Summary of Key Points
In the most recent quarter, there has been a complete reshuffle among the top fund managers in the public offering (public fund) industry: New managers specializing in AI technology (such as Zheng Xi from E Fund and Jin Zicai from Caitong Fund) have seen their funds soar in size due to their heavy investments in AI-related stocks, becoming the new “leaders” in the industry. In contrast, former leaders in the consumer and pharmaceutical sectors, such as Zhang Kun and Ge Lan, have experienced significant declines in rankings due to redemptions and reduced fund sizes. This reshuffle is driven by the current AI market trend, which differs fundamentally from the past strategy of “long-term holding of core assets.” However, this shift also carries risks—extreme concentration of funds in a particular sector can lead to inflated valuations and overheated market sentiment. Experts advise investors to avoid blindly following star fund managers.
1. A Complete Change in the Industry’s Elite: Newcomers Rise, Established Managers Fall
The previous top public fund managers included names like Zhang Kun (E Fund) and Ge Lan (CITIC Fund), but things have now changed dramatically:
- New Leaders Emerging: Zheng Xi from E Fund has become the largest public fund manager with a fund size of 57.8 billion yuan; Jin Zicai from Caitong Fund has performed even more impressively, growing his fund size from 8.9 billion yuan in the first quarter to 56.5 billion yuan in the second quarter (more than a five-fold increase). Other managers like Zhang Mingxin from Huashang Fund, Wu Yang from E Fund, and Yan Kai from Dongfang Fund have also seen their fund sizes increase by a combined total of 173.5 billion yuan, all thanks to the AI market trend.
- Established Managers Declining: Zhang Kun’s fund size has dropped to 32.2 billion yuan, ranking him 16th; Ge Lan’s fund size is at 31.4 billion yuan, placing him 18th; Liu Gesong and Liu Yanchun have fallen even further, outside the top 30. Among the top ten, only Xie Zhiyu from Xingzheng Global Fund remains a established leader, ranking 8th.
In short, fund managers in the AI sector have become extremely successful overnight, while the previous stars have been overshadowed by their newer competitors.
2. The Secret to the New Leaders’ Success: A High Focus on AI
The reason for these new managers’ rapid growth lies in one word: AI.
- Market Trends Driving Performance: In the second quarter, electronics and communications (AI-related sectors) were the most heavily invested industries, accounting for over 60% of fund assets. The new leaders happened to have a significant stake in these sectors, resulting in outstanding performance—Zheng Xi’s products achieved an average return of 93%, meaning investors who invested 100 yuan would earn 93 yuan, attracting a large number of new subscribers (his products saw net subscriptions of 1.9 billion units in the quarter).
- Performance Leads to Growth: Good performance attracts more investors, which in turn increases fund size, allowing for further investments in AI stocks and even better returns, creating a positive cycle. For example, Jin Zicai’s two core products have seen their sizes explode due to the AI trend, transforming them from relatively small funds into giants with assets of over 50 billion yuan.
In other words, those who are positioned at the forefront of the AI revolution can achieve remarkable success.
3. A Shift in Investment Logic: From Slow Growth to Rapid Change
The strategies of past and current leaders differ significantly:
- Old Logic: Focusing on “core assets” over the long term, such as investing in companies like茅台 (which benefits from China’s growing consumer market). The idea was to gradually increase holdings and stabilize fund size through market growth.
- New Logic: Emphasizing the explosive potential of current industry trends, with a focus on short-term opportunities. Fund managers need to accurately predict the timing of AI-related developments.
However, this new approach also carries greater risks: While core assets like茅台 have inherent stability, the AI sector’s momentum can be more volatile. If the trend slows down, investors may redeem their funds en masse, leading to a more abrupt decline in fund performance than with traditional sectors.
4. Hidden Risks of Large Fund Sizes
The large sizes of these new funds present several challenges:
- Large Sizes Can Be Counterproductive: Managing funds worth billions makes it difficult to make strategic adjustments; buying too much of a stock can affect its price, and buying too little may not have a significant impact on performance.
- Crowded Markets: With many funds investing in AI, stock valuations are already high. A market downturn or poor AI-related performance could lead to sharp drops in stock prices and fund values, triggering panic among investors.
- Past Lessons: Similar trends in consumer, pharmaceutical, and renewable energy sectors have resulted in significant losses (e.g., consumer funds lost over 30% in 2022). Whether the same will happen with the AI sector is uncertain.
Experts warn that AI-related investments are at historically high levels, but since it’s a global trend, the peak may not be immediate. However, investors should be cautious of the risk of a sudden market collapse due to excessive concentration of funds in this sector.
5. What Should Investors Do?
Investors who followed Zhang Kun and Ge Lan in the past often suffered losses. Following the new AI leaders could also lead to similar outcomes. Experts suggest:
- Avoid Blindly Following Managers: No single manager can guarantee success in all market conditions. For example, Jin Zicai’s performance may decline as his fund size increases.
- Evaluate Fund Companies Thoroughly: When choosing a fund, consider the company’s research team, risk management capabilities, and support infrastructure. A company with a dedicated AI research team can provide valuable assistance to the manager.
- Diversify Investments: Don’t put all your money into AI funds; spread your investments across different sectors (consumer, pharmaceutical, renewable energy) to reduce risks.
In summary, investing is not about following individual stars but about finding a reliable investment “system” that can withstand market changes. The current reshuffle highlights that the market is constantly evolving, and there are no eternal leaders. For ordinary investors, it’s crucial to remain rational and avoid chasing short-term trends.