This year, amidst turbulent international situations and a complex, ever-changing external environment, the A-share market has demonstrated a slow and long bull market trend. In March, although the market experienced a significant adjustment due to the Middle East conflict, with the main index approaching 3800 points, I firmly believed that levels below 4000 points represented a "bull market pullback." During a live broadcast in Beijing with Professor Liu Jipeng, we expressed a very clear view. Below 4000 points, many high-quality stocks fell to levels presenting value, offering investors a good opportunity for strategic positioning during this pullback. Subsequently, the market staged a strong rally, recovering above the 4000-point level and once breaking through 4200 points to reach an 11-year high. The ChiNext Index, driven by a surge in technology stocks, even reached a new historical high.
The Central Political Bureau meeting held on April 28 explicitly called for "stabilizing and enhancing confidence in the capital markets." Compared to last year's government work report which emphasized "continuously deepening comprehensive reforms for capital market investment and financing," this meeting placed greater emphasis on stabilizing and boosting market confidence, sending a positive signal and demonstrating the highest-level determination to support capital market development. Stabilizing and strengthening the capital market lays the foundation for this round of slow, long-term bull market in A-shares. Currently, China's economic growth has slowed, particularly with a notable deceleration in consumption growth, which fell to 0.2% in April. A sustained bull market that allows more investors to earn returns and generate property income through buying funds or stocks is the best means to stimulate consumption and a key to breaking the current impasse. I have maintained this view for several years, and it is now gaining wider recognition.
From a policy perspective, support underpins this market trend. From a capital flow perspective, the ongoing shift of household savings into the market is providing a continuous stream of incremental funds for the A-share bull run. Reports indicate that sales of equity funds have significantly rebounded this year, with several new funds achieving initial issuance sizes exceeding 50 billion yuan, and one even surpassing 70 billion yuan. In the current low-interest-rate environment, bank savings offer limited attractive options, while the profitable effect of the bull market attracts investors to enter and position themselves. Most investors enter the market by purchasing funds, and the recovery in new fund issuance suggests this bull market has a relatively solid foundation.
This year marked my eighth trip to the US to attend the Berkshire Hathaway Annual Shareholders Meeting. I have always aimed to use this gathering of global investors to advocate for value investing principles. Unlike mature overseas markets, as a representative of an emerging market, applying value investing in A-shares cannot mechanically replicate Warren Buffett's philosophy. I have developed an original Chinese-style value investment philosophy, integrating it with the realities of China's economic development and the specific conditions of its capital market, while considering policy direction, industry cycles, and valuation safety margins. Its core内涵 encompasses at least two dimensions. First, from a policy angle, it involves interpreting both macroeconomic调控 policies like fiscal and monetary policies, as well as industrial policies, focusing布局 on industries prioritized for national support. Since last year, I have proposed that six major sectors represent areas of policy support and industrial development cycles, including chips/semiconductors, computing power and algorithm infrastructure, humanoid robots, commercial aerospace, energy storage industries like solid-state batteries, and biomedicine. These sectors have already produced many ten-bagger stocks, and I believe more will emerge in the future, as they represent the direction of China's economic transformation and industrial trends. The concept of these six major sectors is gradually gaining widespread acceptance. Second, given significant valuation fluctuations, appropriate position management is necessary. China's capital market is dominated by retail investors, often leading to mispricing opportunities where prices may rise into泡沫 territory or fall into oversold conditions. During periods of high market volatility, risk can be mitigated through position management. Over the past 12 years, since its establishment, Qianhai Kaiyuan Fund has successfully practiced this Chinese-style value investment philosophy and accumulated rich experience.
Currently, the global wave of AI technological revolution is surging. I have consistently believed that the AI科技 revolution brings more profound changes than the internet revolution did, with a sufficiently grand narrative. In capital markets, the AI revolution has spurred the rise of numerous industries. Many细分 segments within the AI产业链 possess medium-to-long-term potential for超额收益, including currently popular areas like optical modules, CPO, PCB within the chip/semiconductor direction, memory chips, computing power and algorithm infrastructure, power and grid equipment, AI applications, autonomous driving, and humanoid robots. The recent sharp rise in AI科技 stocks has sparked debate about an AI科技泡沫. Traditional value investors prioritize earnings certainty. Warren Buffett配置很少科技股, with few涉猎 beyond Apple and Google. Over the past two years, he has continuously reduced his US stock holdings, even as the US market reached new highs. In the short term, the AI科技泡沫 may inflate further, generating strong赚钱效应. Buffett's performance has notably lagged the S&P 500. However, viewed over a 5 to 10-year horizon, it may again prove that追求业绩确定性 is correct. It is crucial to balance the relationship between short-term volatility and long-term value. Investing in technology should also follow a path with Chinese characteristics, avoiding盲目炒作主题 and concepts, and adhering to fundamentals. When配置科技股, focus should be on technology leaders capable of securing orders and delivering on earnings, rather than pseudo-tech stocks driven solely by题材 concepts. Recently, some individual stocks have been penalized for catering to market speculation and蹭概念. Investors should avoid纯题材股炒作 and select industry leaders based on fundamentals.
Public offering funds have achieved high-quality development in recent years, particularly with rapid growth in equity funds, which is related to the market recovery. Since 2026, multiple new fund regulations have been introduced, optimizing the fund ecosystem across dimensions such as fee reforms, performance benchmarks, and information disclosure. These reforms encourage fund companies and managers to focus more on performance and investor profitability rather than单纯追求规模 growth, aligning the interests of holders with those of the company and managers. This enables public funds to better serve广大投资者 and create favorable performance returns for holders.
As we approach the second half of the year, I believe the core investment主线 for the A-share market from the second half of 2026 into 2027 will likely remain "Technology + HALO Assets." The six major sectors mentioned earlier all represent important investment areas within the technology方向. "HALO Assets" refer to industries characterized by heavy assets and low volatility, primarily represented by leading companies in energy and resources. Investors should借鉴 institutional思路, constructing a long-term, stable value investment portfolio suited to the characteristics of the Chinese market. One can choose to focus on the technology innovation sector to capture opportunities from the AI revolution, while also关注业绩确定性较强的 "HALO Assets" to prevent significant净值波动 when technology stocks experience high volatility.
During the process of a slow, long bull market in capital markets, it is also necessary to警惕一些阶段性 risks and扰动 factors. For instance, if certain technology stocks experience excessive short-term gains leading to明显的泡沫化, it is prudent to及时获利了结, reduce positions, secure profits, and lower持仓成本. Another factor to monitor is the trend of US stocks. Currently, the US tech泡沫 is intensifying. Warren Buffett has an apt比喻: the formation of a泡沫 is like a dance party where the girls are pretty, the guys are handsome, everyone is drinking champagne and dancing, and no one wants to leave. Everyone knows that after midnight, everything turns into mice and pumpkins, but everyone wants to leave at 11:50. Unfortunately, there is no clock in the room to tell you what time it is. This比喻 vividly illustrates the prevailing心态 during the current tech泡沫. During a recent visit to Wall Street institutions like Morgan Stanley, a leader there also offered a good应对策略: try to dance near the exit. This means we must时刻关注 the situation with the US tech泡沫, checking each morning whether the overnight US market is stable. If the US market experiences a暴跌 overnight, it could signal the泡沫破裂, at which point one can choose to adjust positions to避险. The risk of a US tech stock泡沫破裂 is the most critical风险 to警惕 currently.
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