Active equity funds with a yield of more than 200% since the Shanghai Composite Index hit a record high of 6124 points on 2007/10/16

On 2007/10/16, the Shanghai Composite Index recorded 6124 points, setting a record high. After 13 years, the index hovered around 3,300 points, but during the same period, the net worth of a number of funds rose steadily and achieved outstanding performance. The yield of nearly 40% of active equity funds doubled, reaching a high of 359.51%.

Industry insiders said that active equity funds have created excellent long-term absolute returns against the market, confirmed the concept of creating investment value through in-depth research, and fully demonstrated the value of public equity funds.

6124.13 anniversary

Funds outperformed the index by a large margin

From 2007/10/16 to 2020/10/15, in 13 years, the Shanghai Composite Index fell 44.74% from the highest point of 6124.04, while the SZSE Index and the Shanghai and Shenzhen 300 fell 28.62% and 17.57%. The China Securities 500 and SME indices, which represent growth stocks, rose 32.09% and 59.56%. In the structured market, equity funds performed well overall.

Data shows that during this period, there were 214 active equity funds with statistically-available data (including stock type, balanced hybrid type, partial share hybrid type, flexible allocation type), all outperforming the Shanghai Composite Index. 79 funds performed more than 100%, accounting for about 37%; the yield for 23 periods exceeded 200%, accounting for more than 10%.

Data shows that over the past 13 years, the yield of five hybrid funds, including Harvest Growth, Huaxia Market Selection, Yinhua Wealth Theme, Fuguo Tianhui Selected Growth, and Fuguo Tianhe Steady Preferred, has exceeded 300% during the period.

Established in July 2003, Harvest Growth has had a yield of 359.51% since 6124 points, making it the best performing fund in 13 years. This fund has been managed by star fund manager Shao Jian for a long time; it generated a profit of 768.11% from April 6, 2004 to July 8, 2015.

It was followed by the Huaxia Market Selection, which had a return of 348.65% over the past 13 years. Huaxia Market Selection used to be a masterpiece by Wang Yawei, a well-known fund manager of Huaxia Fund. From the end of 2005 to 2012/5, when he managed Huaxia Market Select, he created a total return of 11.99 times his employment, with an annualized yield of 49.77%. In addition to Wang Yawei, Sun Bin, Yang Kun, and Chen Weiyan have also managed the Huaxia Market Select Fund.

Yinhua Wealth Themed Fund ranked third in earnings during the period, with a yield of 337.1%; two funds, Fuguo Tianhui Select Growth and Fuguo Tianhe Steady Preferred, had yields of 329.55% and 323.23% over the past 13 years.

In addition, funds such as Huitianfu's Growth Focus, Fuguo Tianrui Strong Selection, Cathay Pacific Golden Bull Innovation and Growth, Bank of China Earnings A, Huaan Baoli Allocation, Xing Quan Trend Investment, Galaxy Stable, Jingshun Great Wall Dingyi, and Fuguo Tianyi Value all reaped returns of more than 200% during the same period.

Behind the funds whose net worth has doubled since 6124 points in the Shanghai Index, there is basically an excellent fund manager. In addition to Shao Jian and Wang Yawei, Wells Fargo Fund Zhu Shaoxing and Bosch Fund Deng Xiaofeng are all star fund managers with excellent long-term performance.

If you look at fund companies, among the funds that have doubled since 6124 points, Fuguo and Huaxia have performed excellently, with each owning 6 funds that have doubled their performance. The performance of more than 3 funds under fund companies such as Invesco Great Wall, BOCOM Schroder, Guohai Franklin, Cathay Pacific, Huaan, Penghua, Teda Manulife, Xingzheng Global, and Galaxy each doubled.

Industry insiders said that maintaining excellent investment performance for a fund over a long period of time is inseparable from the support of the fund company's overall investment and research strength. It is a reflection of the continuity and comprehensive strength of the company's investment and research culture. “Changes in fund managers are unavoidable. For fund companies, it is necessary to reduce the impact of individual changes on funds as much as possible. This is also a reflection of the company's strength.”

Over 90% of active equity funds

Get a positive return

The data shows that as of October 15, over the past 13 years, the average investment income of 214 active equity funds with statistics was 91.28%. Compared with the decline of more than 40% in the Shanghai Index, the excess earnings were very obvious.

