What did foreign capital buy in the first quarter? The dividend style was still favored, and Fidelity Fund raised 925 million yuan in new products

Source of this article: Times Finance Author: Jin Zixin

The product line of foreign public offerings is gradually improving, and the public funds of many international asset management giants have been deployed in the mainland. Since the beginning of this year, a number of foreign-funded public funds have issued new products, mainly equity funds from the perspective of product settings.

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Since April, both Schroders and AllianceBernstein have issued their first equity products. On April 26, Fidelity Fund's second equity product, Fidelity Joy Dividend Selection, was also successfully raised, with a total amount of 925 million yuan, ranking among the top similar fund products in the year.

It is worth noting that foreign-funded public funds have become quite competitive. J.P. Morgan Asset Management, which has been developing in the mainland for many years, announced on February 28 that its CSI A50 index products ended their fundraising ahead of schedule on the same day. On April 1, J.P. Morgan Asset Management once again led the issuance of the CSI A50 ETF Initiator Feeder Fund, ranking among the forefront of the market.

According to the first quarterly report of foreign public offerings, the dividend style is still favored. CNOOC (00883.HK) HK) has become the top stock in the public offering of foreign investors, and it is also the largest heavy stock in BlackRock China New Vision and Fidelity for 6 months. From the perspective of holding style, many foreign public offerings have bought large-cap stocks with high dividends and stable performance, and technology, medicine and energy are the key allocation industries favored by foreign public offerings in the first quarter of 2024.

Fidelity Fund's dividend product ranked second in fundraising during the year

Judging from the amount of funds raised by foreign public offerings of new products, 2024 is indeed not easy.

In 2021, BlackRock China New Vision raised RMB6.680 billion for the first time, setting a new high for the issuance of wholly foreign-owned public funds, and in 2023, Neuberger Berman Escort raised RMB4.091 billion in bonds held for one year as a "fixed income+".

The market environment is volatile, and it is becoming more and more difficult for equity funds to raise funds, but foreign capital is gradually showing vigorous "gold absorption".

The fundraising ended on April 26, and the Fidelity Yuexiang Dividend Selection, which raised an amount of 925 million yuan, became the top product in the fundraising list during the year. Wind data shows that as of April 26, the fund ranked second among the 89 similar funds (equity and partial stock hybrid funds) issued in 2024, while the average size of similar products raised this year was 287 million yuan.

The main distribution agencies of Fidelity Enjoy Dividend are China CITIC Bank and CITIC Securities, and other distribution channels include China Merchants Securities, Haitong Securities, Ant, Teng'an, Tiantian, JD.com, Xueqiu, Yingmi, etc., a total of 25 institutions.

Huang Xiaoyi, General Manager of Fidelity Fund, said, "China CITIC Bank, as the main custodian and sales bank, has given Fidelity strong support during the fundraising period, and Fidelity is very pleased to deepen cooperation with outstanding local financial institutions and jointly explore the cooperation path of first-class Chinese and foreign financial institutions. ”

Why did it choose to issue dividend-related products at this time, Fidelity Fund responded to Times Finance, saying, "Judging from historical data, dividend strategies have outstanding performance in volatile markets, and high dividends can provide a relatively stable source of income in a low interest rate environment." At the same time, the policy tone of this year has been clear, and in the context of the transition period of structural transformation, we believe that the high-dividend sector with high certainty has an advantage. ”

At the same time, Fidelity adopts a forward-looking dividend investment strategy, based on the dividends of listed companies in the past three years, combined with in-depth fundamental analysis, focusing on the stability of the company's earnings, judging the company's willingness and ability to pay dividends in the future, so as to be more forward-looking.

It is understood that the dividend strategy is one of Fidelity International's seven core stock investment capabilities, and has been operating in an overseas long-term low interest rate environment for many years, and as of the end of 2023, the total scale of Fidelity International's dividend strategy has exceeded 170 billion yuan.

What did foreign investors buy in the first quarter?

In terms of the number of issuances, among the foreign fund companies that have started to operate in the mainland in recent years, BlackRock funds have issued 8 products in the mainland, Fidelity Funds and Neuberger Berman Funds have both issued 5 products, and Schroders Funds and AllianceBernstein Funds have issued 2 and 1 products respectively.

Although there are not many equity products in the issued foreign public offerings, judging from the position of foreign capital in the first quarter, high-dividend stocks are still the "favorite" of various companies.

CNOOC is the largest heavy position in Fidelity Funds and BlackRock Funds. BlackRock Fund has a heavy position in individual stocks, and the other two are China Mobile (600941. SH;00941.HK) and Sanmei (603379.SH), while Fidelity Fund is Shaanxi Coal (601225.SH) and China Shenhua (601088.SH). The top three heavy stocks of the Neuberger Berman Fund are Sinocare Biotech (300298. SZ), Gushengtang (02273. HK) and Tsingtao Beer (600600.SH).

Zhou Wenqun, deputy director and fund manager of Fidelity Fund's equity department, said in the first quarter report of Fidelity Inheritance for 6 months that the allocation of the upstream sector was increased in the first quarter, and he believed that this part of the rebalancing was the main source of excess returns, and the overweight of home appliances and underweight of the pharmaceutical sector also brought a certain positive contribution.

However, on the other hand, it pointed out that in the first quarter, the stock selection, overweight food and beverage and underweight banking sectors in the TMT sector had a certain drag on the overall performance, combined with the weak domestic demand, the allocation to food and beverage and real estate-related targets was reduced in the first quarter.

Zhou Wenqun believes that it is expected that from the second quarter, local government bonds and special bond funds will gradually be in place, effectively supporting the recovery of domestic demand, and the overall overseas demand is active, which is expected to continue to drive export activities;

Most of the top 10 heavy stocks in Fidelity's 6-month heritage are allocated to Hong Kong stocks. In this regard, Fidelity Fund told Times Finance, "We see that Hong Kong stocks have more high-dividend targets, and Hong Kong-listed companies are more willing to pay dividends and have higher dividend yields than A-shares." Most of the high-dividend varieties of Hong Kong stocks are concentrated in utilities, finance and other sectors, and some varieties are relatively scarce in A-shares, which can be used as an effective supplement to A-share investment. ”

Wei Xiaoxue, manager of China Opportunities Fund of Neuberger Berman Fund, maintained a neutral and cautious position in the first quarter, with a balanced position structure, increased the allocation of upstream resource companies, and maintained the export-related consumer industries that have benefited more from the depreciation of the RMB this year, and at the same time, preferred individual stocks that are willing to actively increase the dividend rate and have low valuations. It also said in a quarterly report that it has also increased investment opportunities with strong growth attributes in the context of China's economic transformation, high-end manufacturing upgrades, the development of the automobile and electric vehicle industry, and the wave of AI technology.

At the same time, Wei Xiaoxue expressed optimism about the future, believing that new quality productivity is the top priority of this year's National People's Congress and the National People's Congress, and a series of industrial policies may be introduced in the future, which is conducive to boosting the confidence of the capital market.