An analysis of the second-quarter 2026 mutual fund reports reveals a recovery in the overall market size of public funds, with mixed-asset funds showing notable growth, while commodity funds experienced a significant contraction.
The new issuance market continues to warm up.
During the second quarter, the equity market generally trended upwards, with the ChiNext and Nasdaq indices leading the gains.
Small-cap growth stocks performed relatively well, while sectors like electronics and communications stood out.
Many of the top-performing equity funds this year have a strong focus on technology.
The stock allocation of active equity-oriented funds saw an increase in the second quarter, while their allocation to Hong Kong stocks continued to decline.
In terms of market capitalization, the proportion allocated to the STAR and ChiNext boards, as well as large-cap stocks, rose significantly.
Regarding sectoral allocation, funds increased their holdings in electronics and communications while reducing exposure to manufacturing and cyclical sectors.
Electronics now accounts for over 40% of the portfolio weight.
Among the top individual holdings, Zhongji Innolight and Sunny Optical are the two largest positions.
Market Size Changes
The total size of the public fund market has resumed growth.
In Q2, the scale of non-monetary market funds increased by 9.87%.
The size of equity funds continued to shrink, while mixed-asset funds saw relatively pronounced growth, driven by structural market trends.
With volatile commodity markets, the scale of alternative investment funds fell by 20%.
The size of passive funds experienced a periodic decline, accounting for approximately 28% of the total at the end of the latest quarter.
Within equity funds, the proportion of passive investment dropped back to 40%.
The decline in ETF scale has slowed, with a single-quarter decrease of about 5%, maintaining a stable share of over 70% within the passive fund segment.
Sustained Recovery in New Issuances
The new issuance market continues to show signs of warming up.
A total of 506 new funds were launched, raising approximately 335.803 billion yuan, with an average issuance size of 664 million yuan.
Both the number and total scale of new issuances increased compared to the previous quarter.
While the average issuance size dipped slightly, the pace of issuance accelerated.
A significant number of new passive funds and equity-biased funds were launched, indicating a clear recovery in the issuance momentum for active equity funds this year.
Products like fixed-income plus strategies and Fund of Funds (FOFs) remain highly popular, though FOF issuance has decreased from its peak in Q1.
Performance Review
The equity market generally moved higher in the second quarter, led by the ChiNext and Nasdaq indices.
Small-cap growth was the relatively dominant style, while Hong Kong stocks continued to correct.
Active equity funds delivered significant outperformance, with the CSI Partial Equity Fund Index rising 24.2%, compared to an 11.9% gain for the CSI 300 Index over the same period.
Examining the average performance across different fund types, the leaders year-to-date remain high-conviction funds heavily weighted in TMT sectors and globally invested technology growth funds, which showed particularly strong resilience in Q2.
Competitive Landscape
Looking at the overall size of non-monetary funds, E Fund Management Co., Ltd. and ChinaAMC had assets under management of approximately 1.89 trillion yuan and 1.36 trillion yuan, respectively, by the end of Q2, each holding a market share exceeding 5%.
E Fund Management Co., Ltd., China Universal Asset Management Co., Ltd., and Fullgoal Fund Management Co., Ltd. saw relatively larger increases in their market shares.
Portfolio Analysis
(1) Asset Allocation: Stock positions increased, while allocations to Hong Kong stocks continued to decline.
(2) Market Cap Style: The proportion allocated to the STAR/ChiNext boards and large-cap styles rose significantly.
(3) Sector Allocation: Increased holdings in electronics and communications; reduced holdings in manufacturing and cyclical sectors.
This analysis is for investment reference only.
Past fund performance is not indicative of future results and does not constitute a guarantee or recommendation for investment returns.
The data statistics in this report are sourced from third-party databases, which have varying update frequencies.
Data completeness is related to the extraction time, and inaccuracies may exist.
The holdings information disclosed in fund periodic reports is static point-in-time data at the end of the quarter.
There is a possibility of short-term portfolio adjustments for window-dressing purposes, which may not fully reflect the fund's actual investment behavior.
Due to the inherent time lag in fund report disclosures, actual fund investment activities may have already changed, leading to potential discrepancies.
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