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Text/Liu Zhentao

The FOF management scale of Bocom Fund has been overtaken!

FOF funds are known as "funds of funds" and "funds of funds". Since the establishment of the first batch of public FOFs in China in October 2017, public FOFs have been developed for nearly 7 years.

Wind data shows that as of the end of June 30, 2024, the number of FOF products in the public offering market reached 499, an increase of 13 from the end of 2023, with a total asset size of 139.485 billion yuan, a decrease of 15.988 billion yuan from the end of 2023.

As of the end of June 30, 2024, among the public funds that manage FOF products, three public fund companies have a management scale of more than 10 billion yuan, namely, Industrial Securities Global Fund, Bocom Schroder Fund (hereinafter referred to as "Bocom Fund"), and E Fund.

After sorting out the FOF situation, it was found that the scale of FOF funds of the leading public fund company Bocom Fund has declined significantly in recent years, from more than 38 billion at its peak to just over 10 billion. And Bocom Fund, which once ranked first in FOF product scale, was replaced by Industrial and Commercial Bank of China Global Fund and has now been overtaken by E Fund, and its ranking has slipped to third place.

What is the situation of FOF products under Bocom Fund?

Wind data shows that as of the end of June 30, 2024, there are 9 FOFs under Bocom Fund (calculated by combining multiple shares), with a total size of 10.879 billion yuan. Bocom Fund's FOF size ranks third in the market, with the top two being E Fund with a size of 11.09 billion yuan and Xingzheng Global Fund with a size of 16.401 billion yuan.

Looking back at the changes in the scale of FOF of Bocom Fund, on May 30, 2019, Bocom Fund established its first FOF with an issuance scale of 2.043 billion yuan. Subsequently, the number and scale of Bocom Fund's FOF products began to grow continuously.

As of the end of December 31, 2021, Bocom Fund had 5 FOFs with a total management scale of 38.902 billion yuan, ranking first in the market at that time.

However, in 2022, the number of FOF products of Bocom Fund increased, but the scale began to decline. As of the end of December 31, 2022, the scale of Bocom Fund's FOF decreased by 15.735 billion yuan from the same period in 2021 to 23.167 billion yuan.

At the end of 2022, the management scale of Xingzheng Global Fund FOF was 23.375 billion yuan, more than 200 million yuan higher than Bocom Fund, and Bocom Fund fell to second place.

Since 2023, the FOF management scale of Bocom Fund has continued to decline. As of the end of June 30, 2024, the number of Bocom Fund's FOF products reached 9, but the scale was reduced to 10.879 billion yuan, a decrease of 2.788 billion yuan from the end of 2023. The FOF management scale has slipped from the second place to the third place in the market.

Why did the scale of FOF products of Bocom Fund decrease? This may be related to the performance of FOF products.

Data from Tiantian Fund Network shows that the nine FOF products under Bocom Fund are currently managed by two fund managers. Fund manager Liu Bing manages nine FOF products, two of which are jointly managed with veteran Cai Zheng.

According to the information, Liu Bing joined Bocom Fund in 2016. He has served as a researcher in the quantitative investment department, a researcher in the diversified asset management department, and an investment manager. He is currently a fund manager in the diversified asset management department and an investment manager in the fund investment advisory business. Liu Bing has been a fund manager for more than two years.

Cai Zheng joined Bocom Fund Management in 2009. He has served as a quantitative analyst in the investment research department, assistant general manager of the quantitative investment department, and deputy general manager of the quantitative investment department. He is currently the deputy director of quantitative investment and deputy director of diversified asset management. Cai Zheng has been a fund manager for more than 11 years. Before 2021, most of the fund products he managed were index products. He started to manage FOF products in April 2021.

Judging from the performance, the net value of the FOF product funds managed by veterans Cai Zheng and Liu Bing has declined.

For example, Liu Bing participated in the management of 9 FOF products under Bocom Fund. Without exception, the tenure returns of the 9 products managed by Liu Bing were all negative, with the highest loss exceeding 30% and the best performance being -1.03%.

Judging from the management returns of the 9 FOF products under Bocom Fund, the performance returns of the FOF products managed by the fund managers are loss-making. Based on this, fund investors may redeem a large number of fund shares, which in turn leads to a substantial reduction in the size of fund assets.

For example, the Bank of Communications Zhaoxiang One-Year Holding Mixed Fund was established on August 24, 2021. At the time of its establishment, the fund raised a total of 8.99 billion shares and raised 8.99 billion yuan. Fund manager Liu Bing has managed this fund for more than two years, and the fund has fallen by 1.77% cumulatively.

In terms of scale, as of the end of June 30, 2024, the total number of shares of the fund was 2.743 billion, and the fund asset size was 2.714 billion yuan. Compared with the time when the fund was established, the total number of shares of the fund has shrunk by more than 6 billion yuan, and the fund asset size has also shrunk by more than 6 billion yuan.

In the future, if the performance of the FOF products under Bocom Fund does not improve in the later stages, its scale is likely to decline again. It will be worth paying attention to how the company's FOF scale changes.

Recently, according to Cailianshe report, Zhang Hongliang, chairman of Bocom Wealth Management, has recently taken up the post of Bocom Schroder Fund and served as party secretary. After approval from the regulatory authorities, he is expected to become the chairman of Bocom Schroder Fund.

The change of chairman of Bocom Fund in the later period, under the new chairman, can the scale of FOF be increased and return to the top position? Time will tell!