Financial Services Association, October 25 — All three quarterly reports on Zhang Kun's products have been disclosed. Regarding long-term development prospects, Zhang Kun said that it has been discussed many times before and will not be detailed. However, he emphasized the need to believe that in 10 years, the standard of living of ordinary people will be better than it is now, and leading technology and consumer companies will break out of the current phased growth dilemma and re-enter a period of growth. In the current environment, Mr. Market rarely quoted prices, so investors can buy shares in excellent companies at cheap prices.

After more than three years of reverse stock price changes, he discovered that some leading companies in the technology or consumer industry had high shareholder returns, exceeding a significant number of dividend index companies.

By the end of the third quarter, the total scale of the four products under Zhang Kun's management was 69.082 billion yuan, an increase of 7.401 billion yuan compared to 61.681 billion yuan at the end of the second quarter. With the exception of E Fund Asia's selection scale slightly reduced by 0.9%, the size of the remaining 3 products all increased by more than 10%.

In the third quarter, the yield of E-Fund Premium Select, E-Fund Asia Select, E-Fund Blue Chip Select, and E-Fund Premium Enterprise for three years were 17.9%, 2.08%, 15.11%, and 15.12%, respectively. With the exception of E-Fund Asia Select, the performance performance of the remaining 3 products was higher than the performance comparison benchmark for the same period.

In terms of individual stocks, Zhang Kun said he still owns high-quality companies with excellent business models, clear industry patterns, and strong competitiveness. According to Wind statistics, as of the end of the third quarter, Zhang Kun's top ten product warehouses were in order:$Wuliangye Yibin (000858.SZ)$,$BABA-W (09988.HK)$,$Kweichow Moutai (600519.SH)$,$TENCENT (00700.HK)$,$Jiangsu Yanghe Distillery (002304.SZ)$,$Luzhou Laojiao (000568.SZ)$,$Shanxi Xinghuacun Fen Wine Factory (600809.SH)$,$CNOOC (00883.HK)$,$MEITUAN-W (03690.HK)$, $YUM CHINA (09987.HK)$ The total ratio of holdings to net value was 71.33%. Compared to the end of the second quarter, Alibaba-W and Yum China added to Zhang Kun's top ten major stocks. $HKEX (00388.HK)$ ,$SAMSONITE (01910.HK)$Then leave this queue. As can be seen, there are still 5 liquor stocks in the top ten heavy-held stocks.

Of the 2 QDII, the proportion of E-Fund Premium Select invested in Hong Kong, China in the third quarter was higher than at the end of the second quarter; the proportion of E-Fund Asia Select's investment in Hong Kong, China and South Korea both increased compared to the end of the second quarter. At the same time, the allocation ratio of US assets decreased from 38.2% at the end of the second quarter to 33.08% at the end of the third quarter.

E-Fund Asia's Selected US Asset Allocation Ratio Declines

By the end of the third quarter, the top stocks selected by E-Fund were: Alibaba-W, Wuliangye, Tencent Holdings, Kweichow Moutai, Yanghe Co., Ltd., Luzhou Laojiao, Shanxi Xinghuacun Fen Wine, $CNOOC (00883.HK)$ ,$PRADA (01913.HK)$, Meituan-W, accounting for a total share of 73.90% of positions. Compared to the end of the second quarter, Meituan-W newly entered the top ten major stocks of this product.$HWORLD-S (01179.HK)$Exit this queue.

According to fair value, E-Fund Premium Select's assets in China and Hong Kong, China accounted for 49.74% and 45.09% respectively. According to the Global Industry Classification Standard (GICS), the top three major industries for this product are: essential consumer goods, non-essential consumer goods, and telecommunications services, accounting for 42.85%, 28.67%, and 12.48% respectively.

As of the end of the second quarter, the product accounted for 47.18% and 47.03% of the assets invested in China and Hong Kong, China, respectively.

As of the end of the third quarter, E-Fund Asia's top ten heavy-duty stocks were in order:$BABA-W (09988.HK)$,$TENCENT (00700.HK)$,$Taiwan Semiconductor (TSM.US)$,$CNOOC (00883.HK)$,$Futu Holdings Ltd (FUTU.US)$,$SK HYNIX INC (HXSCF.US)$, Samsu,$HWORLD-S (01179.HK)$,$SAMSONITE (01910.HK)$, Total holdings accounted for 73.30%. Compared to the end of the second quarter, Meituan-W entered the top ten major stocks of this product, and HWorld Group-S withdrew from the ranks. Compared to the end of the second quarter, SK hynix entered the top ten major stocks of this product, and Asma withdrew from the ranks.

