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China’s top money managers bet on more tech stocks, cut liquor producers to boost returns amid policy challenges

  • Zhang Kun at E Fund made Tencent his top holding in flagship fund, while Yang Ruiwen at Invesco Great Wall bought Shiyuan Electronics, Raytron Technology
  • While fortunes were mixed last quarter, both have suffered losses in the opening weeks of 2022 amid risk aversion

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A bull statue in Shanghai seen on January 4, 2022. Photo: Bloomberg
Zhang Shidong
China’s biggest fund managers increased their bets on technology and green-energy stocks at the expense of liquor distillers, taking advantage of depressed valuations following a trillion-dollar sector crash. They had contrasting fortunes amid policy twists.

Zhang Kun, who manages more than 100 billion yuan (US$15.8 billion) at E Fund Management, added Tencent Holdings to elevate the WeChat operator as the top holding in his Blue Chip Selected Mixed Fund, according to his quarterly report to investors.

Yang Ruiwen, who oversees about 50 billion yuan at Invesco Great Wall Fund Management, also bought chip maker Raytron Technology. Lu Bin at HSBC Jintrust Fund Management picked up more of No. 1 electric-car battery maker Contemporary Amperex Technology, their reports showed.

Tencent became the top holding at Zhang Kun’s flagship fund last quarter, up from eighth in the preceding three months. Photo: Reuters
Tencent became the top holding at Zhang Kun’s flagship fund last quarter, up from eighth in the preceding three months. Photo: Reuters
The adjustments reflect the thinking and the struggle among domestic money managers as the Chinese economy lost further momentum. While the CSI 300 Index ended last quarter with gains amid rate cuts, the onshore market has been infected by concerns about policy tightening elsewhere.

“It may not be a problem of whether to invest in technology stocks or not, but one of how to invest,” Shenzhen-based Yang said in his fund report. “China’s rise is impossible without the rise of technology stocks. We’ll be committed to tapping technology growth to bring sustainable above-average returns to investors.”

Zhang’s flagship fund lost 0.1 per cent last quarter to end the year with an almost 10 per cent decline. Yang’s Selected Equity Fund gained 11 per cent during the October-to-December period, taking its annual winnings to 20 per cent. Yang’s fund has lost 5.1 per cent this month, in line with the broader market.

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