The track with new energy, medicine and other funds has been continuously adjusted recently. Especially in the first trading week of the year of the tiger, the gem performed poorly, and the fund’s heavy positions fell in turns. “What happened to the market? What happened to the fund?” Become the soul torture sent by many investors.
At the beginning of the year, the fund manager also shouted “today’s new energy will not become the Baijiu“. The fund managers quickly disappeared, and the “steady growth” line of underestimation became a consensus among the organizations.
From last year’s Spring Festival, the stock of Baijiu and consumption continues to adjust, until the Spring Festival this year, new energy, medicine and other stocks are no longer in sight. The roulette of the investment channel represented by the fund is spinning rapidly, but it repeats a similar plot. The risk is obvious. Why are fund managers “biased towards Hushan bank”?
continuous adjustment of the track caused by multiple factors
Since this year, the market performance of new energy, semiconductor and other circuits with outstanding performance last year has turned downward. In the Shenwan secondary industry index, since this year, medical services have fallen by 27.63%, photovoltaic equipment by 22.11%, semiconductors by 18.11% and batteries by 17.77%. At the same time, the funds with heavy positions in these tracks have been deeply damaged.
At the beginning of the year, they shouted, “today’s new energy will not become the fund manager of last year’s Baijiu”.
Institutions believe that the overestimation is the primary reason for the continuous adjustment of this round of track. A public fund manager bluntly said that as the Fed’s tightening expectation heats up, investors’ risk appetite decreases, and their tolerance for high valuations decreases, resulting in looseness. Zhou Ning (a pseudonym), a fund manager of a large public offering in Beijing, cited the pharmaceutical outsourcing (CXO) sector as an example. The boom peak of the sector appeared last year, and the valuation is not cheap. Since this year, the comparative advantage has declined, and the valuation needs to be continuously digested. Shi Bo, deputy general manager and chief investment officer (equity) of China Southern Fund, also believes that the positions of some track stocks are relatively concentrated, and the lack of incremental funds in the short term drives the further rise of relevant stock prices.
The mechanism adjusts the position and becomes a booster for the continuous adjustment of the track. Huang Peng, fund manager of Mingshi partnership fund, said that at present, the prosperity of the undervalued sector has been marginally improved, causing institutions to switch from the growth style of high valuation to the value style of undervalued value.
Trading is overcrowded, and the game between funds is also intensifying. Zhou Ning still cited CXO as an example. From the transaction level, some pharmaceutical funds had a high allocation of CXO sector, and some funds even reached 80%. Under the influence of external bad factors, institutions scrambled to flee, resulting in increased volatility of stock price. Insiders said that funds with a large amount of funds usually do not limit the price in the trading of individual stocks, otherwise the trading will be unsuccessful. Therefore, once there is a trend of decline in fund holding stocks, there is the possibility of continuous adjustment.
“The second tier companies in the pharmaceutical and new energy sectors have fallen more recently. From the perspective of allocation, it is not that they are not optimistic about these industries. It is just that the chips are too concentrated. If we want to increase the allocation of undervalued sectors, we will give priority to selling such companies. Although the valuation of leading stocks is more expensive, they have higher stability and more prominent value at the current stage, so the second tier growth stocks have fallen even worse.” Liang Hui, general manager of Xiangju capital, said.
why does the fund “favor Hushan line”
The institutional track investment represented by the fund repeatedly staged the plot of centralized capital bet, sharp rise in share price, overdraft performance of valuation and continuous adjustment of loose track. The risk is obvious. Why do fund managers “favor Hushan bank”?
Zhang Hui, general manager of huitianfu fund, said that from the investment side, there are signs of extreme and centralized investment by some fund managers in the industry, that is, heavy positions bet on a certain sector, which violates the basic principles of portfolio management of balanced allocation and risk diversification. Some fund managers are extremely investing in a certain sector to win short-term performance ranking. The “fame” story that the scale has increased rapidly from a small to 120 billion yuan affects fund managers.
