Quantitative Models and Construction Methods 1. Model Name: Timing System Model - **Model Construction Idea**: The model uses the distance between the short-term moving average (20-day) and the long-term moving average (120-day) of the WIND All A Index to determine the market trend[2][9] - **Model Construction Process**: - Calculate the 20-day moving average and the 120-day moving average of the WIND All A Index - Compute the percentage difference between the two moving averages: $ \text{Distance} = \frac{\text{20-day MA} - \text{120-day MA}}{\text{120-day MA}} \times 100\% $ - If the absolute value of the distance is greater than 3% and the short-term moving average is above the long-term moving average, the market is in an upward trend[2][9] - **Model Evaluation**: The model effectively identifies upward market trends and provides actionable signals for investors[2][9] 2. Model Name: Industry Allocation Model - **Model Construction Idea**: This model identifies medium-term industry allocation opportunities by focusing on sectors with potential for recovery or growth[2][9] - **Model Construction Process**: - Analyze industry-specific factors such as valuation, growth potential, and market sentiment - Recommend sectors like "distressed reversal" industries, Hong Kong innovative pharmaceuticals, Hang Seng dividend low-volatility sectors, and securities for medium-term allocation[2][9] - **Model Evaluation**: The model provides clear guidance for sector rotation and captures medium-term opportunities in specific industries[2][9] 3. Model Name: TWO BETA Model - **Model Construction Idea**: This model focuses on identifying high-growth sectors in the technology domain[2][9] - **Model Construction Process**: - Analyze beta factors related to technology sectors - Recommend sectors such as solid-state batteries, robotics, and military industries based on their growth potential and market trends[2][9] - **Model Evaluation**: The model is effective in capturing high-growth opportunities in the technology sector[2][9] --- Model Backtesting Results 1. Timing System Model - **Key Metrics**: - Moving average distance: 6.06% (absolute value > 3%, indicating an upward trend)[2][9] - WIND All A Index trendline: 5480 points[2][9] - Profitability effect: 1.45% (positive, indicating sustained market inflows)[2][9] 2. Industry Allocation Model - **Key Metrics**: - Recommended sectors: distressed reversal industries, Hong Kong innovative pharmaceuticals, Hang Seng dividend low-volatility sectors, and securities[2][9] 3. TWO BETA Model - **Key Metrics**: - Recommended sectors: solid-state batteries, robotics, and military industries[2][9] --- Quantitative Factors and Construction Methods 1. Factor Name: Profitability Effect - **Factor Construction Idea**: Measures the market's ability to generate positive returns, serving as a key indicator for market sentiment and fund inflows[2][9] - **Factor Construction Process**: - Calculate the profitability effect as a percentage value - Positive values indicate favorable market conditions for sustained fund inflows[2][9] - **Factor Evaluation**: The factor is a reliable indicator of market sentiment and a useful tool for timing investment decisions[2][9] --- Factor Backtesting Results 1. Profitability Effect - **Key Metrics**: - Profitability effect value: 1.45% (positive, indicating favorable market conditions)[2][9]

Market Review - Global equity markets experienced a general adjustment, with Hong Kong, France, Germany, and the US stock markets showing significant declines. A-shares, after five consecutive weeks of gains, faced a correction, with major indices generally declining. In terms of sectors, A-share CPO and innovative pharmaceuticals led the gains, while cyclical products like coal and non-ferrous metals saw a pullback. The domestic commodity market cooled down due to risk warnings from the three major futures exchanges and position limits on certain products, leading to sharp declines in previously strong commodities like coking coal, glass, and polysilicon. On the international front, Trump's announcement on July 30 regarding copper tariffs did not impose restrictions on copper raw materials, resulting in a significant drop in COMEX copper prices. In the foreign exchange market, the US dollar index plummeted after the release of non-farm payroll data on Friday, with market expectations for a rate cut in September significantly increasing [1][2][3]. Market Outlook - The report suggests that the current market correction is temporary, and the slow bull market trend remains unchanged. Following the July Politburo meeting and the new round of China-US economic and trade talks, the market's speculation on incremental policies has cooled down, and after five weeks of consecutive gains, the index requires a phase of adjustment. Looking ahead, the expectation of a Federal Reserve rate cut has reignited, and domestic macro and micro liquidity remains relatively ample, which is conducive to the continuation of the slow bull trend in A-shares. Since the "623" market, A-shares have shown clear characteristics of "rotating upward and low-level replenishment," with better sustainability of the profit-making effect. Additionally, the sources of incremental capital in the market are diverse, with increased participation from public and private equity institutions, and the positive feedback effect of "residents allocating funds into the market and the slow rise of the stock market" is expected to strengthen [2][3]. Sector Allocation - The report recommends focusing on the following areas for sector allocation: 1) New technologies and growth directions such as AI computing power, robotics, and solid-state batteries; 2) Reallocation opportunities in dividend sectors after corrections, such as certain undervalued state-owned enterprises. Thematic areas of interest include self-controllable technologies, military industry, low-altitude economy, and marine technology [2][3].

