Group 1 - The core viewpoint is that stock quantitative long strategies have recently faced significant challenges, leading to a notable decline in excess returns, with many funds underperforming the index [1][2] - As of August 31, 2025, the average excess return for 696 stock quantitative long products was -2.28%, with only 20.83% of products achieving positive excess returns [1] - Weekly performance from August shows a consistent decline in excess returns, with averages of -1.06%, -0.61%, and -1.99% over three weeks, indicating a worsening trend [1] Group 2 - A large quantitative private equity firm in Shanghai noted that the A-share market has seen increased trading volume, but structural market conditions have led to many stocks declining despite index gains [2] - The primary reasons for the excess return decline in quantitative products are identified as style reversals, particularly between large-cap and small-cap stocks, and significant sector differentiation due to rapid growth in financing [2] - The firm believes that the current excess return decline is likely a temporary phenomenon, with expectations of a return to normal market conditions and recovery of excess returns in the near future [2]

Core Insights - The private equity sector in the securities industry is experiencing a positive trend with both performance and positions rising significantly this year [1][3] - Stock strategy products are leading among the five major strategies, reflecting increased investment confidence and a favorable outlook on policies, economic expectations, and A-share valuations [1][3] Performance Summary - As of May 31, 12,843 private equity securities products recorded an average return of 4.34% in the first five months of the year, with nearly 75% of products showing positive returns [3] - Stock strategy products, totaling 8,487, achieved an average return of 4.81%, with approximately 73.5% of these products in positive territory [3] - Quantitative stock strategies particularly benefited from the small-cap growth market style, with 1,480 quantitative long products averaging a return of 8.46% and over 86% showing positive returns [3] Positioning Summary - As of June 6, the average position of large-cap stock private equity firms reached 79.10%, an increase of nearly 9 percentage points from the end of December last year, indicating a high level of investment [3] - Nearly half of the private equity firms are in a heavy or fully invested state, with the overall average position for stock private equity at 74.43% [3] Investment Focus - The continuous increase in positions is driven by three main factors: positive policy signals boosting market expectations and investor confidence, A-share valuations being historically reasonable and low, and the emergence of structural opportunities in the market this year [3] - Key investment areas identified by leading private equity firms include high-dividend low-valuation stocks, AI and hard technology sectors, and new consumption trends, all reflecting a pursuit of "certainty" in investments [3][4]