Core Drivers Analysis - Recent policies from the China Securities Regulatory Commission (CSRC) aim to standardize the capital market, including the implementation of the "Derivatives Trading Supervision Management Measures (Trial)" and "Regulations on the Supervision of Secretaries of Listed Companies" [2] - The Central Huijin Investment Ltd. is playing a stabilizing role in the market, with six departments promoting long-term capital inflow to enhance market confidence [2] - Fiscal and monetary policies are working in tandem, with 1.5 trillion yuan in new special bonds allocated to support manufacturing equipment upgrades and new infrastructure, alongside a 10 basis point expected reduction in LPR rates to support liquidity for the real economy and capital markets [2] - January 2026 macro data shows a 0.8% year-on-year increase in CPI and a narrowing year-on-year decline in PPI to -1.9%, indicating improved industrial demand and marginal profit recovery in upstream sectors like black metals and chemicals [2] - Foreign exchange reserves reached $3.358 trillion, the highest since May 2024, with a resilient trade surplus supporting the stability of the RMB and enhancing foreign investor confidence in Chinese assets [2] Market Sentiment and Capital Flow - The trading volume in both markets has exceeded 1 trillion yuan for five consecutive days, indicating a significant increase in market activity and optimistic investor sentiment [2] - Foreign capital is accelerating its inflow, with international investors, including South Korean capital, increasingly allocating to high-quality A-share assets, while domestic savings are shifting towards capital markets [2] - Sectors such as technology, pharmaceuticals, and cyclical stocks are performing well, with AI computing chains, innovative drugs, and rare earth chemicals driving index growth; low-valuation, high-dividend sectors like banks and liquor are favored by institutions, creating a dual support of "technology growth + stable dividends" [2] Future Outlook and Strategic Recommendations - The Shanghai Composite Index's breakthrough of 3600 points and the trading volume exceeding 1 trillion yuan reflect a collective result of policies, economic conditions, capital flows, and international environments, indicating market confidence in economic recovery and long-term positive expectations [9] - In the short term, the market is expected to maintain a fluctuating upward trend, with potential for the Shanghai Composite Index to surpass 4000 points, necessitating attention to mid-year report expectations in sectors like AI, new manufacturing, and new consumption, as well as the pace of policy implementation [10] - In the medium to long term, the upward trend of A-shares remains intact, with structural opportunities arising from industry trends such as humanoid robots, semiconductors, and innovative drugs; investors are advised to shift from trading strategies to holding strategies, focusing on domestic consumption, technological independence, and dividend stocks while diversifying investments to mitigate concentration risks [10]

Core Viewpoint - The article highlights the exploitation of retail investors by the You family, who used their control over Hongbo Co. to extract 3.1 billion yuan before relocating to the United States, leaving 170,000 shareholders in financial distress [1]. Group 1: Background of the You Family - The You family began their business in the 1990s, initially accumulating capital through foreign trade before shifting focus to the niche market of ticket printing [3]. - They gained significant recognition during the 2000 national census, which required high-precision printed materials, allowing them to secure government and bank contracts [5][7]. - By 2008, the family successfully listed Hongbo Co. on the Shenzhen Stock Exchange, controlling over 70% of the shares [9][11]. Group 2: Business Decline and Exit Strategy - Following the rise of digital alternatives, the demand for paper tickets declined, leading to a drop in profits for Hongbo Co. [13][14]. - Instead of pivoting to new business models, the You family began a systematic cash-out strategy, starting with small share reductions under the guise of personal financial needs [16][18]. - Over the years, they executed a series of incremental share sales, which went largely unnoticed by the market, allowing them to accumulate significant cash reserves [20][22]. Group 3: Major Cash-Out Events - In 2018, the You family executed a major share transfer, selling 14% of Hongbo Co. for 700 million yuan, which was framed as bringing in strategic investors [28]. - By 2020, they repeated this strategy, transferring another 8% of shares for 400 million yuan, totaling 1.1 billion yuan extracted from the company [30]. - Ultimately, by 2021, the You family completely divested their holdings, amassing a total of 3.1 billion yuan over a decade [34]. Group 4: Aftermath for Shareholders - After the You family's exit, Hongbo Co. fell into disarray, with the new management failing to stabilize the company, leading to significant financial losses [38]. - The stock price, which had been artificially inflated by speculative trends, collapsed after a disappointing earnings forecast, resulting in an 80% drop in value [42][45]. - The company became effectively ungoverned, with no responsible parties left to address the grievances of the 170,000 shareholders who suffered substantial losses [48][50].

