The first-quarter public fund reports are being released one after another. On April 17, all 4 products under Ruiyuan Fund revealed their 2024 quarterly reports, and the first-quarter position adjustments of “Ruiyuan Shuangxiong” Fu Pengbo and Zhao Feng also surfaced.

Judging from performance, “Ruiyuan Shuangxiong”'s performance in the first quarter of this year was lackluster, and the products managed all failed to perform well in terms of yield. Ruiyuan Equilibrium Value, managed by Zhao Feng, rose slightly by 0.91% in the first quarter after holding Hybrid A for three years. Compared with the poor performance, the yield was 1.12%. Ruiyuan Growth Value Hybrid A, managed by Fu Pengbo and Zhu Wei, fell 7.36% in the first quarter, compared with an average yield of 8.49%.

Judging from changes in management scale, Zhao Feng's management scale in the first quarter was 11.83 billion yuan, a decrease of 390 million yuan compared to 12.220 billion yuan in the previous quarter.

Fu Pengbo's management scale in the first quarter was 18.813 billion yuan, a decrease of 1,983 billion yuan compared to 20.796 billion yuan in the previous quarter.

It is worth mentioning that as of the first quarter of this year, Fu Pengbo and Zhu Wei held 159 million shares of Ruiyuan Growth Value Blend A, and spent nearly 50 million on January 29 to buy 46.28 million shares of Ruiyuan Growth Value Blend A.

On January 29, Zhao Feng also spent nearly 50 million yuan to buy 46.78 million shares of Ruiyuan Equilibrium Value and held 46.78 million shares of Hybrid A for three years. As of March 31, Zhao Feng held a total of 143 million shares of Ruiyuan Equilibrium Value for three years.

Judging from the position adjustments in the first quarter, Fu Pengbo drastically reduced his holdings of Wanhua Chemical, Dongfang Yuhong, and China Mobile in the first quarter, and slightly reduced his holdings in Tongwei shares and the Ningde era.

In terms of increasing positions, Fu Pengbo significantly increased Lixun Precision and Miwei shares in the first quarter. What is most special is that Tencent Holdings has newly entered the fourth largest stock

In the fourth quarter of 2023, Tencent was still the 11th largest stock, just outside the top ten.

Fu Pengbo bought 1,332 million shares of Tencent in the first quarter. He already bought 638,000 shares in the fourth quarter of last year. Since re-adding positions in the second quarter of 2023, he has increased his position for three consecutive quarters.

Fu Pengbo also said in the first quarter report that mainly reduced holdings of some of the top 20 companies with a net worth share, added some companies benefiting from export chain growth and equipment replacement upgrades from the bottom up, and increased the allocation of Hong Kong stocks. In addition, individual energy stocks also bucked the trend and increased their holdings during their pullback.

In terms of macroeconomic judgment, Fu Pengbo believes that although PPI improved slightly in January-February, it fell into a negative growth range. Under conditions where production capacity in the industry is generally redundant, enterprises need to exchange price for volume to maintain and increase their market share.Improving PPI is not easy, but when positive signals appear, there is a corresponding improvement in corporate profits. Referring to the 2023 performance, in the context of abundant liquidity, improving corporate profits is a necessary condition for the upward movement of the market.

Looking ahead to investment in the second quarter, Fu Pengbo believes that the A-share market is expected to have some structural opportunities, and the valuation level of sector indices is still below the historical average. With the disclosure of listed companies' annual reports and quarterly reports, improvements in fundamentals and changes in the economy in the second quarter may have a stronger and more clear guiding effect on investment throughout the year. They will continue to dynamically adjust their portfolios, explore new investment targets, and select companies with reasonable valuations, high growth certainty, and steady endogenous growth that continues to generate cash flow.

Let's take another look at Zhao Feng's position adjustments in the first quarter. Zhao Feng also drastically reduced his holdings of China Mobile during this period, slightly reducing his holdings of Siyuan Electric, Sannuo Biotech, Tencent Holdings, and China Resources Brewery.

Unlike Fu Pengbo, who drastically reduced Wanhua Chemical's holdings in the first quarter, Zhao Feng also increased Wanhua Chemical's holdings, and the number of shares held increased 5% month-on-month.

Zhao Feng also bought leading Hong Kong stocks in the first quarter. Meituan and China Financial Insurance became the top ten new heavy-duty stocks in the first quarter, and both bought 1 million shares in the first quarter.

In the fourth quarter of last year, China Financial Insurance and Meituan were Zhao Feng's 14th largest stock and 16th largest stock respectively. At the time, Zhao Feng had already bought 33 million shares and 800,000 shares of China Financial Insurance in a big way, of which China Financial Insurance was a new individual stock.

Zhao Feng also said in the quarterly report that during the period, the fund reduced its holdings of companies related to fixed asset investment, companies with unattractive static valuations and difficult to determine future growth, and increased holdings of some new energy companies with attractive valuations, and companies with low valuations and stable fundamentals.

Zhao Feng is optimistic about macroeconomic recovery. As of February 2024, total industrial PPI had been declining year on year for 17 consecutive months, and social inventories continued to be compressed and at a low level. Along with macroeconomic policy support and a recovery in demand, the economy and company fundamentals are likely to pick up in the future.

Zhao Feng expects that as demand growth slows down, listed companies will be more rational about expansion and pay more attention to profitability and shareholder returns, which will improve the profit quality and level of return of listed Chinese companies.