Can the "explosive" fund have excess returns?
Economic Daily · China Economic Net reporter Zhou Lin
Since the first half of this year, benefiting from a series of favorable conditions such as the reform of the GEM pilot registration system, the revision of the Shanghai Stock Exchange Index, and the continuous inflow of "Northbound Capital", the A-share market has gone out of a round of rising prices. —— There is no shortage of 10 billion yuan scale funds sold out in a single day, and the degree of popularity is evident. So, must "explosion funds" be reliable?
Wind statistics show that in the first half of this year, a total of 613 public funds were on sale, with a cumulative issued share of 972.189 billion copies-regardless of the number of issuances or the scale of establishment, the popularity of the funds is much higher than the same period last year. During this period, there is no shortage of 10 billion yuan scale funds sold out in a single day, and there are "precious" varieties that are for sale and restricted purchase. Are these well-selling "explosions" funds reliable?
Fund sales are hot
Statistics from Shanghai Liantai Fund Sales Co., Ltd. show that with the excellent performance of the A-share market, there are 11 newly established 10 billion yuan public funds this year, mainly equity products.
Chen Dong, Director of the Financial Products Department of Liantai Fund, a subsidiary of Investment Technology, believes that the breakdown of these "explosions" mainly has the following characteristics: First, the creation of explosive funds cannot be separated from long-term brand accumulation, so as to gain investor trust, Fund issuers are concentrated in large fund companies such as China Southern Fund, E Fund Fund and Huitianfu Fund. Among them, the Southern Growth Pioneer issued in June, the first fundraising reached 32.115 billion yuan, becoming the largest fund established in the first half of the year. Second, most explosion funds have a “star effect”. For example, Southern Growth Pioneer is managed by two outstanding fund managers, Mao Wei and rookie Wang Bo. Mao Wei is the general manager of the equity research department of China Southern Fund. He is known for his investment in growth stocks and has a stable investment style. As a newly issued fund, Southern Growth Pioneer has become the third largest active equity fund in history following Harvest’s strategic growth and its appropriateness. It can be seen that when investors choose to subscribe for new funds, the “star effect” of the fund manager and the “brand effect” of the fund company have a significant impact on the fundraising results. The third is that the product design of explosive funds often keeps up with market hotspots. For example: in 2018, with the volatility of the equity market going down, a large number of “tool-based” product collections with market indexes and industry indexes as tracking targets have increased significantly; in 2019, the opening of the Science and Technology Board and the launch of the Science and Technology Theme Fund will also arrive High points, investors get rush to buy.
Behind the sales of equity funds is the enthusiasm of investors to invest in the equity market. Does this mean the arrival of a "bull market"? Fan Jituo, an analyst at New Era Securities, believes that: "Since 2009, the amount of public funds issued has been mostly a reverse indicator of the market's "bullish". That is, most of the time, the emergence of public fund explosion funds means the end of the bull market or a The round market is coming to an end." This is mainly due to the declining right of public funds in the stock market before, resulting in the increase in the volume of each equity fund issuance in the late stage. However, there are exceptions. For example, in the bear market and the shock market from 2015 to 2018, the performance of public funds compared to most other products, including private equity, retail investors, hot money, etc., the performance is remarkable. Public fund issuance is no longer a lagging indicator, but a synchronous indicator.
There is also a view that hot fund sales are a positive indicator of the market's "bull run", that is, whenever a hot fund appears, the market will strengthen. Huafu Securities statistics show that in the past 10 years, stock funds have kept rising in the year of A-share rises; in the year of stock market declines, the fund has kept rising for 2 years. Specifically, in the market trend in 2013, 90% of stock funds rose, while the number of stocks rose only accounted for 69%; in 2017, 84% of stock funds rose, and the number of stocks rose only 32% ; In 2019, 98% of equity funds rose, with 76% of stocks. In the 7 years that the explosive funds have won, the A shares have staged structural quotes to some extent. Therefore, the "explosive funds" have some positive correlation with the bull market.
Do not blindly pursue "explosive models"
Explosion means selling well. Beside this, in addition to the brand effect of star fund managers and fund companies, it is also inseparable from the strong support of sales channels.