Core Viewpoint - In 2026, China's technology leaders are expected to regain global asset pricing, leading to a dual opportunity for valuation recovery and performance realization [1][5]. Investment Opportunities - The AI computing power sector is projected to have high investment certainty in 2026, with significant infrastructure investments anticipated [3][6]. - The liquid cooling sector is identified as a potential growth point for 2026, with advancements in technology making it more cost-effective [6]. - The humanoid robot and smart driving sectors are highlighted as having explosive growth potential, with the humanoid robot market expected to transition significantly in 2026 [7]. Economic Context - The Chinese economy is transitioning from traditional investment and real estate-driven growth to a new model characterized by high-end equipment manufacturing and new productive forces [2]. - The central economic work conference emphasizes the importance of domestic demand and innovation-driven growth as key tasks for 2026 [1]. Market Dynamics - The risk appetite for the technology growth sector is expected to increase as domestic asset valuations are seen to have a recovery foundation, with core companies not showing signs of significant bubble formation [4][10]. - Global monetary policy divergence, particularly the anticipated interest rate cuts by the Federal Reserve, is a significant variable affecting capital markets [4]. Structural Changes - Traditional infrastructure investments are yielding diminishing marginal returns, while AI computing infrastructure is becoming a new investment focus [3]. - The growth in consumer spending is expected to come from new consumption patterns, particularly in smart vehicles and AI-related products [3]. Competitive Landscape - The AI computing power sector is characterized by strong demand, with leading companies expected to exceed performance expectations [6]. - Domestic companies in the PCB sector hold an 80% market share and are entering a performance realization phase in 2026 [6]. Investment Strategy - The overall market outlook for 2026 is optimistic, with expectations of improved profitability across the A-share market, particularly in the second quarter [9]. - The focus should be on selecting companies with core competitiveness that can deliver performance, as broad market rallies are less likely [10].

Core Insights - The year 2026 marks the beginning of the "15th Five-Year Plan," with the market seeking new directions amidst macroeconomic changes and industry adjustments [1][12] - The focus of the technological transformation is shifting from laboratory model competitions to global industrialization efforts, characterized by "co-opetition" between global tech races and domestic supply chain breakthroughs [2][13] Group 1: Overseas Computing Power - The demand for overseas AI computing power remains a bright spot in global tech investment, driven by strong capital expenditures from tech giants supported by robust cash flows [3][14] - The competitive landscape in the large model sector is stable, avoiding harmful internal competition, while the evolution of technology from text and multimodal to "world models" is clear, opening new ceilings for growth [3][14] - The investment strategy focuses on selecting leading companies for long-term holding, benefiting from a clear demand chain that starts with optical modules, followed by servers and supporting components like PCBs [3][14] Group 2: Domestic Substitution - China's path to overcoming existing computing power gaps is becoming clearer, utilizing "super node" clusters to compensate for single-point weaknesses, which will significantly increase demand for GPUs and high-speed switching chips [4][15] - The semiconductor equipment and materials sector shows strong certainty, as expansion requires purchasing equipment and materials regardless of which wafer factory prevails [4][15] - Attention is drawn to leading equipment manufacturers benefiting from orders in the expansion of domestic storage giants, as well as small-cap growth stocks that achieve breakthroughs in high-end processes [4][15] Group 3: Storage Chips - AI is fundamentally altering the supply-demand dynamics of storage chips, with supply growing steadily at around 15% annually, while demand surges due to the memory functions of large models and the massive consumption of multimodal content [5][16] - The focus is on the listing and expansion of domestic storage leaders, which presents opportunities not only for chip design companies but also for the entire supply chain from module manufacturing to upstream equipment and materials [5][17] - The current storage cycle is accompanied by rapid technological iterations, leading to potential early depreciation of capacity, which introduces unique "option value" in investments [6][17] Group 4: AI Extensions - The success of grand technological concepts relies on solid physical foundations and commercial closed loops, extending the view to both ends of the industry chain [7][18] - The surge in computing power in North American data centers has created significant electricity shortages, making energy storage a core solution for stabilizing power supply, transitioning from a theme to a necessity [7][18] - As infrastructure improves, finding value "outlets" becomes crucial, with a focus on companies in the Hong Kong market that can integrate traditional businesses with AI, as well as new infrastructure services emerging in the AI era [7][18] Group 5: Market Dynamics - In addition to focusing on high-growth sectors, attention is also given to the "other side" of the market [8][19] - There is a reverse layout for high growth in the lithium battery supply chain driven by energy storage, with expectations of supply-demand mismatches in midstream battery materials and upstream resources due to unexpectedly high demand [8][19] - Caution is advised regarding overheated themes like humanoid robots, which face significant engineering challenges and unclear paths to mass production and profitability [8][19] Conclusion - The technology investment landscape in 2026 is expected to be complex and differentiated, with ongoing prosperity for overseas computing power leaders and challenges for domestic supply chains [9][20] - The interplay of hardware investments and the patient exploration of application deployment highlights the need for a nuanced understanding of industry logic [9][20] - The focus will remain on the essence of technological evolution, supply-demand patterns, and commercial closed loops to navigate the significant industrial transformation ahead [9][20]

