Core Viewpoint - The trend of "track-oriented" and "tool-oriented" active equity funds is emerging in the public fund industry, driven by industry competition, customer demand, and market conditions [1][2][3] Group 1: Industry Trends - Active equity funds are increasingly adopting "track-oriented" and "tool-oriented" strategies, focusing on specific sectors such as innovative pharmaceuticals, robotics, computing power, semiconductors, and low-altitude economy [2][3] - In the second half of the year, 34 out of 68 newly established mixed funds had clear themes like "technology," "healthcare," and "consumption," accounting for 50% of the total [2] - The rapid growth of active equity funds since 2019 has led to a focus on core sectors, with fund managers increasingly concentrating their portfolios on specific industries [4][15] Group 2: Market Dynamics - The "track-oriented" trend is a response to significant industry competition, where smaller fund companies find it challenging to compete with larger firms in broad market selections [3][6] - Customer demand has shifted from product-oriented to client-needs-oriented, with investors preferring products with clear strategies and investment directions [3][6] - The current market environment, characterized by structural trends, presents opportunities for excess returns in specific sectors, leading to a consensus among funds to focus on niche industries [3][6] Group 3: Fund Manager Strategies - Fund managers are transitioning from a broad investment approach to a more focused strategy, enhancing the sharpness of their investment styles [5][6] - The shift towards "track-oriented" products requires fund managers to narrow their focus, allowing for deeper understanding and identification of mispriced opportunities [6][8] - The trend does not signify the end of "all-round" fund managers, as the market still requires diverse capabilities among fund managers [6][7] Group 4: Research and Evaluation Requirements - The new "track-oriented" and "tool-oriented" strategies necessitate a more sophisticated research and evaluation framework within fund companies [8][10] - A multi-dimensional evaluation system is needed to assess the performance of "sharp" fund managers and tool-oriented products, as traditional metrics may not accurately reflect their capabilities [10][11] - Fund companies must adapt their assessment criteria to align with the specific characteristics of "track-oriented" products, focusing on long-term excess returns and risk management [10][11] Group 5: Investor Considerations - Investors are advised to avoid over-concentration in single-track investments and to adopt a diversified asset allocation strategy [12][20] - The rise of "track-oriented" funds increases the need for investors to have strong asset allocation skills and timing abilities [12][20] - Fund companies are encouraged to enhance investor education to help clients understand the risks and characteristics of these products [12][19]

Core Viewpoint - The public fund industry is witnessing a shift towards "track-oriented" and "tool-oriented" investment strategies, driven by industry competition, client demand, and market conditions, leading fund managers to focus on specific sectors for higher returns [3][4][6]. Group 1: Industry Trends - The trend of "track-oriented" and "tool-oriented" characteristics in active equity funds is becoming increasingly prominent, with many funds focusing on niche sectors like innovative pharmaceuticals, robotics, computing power, semiconductors, and low-altitude economy [5][6]. - In the second half of the year, 34 out of 68 newly established mixed funds (50%) had clear themes in their names, such as "technology," "healthcare," and "consumption," indicating a strong thematic focus in new fund launches [5][6]. - The rise of track-oriented funds is attributed to the significant "Matthew effect" in the public fund industry, where smaller firms struggle to compete with larger firms in broad market selection, making niche-focused funds more appealing [6][7]. Group 2: Fund Manager Strategies - Fund managers are increasingly "narrowing their capability circles," focusing on sectors where they have expertise, which enhances the sharpness of their investment strategies [10][11]. - The shift from broad-based to focused investment strategies is driven by changes in market conditions, competition, and evolving client demands for more precise investment opportunities [11][12]. - The trend does not signify the end of "all-round" fund managers, as the market still requires diverse capabilities among fund managers [11][12]. Group 3: Research and Evaluation Requirements - The new investment strategies necessitate a more sophisticated research framework within fund companies, requiring collaboration between fund managers and analysts to establish a comprehensive research mechanism [14][15]. - A more scientific and multi-dimensional evaluation system is needed for "sharp" fund managers and tool-oriented products, as traditional evaluation methods may not accurately reflect their performance [17][18]. - The focus should be on long-term sustainable excess returns rather than short-term rankings, with a need to align performance benchmarks with the specific styles of the funds [18][19]. Group 4: Investor Considerations - Investors are advised to approach track-oriented and tool-oriented products with caution, as these high-volatility investments can lead to significant risks if not managed properly [20][21]. - It is recommended that investors diversify their portfolios and avoid over-concentration in single sectors, ensuring a balanced approach to asset allocation [20][21][32]. - Fund companies are encouraged to enhance investor education to help clients understand the risks and characteristics of these new investment products [21][31].

Core Viewpoint - The Chinese public fund industry is undergoing a historic transformation with the introduction of the "Action Plan for Promoting High-Quality Development of Public Funds" by the China Securities Regulatory Commission, which includes 25 specific reform measures aimed at prioritizing investor interests and enhancing industry quality [1] Group 1: Reform Measures - The plan emphasizes the establishment of a mechanism linking fund company income to investor returns, requiring a floating management fee structure based on fund performance for investors meeting certain holding period requirements [2] - It mandates that leading fund management firms issue floating fee rate funds that account for no less than 60% of their actively managed equity fund issuance within the next year [2] - The plan also strengthens the regulatory oversight of performance benchmarks used by fund companies, ensuring they effectively define product positioning, clarify investment strategies, and measure performance [2] Group 2: Performance Evaluation - Fund companies are required to establish a performance evaluation system centered on fund investment returns, reducing the weight of operational metrics like scale ranking and profit [2] - The evaluation metrics for fund investment returns will include both fund performance and investor profit/loss, with long-term performance assessments (over three years) accounting for at least 80% of the evaluation [2] Group 3: Addressing Industry Issues - The plan aims to address the prevalent issue where fund companies profit while investors incur losses by incorporating investor profit/loss into performance evaluation metrics [3] - It highlights that many investors tend to buy funds during market peaks, often leading to significant losses when the market turns, exacerbated by aggressive marketing tactics from fund companies [3] - The long-term performance of many thematic funds has shown overall losses, indicating a need for better alignment of interests among all parties involved in fund investment [3][4] Group 4: Stakeholder Interests - The interests of fund companies, fund managers, sales institutions, and investors have historically been misaligned, with a focus on sales rather than investor outcomes [4] - The implementation of the action plan is expected to better align the interests of all parties involved in fund investments, potentially leading to a more stable and sustainable industry [4]