The star team of China-Europe Fund looks forward to economic recovery and actively looks for new growth points in the industry
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With the successive release of the Four Seasons Report, the China-Europe Fund star fund manager team that has attracted much attention in the market – Ge Lan, Cao Mingchang, Zhou Weiwen, etc., showed investors their in-depth market insights and future investment strategies. In a complex and ever-changing market environment, they remain calm, firmly optimistic about China’s economic recovery prospects, and actively seek new growth points in their respective fields.
Gulen: It is expected that the supply and demand pattern of the medical industry will further improve
As the helmsman of the China-Europe Healthcare Fund, Gulen made a detailed analysis of the trends and future development prospects of the pharmaceutical sector in the Four Seasons Report. She pointed out that the pharmaceutical sector as a whole showed a volatile trend in the fourth quarter and maintained a certain degree of resilience despite the overall market weakness. At the same time, she also saw that the various sub-industries within the sector still continued the style of rapid rotation. Regarding the future, Gulen said with confidence that the global investment and financing environment is expected to gradually recover after the interest rate hike cycle, domestic policies may remain stable, and the industry will have a clearer understanding of the impact of compliance. These factors will provide strong support for the steady growth of the pharmaceutical industry.
In terms of specific investment directions, Gulen is more concerned about the broad development space of innovative drugs. She believes that although the bases among different sub-sectors are different, the pharmaceutical industry as a whole will maintain a steady growth trend. On the supply side, innovation is still an important driving force. The indications of mature targets are gradually expanded, and the concepts of new targets are continuously verified, all of which provide innovative pharmaceutical companies with broad room for growth. On the demand side, Gulen has also seen some new changes. For example, in 2023, research and development breakthroughs in areas such as weight loss and Alzheimer’s disease will become the focus of the industry, and some application markets will gradually open up. However, she also pointed out that there are still a large number of clinical needs that have not been fully met, including the convenience and comfort of medication, which also have great clinical value. Therefore, she believes that innovative drugs and innovative devices have broad room for growth.
Cao Mingchang: The decline is more at the emotional level and does not have long-term sustainability
Since last year, value investing style has attracted market attention. As a value veteran with 28 years of investment research experience, Cao Mingchang believes that the market’s short-term decline from fundamentals is more at the emotional level and does not have long-term sustainability. He pointed out in the quarterly report, “Due to three consecutive quarters of adjustments, the overall market valuation has been hovering at historically low levels. Measured from the number of low-valued stocks, the current PE (TTM) valuation of the entire market is lower than 30 times The number of individual stocks exceeded 1,500, which was the same as in the third quarter; there were more than 900 stocks with a multiple of less than 20 times, and the number continued to increase.”
Cao Mingchang believes that the current market valuation is in the historically low area, and macroeconomic fundamentals and corporate performance are expected to continue to improve. Although the market did not improve as we expected in the fourth quarter, it has not changed the outlook for the next year or even longer. The optimistic expectations of market trends are optimistic about the performance of the capital market throughout 2024.
He disclosed in the quarterly report that the positions of the fund portfolios he manages are still relatively high, and some structural adjustments will be made based on changes in the macroeconomic environment, industry and relative changes in individual stock valuations. “We continue to be optimistic about manufacturing industry chains such as automobiles and some consumer-related industries. We also continue to be optimistic about and hold some related targets in the real estate industry chain. At the same time, we have begun to increase allocations to large-cap value-related stocks such as large financials that are very undervalued. “
Zhou Weiwen: Seize the opportunity of market decline and gradually increase your position
As an “evergreen tree” in the industry, China Europe Fund investment veteran Zhou Weiwen revealed in the Four Seasons Report that market volatility has intensified and the overall trend is weak. In addition to disturbances from overseas factors, the main reason is that investors’ confidence in economic growth is still recovering. Zhou Weiwen said in the quarterly report that from an industry perspective, the industries with the largest declines during the reporting period were the real estate, construction and building materials, and power equipment industries whose fundamentals have not yet stabilized. The industries that can still obtain positive returns are the coal industry, which is stimulated by policies and seasonal factors. , the electronics and breeding industries whose fundamentals have begun to pick up.
In terms of specific operations, Zhou Weiwen said: “This fund seizes the opportunity of the market decline to gradually increase its positions, and the overall position remains at a high level. The direction of the increase is mainly towards the shipbuilding industry where the industry is in an upward cycle and the fundamentals are in the low range and are beginning to recover. breeding, consumer electronics and basic chemicals; reduced allocations to the power equipment industry where competition has intensified and profits have declined, the machinery industry where exports have been hampered and performance is lower than expected, and the epidemic-benefiting stocks where the impact of the epidemic has gradually subsided.”
In general, many star fund managers of China Europe Fund have demonstrated their firm confidence in China’s economic recovery prospects and keen insight into new opportunities in the industry in the four-season reports. They respond to market fluctuations and seize investment opportunities through in-depth market analysis and flexible investment strategy adjustments. On the future investment path, they will continue to point the way for investors and seek long-term and stable investment returns.
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