Core Insights - The 2025 fund reports indicate a clear "dual bet" strategy by fund manager Chen Zongchao, focusing on AI applications and controlled nuclear fusion as key investment themes for 2026 [1][9]. Group 1: Same Fund Performance - The fund "Tongtai Digital Economy A" has evolved into an "AI computing power hardware fund," with its top ten holdings accounting for 66.51% of the fund's net asset value by the end of Q4 [2][10]. - Key holdings include Zhongji Xuchuang, Haiguang Information, Xinyi Sheng, and Hanwha, which together represent over 34% of the fund [2][10]. - The fund achieved a return of 3.49% in Q4 2025, reflecting its focused investment strategy [6][16]. Group 2: Investment Strategy - Chen Zongchao has strategically reduced exposure to general tech hardware stocks while increasing stakes in core holdings like Haiguang Information and Xinyi Sheng, reinforcing the focus on domestic AI computing power [3][11]. - New investments in companies like Jereh and XPeng Motors indicate an expansion into AI-enabled high-end manufacturing and smart driving [3][11]. Group 3: Future Outlook - The fund "Tongtai New Energy Preferred" is focused on the ultimate energy solution of controlled nuclear fusion, with a portfolio heavily invested in companies linked to high-temperature superconductors and special metals [5][14]. - Chen Zongchao predicts that advancements in high-temperature superconductors and AI will accelerate the realization of controlled nuclear fusion, potentially surpassing the commercial scale of wind and solar storage industries [6][16]. - The fund's concentrated strategy yielded a remarkable quarterly return of 26.28%, ranking it first among similar products [6][16]. Group 4: Market Sentiment and Risks - Despite acknowledging the high uncertainty and risks in the controlled nuclear fusion sector, Chen Zongchao remains optimistic about the long-term potential of AI computing stocks, which have shown resilience amid market skepticism [8][18]. - The AI computing sector is viewed as entering a new Kondratiev wave, with the main battleground shifting from the West to China [20].

