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Fund managers are gradually converging on their optimism about semiconductors.

Author | Los

Editor | Xiaobai

At the end of June 2024, Xingzheng Global Fund ranked 17th among public fund companies with a management scale of over 600 billion yuan. The management scale increased by 40 billion yuan from the end of last year. However, in fact, the growth in scale was basically supported by bond products. On the other hand, its hybrid products have been declining since the 2021 interim report.

(Source: Tiantian Fund Network)

Currently, there are only 138.3 billion left, which has shrunk by 45% compared with the highest level of 248 billion three years ago. Currently, the fund managers of the company's equity products are three pillars, namely Xie Zhiyu, Qiao Qian and Dong Li, with a total management scale of nearly 80 billion.

(Source: Tiantian Fund Network)

So how did they perform in the first half of the year?

Overall, the performances of the three were relatively stable in the first half of the year. Veteran Xie Zhiyu was slightly inferior, with his representative work having a year-to-date return of negative 2.37%, underperforming the CSI 300 Index by 5 percentage points, while Qiao Qian and Dong Li's representative works made a small profit during the year.

(Source: Tiantian Fund Network)

Xie Zhiyu operates with a high position and actively adjusts positions to semiconductors

The equity market was not doing well in the first half of the year, and investors gradually gave up. Faced with Xie Zhiyu's small loss, "financial consumers" had a relatively high tolerance. Individual investors accounted for as high as 97.4% of their representative work, Xingquan Herun Mixed Fund (163406.OF), while the fund shares only decreased by 300 million shares from the first quarter.

At present, Xingquan Herun Hybrid Fund is operating with a high position, with stock assets accounting for 93.4%, an increase of nearly 4 percentage points from the previous quarter. While increasing positions, the top ten holdings have also become concentrated, accounting for more than 45% of the fund's net value at the end of the second quarter, the highest value in the past four years.

Xie Zhiyu's turnover rate has not been high all along, and has not exceeded 150% in each reporting period in the past five years. For the top ten holdings, he changes about two every quarter.

Xie Zhiyu has held four stocks, namely Sanan Optoelectronics, Lanqi Technology, Haier Smart Home, and Jingchen Holdings, for six consecutive quarters. The total market value of his holdings accounts for 25%, which can be regarded as a ballast.

However, in the second quarter, Xie Zhiyu actively adjusted his positions and increased his holdings in the electronics sector, with Luxshare Precision, Crystal Optech and North China Huachuang entering the top ten. Since the second quarter, the three major stocks have all risen to varying degrees, with the first two rising by about 30% and North China Huachuang rising by 15%.

Since the establishment of the third phase of the National Integrated Circuit Industry Investment Fund, the semiconductor sector has continued to be active. Recently, there have been news of sanctions from the United States. Under the logic of independent and controllable domestic substitution of semiconductors, many stocks have hit new highs.

At the same time, the sector has the support of performance. The performance forecasts recently announced by North Huachuang and Crystal Optech, in which Xie Zhiyu increased his holdings, show that net profits increased by 42-64% and 125-153% year-on-year respectively.

(Source: Choice data, produced by Market Capitalization Storm APP, yellow indicates new entrants)

In the second quarter, Xie Zhiyu's investment direction changed. In the first quarter report, he mentioned that there are four areas of focus, namely artificial intelligence, intelligent driving, AI applications and medical consumption. In the second quarter report, he said that he would explore related industrial chains such as pan-AI applications, semiconductors, new energy vehicles and home appliances.

Overall, he is still more interested in technology and automobiles. Although the home appliance industry he mentioned has performance support, the news of the US election changes rapidly and the market has concerns about export tariffs, which may affect the direction of overseas expansion.

(Source: Choice data)

Qiao Qian and Xie Zhiyu have half of the same top ten, and are also optimistic about the technology sector.

As of the end of the second quarter, Qiao Qian's management scale was 24.53 billion, and the best return of the funds under management was still as high as 100.5%. She currently manages three funds, of which the representative works are Xingquan Business Model Optimal Hybrid (163415.OF) and Xingquan New Vision Fixed Open Hybrid (001511.OF), which she manages alone.

(Source: Tiantian Fund Network)

During the year, the Xingquan Business Model Preferred Hybrid Fund had a return of 1.2%, slightly underperforming the CSI 300 Index by 1.2 percentage points, but once again outperforming Mr. Xie's Xingquan Herun Hybrid Fund. In the past six months, this fund outperformed the performance benchmark and the CSI 300, while the Xingquan Herun Hybrid Fund did not outperform the performance benchmark.

It is not an exaggeration to say that Qiaoqian is better than its predecessor. The performance is good. The fund shares of Xingquan Business Model Preferred Mixed Fund increased slightly in the second quarter, an increase of 100 million shares month-on-month.

In terms of position management, Qiaoqian has always operated with a high position. In the past three reporting periods, the proportion of equity assets exceeded 90%, which increased in the second quarter to 94%.

Unlike Xie Zhiyu, Qiao Qian has always liked high turnover. Every quarter, there are 4-5 new faces in the top ten holdings. In the second quarter, there were three new stocks, namely Tiger Pharmaceuticals, Crystal Optech and Ping An of China, and the ones replaced were Gu Jiajia Furniture, Heilan Home and Siyuan Electric.

(Source: Choice data, produced by Market Capitalization Storm APP, yellow indicates new entrants)

In addition, Haier Smart Home, Lanqi Technology, and Jingchen Holdings have also appeared in the top ten of Xingquan Business Model Preferred Mixed Fund for a long time and frequently, and can be called the favorite stocks of the entire company.

