One of the big reasons why everyone flees from the “old generation” top star fund managers is that their management scale is getting bigger and bigger.
Now the old folks recommend the products of excellent “Mesozoic” fund managers to each other, and they often add an emphasis at the end, “and their scale is not large.”
What does it mean?
The people in the sales department of the fund company are embarrassed. Faced with the two asymmetric indicators of “excellent” and “small scale”, “is this a compliment? Should I be happy or ashamed?”
The fund is “small and beautiful”, which may mean a comfortable layout range.
The rise of the “Mesozoic” power in the fund industry (Phase 4) will discuss the relationship between the “Mesozoic” fund’s “overweight”, “golden figure” and “standard figure” and performance, and take you to take an inventory of the current good performance and small scale The mesozoic fund manager. The fund is “small and beautiful”, which may mean a comfortable layout range.
Is scale “overweight” the killer of performance?
There is a view in the industry that “scale is the killer of performance.”
There is a joke that the size of the fund is like the weight of a beauty!
For example, for the old Christians, the top-tier fund managers of the “old generation” who have managed more than 100 billion yuan, everyone feels that this figure is still “overweight”.
Of course it doesn’t mean that “overweight” is definitely not beautiful, after all, Yang Yuhuan is still the four major beauties.
In the fund industry, for example, “Mesozoic” fund manager Zhao Hao manages nearly 30 billion yuan, and its representative fund-ABC-Agriculture New Energy Theme Fund-has a scale of nearly 20 billion yuan. This fund has performed well this year, with returns of over 60% since the beginning of the year. Because it stands on a good track-new energy, this year’s new energy performance is very good, and most of the stocks allocated by Zhao Yu are concentrated in the leading companies in the middle reaches of the new energy. From this perspective, it is also very much in the fund industry. The potential of “Yang Yuhuan”.
In addition, people have different aesthetics, and Christians have different preferences for funds. Some investors will prefer large-scale funds.
In fact, does the size of the fund also show how optimistic people are? When it comes to practical operations, there is also a choice logic that supports this group of Christians with “great beauty”. For example, some fund managers have a long-term investment style and prefer white horse blue chips. The investment style does not have much restriction on the scale of funds, and more money and less money have little effect on operations. Choosing this type of fund manager does not need to worry about the size of the fund under management. In fact, “Kunkun, Chunchun” and a large number of fund managers who invest in core assets basically fall into this category.
Zhao Yubin, research director of Yingmi Fund, pointed out that “the upper limit of the scale of active funds depends on the capacity of the fund manager’s investment strategy. For value-based players with a left-hand layout, the upper limit will be higher; For the players, the upper limit of the scale will be lower. Therefore, there is no absolute standard, which requires specific analysis.”
However, “overweight” funds are still not in line with the aesthetics of old Christians who want higher returns. In fact, judging from historical experience, super-large-scale funds are poor in flexibility, difficult to operate, and difficult to adjust positions in a timely manner. Large-scale funds are not like small funds that “boats are easy to turn around.” In addition, it is more difficult for large funds to obtain excess returns.
“Golden figure” and “standard figure” of scale
So, what is the optimal size of the fund?
Different people have different opinions on this issue.
Insiders believe that the “golden figure” of blue-chip funds is between 200 million and 2 billion.
Yang Delong, chief economist of Qianhai Kaiyuan Fund, told reporters, “Generally, the scale of funds with relatively good performance is about 2 billion or less, that is, between 200 million and 2 billion.”
In short, a similar rule is that funds are as beautiful as beautiful women. “Small but beautiful” is the more common norm for blue-chip funds. Most of the top-earning funds this year fall into this category.
For example, as of October 20, 2021, the 4 hybrid funds with returns of more than 90% since the beginning of the year, Great Wall Industry Rotation A, Xincheng Emerging Industry A, Golden Eagle National Xinxing, Qianhai Kaiyuan New Economy A, their fund size ( Total) are respectively 391 million yuan, 1.518 billion yuan, 395 million yuan, and 1.402 billion yuan.
Although “thin is beautiful”, funds that are too small will not work. Too “thin” may be easy to “get sick”-there is a risk of liquidation, so the size of the fund is not as small as possible.
Taking a closer look, if 200 million to 2 billion may be the golden figure of the fund, what is the “standard figure” of the fund?
A more consensus view is “between 2 billion and 50 billion.”
Zhao Yubin said in an interview with reporters that “extraordinarily large foundations affect fund managers’ stock selection and should avoid such funds. In terms of scale, 2 billion to 5 billion is better.”
And Yang Delong, chief economist of Qianhai Kaiyuan Fund, also believes that “too large a fund is definitely detrimental to performance, generally less than 5 billion, and a scale of around 2 billion is relatively comfortable.”
It is worth noting that Zhao Yubin reminded that it is necessary to be wary of the situation where the short-term scale rises particularly fast, but the fund manager has no experience in managing large funds in history.
“Although the principle of choosing a Mesozoic fund manager is the same as choosing other fund managers. However, since the Mesozoic’s performance is just emerging and the performance curve is not long, the attribution of the income may not be clear, so it is necessary to understand the investment framework behind the fund manager.” Zhao Yubin said.
Who is the best player?
Yang Delong advises investors to look at a few things when choosing a fund manager: past performance growth rate, maximum drawdown and volatility, investment style (try to choose a fund manager who insists on value investment and buys the company instead of betting on the direction), in addition, you can also Refer to indicators such as the Sharpe ratio.
The basic selection criteria for “Mesozoic” fund managers in this article are: fund managers have a life span of 3-7 years; mid- to long-term performance during their tenure is relatively stable and outstanding, and the geometric average annualized return rate is more than 20% for active management equity fund managers.
According to the aforementioned two standards, according to Wind statistics, the reporter has 117 outstanding “Mesozoic” fund managers with a management scale of between 200 million and 10 billion.
Among them, 47 “Mesozoic” high-quality fund managers with a management scale of 200 million to 2 billion; 43 “Mesozoic” high-quality fund managers with a management scale of between 2 billion and 5 billion; and a management scale of between 5 billion and 10 billion There are 27 “Mesozoic” outstanding fund managers in China.
Among the above-mentioned 117 “Mesozoic” high-performance fund managers, the best performance is concentrated in the fund manager’s three-year period, and the management scale is about 1.5 billion to 5 billion. Including Fan Yong of Golden Eagle Fund (geometric average annualized return rate of 52.94%) 2.859 billion yuan, Zhang Hong of CITIC and Prudential Fund (geometric average annualized return rate of 52.36%) 4.515 billion yuan, and Han Guangzhe of Golden Eagle Fund (geometric average annualized return) Yield 49.89%) 5.073 billion yuan, Wang Jinsong of China Asset Management (geometric average annualized return rate of 47.81%) 2.117 billion yuan, and Wang Di of Rongtong Fund (geometric average annualized return rate of 44.42%) 1.560 billion yuan.
In addition, besides taking into account the mid- to long-term performance of the “Mesozoic” fund managers and the scale of fund management, there is another key option that is the track.
Zhao Yubin said that priority can be given to long bull-shaped tracks such as consumption, medicine, and technology.
A South China private equity person believes that when choosing the products of the “Mesozoic” fund managers, for the present, consider choosing funds with low valuations and investing in Hong Kong stocks, including the Internet and pharmaceutical sectors of Hong Kong stocks.
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