Group 1 - The market style has entered a period of fluctuation, with diminishing marginal positive factors impacting the market [1] - Focus is shifting towards industry trends that are more certain and less affected by external disturbances [1] - The second half of the year typically sees a concentrated technology release cycle in the domestic technology sector, with increasing certainty in areas such as AI computing power, AI applications, medical exports, military, and solid-state batteries [1] Group 2 - The analysis combines market environment, catalytic factors, and comprehensive quantitative indicators to make investment recommendations [1]

Market Performance - The North Exchange 50 Index declined by 2.7% this week, closing at 1,419.61 points as of August 1, 2025, which is a larger drop compared to the Shanghai and Shenzhen 300 Index (-1.75%), the ChiNext Index (-0.74%), and the Sci-Tech Innovation 50 Index (-1.65%) [10] - The average market capitalization of North Exchange A-shares is 3.113 billion yuan, with a total of 269 constituent stocks [24] Liquidity and Trading Activity - The average daily trading volume for North Exchange A-shares decreased by 19.25% to 25.1 billion yuan this week, with a daily turnover rate of 5.94%, down by 1.06 percentage points [10] - The trading volume for North Exchange A-shares this week was 125.5 billion yuan, compared to 155.4 billion yuan the previous week [26] Industry News and Economic Policies - The National Development and Reform Commission announced the allocation of 800 billion yuan for "two heavy" construction funds and 735 billion yuan for central budget investments, with an additional 690 billion yuan planned for "two new" funds by October [18] - The U.S. Federal Reserve maintained the federal funds rate at 4.25%-4.50%, but internal divisions are growing, with two members voting for a 25 basis point cut, marking the first dissent since 1993 [20] Investment Recommendations - The report suggests focusing on stocks with high mid-year growth and those benefiting from industrial catalysts, particularly in the solid-state battery sector and AI technology [5] - The current price-to-earnings (PE) ratios for North Exchange A-shares, ChiNext, Shanghai Main Board, Shenzhen Main Board, and Sci-Tech Innovation Board are 50.92, 38.12, 12.37, 20.95, and 60.29 respectively, indicating a high valuation environment [11] Risks - Potential risks include policy risks, liquidity risks, and the risk of corporate earnings not meeting expectations, which could negatively impact stock prices [39]

Market Overview - On August 1, A-shares experienced varying degrees of decline, with the Shanghai Composite Index down by 0.37%, the Shenzhen Component Index down by 0.17%, and the ChiNext Index down by 0.24% [1] - The total trading volume in the Shanghai and Shenzhen markets was 15,984 billion RMB, showing a significant decrease compared to the previous trading day [2] Stock Performance - The CSI 1000 Index increased by 0.14% and has risen by 11.96% year-to-date [2] - The Hang Seng Index and its major indices, including the Hang Seng Technology Index and the Hang Seng China Enterprises Index, all closed lower, with the latter down by 1.49% [4][5] Industry Highlights Traditional Chinese Medicine - The National Medical Products Administration approved a new traditional Chinese medicine, Can Yuan Pharmaceutical's Sanpu Granules, for treating chronic pelvic pain [5] - The sales of gynecological traditional Chinese medicine in China are projected to exceed 20 billion RMB in 2024 across various market segments [5][6] - The penetration rate of traditional Chinese medicine health products has significantly increased from 0.01% in 2019 to 4.79% in 2023, indicating growing consumer acceptance [6] New Energy and Solid-State Batteries - The solid-state battery industry has reached a critical point of industrialization, with CATL clarifying its mass production path and overcoming key scientific challenges [6][7] - Solid-state batteries are expected to significantly enhance lithium battery performance, with various segments of the supply chain poised to benefit [7] - Key materials and equipment for solid-state batteries are experiencing increased demand, with a focus on high-pressure equipment and advanced materials [7] Investment Products - Relevant investment products in the traditional Chinese medicine sector include the Chinese Medicine ETF (159647) and various fund linkages [6] - In the new energy sector, investment products such as the New Energy ETF (588830) and associated fund linkages are highlighted [7]

