Multiple healthcare-focused funds have seen significant net asset value (NAV) increases this year. As of August 7, Wind data shows that 19 healthcare funds have recorded NAV gains exceeding 10% in 2024, with the top performer climbing nearly 25%.
Among them, actively managed healthcare funds had the strongest performance. These funds dominated the top ten rankings, with China Merchants Healthcare Industry leading the market with a nearly 25% NAV gain, followed by Peng Hua Innovation Healthcare A at 24%, and Yong Ying Healthcare A maintaining gains above 20%. Additionally, products like Guotai Healthcare A, Huatai-PineBridge Healthcare A, Bank of Communications Schroders Healthcare Innovation A, and Harvest Healthcare A posted NAV gains between 10% and 20%.
Index-based healthcare funds showed more divergent performance year-to-date. The Tianhong Hang Seng CSI Hong Kong-Shanghai-Shenzhen Innovative Drug Select 50 ETF led with an 11.19% NAV gain, while ETFs tracking the CSI Innovative Drug Industry Index generally saw gains of 2% to 8%. However, several Hong Kong-listed healthcare index funds underperformed, with one Hong Kong Stock Connect Healthcare A fund declining 12.37% and a Hang Seng Hong Kong Stock Connect Innovative Drug Select ETF falling 11.79%.
The overall scale of healthcare funds grew substantially year-to-date, with total assets increasing by nearly 300 billion yuan to 2,767 billion yuan. Five products now exceed 100 billion yuan in scale, including the GF CSI Hong Kong Innovative Drug ETF (266 billion yuan), Huatai-PineBridge CSI Hong Kong Stock Connect Innovative Drug ETF (245 billion yuan), Yinhua CSI Innovative Drug Industry ETF, E Fund CSI 300 Healthcare ETF, and GF CSI Innovative Drug Industry ETF. Another 48 funds, such as Huatai-PineBridge Innovative Healthcare A, Yinhua CSI Hong Kong Stock Connect Innovative Drug ETF, and ICBC CSI Hong Kong Stock Connect Innovative Drug ETF, have scales between 10 billion and 100 billion yuan.
Innovative drug-themed funds performed particularly well in both NAV and scale. The top ten innovative drug funds by NAV gains were all index-based, with gains exceeding 6%. The Tianhong Hang Seng CSI Hong Kong-Shanghai-Shenzhen Innovative Drug Select 50 ETF led with an 11.19% gain, while the Huatai-PineBridge CSI Shanghai-Hong Kong-Shenzhen Innovative Drug ETF and Fullgoal CSI Shanghai-Hong Kong-Shenzhen Innovative Drug Industry ETF both posted gains above 7%. The scale of innovative drug funds grew from 1,192 billion yuan at the start of the year to 1,517 billion yuan, a gain of over 300 billion yuan.
Liu Jie, a fund manager at GF Fund's index investment department, commented: "The innovative drug sector is showing a fluctuating upward trend, and with the Hong Kong innovative drug index at historically low levels, overall valuation is expected to rise. Combined with fundamental improvements, positive catalysts may drive further opportunities for innovative drugs and CXO sectors."
Cai Qiang, manager of Southern Healthcare Innovation Stock A, attributed the strong performance of the healthcare sector to three key factors: significant prior corrections that made some pharmaceutical stocks attractive; improving fundamental expectations driven by Chinese innovative drug companies expanding overseas and policy shifts; and a market rotation toward balanced allocation, with healthcare offering strong growth potential to attract capital.
Tian Ximeng, manager of the Hong Kong Stock Connect Innovative Drug Healthcare ETF at Fullgoal Fund, emphasized the strong innovation and overseas expansion capabilities of leading pharmaceutical companies, supporting long-term growth. "The innovative drug industry has robust fundamentals. With the upcoming mid-year earnings disclosures and the progression of overseas expansion into Phase 2.0, the investment value of the innovative drug sector may warrant continued attention," he said.
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