(Original title: Intensive adjustment of public offerings to focus on five major sectors! This year’s fund investment ideas are here)
The Four Seasons Report has been released. Which sectors have public funds increased or decreased their positions, and which stocks are they most optimistic about?
Statistics show that in the fourth quarter of 2022, public offering funds actively increased their holdings in sectors such as medicine, media, computer, non-bank finance, and building materials. In terms of individual stocks, Tencent Holdings leads the way in terms of active holdings. In terms of market value, Tencent Holdings, WuXi AppTec, WuXi Biologics, etc. received the most fund holdings; in terms of fund holdings, Tencent Holdings, SF Holding, and Zijin Mining received the most fund holdings.
At the same time, in the fourth quarter, non-ferrous metals, power equipment and new energy sectors were actively reduced their holdings, and many power equipment stocks were reduced by a large margin.
The pharmaceutical and other sectors have been greatly increased
According to the statistics of Huabao Securities Research Institute, in terms of the sector distribution of heavy holdings, medicine, media, computer, non-bank finance and building materials are the top five sectors with increased holdings, which increased their holdings by 1.36%, 1.15%, and 0.87% respectively compared with the previous quarter. %, 0.44% and 0.25%.
It is worth noting that, as far as the situation at the end of the fourth quarter of 2022 is concerned, food and beverage, power equipment, new energy and medicine are still the top three major sectors of active equity funds. The proportion of holdings in the beverage sector dropped from 15.08% to 14.64%, the proportion of holdings in the power equipment and new energy sectors dropped from 15.30% to 14.03%, and the pharmaceutical sector achieved positive growth, jumping from 10.07% to 12.24%.
At the same time, the computer sector rose from 3.05% to 4.20%, ranking sixth among active equity funds’ heavy positions. As for sectors such as media, non-bank finance, and building materials, although funds increased their holdings more in the fourth quarter, the absolute proportion of holdings was still at a low level.
Institutional confidence in the pharmaceutical sector can also be seen from the overweight data. As of the end of 2022, compared with the China Securities All Index Industry Index, there are a total of 9 sectors in which active equity funds are overweighted in the market. Among them, medicine is the third largest overweighting industry, with an overweighting ratio of 2.90%.
When reviewing the performance of the pharmaceutical sector in the fourth quarter of 2022, Gu Lan, a well-known fund manager of China Europe Fund, said that in the fourth quarter, the adjustment of the epidemic prevention policy made the pharmaceutical sector attract more attention. In addition, after five quarters of adjustments, the pharmaceutical and biological sector Valuations have also returned to historically low levels, and the sector generally rebounded in the fourth quarter. From a fundamental point of view, with the adjustment of the epidemic prevention and control policy, part of the demand for the diagnosis and treatment of the pharmaceutical industry has also been impacted in the short term along with the whole society, while the demand for epidemic prevention related products has increased significantly. In terms of policy, the centralized procurement framework has maintained stability, the policy has continued to be stable and the positive trend has not changed, and the predictability of the policy is gradually improving.
Looking forward to the first quarter of 2023, Gulen believes that as the disruption of the epidemic to the industry gradually weakens, related companies will return to the long-term growth trend. The long-term growth logic of the pharmaceutical industry has not undergone fundamental changes, and innovation is still the most important driving force for industry growth.
At the same time, after increasing positions in the fourth quarter, the media sector has become an overweight industry, with an overweight of 1% relative to the CSI All Index industry. In contrast, after the non-bank financial sector was increased in the fourth quarter, it is still the sector with the lowest allocation of public funds, with an underweight ratio of 4.23% relative to the CSI All Index industry. The computer sector and the building materials sector are slightly underweight, and the proportions of underweight relative to the CSI All Index industry are 0.36% and 0.53%, respectively.
Fund-intensive heavy warehouse Tencent Holdings
In the fourth quarter of 2022, Tencent Holdings is undoubtedly the “most beautiful boy” among the fund’s heavy holdings.
From the perspective of the number of fund holdings, Tencent Holdings has properly won the first place and entered the list of heavy holdings of 371 active equity funds. Among the top ten heavily held stocks, the top three holdings by funds were Tencent Holdings, SF Holding and Zijin Mining, and the number of holding funds increased by 175, 83 and 80 respectively. Compared with the record of being heavily held by 196 active equity funds at the end of the third quarter, the increase in Tencent Holdings’ holdings by funds is not small.
Judging from the market value of fund holdings, Tencent Holdings’ performance is also outstanding, with a total market value of 39.018 billion yuan heavily held by active equity funds. In the fourth quarter of 2022, Tencent Holdings, WuXi AppTec, and WuXi Biologics were the top three stocks with the largest growth in the market value of active equity fund holdings. Looking back at the previous quarter, the market value of the total holdings of active equity funds in Tencent Holdings was 17.776 billion yuan. Only one quarter later, the market value of holdings increased significantly.