Core Viewpoint - The solid-state battery sector is experiencing a significant downturn, highlighted by the termination of partnerships between Anfu Technology and Lihuhua Co. with Gaon Energy, signaling a broader industry shift as capital retreats and previous expectations are challenged [2][9][31]. Group 1: Company Developments - Anfu Technology and Lihuhua Co. announced the termination of their collaboration with Gaon Energy due to the latter's unstable operational capabilities and frozen shares of its controlling shareholder [2][12]. - Gaon Energy, once a promising player in the solid-state battery market, has seen its operations come to a halt, with a reported revenue of only 1.95 thousand and a loss of nearly 1.8 million in 2024 [13][14]. - The company had ambitious plans for product samples in various sectors by 2028, but these plans have now collapsed due to financial instability and lack of funding [12][13]. Group 2: Industry Trends - The solid-state battery sector, once viewed as a revolutionary technology, is now facing skepticism as the initial excitement fades and the reality of production challenges sets in [9][31]. - The investment landscape has shifted, with venture capitalists now prioritizing cash flow and deliverables over mere potential, leading to a reevaluation of previously favored startups [28][34]. - The current environment mirrors past trends in other sectors, such as the hydrogen energy bubble, where initial enthusiasm gave way to a focus on practical applications and sustainable business models [34][35]. Group 3: Challenges and Future Outlook - Gaon Energy's rapid expansion and ambitious goals led to financial strain, highlighting the difficulties of balancing technology development, capital needs, and operational execution in the hard tech sector [19][20]. - The industry is at a turning point where only those who can manage costs, validate their technologies, and secure customer orders will survive [37][38]. - The narrative around solid-state batteries is shifting, with a need for more grounded approaches and realistic timelines for product development and market entry [36][39].

Core Viewpoint - The photovoltaic industry is expected to return to an orderly competitive state due to the price law revision draft addressing "involution" competition and upstream capacity consolidation, with recent increases in silicon material and wafer prices likely to transmit downstream [1] Group 1: Photovoltaic Industry - Silicon material and wafer prices have recently increased, indicating a potential rebound in component prices [1] - Bifacial cell technology is expected to command a premium due to its efficiency advantages [1] - The expectation for consolidation in the silicon material segment is becoming clearer, with photovoltaic glass companies proactively reducing production by 30% to alleviate inventory pressure [1] Group 2: Battery Technology - Solid-state batteries are identified as the next generation direction due to their high energy density and safety, accelerating the industrialization process and driving upgrades across the entire supply chain [1] Group 3: Wind Power Sector - The Jiangsu offshore wind project is progressing, with an expected contribution of over 10 GW of installed capacity over the next 25-30 years, indicating significant growth potential in domestic offshore wind [1] Group 4: Power Equipment Sector - The power equipment sector is benefiting from the high computing power demand driven by AI, with strong demand for high-power diesel generators, high-density server power supplies, and liquid cooling systems [1] Group 5: Investment Opportunities - The Guotai New Energy ETF (159387) tracks the Innovation Energy Index (399266), which can fluctuate by up to 20% in a day, focusing on companies in the renewable energy sector with high growth potential and R&D investment [1]

