Initiating funds cluster to establish new equity products with poor performance

Source: Shenzhen Business Daily

This year, the fund issuance market was cold, and the popularity of the initiator funds with low establishment threshold increased. During the year, 30% of the new funds were initiator products. The active equity initiating funds that have been set up since this year are almost the same as last year, but the income is not ideal. Nearly 90% of the net value of the products fell during the year, and the net value of 8 of them fell more than 20%.

The data shows that, according to the statistics of the fund establishment date, so far this year, there are 286 newly established initiating funds (only A shares are counted), accounting for 30% of the new funds established in the year, a record high over the years; There are also 27 initiating funds that are being issued or about to be issued. In addition, more than 300 initiating funds have been reported and accepted, of which more than 70 are in the "approved" status. A total of 355 initiating funds were established last year, and the number of active equity initiating funds (including common stock and partial stock hybrid funds) established during the year almost equaled the number established last year.

According to data, 79 of the launched funds established during the year were active equity products. However, from the perspective of earnings, there were 68 net worth declines within the year, among which, 8 products, including Guotai Jun'an Innovation Growth Hybrid Initiative A, Yongying Digital Economy Smart Selection Hybrid Initiative A, Dongcai Growth Preferred Hybrid Initiative A, Harvest Green Theme Stock Initiative A, have seen their net worth decline by more than 20% since their inception. Five months after the establishment of Guotai Jun'an Innovation and Growth Hybrid A, the worst performing company, its net value dropped by 28.29%, 21 percentage points lower than the benchmark yield in the same period. The net value of Dongcai Growth Preferred Hybrid Initiator A, established at the end of March, has dropped 26.39% since its establishment, at least 18 percentage points lower than the benchmark yield of the same period. The mid year report shows that the stock position of this product is close to 95%, and more than 80% of its shares belong to the technology sector.

Among the several launching sub new funds that achieved positive returns in the year, Guotai Junan Vision Value Hybrid Initiative A and Hongta Laterite Information Industry Selected Stock Initiative A were established in the first ten days of March this year, and their net values have risen only 0.14% and 0.77% respectively so far.

Some insiders pointed out that if the performance of the Promoter Fund is poor, it is highly likely that it will become a "mini base" after three years of establishment, with a greater risk of liquidation; In the face of the launch fund with outstanding performance, investors need to consider whether this performance is significantly related to the investment and research ability of fund managers, and whether the subsequent product can maintain this performance in the case of large capital inflows and larger scale.

key word: fund performance Fund issuance New Fund Net value decline Fund establishment