Find a certain "basket" in the uncertainty of investment

Title | Visual China

"Don't put your eggs in the same basket" is a well-known investment guideline.

With the gradual deepening of China's financial market reform and the increasingly close connection with the world, ordinary residents can invest in more and more product types, channels and even regions, which is dazzling. Residents urgently need comprehensive solutions with clear goals and styles to find more reliable "baskets" or "basket" combinations to achieve the goal of laying eggs in their hands.

As a professional investment institution, the growing uncertainty of the macro environment in recent years has also become a huge test for fund companies. How can we better meet the asset allocation needs of investors and find a more certain basket for investors? How should investment objectives and methods evolve? How to upgrade the playing method and strategy? How the team cooperates efficiently? All of them have higher requirements for the fund company.

Looking for a more reliable "basket"

Domestic asset management originated at the end of last century. In 2004, Everbright Bank issued the first bank financial management plan, marking the beginning of the asset management industry. The initial development of the industry was relatively extensive, and the number of investable products was limited, which was nothing more than two categories of divided rights and bonds. The investment strategy was also relatively simple, which could be said that most eggs were put in the same basket.

With the rapid accumulation of residents' wealth, investors' demands have gradually become diversified, and a single asset or single product can no longer meet the needs of investors. The asset management industry is also undergoing self transformation. From pure equity to fixed income+, to all-weather multi asset, algorithm tools have been widely used, and asset varieties, market diversity and strategy richness have been effectively improved.

While the asset management industry is self iterative, the industry has ushered in another round of supervision. High yielding trust plans have exited. Bank financing with guaranteed principal and earnings has become a thing of the past. Black swan and grey rhinoceros events have occurred frequently, and the internal and external market environment has become more complex.

In the face of the complicated investment environment, is the investment goal still to pursue high odds and high elasticity, or pay more attention to high winning rate and certainty? Is the starting point of investment still oriented by expected returns or risk budgeting? Is the investment method still relying on the individual subjective ability of fund managers, or is it a systematic investment that turns to team operation and subjective combination? How to find certainty for customers and reliable "baskets" and combinations in such an environment is a subject that every asset management institution needs to answer at present.

From "fighting alone" to "team fighting"

From bonds, stocks to mixed assets, from special accounts, public offerings to FOFs, from subjectivity, quantification to risk control, from research on individual stocks and individual bonds to research on macro allocation, CEIBS Fund has been looking for reliable "basket" portfolios. After more than ten years of experience in the market, according to the team's overall investment awareness and thinking collision, combined with the company's cultural characteristics, CEIBF has explored "Multi Asset Solution" 。

"Multi assets and solutions" means the division and cooperation of multiple links since its name. It is no longer a simple stock and debt warehouse management, nor a single fund manager fighting alone, but needs to build a professional and tacit team.

Huang Hua, Director of Multi Asset and Solution Investment Department, gave three requirements that the current team members meet: Diversified background, quantitative thinking, systematic cognition 。

The first is the diversified background. In recent years, star fund managers have been widely concerned, and their performance has been popular in the market. However, once the performance declines, they will bear huge pressure, which is not conducive to the stability of product scale, and their disadvantages are obvious. In the multi asset solution, each team member is involved in different fields and has their own expertise: Hua Li Cheng is good at large asset allocation, Xu Wenxing holds the equity investment strategy, Zhang Xueming focuses on strategy development and the establishment of investment research platform, focuses on risk control and performance attribution to Aixu, and Xu Guangyu tracks overseas markets and asset allocation.

The second is quantitative thinking. Quantification is a language, a way of expression and cooperation. Find the relationship between strategies and factors through quantification, and avoid the problem that fund managers between different assets are easy to talk with each other. Use quantification as the language of communication within the department to improve the coordination ability within the department.

The last is systematic cognition. Have a high degree of consensus on the development of systematic asset management business and maintain the consistency of objectives.

According to such strict requirements, the multi asset team has assembled a group of investment backbones with similar age, consistent goals and different experiences. Each member's work has its own division of labor and overlap. Instead of standing in front of the stage, a single fund manager more serves a certain link in the investment process, standing behind the "solution" and striving to achieve asset management "From a single strategy to multiple strategies, from a single fund manager to industrial production" Transformed and innovative working mode.

