Core Viewpoint - The phenomenon of "style drift" in public funds continues to exist, leading to the exclusion of certain funds from ratings due to significant deviations from their stated investment styles [1][2][9] Fund Rating and Style Drift - Ji'an Jinxin reported that ten funds were excluded from ratings in the second quarter due to "style drift," along with three funds penalized in the first quarter for the same reason [1][2] - The funds affected include those managed by major institutions such as Huatai-PB and Jiao Yin Shirode [2] Regulatory Response - Regulatory bodies have been actively addressing the issue of "style drift," with the CSRC emphasizing the need for clear performance benchmarks for each fund to ensure alignment with their stated investment strategies [1][9] - The CSRC's recent action plan aims to strengthen the constraints of performance benchmarks and improve the clarity of fund classifications to prevent misleading practices [9][10] Market Environment and Fund Performance - The "style drift" reflects conflicts between market conditions and fund positioning, as well as imbalances between performance pressure and investment discipline [1][5] - Some funds have shown significant deviations from their intended investment styles, with examples including a shift towards banking stocks in the Jiao Yin Innovation Leading Fund [5][6] Fund Characteristics and Performance Metrics - The ten funds that experienced "style drift" had varying performance metrics, with some showing declines in net value while others performed better [6][8] - For instance, the Jiao Yin Innovation Leading Fund had a net asset value of 2.066 billion yuan and a net value growth rate of 8.86% in the second quarter [7] Long-term Returns and Risks - Long-term performance varies significantly among funds, with some achieving high returns while others have incurred substantial losses over three years [8] - The issue of "style drift" poses multiple risks for investors, including mismatched expectations and increased exposure to non-hedged risks [8][10]

Core Viewpoint - The phenomenon of "style drift" in public funds has raised concerns in the market, despite regulatory efforts to standardize and constrain it. Several funds have shown significant deviations from their stated investment themes in the second quarter of this year [1][11]. Group 1: Fund Performance and Characteristics - Several funds exhibiting style drift include: Baoying Modern Service Mixed, Beixin Ruifeng External Growth Theme Flexible Allocation, Huatai Bairui Health Life Mixed, and others, involving multiple institutions such as Jiashi and Huatai Bairui [1]. - The funds primarily affected are mixed funds, including equity-mixed and flexible allocation types, with some stock funds also showing drift. For instance, Baoying Modern Service Mixed is heavily concentrated in the pharmaceutical sector despite its name suggesting a focus on modern services [1]. - Performance analysis shows that some funds with style drift have high volatility and inconsistent returns. For example, Zhongyou Health Entertainment has a return of 62.22% this year, while Baoying Modern Service has increased by 64.73% [2]. Group 2: Structural Characteristics of Style Drift - The heavy holdings of these funds significantly deviate from their claimed thematic directions. For example, Baoying Modern Service's largest holding is a pharmaceutical company, which is not aligned with its stated theme [3]. - Other funds like Taixin Internet+ have major allocations in consumer and transportation stocks, diverging from their "Internet+" theme [4]. - Beixin Ruifeng External Growth is almost entirely invested in electric power stocks, which contradicts its stated investment logic [6]. Group 3: Fund Manager Experience and Investor Composition - The experience of fund managers and the scale of the products may influence the stability of investment styles. For instance, the largest fund, Jiaoyin Innovation Pioneer, has a total scale of 2.066 billion yuan [9]. - Most funds exhibiting style drift are primarily held by individual investors, with institutional investors showing a more cautious approach. For example, Huatai Bairui Health Life and Taixin Internet+ have 100% and over 99% of their holdings from individual investors, respectively [9]. Group 4: Regulatory and Industry Implications - The issue of style drift in public funds is not just a technical problem within rating systems but also relates to industry integrity and investor management. It highlights a disconnect between product design and actual investment practices [11]. - There is a call for enhanced supervision and disclosure regarding the consistency of fund investment styles to promote a return to transparent strategies and stable investment styles [11].

Core Insights - A total of 10 mutual funds have been identified with style drift in Q2 2025, with some funds from major asset management firms like Harvest Fund, Huatai-PineBridge Fund, and China Merchants Jinling Fund [2][3] - The China Securities Regulatory Commission (CSRC) has emphasized the need for clear performance benchmarks for each fund to prevent deviations from their stated investment objectives [2][12] - As of August 18, 2025, five of the identified funds have underperformed their benchmarks over the past three years, indicating potential issues with their investment strategies [2][9] Fund Performance and Characteristics - The largest fund among those identified is the China Merchants Jinling Fund's "Innovation Leading" mixed fund, with a scale of 2.067 billion yuan, which has shown a significant style drift towards banking stocks [5][11] - Other funds with notable style drift include "Smart China 2025" and "Modern Service Industry," which have concentrated holdings in sectors that do not align with their thematic names [7][11] - The performance of the identified funds varies, with some achieving positive returns over the last three years, while others have recorded significant losses, such as the "Modern Service Industry" fund with a return of -55.17% [9][11] Regulatory Context - The CSRC has been actively addressing the issue of style drift in mutual funds, implementing measures to enhance the stability of fund investment behaviors and ensure that investors receive what they expect based on fund names [12][13] - Recent regulatory actions include the introduction of clearer guidelines for fund performance benchmarks and restrictions on excessive trading behaviors that may lead to style drift [12][13]

Core Viewpoint - The report highlights significant style drift in the fund "交银创新领航混合" (Jiaoyin Innovation Pioneer Mixed Fund), which has shifted its focus from innovation to traditional banking stocks, leading to poor performance compared to its peers [2][5]. Fund Performance and Style Drift - As of Q2 2025, 10 funds are reported to have style drift, with 3 facing punitive non-rating due to Q1 drift. The Jiaoyin Innovation Pioneer Mixed Fund is particularly noted for its prolonged style drift [2]. - The fund's top ten holdings have been dominated by bank stocks since Q3 2024, with bank stock allocation exceeding 55%, which contradicts its stated focus on innovation [2][3]. - The fund's performance has deteriorated, ranking at the bottom among peers over the past month and three months, significantly underperforming the average of similar funds [2][9]. Investment Strategy and Holdings - The fund's investment strategy, as per its prospectus, mandates that at least 80% of its non-cash assets be invested in securities related to the "innovation pioneer" theme, which includes high-quality listed companies that drive innovation [3]. - Despite this, the actual holdings show a heavy reliance on bank stocks, with 7 out of the top 10 holdings being banks, leading to a total bank stock allocation of approximately 55.24% [3][4]. Management and Oversight - The fund manager, 郭斐 (Guo Fei), has been managing the fund since February 2020, with a background in investment banking and fund management [7]. - Concerns have been raised regarding the fund management's responsibility for the style drift, with regulatory bodies emphasizing the need for stricter compliance and risk management to protect investors [6].