Last year, many fund managers drove the rapid growth of scale with the ultimate style by focusing on investment in high boom tracks. The fund manager of a small and medium-sized fund company said: “fund managers need to prove their ability to make excellent performance. Focusing on investing in high boom track can not only quickly prove their ability in the short term, but also create a ‘safety cushion’ for career performance reputation.”.
At the same time, short-term ranking pressure is an important reason for fund managers to stick together. According to the survey report on investors in the national public fund market (2020) released by China Securities Investment Fund Industry Association, the evaluation cycle of 60% of public funds shall not exceed one year. Among them, the proportion of assessment cycle in three months, six months and one year is 5.6%, 20.4% and 35.3% respectively. Short term ranking pressure leads fund managers to pursue short-term performance when investing, which will amplify market fluctuations and make the market style more extreme. “In order to win high returns, some fund managers even bet 80% or 90% of their funds on an investment track, but this will have a negative effect on fund managers, the fund industry or the A-share market.” Some fund managers said.
The pressure from the sales channel and the foundation is also a major reason for the deformation of fund managers’ investment behavior. Zhang Hui said that sales agencies and end customers are becoming more and more enthusiastic about the so-called “flow”, that is, they can buy whatever fund has high attention.
Insiders said that by observing some Internet fund sales platforms, it can be found that some short-term outstanding performance or some theme investment funds at the outlet are recommended all year round. Often, the more extreme the interpretation of the track market, the more popular the sales of related theme funds. Some fund managers with heavy positions in other tracks are even “pressured” by the holders to transfer their positions to the corresponding track.
In order to avoid the repetition of the continuous adjustment of the track, some industry voices proposed that it should be standardized at the institutional level. “The whole market fund needs to strengthen the information disclosure of industry concentration and avoid the ‘blind box fund’ with style drift; the industry and theme funds should be more clear about the investment style and fully inform investors of risks; the development of passive products should consider avoiding a large number of repeated construction, such as the homogenization of ETF funds.” An executive of a fund company who declined to be named said.
At the level of investor education, insiders believe that the foundation should be further guided to pay attention to the balance of fund return and risk. Zhang Hui said that fund products have two elements: one is income; One is risk. Investors always compare one factor with another. They either don’t pay attention to it for a short time or forget it completely.
new direction of institutional game
After the continuous adjustment of the old track, the main line of the market is still unclear, and the game between institutions continues.
Judging from the shenwanyi industry index, in the first week of the year of the tiger, the policy direction of steady growth is making efforts, with building materials, construction, banks and non bank finance among the top gainers. Some institutional investors continue to focus on steady growth.
Liu Yanchun of Jingshun Great Wall Fund pointed out that under the background of clear direction of steady growth policy, clear entry point and clear characteristics of joint efforts of all departments and lines, we should maintain confidence in the cumulative effect of steady growth policy. According to the order of growth and the margin of profit improvement, Chen Xian Shun, chief strategist of Guotai Junan Securities Co.Ltd(601211) securities, recommended four main lines of layout: first, the direction of pigs, household appliances, furniture, tourism, Baijiu and so on, whose performance is supported and negative expectations are weakened. Second, building materials, construction and power operation in the field of infrastructure; Third, securities companies and banks in the financial field; Fourth, consumer electronics.
Northward capital dynamics are also consistent with this. From the perspective of capital flow changes in the industry, banks and non bank finance are the industries with the largest net purchase amount in recent months.
However, some institutions that have firmly explored the direction of growth stocks have raised objections. Institutional people who firmly believe in growth stocks believe that in the long run, it will still be the world of growth stocks. Wei Wei, senior strategist of Huaxia Fund, said that the current round of undervalued blue chip market may continue until April. From the perspective of the whole year, the long-term income of growth stocks is still competitive, and the disclosure of the first quarterly report may bring directional judgment to the investment of growth stocks.
Chen Ping, manager of HSBC Jinxin technology pioneer fund, believes that in the long run, growth stocks represented by new energy and medicine represent the direction of China’s economic development, and representative high-quality companies will continue to emerge in the process of economic transformation and upgrading.
