Chinese GF International

Focusing on quality leaders in three regions, Guangfa Shanghai,-Hong Kong -Shenzhen Value Selections (广发沪港深价值精选)set sail on May 18th

Date: 2021-05-14 Source: STCN

  With the return of Chinese stocks one after another, more and more high-quality targets in the Hong Kong stock market have attracted the attention of many investors. However, for ordinary investors, compared with A-shares, Hong Kong stocks have a higher investment threshold. Therefore, investing in Hong Kong stocks with the help of public funds is the choice of most investors.

  From May 18th to May 21rd, Guangfa Fund will launch a new Shanghai-Hong Kong-Shenzhen themed fund - Guangfa Shanghai-Hong Kong-Shenzhen Value Select (Class A: 011908, Class C: 011909) with proposed fund manager Zhang Dongyi, available at CITIC Bank and Guangfa Fund's website/APP. (The fund is a hybrid fund, with equity assets accounting for 60%-95% of fund assets, of which, investment in Hong Kong Stock Connect equity shall not be less than 20% of non-cash fund assets and not more than 50% of equity assets)

  As a strong player with 13 years of experience, the proposed fund manager Zhang Dongyi has rich experience in "A+H" stock investment. The products she has managed for more than two years include Guangfa Juyou (广发聚优) and Guangfa Valuation Advantage (广发估值优势). According to the fund contract, Guangfa Juyou investment scope is A shares, according to Wind statistics, from July 26, 2016 to May 7 this year, Guangfa Juyou won the Galaxy Securities with cumulative return of 181.42% and annualize ed return of 24.12%, Haitong Securities, China Merchants Securities three major fund rating agencies 5-star rating for tenor as three-year.

  GF Valuation Advantage can invest in both Hong Kong and A-shares, and the product's equity assets account for 60%-95% of the fund's assets (of which the proportion of investment in the Hong Kong Stock Connect equity shall not exceed 50% of equity assets). From September 21rd , 2018 to May 7th, this year, the fund has achieved a cumulative return of 168.87%, with excess returns of 117.94% and 164.75% over the CSI 300 and Hang Seng Index, respectively.

  "Core+Satellite" strategy with a focus on long-term excess returns

  Dongyi Zhang is a double master of York University and London School of Economics and Political Science (LSE), and joined GF Fund in February 2008. She has worked as industry researcher and dedicated investment manager in GF Fund's research and development department, and is now the fund manager of GF Fund's international business department, focusing on large consumer industries, as well as pharmaceuticals, TMT, midstream manufacturing and other industries.

  Zhang Dongyi is a player who insists on long-term investment. She hopes to join hands with high-quality companies to surpass in the long run and share the fruits of long-term corporate development. Thanks to her solid accounting foundation, she is good at grasping the business model, development stage and sustainability of companies from financial statements, evaluating the value of companies based on medium and long-term indicators, and selecting high-quality assets with the right risk-return ratio.

  Specifically in investment, Dongyi Zhang combines top-down and bottom-up approaches. Top-down, she focuses on the rise and fall trend of the industry, considering the impact of macroeconomic changes, economic structure changes, various factor price changes and other macro variables; bottom-up, she grasps individual stocks' alpha excess returns by studying companies' business models. Through the organic combination of the two strategies, she makes better investment decisions.

  In terms of portfolio construction, Dongyi Zhang adopts a "core + satellite" strategy, with long-term stable high-ROE assets as the base position and PB-ROE strategy as an effective supplement. Specifically, she focuses on two types of assets, one is the assets with stable earnings and high ROE; the other is the PB-ROE strategy, which selects assets with undervalued PB relative to their ROE, or assets with fluctuating ROE levels but with cyclical inflection points. In the portfolio management, Zhang Dong will dynamically adjust the allocation ratio of the two asset classes to reduce the overall portfolio volatility.

  Focus on quality leaders in three regions with consumption as the center of the circle

  Dongyi Zhang has been in the industry for 13 years since she joined the firm in 2008. During her career as a researcher, she was responsible for the research of big consumption sectors such as textile and garment, commercial, e-commerce, food and beverage, and leisure services. During this period, she unearthed several bull stocks through in-depth fundamental research, laying a good foundation for focusing on the big consumption track afterwards.

  At that time, most of the public fund managers' vision was placed on A-shares and rarely focused on Hong Kong stocks. However, Dongyi Zhang would focus on quality consumer goods in Hong Kong stocks outside of work. She would track the representative companies of interest and regularly study the financial statements and research reports of the representative companies.

  Thus, in addition to A-shares, Zhang Dongyi started to cover quality underlying in Hong Kong stocks at an early stage and has a good global perspective. in 2016, after taking over the management of a public fund, Zhang Dongyi will also refer to the growth path of overseas listed companies and conduct comparative research on A-shares and Hong Kong stocks to select good companies from Shanghai, Hong Kong and Shenzhen.

  It is reported that from May 18 to May 21, the new Shanghai-Hong Kong-Shenzhen product to be managed by Zhang Dongyi - Guangfa Shanghai-Hong Kong-Shenzhen Value Select (Class A: 011908, Class C: 011909) was released in channels such as CITIC Bank and Guangfa Fund's official website/APP. The fund's equity assets account for 60%-95% of the fund's assets and invests no less than 20% of non-cash fund assets and no more than 50% of equity assets in the underlying stocks of Hong Kong Stock Exchange.

  Zhang Dongyi said, from the perspective of industry allocation, the domestic consumer market has a vast space and the consumer industry has the advantages of stable demand and stable cash flow. Chinese consumption leaders are extremely competitive globally, with high certainty of future growth and long-term allocation value. Therefore, she will focus on investment opportunities in consumer sectors such as food and beverage, home appliances, catering and tourism, medical services, etc., while selecting high-quality targets in the Hong Kong market, such as Chinese Internet companies and innovative pharmaceutical companies.

  According to the research of China Merchants Securities, Guangfa Fund's Hong Kong stock team has strong investment research ability and good performance of Shanghai, Hong Kong and Shenzhen products. At present, there are three active HFT thematic products under the management of GF Fund, namely GF HFT New Beginning, GF HFT New Opportunity and GF HFT Industry Leader, with annualized returns of 20%, 15% and 10% respectively since their inception, and the returns in the past 1 year are over 45%, which are better performance.