Advanced systematic investment

With the accumulation of wealth, the number of eggs in the hands of residents gradually increases. For fund companies, in addition to finding reliable "basket" combinations, how to distribute eggs more effectively, whether the strategy of egg distribution keeps pace with the times, and whether it can adapt to the rhythm and changes of the market, it also tests the professionalism of the team and the degree of tacit cooperation.

Huang Hua said that what the multi asset and solution team of CEIBS Fund tried was not only "industrialization" in production mode, but also "solution" in product form, "Transform from emphasizing individual ability to team cooperation to win. On the basis of clear investment objectives, obtain stable and clear absolute returns through asset allocation, diversified strategies and risk control attribution, instead of blindly pursuing high returns under high volatility."

Specifically, The systematic investment process includes clear investment objectives, reasonable asset allocation, diversified strategy combinations and clear performance attribution. The whole investment decision-making process is highly standardized and emphasizes discipline. This is also the only way to advance systematic investment "from a single strategy to multiple strategies, from a single fund manager to industrial production". The three members of the multi asset team of CEIBS Fund focus on their respective fields Asset allocation, equity strategy, quantitative production Three directions were shared.

Scientific and reasonable asset allocation is an important cornerstone of the solution. It is worth mentioning that the China EU multi asset team did not use assets as the cornerstone of portfolio allocation, but used various strategies as the cornerstone of portfolio allocation. From the strategic point of view, it actually increases the width of investment, enabling public funds to find as many diversified sources of income as possible in the case of relatively limited asset classes, that is, to increase the distribution of eggs as much as possible in the case of limited "basket" portfolios. "Asset allocation is more used to hold the lower limit, and also provides us with an interpretable, replicable and sustainable methodology system, becoming a bridge between fund managers and customers," said Hua Licheng.

So how to extract a clear and stable diversified equity strategy from the complex and volatile market? This key step is completed by Xu Wenxing, a fund manager who has been deeply engaged in equity investment for many years. He pointed out that, From the perspective of business model, enterprises that can create excess returns for a long time can be divided into four categories: quality, prosperity, value and dividend, which also constitute the underlying strategy of multi asset solutions 。 "When the mapping relationship is relatively sufficient and logical, we can use quantitative methods to summarize and abstract the most important core variables into investment paradigms, investment styles, and investment frameworks, and turn them into smart beta." He said frankly that in the rapidly changing market, it is difficult for a single strategy iteration to achieve accurate style rotation, However, this problem can be solved by negatively correlated underlying policy configuration.

With the logic of subjective strategy, the next step is to produce in a quantitative way. This is what Zhang Xueming, the "quantitative expert" in the team, is best at. He once served as the director and partner of the investment department in an excellent 10 billion private placement, and was very familiar with the biased waterline and factory private placement production model. The first thing he did when he joined the team was to build a more efficient production model, including a strategic production platform, a performance attribution platform, and the introduction and application of new technologies. As the private placement model does not fully match the public financing needs, for example, private placement is more focused on maximizing short-term returns, short holding cycle, high turnover rate, black box, etc., Zhang Xueming's change is to shift from a single short-term return driven to multi-dimensional long-term returns; From black box to transparency, subjective and quantitative are deeply integrated to achieve clearer earnings characteristics and strive to achieve interpretable, replicable and sustainable earnings for investors.

epilogue

With the rapid development of the market, investors' demands are becoming more diverse, but the theory of "eggs" and "baskets" is still not outdated. With the gradual expansion of investable products and channels, and the wide application of various financial technology tools, different asset management institutions will have different ideas and solutions. How to go through the fog of the market and find a clear path to realize more value for investors and stand out in the fierce competition will be left for time to test.

*Risk tip: The fund has risks, so investment should be cautious. The above information is for reference only, does not predict future performance, nor is it used as any investment advice. The opinions and predictions only represent the opinions at that time, which may change in the future. Do not quote or reprint without permission.