At the same time, five of the top ten stocks that Qiao Qian represented in the second quarter overlapped with those of Xie Zhiyu, namely Luxshare Precision, Haier Smart Home, Montage Technology, CATL and Crystal Optech.

In the quarterly report, regarding the selection of industries, Qiao Qian only pointed out that the fund would still maintain the weight of the allocation related to the science and technology innovation industry chain. She did not write more about other industries, but only said that the fund would make balanced allocation in the industries and explore some industry leaders that could maintain their competitive advantages in the long term.

Overall, Qiao Qian still adopts the strategy of balanced industry allocation and high turnover. At the same time, she recognizes and actively participates in the current hot semiconductor market.

Dong Li's performance is acceptable, and his holdings are more concentrated

Dong Li, another major equity product manager at Xingzheng Global, currently manages over 18 billion yuan in assets and is in charge of two funds, with one positive and one negative return during his tenure.

Among them, the management scale of Xingquan Trend Investment Mixed (163402.OF) is 15.2 billion. Although the return on tenure is a loss of 31.5%, Dong Li actually started to manage it independently on August 28, 2023. The fund's yield since the independent management has been -5.1%.

(Source: Choice data, produced by Market Capitalization App)

During the year, the Xingquan Trend Investment Mixed Yield was nearly 3%, basically on par with the CSI 300 Index. Judging from the performance of the Xingquan Light Asset Mixed Fund, which he has independently managed since 2018, Dong's performance was also acceptable. It could outperform the index in a bull market and be on par with the index in a bear market.

However, except for outperforming Qiao Qian and Xie Zhiyu in 2021, it has lagged behind the two in other periods. Overall, Qiao Qian is the most stable in the near future.

(Source: Choice data, produced by Market Capitalization App)

In the second quarter, the scale of Xingquan Trend Investment Mixed Fund, the largest fund managed by Dong Li, remained relatively stable, with a decrease of 400 million from the previous month and a decrease of 600 million shares.

Unlike Qiao Qian and Xie Zhiyu, Dong Li did not increase his equity asset positions in the second quarter. At the end of the second quarter, stock assets accounted for 90.2% of the fund's total assets, a decrease of nearly 2 percentage points from the previous quarter.

In addition, Dong Li is more focused on industry allocation. At the end of 2021, he was optimistic about the electronics sector. At that time, the allocation of Xingquan Light Asset, which he independently managed, to the sector was as high as 42.7%. By the end of 2023, the allocation of Xingquan Trend Investment Mixed to the electronics sector also exceeded 40%.

(Source: Choice data)

Dong Li's two funds adopt a replication strategy, with a high degree of overlap in holdings. Taking his Xingquan Trend Investment as an example, five of the top ten in the second quarter came from the electronics sector, mainly semiconductor stocks, namely North Huachuang, Sunlord Electronics, Luxshare Precision, Montage Technology and Changdian Technology.

(Source: Choice data, produced by Market Capitalization Storm APP, yellow indicates new entrants)

In the second quarter, there were five new faces in his top ten stocks. In addition to Lanqi Technology and Changdian Technology, the other three were Hualu Hengsheng, Ping An of China and China Pacific Insurance. The ones that were replaced were Poly Developments, State Grid Information and Communication, China Merchants Shekou, Conch Cement and Xinsen Technology.

At the end of April, favorable policies related to real estate were issued one after another. Stimulated by the news, the real estate sector also saw a significant rise. From Dong Li's actions, it can be seen that he is reserved about the sustainability of the rebound in the real estate sector. It is likely that he will reduce his holdings while the market is rising, so that the relevant stocks will exit the top ten.

At the end of the second quarter, the market value of the top ten stocks held by Xingquan Trend Investment Mixed Fund accounted for 55% of the fund's net value, significantly higher than Qiao Qian and Xie Zhiyu. Whether in terms of the allocation of industry sectors or the concentration of the top ten stocks, Dong Li did not balance the other two.

In the quarterly report, Li Dong also made clear that he is optimistic about three directions. The first is the technology industry such as semiconductors and electronics. The second is the leading central state-owned enterprises supported by high dividend returns, such as power and telecom operators (but he himself does not have a heavy position). The third is the current more pessimistic pro-cyclical direction. He believes that these industries are expected to reverse.

(Source: Xingquan Trend Investment Mixed Second Quarter Report)

Overall, the three major global fund managers of Xingzheng Securities are currently unanimously optimistic about the semiconductor sector and have increased their holdings in the second quarter.

In addition, Xie Zhiyu prefers the automotive sector, Qiao Qian continues to rotate high-turnover sectors and focuses on leading companies. In the second quarter, the top ten companies excluding semiconductors tend to be in the pharmaceutical and biological sector, while Dong Li focuses on high-dividend stocks and pro-cyclical stocks that are at a low level.

Judging from the past performance of the three fund managers, their recent performance has been relatively stable. Qiao Qian is more stable, Dong Li is more focused, and Xie Zhiyu is average.

The current semiconductor market is relatively recognized by funds, and public funds, northbound funds, and hot money have all intervened. However, the theme has been active for two months. Judging from its increase, it is mainly a wave of increase. This also means that it is important to get the rhythm right. It is not suitable to chase the increase, and don't blindly get excited because of the calls from major fund managers in the second quarter report.

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