China Equity Funds Quarterly Reports 2023: Resource and Consumer Electronics Sectors in Focus
By Ruohui, China Fund News reporter
The first batch of equity funds’ quarterly reports for 2023 have been disclosed, revealing the investment strategies of fund managers for the year-end stock exchanges. The latest Four Seasons Report showed that some funds anticipated the “coal boom” trend in A-shares by positioning in the resource sector, while others adjusted their holdings to take advantage of the upcoming replacement cycle in the consumer electronics industry.
The reports also disclosed the first batch of public offering FOF (Fund of Funds) quarterly reports, indicating that funds with heavy positions in the coal sector are a key target for FOF.
Many fund managers expressed optimism for resource stocks as the top choice among procyclical varieties. They cited the expected replacement cycle for consumer electronics products and the strong catfish effect brought by Huawei as contributing factors to their bullish sentiment.
China-Europe Jinquan Fund, for example, added positions in the coal sector according to its latest quarterly report. Portfolio managers Hu Qiongyu, Liu Yong, and Zhang Yuepeng emphasized the stability of cash flow and high-quality dividends in their investment approach, with a focus on high-dividend assets and industries with good cash flow. They continued their allocation to the pharmaceutical sector, citing the growing need for medicine in the aging era.
On the other hand, SDIC UBS Industrial Upgrade increased its position in the consumer electronics sector in the fourth quarter of last year, signaling a focus on new consumer electronics equipment and end-side AI development. Fund managers Shi Cheng and Li Wei forecast a new replacement cycle and the emergence of new consumer electronic terminals, such as MR headsets, AR glasses, AI mobile phones, and AI PCs in 2024.
Meanwhile, the public offering FOF position rebalancing directions have been exposed, with funds actively adding positions in equity funds that are expected to benefit from recovery in various sectors.
Deng Da, the fund manager who manages China-Europe Fund’s FOFs, emphasized the stable allocation of equity assets and the optimization of the internal structure to maintain better risk-return characteristics.
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