1. Report Industry Investment Rating - No specific industry investment rating information is provided in the content. 2. Core Viewpoints of the Report - The convertible bond market last week saw an increase in both volume and price. Although the convertible bond valuation is already high, high - priced and over - valued convertible bonds remain strong. The 100 - yuan premium rate has broken through the previous 30% - 34% oscillation range and may experience a slow correction. In an environment with a scarcity of cost - effective convertible bonds, incremental funds can only flow to convertible bonds with strong certainty in the remaining term [5][8]. - From the current absolute price and valuation level, the future upward space for convertible bonds is limited, but incremental demand is expected to provide some support. With individual bond valuations already over - estimated across the board, it is recommended to focus on newly - issued convertible bonds and those whose redemption has been waived, as trading opportunities are greater than trend - following opportunities [5][8]. - Last week, the Shanghai Composite Index achieved 16 consecutive positive days and reached 4,100 points. With the inflow of foreign capital and an increase in the proportion of equity asset allocation by domestic long - term funds, the trading volume exceeded 3 trillion yuan. Sectors such as commercial space, AI computing power, applications, and small metals continued to be strong. There was no market pull - back as previously speculated, and the market continued to break through strongly after the New Year's Day. Historically, in the A - share market, high trading volumes do not necessarily mean a market peak, but caution should be exercised when chasing high - risk themes. The market is expected to move sideways with a slight upward trend, and the two - end market of technology and dividends will shift towards mid - cap blue - chip stocks, including industries such as cyclical, consumer, and manufacturing sectors, and entities such as aerospace satellites, artificial intelligence, service consumption, unmanned driving, nuclear fusion, and semiconductors [5][8]. 3. Summary by Relevant Catalogs 3.1 Convertible Bond Views: Increase in Both Volume and Price of Convertible Bonds, and Re - emergence of Valuation Pressure - The convertible bond market last week was driven up by the underlying stocks, with high - priced and over - valued convertible bonds remaining strong. The 100 - yuan premium rate broke through the previous range and may correct slowly. Incremental funds flow to convertible bonds with strong certainty in the remaining term [8]. - The upward space for convertible bonds is limited, but incremental demand provides support. Attention should be paid to newly - issued convertible bonds and those with waived redemption, as trading opportunities are greater [8]. - The Shanghai Composite Index reached 4,100 points with high trading volume. Sectors like commercial space and AI were strong. The market is expected to move sideways with a slight upward trend, and the market style will shift to mid - cap blue - chips [8]. 3.2 Convertible Bond Review: Leading Rise of High - priced Bonds, and New High in Valuation 3.2.1 Market Overall Performance: Overall Rise of Equity Indexes and Increase in Trading Volume - The equity market last week saw an increase in both volume and price, with all broad - based indexes rising. The Shanghai Composite Index rose 3.82%, the Shenzhen Component Index rose 4.40%, and the ChiNext Index rose 3.89%. The defense and military, media, and non - ferrous metals sectors led the rise, while only the banking sector declined. The average daily trading volume increased significantly from 726.158 billion yuan to 2.84 trillion yuan [12]. - The top ten convertible bonds in terms of gains last week were Seli Convertible Bond, Dingjie Convertible Bond, etc. The more actively traded convertible bonds included Seli Convertible Bond, Zai 22 Convertible Bond, etc. [12] 3.2.2 Significant Increase in Trading Volume, and Better Performance of High - priced, Small - cap, and Low - rated Convertible Bonds - Last week, convertible bonds rose significantly, with the 100 - yuan premium rate breaking through the previous high and the average daily trading volume reaching 93.701 billion yuan. The CSI Convertible Bond Index rose 4.45%, the parity center rose 4.2% to 105.1 yuan, and the median conversion premium rate remained flat at 32.3%. High - priced, small - cap, and low - rated convertible bonds led the rise, while high - rated and dual - low convertible bonds performed weakly [17].

Core Viewpoint - The article discusses the volatility of A-share themes in 2023, highlighting the performance of various sectors and the potential pitfalls of blindly following market trends without a solid trading strategy [1][3]. Monthly Performance Summary - January: Human-like robots, stock Ji Dong Equipment, gained +84.49% [2] - February: AI computing, stock Capital Online, gained +150.97% but fell -26.25% the next month [2] - March: Chemicals, stock Zhongyida, gained +135.41% [2] - April: New retail, stock Guofang Group, gained +117.10% [2] - May: AI computing, stock Zhongyou Technology, gained +157.28% but fell -29.75% the next month [2] - June: Military industry, stock Beifang Changlong, gained +159.97% [2] - July: Human-like robots, stock Shangwei New Materials, gained +1083.42% but fell -9.85% the next month [2] - August: AI computing, stock Cambricon, gained +110.36% but fell -11.22% the next month [2] - September: Unknown sector, stock 688411.SH, gained +153.52% but fell -15.15% the next month [3] - October: Cross-strait relations, stock Pingtan Development, gained +99.44% and +51.55% the next month [3] - November: Cross-strait relations, stock Hefei China, gained +143.31% and +2.43% the next month [3] - December: Commercial aerospace, stock Aerospace Power, gained +104.83% [3] Overall Results - The cumulative return from this strategy was -4.8%, underperforming the CSI 300 by -22.46% [3]. - The analysis indicates that while chasing hot stocks is not inherently wrong, it is crucial to have a well-defined trading strategy [3]. Trading Strategy Insights - Stocks with a monthly gain exceeding 150% have an approximately 80% chance of declining the following month [4]. - Stocks driven by policy and industry support, with significant monthly gains, have a success rate exceeding 75% in the following month [4]. Key Questions for Analysis - Can the performance be supported by the company's earnings? - Is the stock at a peak or in a consolidation phase? What are the resistance levels? - Are there any negative factors on the horizon? [5] Sector Analysis Example - In December 2025, commercial aerospace emerged as a hot market concept, driven by policy and industry factors, with the national space agency expanding government procurement and a projected industry scale exceeding 2.5 trillion by 2025 [7]. - Key questions for evaluating this sector include recent policy support, investment trends, core companies' commercialization progress, and overall industry trends [7].