Tencent Holdings closed up 25.38% during the fourth quarter and closed up 23.51% this year. The outstanding performance of Tencent Holdings may be related to the good news of some of the company’s main businesses. On December 23, Tencent announced that the video account will charge technical service fees to merchants from January 1, 2023. The technical service fee rate is distributed between 2% and 5% according to different categories of goods. On December 28, the State Administration of Press and Publication announced a new round of game version numbers. A total of 84 games were approved, including Tencent’s client games “Fearless Contract”, “Edge of Rebirth”, and mobile games “Pokémon Gathering”. CICC stated in its research report that the e-commerce of video accounts can better revitalize the WeChat ecology, and is optimistic about the long-term commercialization potential of e-commerce on video accounts and the boost to the overall ecology of video accounts. The normalization of the release rhythm of the version number has alleviated the market’s concerns about the uncertainty of the release of the imported version number. In addition, the overseas version of the end game’s turnover growth in the third quarter was impressive, and Tencent’s game’s sustainable growth ability is still confident.
Source: Tencent Holdings stock price changes in the past five years (quarterly)
Since Tencent Holdings belongs to the media in Shenwan’s first-tier industry, Tencent Holdings has aggressively entered the ranks of the top ten major holdings of active equity funds, which has also significantly increased the proportion of the media sector itself held by the fund. In addition to Tencent Holdings, the market value of Kuaishou, which is also a media stock, has also increased significantly. As of the end of the fourth quarter, Kuaishou was heavily held by active equity funds of 9.349 billion yuan, while at the end of the third quarter, the value was 4.574 billion yuan. 4.775 billion yuan.
In the list of heavily held funds of Tencent Holdings, we can see many well-known fund managers. In the newly disclosed Four Seasons Report, the market value of Tencent Holdings held by Zhang Kun’s E Fund Blue Chip Selection and E Fund High-Quality Enterprises is not low. Tencent Holdings is the largest holding of these two funds. Coincidentally, active equity products such as Qianhai Kaiyuan Shanghai-Hong Kong-Shenzhen Advantage Selection under the management of Qu Yang, ICBC Credit Suisse Yuanfeng under the management of Du Yang, and Southern Hong Kong Stock Connect Advantage Enterprise under the management of Luo Shuai also have a high position in Tencent Holdings.
Power equipment stocks were reduced
Some are happy and some are sad. In the fourth quarter, some sectors and individual stocks also fell out of the ranks of the top ten heavily held stocks as the market rose and fell and funds adjusted their positions.
As far as the sector is concerned, non-ferrous metals, electric equipment and new energy actively reduced their holdings the most compared with the previous quarter, with a reduction ratio of 0.65%. In addition, communications, coal, and real estate, together with the former two, constitute the five industries that have actively reduced their holdings. The communications, coal, and real estate sectors have reduced their holdings by 0.52%, 0.47%, and 0.41% respectively from the previous quarter.
From the perspective of individual stocks, many power equipment stocks were actively reduced. Longi Green Energy, Tongwei, and Ningde Times dropped 157, 102, and 101 active equity funds, respectively, from the top ten heavyweight stocks. From the perspective of the market value of holdings, changes in power equipment stocks are not small. The total holdings of LONGi Green Energy’s active equity funds decreased by 12.426 billion yuan compared with the previous period, CATL decreased by 9.753 billion yuan, and Power Technology decreased by 5.287 billion yuan.
Wang Peng, fund manager of TEDA Manulife Fund, said in the Four Seasons News that in the fourth quarter, the two major policies that suppressed the market turned rapidly. The market style has changed significantly to the consumption, finance, and cyclical industries that have been suppressed for a long time in the early stage and have low positions. In the past two years, industries with independent industrial cycles have been continuously pumped in the current stock game market due to their small marginal benefits. Industries with poor short-term performance are considered to have an upward cycle, and industries with short-term high-growth performance are worried that they will not last.
Sun Haozhong, the fund manager of CITIC Prudential Fund, believes that in the fourth quarter, in the context of the lack of macroeconomic highlights, the market is more trading various expectations, and the overall characteristics of thematic investment are financial real estate, biomedicine, aviation hotels, food and beverages. Other sectors performed better, and the growth sector was under pressure as a whole. However, looking forward to the future, Sun Haozhong will still look for investment opportunities in the direction of pan-new energy. He believes that energy infrastructure is expected to become one of the important means of hedging the economy, and investment opportunities related to the pan-new energy industry can still be optimistically expected.