Zhang Kun's latest quarterly report released: his combination is "resting", and his thinking is "running wild"

Zhang Kun has never lacked determination and insight, but in this year's quarterly report, he talked more clearly about his understanding and response to the times.

It's a topic he's never touched on before.

At the same time, none of his funds had new heavy holdings in the first quarter, not a single one (all of which had appeared in at least all portfolios in history).

This result is not that he is "lazy", but the conclusion of a series of thinking decisions.

He said that looking back at the long-term history of the capital market, an important reason for the higher long-term yield of stocks than bonds is that the former has sustained growth. Therefore, the meaning of growth should be greater than the pursuit of "dividends".

He also said that the necessary condition for high-quality stocks is to have long-term sustainable growth. Therefore, equity investors should always give considerable weight to the search for long-term growth.

However, in the period of high-quality development, the basic probability of the company's sustained and high-speed growth is decreasing - this is the second important premise.

Therefore, investors should never give up looking for medium and sustainable growth, and such growth should be available in different segments.

Do you understand it?

When the outside world was worried that Zhang Kun's holdings might age and the growth might decrease, Zhang Kun used his own logic to explain the significance of his insistence on choosing:

First, in the new investment era, medium growth is a rational investment goal that can be pursued.

Second, they're cheap now.

Isn't this both very "calm" and "Zhang Kun"?

We should not give up

During the days of writing the quarterly report, Zhang Kun carefully observed the market and came to his own conclusions (in the quarterly report).

He said that judging from the performance of long-term treasury bonds and bond-like equity assets, the market's risk appetite has been reduced to a very low level, which is manifested in the high weight of static dividend yield levels when pricing, and the attitude of skepticism about growth, especially the long-term growth of enterprises.

However, in his view, if we review the long-term history of the capital market, an important reason for the higher long-term yield of stocks than bonds is that stocks have sustainable growth, and the necessary condition for high-quality stocks is to have long-term sustainable growth.

Therefore, he believes that as a stock investor, you should not give up on growth, and should always give equal weight to the search for long-term growth.

"Get" growth from the segmentation structure

Zhang Kun also said that in the period of high-quality development, although the basic probability of the company's sustained and rapid growth is decreasing, it should never give up the search for medium and sustainable growth.

At the same time, he firmly believes that these medium and sustainable growth potentials can be obtained by looking in different sub-sectors (industries) structure.

He stressed that the growth he was looking for had to be of high quality, not the result of extensive management or cash burning, but should be achieved with a reasonable marginal return on investment.

Therefore, he will pay close attention to the company's ability to control costs and expenses, control working capital, generate free cash flow, allocate capital, and return to shareholders.

The company has an attractive valuation

Zhang Kun made an analogy in the quarterly report: under the simplified model, between company A with a 5% dividend yield + 1% growth and company B with a 3% dividend yield + 8% growth, the market is more inclined to choose company A at this stage, and such companies also attract a large number of fixed-income funds.

But there was a "skeptic" tone about such a choice.

He also mentioned that from a valuation perspective, in the past three years, the valuation of Company A has increased, while the valuation of Company B has decreased due to the continuous revision of the market's long-term growth expectations.

Therefore, the market pricing at this stage makes Company B attractive for long-term high-quality growth, both at absolute and relative levels across valuation dimensions (P/E, market capitalization/free cash flow).

Oil stocks rose to the top position

Judging from the fund managed by Zhang Kun, he has maintained the basic stability of the position and heavy stock pattern as a whole, and mainly made structural adjustments.

E Fund's blue-chip and E Fund high-quality enterprises have mainly adjusted the structure of the consumer and pharmaceutical industries in the past three years. E Fund Premium Select has adjusted the structure of industries such as technology and consumption.

Interestingly, CNOOC has become the largest heavy stock in E Fund's blue-chip and E Fund's high-quality enterprise funds in three years by virtue of its own rise.

Liquor replaces CXO

Most of Zhang Kun's other heavy stocks are also "familiar faces" (taking E Fund's blue-chip fund as an example, the same below).

For example, Shanxi Fenjiu replaced WuXi Biologics and entered the list of the top 10 heavy stocks. However, the number of positions has not changed compared to the 2023 annual report.

The most obvious change in the number of positions is China Merchants Bank. At the end of the first quarter, compared with the number of shares held at the end of 2023, the "queen" is the last seat in the top ten heavy stocks.

Overall, the proportion of funds holding the financial industry did decrease by 3 percentage points compared with the previous period (A and H shares combined).

Best quarter of the past year

From another point of view, the current combination has also witnessed a certain "success" of Zhang Kun.

A keen baijiu enthusiast, he has made additional bets on cyclical resource stocks, and his historical holdings of financial and liquor large-cap stocks have also yielded good returns, which also enabled him to achieve positive returns in the first quarter.

He himself also recorded his best quarterly return of the past year (in the case of blue-chip funds).

Asia Select far outperformed the benchmark

An even rarer outstanding performance occurred in E Fund Asia Select Fund.

In the first quarter, E Fund Asia Select had a net share growth rate of 9.67% in the reporting period, which was the best performance among all funds managed by Zhang Kun in the same period.

The fund is also the only one of all funds managed by Zhang Kun whose performance (in the first quarter of this year) significantly exceeded the performance benchmark.

Zhang Kun mentioned in the fund's quarterly report that the fund's stock position was basically stable in the first quarter, and only the structure was adjusted, involving the structure of industries such as technology and consumption, and also made some balance in the company's business distribution.

Overseas stocks have been "in the bag"

From the perspective of E Fund's heavy stocks in Asia Select Fund, ASML, Prada, and Samsonite are new to the fund's list of heavy stocks.

All three companies are well-known in their industries: the former is a leading company in the most critical industry segment of the semiconductor sector, Prada is a well-known luxury goods manufacturer, and Samsonite is a world-renowned luggage manufacturer.

Obviously, Zhang Kun also focuses on varieties with absolute industrial competitiveness.

Many "fans" are still accompanied

Although it is always said that the star fund manager of active equity has faded, the first quarterly report shows that Zhang Kun still manages more than 64.73 billion yuan, which is a very important existence among public fund managers.

On the flip side, this shows a contingent characteristic of the current fund holders.

The proportion of young people among them is increasing.

This young group is not as sensitive to returns as the older group of investors in the past.

But they attach great importance to affirmation, encouragement and even praise in the spiritual world. They have the same, if not longer, attention to their idols.

They will be with the fund managers for a long time.