Market Overview - The A-share market has started 2026 with strong performance, with the Shanghai Composite Index returning to 4000 points and reaching a ten-year high of 4121.7 points on January 9 [1][4] - The margin trading balance has exceeded 2.62 trillion yuan, marking a historical high, with significant contributions from sectors like semiconductors, military, and non-ferrous metals [1][4] Market Drivers - The market's new highs are attributed to a combination of "liquidity easing expectations" and "strong policy narratives," which have driven up risk appetite [1] - The current market phase is seen as a transition from a "preference-driven structural bull market" to a "profit-validated comprehensive bull market" [1][8] - The positive sentiment is supported by a favorable liquidity environment and the implementation of supportive macroeconomic policies [4][8] Investment Trends - A report from Guosen Securities suggests that as the market's fundamentals improve, A-shares are expected to enter the latter half of a bull market in 2026, with an anticipated influx of 2 trillion yuan in new funds [2] - The number of new A-share accounts reached 27.44 million in 2025, a 9.75% increase from 2024, indicating growing investor interest [5] Future Outlook - Analysts predict that the market will experience a "spring rally" characterized by structural rotation rather than uniform growth [7] - Key factors influencing future performance include the effectiveness of economic policies and the ability of listed companies to meet growth expectations in Q1 [8] - The market is expected to remain in a slow bull trend, with a shift from liquidity-driven growth to earnings-driven growth as companies begin to release their performance [8] Investment Strategies - Investment strategies should focus on a balanced approach, combining value stocks benefiting from macro recovery with growth sectors like AI and high-end manufacturing [11] - Recommendations include maintaining a neutral position with 50-70% equity exposure, gradually building positions, and focusing on sectors aligned with policy support and industry trends [11][12] - High-growth sectors such as AI, innovative pharmaceuticals, and military industries are highlighted as key investment opportunities, alongside traditional sectors like transportation and real estate that may benefit from improved supply-demand dynamics [12]

Market Overview - The A-share market continues its strong upward trend, with the Shanghai Composite Index successfully surpassing the 4100-point mark, reaching its highest level since July 2015 [2] - A-share daily trading volume exceeded 3 trillion yuan for the sixth time in history, signaling strong bullish sentiment in the market [2][3] Index Performance - Major indices closed in the green, with the Shanghai Composite Index rising by 0.92% to 4120.43 points, the Shenzhen Component Index up 1.15% to 14120.15 points, and the ChiNext Index increasing by 0.77% to 3327.81 points [3] - Since the beginning of 2026, the Shanghai Composite Index has accumulated a rise of 3.82%, while the Shenzhen Component Index has increased by 4.40% [3] Margin Trading - The margin trading balance in A-shares has surpassed 2.6 trillion yuan, reaching a historical high of 26206.09 billion yuan, indicating a strong enthusiasm for leveraged funds [4] - On January 8, the margin trading transaction volume was 3126.04 billion yuan, accounting for 11.05% of the total A-share trading volume [4] Sector Focus - The commercial aerospace sector has seen significant growth, with companies like Galaxy Electronics and China First Heavy Industries achieving consecutive gains [6] - The AI application sector is also thriving, with companies like Yidian Tianxia reaching historical highs and benefiting from recent positive developments in AI technology [6] - The humanoid robot concept has shown strong performance, particularly with Fenglong Co., which has experienced an 11-day consecutive rise due to a major acquisition by UBTECH Robotics [6] Commodity Prices - The non-ferrous metals sector is performing well, with small metal concepts rising sharply, as evidenced by the price increases of tungsten products [7] Institutional Insights - Despite major indices reaching new highs, approximately 90% of individual stocks have not yet surpassed their highest closing prices from September 2024 to the end of 2025, indicating a concentrated market rally [8] - Various sectors, including non-ferrous metals, military industry, and AI computing, have seen stocks break previous highs, while technology growth and consumer sectors remain below their peaks [8]

Group 1 - The year 2026 marks the beginning of the "15th Five-Year Plan," with various industry professionals expressing their hopes for the new year [2] - Individuals from diverse sectors, including community service, tourism, logistics, and advertising, are eager to contribute to their industries and improve their lives [2] - There is a collective aspiration for advancements in technology, cultural heritage storytelling, and the implementation of beneficial policies at the grassroots level [2] Group 2 - The emphasis is on unity and practical efforts to embark on a new journey towards high-quality development [3]