management LLC and previously served as Head of Taxable Fixed Income at Fidelity Investments [1] Group 1 - Michael Gray holds an MBA in Finance from Wharton and a BA in Economics from Union College, indicating a strong educational background in finance and economics [1]

Core Viewpoint - The current market conditions indicate a potential turning point driven by a rebound in US liquidity, a dovish shift in Federal Reserve policy, and increasing adoption of AI technologies, which could reshape the outlook for tech and crypto sectors [1][2][4]. Liquidity - US market liquidity is experiencing a decisive reversal after reaching a multi-year low in late October, with a significant $621 billion drain due to a six-week government shutdown, followed by a release of $70 billion back into the markets [2][3]. - An estimated $300 billion is expected to return to the market as the Treasury General Account normalizes, coinciding with a projected 90% chance of a near-term rate cut by the Federal Reserve [3][4]. Policy Easing - The end of quantitative tightening on December 1 is seen as a critical inflection point that markets have not fully priced in, suggesting that supportive monetary policy conditions are developing [4]. - The combination of returning liquidity and supportive monetary policy is believed to create favorable conditions for markets to reverse recent drawdowns [4]. AI Adoption - Cathie Wood highlights a significant gap between consumer AI adoption and enterprise productivity, suggesting that this "productivity drought" could serve as a catalyst for the next bull market in AI and crypto [2][5]. - The liquidity squeeze affecting AI and crypto is expected to reverse in the coming weeks, with market reactions indicating a positive reception to this thesis, as evidenced by an 8% rally in ARK holdings following a recent webinar [5][6].

Summary of Key Points from the Conference Call Industry Overview - The conference call discusses the economic outlook and policy measures in China, particularly focusing on the People's Bank of China (PBoC) and the Ministry of Finance (MoF) [1][2][3][4]. Core Insights and Arguments - **Interest Rates Held Steady**: The PBoC has maintained the Loan Prime Rates (LPRs) at 3.0% for the 1-year tenor and 3.5% for the 5-year tenor for six consecutive months, indicating a cautious approach to monetary policy [2][3]. - **Fiscal Consolidation Observed**: Recent fiscal data shows an 8.6% year-over-year increase in tax revenue for October, while overall expenditure has contracted by 19.1% year-over-year, suggesting a trend towards fiscal consolidation [2][3]. - **Weakness in Property Sector**: There is a notable absence of new support measures for the property sector despite ongoing data weakness, with home sales and prices showing limited signs of stabilization [2][5]. - **Growth Target Feasibility**: The report suggests that achieving the 5% annual growth target for 2025 remains feasible, with a projected growth of approximately 4.5% year-over-year in Q4 2025 [3][4]. - **Policy Space for 2026**: Policymakers are likely to conserve policy space for 2026, the first year of the 15th Five-Year Plan (FYP), with expectations for potential rate cuts and fiscal measures to support consumer spending and welfare [1][4][5]. Additional Important Insights - **Next Policy Window**: The next significant policy window is anticipated to be after the Central Economic Work Conference (CEWC), with potential for a new round of property support measures and front-loading of government bond issuance for 2026 [1][4][5]. - **Incremental Property Support**: There are hints at possible incremental measures for property support, including interest subsidies for mortgage borrowers and additional funding for property developers, although the central government is not expected to utilize its balance sheet directly [5][9]. - **Long-term Constraints**: Long-standing constraints on further easing remain, particularly concerning debt levels for the MoF and net interest margin (NIM) concerns for the PBoC [3][4]. This summary encapsulates the key points discussed in the conference call, providing insights into the current economic landscape and anticipated policy actions in China.