Statistics from the Shanghai Securities Fund Evaluation and Research Center show that from 2001 to date, a total of 209 explosive funds with more than 5 billion copies have been issued. From the perspective of these more than 200 explosive funds, the support and cooperation of various sales channels to help the successful sale of explosive funds are one of its common characteristics. Among them, they are mainly hosted in 13 banks, mainly four state-owned banks and large commercial banks.
Liu Yiqian, head of the Shanghai Securities Fund Evaluation and Research Center, believes that the sales bank of explosive funds has a leading position in fund agency sales due to its advantages of numerous outlets, rich customer resources and smooth information transmission. With the bank's strong support and full cooperation with other agency agencies, fund products are more likely to obtain dazzling sales performance, which has led to the formation of explosive products. Due to the large difference in the sales channels of each fund product, it is difficult to obtain sales data of sales agencies, so it is difficult to categorize them uniformly. But generally speaking, the custodian bank will assume the main underwriting responsibilities.
However, judging from the performance of the explosion fund in recent years, not all hot-selling funds are satisfactory. Wind information statistics show that in 2018 and 2019, a total of 12 equity funds with a scale of more than 10 billion yuan were established, of which 4 funds have negative returns since their establishment; 6 are strategic placement funds, and the average return since establishment The rate is 9.57%, which is significantly lower than the average level of the same kind. In contrast, more than 10 equity funds with a scale of 10 billion yuan established this year have all achieved positive returns so far.
There are many reasons why the performance of explosive fund products is not satisfactory. Liu Yiqian believes that the excessive fund-raising scale of some funds will lead to the failure of some fund manager strategies; some funds will not be issued at a good time, which will drag down the performance of fund products; some fund managers will change frequently, and market hot spots will switch, resulting in some Industry-themed fund performance lags behind.
Chen Dong believes that explosive funds are often generated in a more certain bull market. Throughout the past few bull markets, when the market was overly optimistic, risks were slowly emerging. Therefore, the hot sale of funds with a scale of 10 billion yuan does not necessarily mean a profitable effect. Many non-professional investors blindly follow explosive funds without knowing their risk appetite and fund characteristics, and the results may often be lower than expected. Therefore, investors must not arbitrarily equate explosive funds with ideal returns, and avoid blind investment.
Choose funds to do what you can
"Explosion" is just an indicator to evaluate the scale and sales, in layman's terms, it means that the fund sells well. However, investors should remember that good sales and large scale do not mean good performance, and they are not necessarily conducive to asset allocation by fund managers.
"The reason is very simple. If it is a fund of ordinary size, the asset allocation of the fund manager is relatively easy. It is only necessary to select a few'exclusive stocks" to buy and leave. But if it is a large-scale fund with more than 10 billion yuan, it is limited by its huge size. , Limited assets can be allocated on a large scale, it is impossible to stare at only one or two'single-share' operations, and it is unlikely to adopt a single investment strategy. It will inevitably consider allocating other types of assets or applying other strategies. Technology is a big test, and it also brings a lot of pressure to maintain its long-term stable performance." Gongni Lin, an analyst at Jinniu Wealth Management Network, said that the A-share equity fund performance champions over the years are often concentrated in small and medium-sized funds. Among the products, product and fund managers who have truly achieved the "double champion" in scale and performance are rare.
Liu Yiqian also believes that investors should carefully choose explosive fund products and rationally determine the trading timing and holding period. The historical performance of star fund managers does not mean that they can obtain excess returns in the future; the performance of explosive products is obviously different, and investors should choose funds rationally, and not blindly "chasing stars". In addition, investors cannot follow the trend of the market, especially avoid irrational purchases of fund products at market highs. Finally, investors should develop good investment habits for long-term tracking and holding.
For fund management companies, they should avoid relying too much on "star-making" strategies and following market hotspots. When selling funds, it is necessary to fully display the performance of fund managers, and it is necessary to treat brand reputation with caution; regulators should continue to strengthen supervision of the fund industry, urge the fund industry to reasonably issue high-quality products, and remind investors to avoid irrational buying of explosive fund products .
Zhou Lin
Zhou Lin