Group 1: Core Insights - The report highlights the continuous growth in the PCB and AI server sectors, indicating a strong demand for computing hardware [8] - The solid-state battery production timeline has been accelerated, with several companies announcing their plans for mass production [8] - A new childcare subsidy plan has been introduced, providing 3,600 yuan per child annually for children under three years old, which may benefit related companies [8] Group 2: Industry Dynamics - The report notes that the PCB industry is experiencing high growth alongside AI server demand, with specific companies like Shenghong Technology and Shenzhen South Circuit being mentioned as key players [8] - The solid-state battery sector is entering a rapid industrialization phase, with companies such as Liyuanheng and Haishun New Materials highlighted for their involvement [8] - The introduction of the national childcare subsidy is expected to positively impact companies like Kidswant and Aiyingshi, which are focused on childcare services [8] Group 3: Company Focus - Xuefeng Technology plans to acquire a 51% stake in Shengshi Putian for 154 million yuan through a private agreement [10] - Xiangdian Co. intends to purchase a 12.5% stake in Tongda Electromagnetic Energy for 208 million yuan from its controlling shareholder [10] - Fuwei Co. has received notices for seat product development from well-known joint venture and domestic brands [10] - Sinochem Equipment is set to issue shares to acquire 100% stakes in two companies from China National Chemical Equipment and Beijing Bluestar Energy Investment [10] Group 4: Market Review and Outlook - On July 29, the total trading volume in the two markets reached 1.8032 trillion yuan, with 2,142 stocks rising and 2,840 stocks falling [12] - The Shanghai Composite Index opened flat and then rose, with all three major indices closing with small gains, while the ChiNext and STAR Market indices continued to reach new highs [12] - The report indicates a potential upward breakout for the Shanghai Composite Index, approaching the July 23 high of 3,613 points, with a generally optimistic short-term outlook [12]

Market Performance - The Shanghai Composite Index continued its upward trend, closing up 0.33% at 3609.71 points, while the Shenzhen Component Index rose 0.64% to 11289.41 points, and the ChiNext Index increased by 1.86% to 2406.59 points [1] - The total trading volume in the Shanghai and Shenzhen markets reached 180.32 billion yuan, an increase of 60.9 billion yuan compared to the previous day [1] Sector Highlights - The technology growth sector performed exceptionally well, with significant gains in areas such as innovative drugs, PCB, CXO, and CPO [1] - The brokerage sector is experiencing a slow bull market [1] Competition Insights - The ongoing "掘金大赛" (Gold Digging Competition) has attracted many participants who are seizing market opportunities [1] - The competition allows participants to simulate stock trading with a virtual capital of 500,000 yuan, running from July 21 to July 31 [3] Participant Benefits - Participants in the competition receive various benefits, including free access to the "火线快评" (Fire Line Quick Review) for five days upon successful registration [6][10] - Top performers in each competition round receive additional rewards, including cash prizes and extended access to the "火线快评" [6][10] Investment Strategies - Participants are advised to focus on holding stocks during significant market movements rather than frequently trading [7] - There are two prevailing profit models in the A-share market: one driven by trading sentiment and the other based on fundamental logic supported by performance [7]

Group 1: Market Overview - US stock market showed slight fluctuations with Dow Jones down 0.14%, Nasdaq up 0.33%, and S&P 500 up 0.02% [1] - Notable stock movements include Tesla up 3.02%, Nvidia up 1.88%, and Microsoft down 0.24% [1] Group 2: Domestic Major Events - China and Thailand agreed to an unconditional ceasefire [2] Group 3: Securities Strategy - Everbright Securities anticipates short-term market fluctuations as funds await significant events, with a trend towards technology stocks emerging [4] Group 4: Industry Highlights 1. **Automotive Components**: CATL's subsidiary, Times Intelligent, has initiated a financing round of 2 billion yuan, indicating a push into chassis business with a post-investment valuation exceeding 10 billion yuan. The integrated intelligent chassis is crucial for advanced autonomous driving [5] 2. **Fertility Optimization**: The implementation of a nationwide childcare subsidy starting January 1, 2025, will provide 3,600 yuan per child annually for children under three years old, potentially boosting demand in maternal and infant products [6] 3. **Solid-State Batteries**: Companies like Honeycomb Energy and Changan Automobile are advancing solid-state battery production, with Honeycomb set to trial its first generation of semi-solid batteries by Q4 2025 [7][9] 4. **Semiconductors**: Samsung Electronics signed a $16.5 billion semiconductor supply contract with Tesla, indicating a recovery in Samsung's foundry business [10] Group 5: Company Announcements - Huhua Co. plans to raise up to 586 million yuan for automation and modernization projects [13] - WuXi AppTec expects a net profit of 8.561 billion yuan for the first half of 2025, a 101.92% increase year-on-year [13] - JuCheng Co. reported a net profit of 205 million yuan for the first half of 2025, a 43.5% increase year-on-year [13] Group 6: New Stock Offerings - Youli Intelligent is offering shares at 23.99 yuan each, focusing on photovoltaic support structures [11]