Specifically, among them, the number of funds that earned positive returns for investors reached 198, accounting for 92.5%. In fact, there has been a big difference in the trend of major indices over the past 13 years. Indices dominated by blue-chip stocks, such as the Shanghai Composite Index, the Shanghai and Shenzhen 300, and the Shanghai Stock Exchange 50, have declined, while the SME index, which represents small and medium capitalization stocks, has shown good gains. In addition to differences in index trends, there are also large differences in the performance of various industries. This kind of market further tests investors' professional investment ability. Public funds as a whole have seized the opportunity and reversed the market to obtain better long-term returns.

Yang Yuanchun, director of the Yingmi Fund Research Institute, made a set of data to expand the scope of funds to all categories. According to product statistics on October 14, 2020, which exceeded the net value of 2007/10/16, the net worth of 288 funds reached a new high since the market high. Among them, 78.87% of biased hybrid funds reached a record high, and 83.87% of biased hybrid funds reached a new high.

Yang Yuanchun summed up that the number of mixed partial stocks that set new highs was the highest. Among the top ten funds with the most earnings exceeding the high points, 9 were partial hybrid products. Excellent domestic fund managers have the ability to obtain excess income when choosing the right time and stock. She stressed that investors should choose fund managers who can overcome the bull market and are worth trusting; they should choose fund managers with excellent performance during the management period and have been in the business for a long time to hold for a long time. Among the products with record high net worth, some excellent fixed income+ style products are included, which are worth the attention of individual investors.

Share “Time Rose”

There are differences in the capabilities and product design positions of various fund companies, and they are all able to obtain excess income in an environment where index performance is poor. The long-term performance of active equity funds reflects the value of public equity funds. Some funds have not only created good relative returns, but also created high long-term absolute returns against the market, confirming the concept of in-depth research to create investment value. Good performance also prompts investors to pay attention to long-term investments, invest rationally, choose excellent fund managers and stick to them for a long time to get the “rose of time.”

“The vast majority of people who have performed well since 2007 have been fundamentalists, or relay runners with fundamentals. At the same time, maintaining a stable style is an important factor.” Zeng Linghua, director of the Haomai Fund Research Center, said that to find a good fund manager, investors need to look more closely to see if the fund manager's words and actions are consistent; second, think more about whether these ideas are logically reliable; third, they ask themselves if they really trust this fund manager and can keep their money there for 3 years.

Huang Tao, director of the equity investment department of Chuangjin Hexin Fund, believes that since the Shanghai Composite Index peaked in October 2007, one of the basic characteristics of funds that have achieved outstanding long-term performance is that they adhere to the underlying mentality of value investment. The core portfolio is dominated by leading individual stocks in various industries that best represent the Chinese economy.

“However, for many investors, the actual situation is quite regrettable, that is, funds make money and citizens do not make money.” Huang Tao believes that one important reason is that people don't insist on long-term investment, and they also lack an asset allocation mindset. They often buy a large number of funds at high levels in the market, and when the market is low, not only do they not buy them, but they even leave the market. Therefore, it is very important to establish an asset allocation mindset for long-term investment, and you also need to learn to buy as you fall.

Li Ying, fund manager of Debon Fund, said that funds that can continue to generate good returns for investors over a long period of time usually have a fairly stable investment style, and their investment performance can be replicated in most market environments instead of relying on short-term market opportunities. Of course, this is also related to the investment and research culture and system that the fund company behind it adheres to. When investors invest in funds, they must combine their own capital characteristics and risk appetite, select funds and managers that match their abilities and preferences, and stick to medium- to long-term investments. In addition, it is possible to consider using fixed investment methods to obtain medium- to long-term performance returns.

“In the past, funds often made money and citizens didn't make money. To change this situation, investors need to pay attention to several aspects: one is to find investment products suitable for capital investment goals, research levels, and operational capabilities. If their abilities cannot be achieved, they should seek help from professional advisors; second, they should not use simple short-term returns to define investment success or failure, but should consider long-term, repeatable returns; third, they should have a calm and objective observation of the market to avoid making major emotional decisions.” Ho Chi Wai, fund manager of NORD Fund, said.