E-Fund Asia selected 48.04%, 33.08%, and 13.58% of its assets in Hong Kong, China, the United States, and South Korea, respectively; in addition, the three major industries for this product were information technology, non-essential consumer goods, and telecommunications services, which accounted for 39.24%, 28.84%, and 9.82%, respectively.

By the end of the second quarter, the product accounted for 49.20%, 38.2%, and 6.92% of the assets invested in Hong Kong, China, the United States, and South Korea, respectively.

By the end of the third quarter, the top ten heavy-held stocks selected by E-Fund Blue Chip were:$Wuliangye Yibin (000858.SZ)$,$BABA-W (09988.HK)$,$Kweichow Moutai (600519.SH)$,$TENCENT (00700.HK)$,$Jiangsu Yanghe Distillery (002304.SZ)$,$Luzhou Laojiao (000568.SZ)$,$Shanxi Xinghuacun Fen Wine Factory (600809.SH)$,$CNOOC (00883.HK)$,$MEITUAN-W (03690.HK)$,$YUM CHINA (09987.HK)$The total share of holdings was 78.49%. Compared to the end of the second quarter, SK hynix newly entered the top ten major stocks of this product.$ASML Holding (ASML.US)$Exit this queue. Compared to the end of the second quarter, Alibaba-W and Yum China entered the top ten major stocks of this product, and the Hong Kong Stock Exchange and Samsonite withdrew from the ranks.

In addition, the total market value of this product invested in Hong Kong stocks through the Hong Kong Stock Connect trading mechanism was 19.453 billion yuan, accounting for 44.38% of net worth. The top three industries in terms of allocation were non-essential consumer goods, telecommunications services, and energy.

By the end of the third quarter, the top ten major stocks of E-Fund high-quality enterprises in three years were: Wuliangye, Kweichow Moutai, Alibaba-W, Tencent Holdings, Yanghe Co., Ltd., China Merchants Bank, Luzhou Laojiao, CNOOC, Meituan-W, and Shanxi Xinghuacun Fen Wine, accounting for a total of 80.69% of their holdings. Compared to the end of the second quarter, Alibaba-W and Yum China entered the top ten major stocks of this product, and the Hong Kong Stock Exchange and Samsonite withdrew from the ranks.

The total market value of the product invested in Hong Kong stocks was $2.218 billion, accounting for 44.9% of the net worth. The top three industries in terms of allocation were also non-essential consumer goods, telecommunications services, and energy.

Some leading technology and consumer companies have a high level of shareholder return

Zhang Kun said that a series of policies introduced at the end of September are expected to stabilize the economy, break the market's continued pessimistic expectations of the economy, and also break expectations that corporate profits will continue to decline.

The stock positions of its products were basically stable in the third quarter, and the structure was adjusted. E-Fund Asia has optimized the structure of industries such as technology and finance, and the other 3 products have all optimized the structure of technology and consumer industries.

He pointed out in the three-quarter report that in the traditional sense, investors mostly use “growth mindset” and “marginal changes” to view leading companies in the technology or consumer industry. Once profit growth slows or declines, they will reflexively generate anxiety and panic. In fact, considering that these companies often enjoyed valuation premiums in the past, that is, excessive expected growth, this response is somewhat reasonable. At the same time, when looking at dividend companies, investors often use “value thinking” and “absolute value”. Considering the past valuation discounts of these companies, people generally accept cyclical profit fluctuations.

However, after more than three years of reverse stock price changes, Zhang Kun discovered that the dividend rate levels of some leading consumers are already at the top of the market, surpassing a considerable number of dividend index companies.

Under these circumstances, investors will have more comparative dimensions when analyzing these companies, namely the ability to generate free cash flow, balance and liability status, and management's willingness to pay dividends with dividend components. In these dimensions, Zhang Kun believes that these leading consumers are even higher than many dividend companies.

If shareholder returns — repurchases and dividends are taken into account, the current shareholder return levels of some leading technology companies and leading consumers are very high, both absolute and relative.

Zhang Kun also said bluntly that the team was also very happy to see that more and more levels of corporate governance continue to improve, and they also expressed their determination to continue to give back to shareholders. If stock prices remain stable in the future, it is even expected that the total number of shares of some leading companies will be halved after 8 to 10 years. This means that long-term shareholders can double their shareholding ratio without spending extra money. Although the stock price rose at the end of the quarter, shareholder returns are still near the highest level in history. Considering the lower yield on 30-year treasury bonds, the difference between the two is undoubtedly also near a high level.

edit/lambor