Core Viewpoint - The article discusses the significant decline in the performance and reputation of Huaxia Fund, particularly its flagship product, the Huaxia Energy Innovation Fund, which has seen substantial losses and a drop in investor confidence following the entry of foreign investment from Qatar Investment Authority [2][6]. Group 1: Fund Performance - The Huaxia Energy Innovation Fund, once a leading product with over 10 billion in assets, has experienced a three-year loss of 37.93%, ranking it 709th out of 752 comparable funds [2]. - In the second quarter, the A-class shares of the fund reported a loss exceeding 340 million, while C-class shares lost nearly 25 million, both significantly underperforming their benchmarks [2]. - The fund's total assets shrank from over 10 billion to 7.778 billion within six months, marking a decline of over 26% [2]. Group 2: Managerial Changes - Prominent fund managers, including Zhang Hongtao and Zheng Zehong, have left the company, leading to concerns about the management of their previously underperforming funds [4]. - The new managers lack experience in handling large-scale products, raising alarms about potential talent shortages within the company [4]. Group 3: Industry Trends - Huaxia Fund's active equity scale has decreased from a peak of 450 billion to 320 billion, a drop of 130 billion or 42.67% over three years [5]. - The current fund managers face scrutiny over their strategies, with evidence of a lack of independent decision-making and over-reliance on popular sectors [5]. Group 4: Trust and Governance Issues - The company reported an average return of -18.72% for its equity products in 2024, significantly underperforming the industry average by over 10 percentage points [6]. - Internal control issues have led to operational setbacks, including a suspension of new business due to inadequate compliance [6]. - The entry of foreign investment has introduced governance challenges, with the need to reconcile differing investment philosophies [6]. Group 5: Recommendations for Recovery - The company must establish a scientific investment research assessment system to avoid short-term performance pressures [7]. - Building a robust talent pipeline and reducing reliance on individual star fund managers is essential for long-term stability [7]. - Strengthening internal compliance mechanisms and rebuilding investor relations are critical steps for regaining trust [7].