中国 A 股风格指南：低风险板块受青睐；成长板块热度降温-China A-Share Style Guide_ Low Risk favoured; Growth declined

Summary of Key Points from the Conference Call Industry Overview - The report focuses on the China A-Share market and its investment environment as of November 2025, highlighting macroeconomic influences and market valuations. Core Insights 1. Macroeconomic Drivers: The explanatory power of macroeconomic factors has been significant, with the US two-year spread increasing slightly while the US 10-year to two-year spread decreased. This indicates a shift in market dynamics, reflecting lower price co-movements and increased stock opportunities [2][9][10]. 2. Market Valuation: The valuation of China's A-share market remained stable at 14x 12-month forward PE in November. Information technology and healthcare sectors maintained higher valuations compared to others, while real estate valuations reached historical highs [3][20]. 3. Investment Environment: A risk-off mode persisted in November, with low-risk strategies outperforming. The 12-month Low Volatility strategy yielded a 7% return on a long-short basis, while the Value strategy also showed positive returns [4][25]. 4. Performance of Factors: - Momentum performance improved slightly, with 12-month Price Momentum rising from -12% in October to -2% in November. - Fundamental Growth increased by 1%, contrasting with a decline in 12-month trailing EPS Growth [4][25]. 5. Style Performance Statistics: - The Growth style saw a -1.9% return in the last month for EPS Growth (12m trailing), while Fundamental Growth posted a 0.9% return. - The Value style showed a 3.1% return for Book Value Yield (12m trailing) and 4.7% for Earnings Yield FS (12m forward) [25][27]. Additional Important Insights 1. Market Correlations: The average pair-wise correlation among stocks has been declining, indicating that macroeconomic factors are becoming less influential on individual stock returns, allowing for better stock-picking opportunities [2][13]. 2. Cross-Sectional Volatility: A decrease in cross-sectional volatility suggests a narrowing spread of returns, which may impact stock selection strategies [16]. 3. Valuation Distribution: The report includes figures showing the PE distribution across various sectors and styles, indicating where low valuations can be found [20][22]. 4. Analyst Insights: The report is prepared by a team of analysts from UBS, emphasizing the importance of independent analysis and potential conflicts of interest in investment recommendations [8][45]. This summary encapsulates the key points from the conference call, providing a comprehensive overview of the current state of the China A-Share market and the factors influencing investment strategies.