Since the news of his proposed resignation, the recent news of Qiu Dongrong's additional fund managers in the products under management has added "a fire" to the relevant rumors. On May 11, Zhonggeng Fund announced that Qiu Dongrong was managing Zhonggeng Value Pilot Hybrid and Zhonggeng Value Quality One-year Holding Period Mixed Fund Manager.
At present, Zhonggeng Fund has a total of 6 funds, of which 5 are products under management by Qiu Dongrong. As of the end of the first quarter of 2024, Qiu Dongrong's scale under management accounted for nearly eighty percent of the total scale under management of Zhonggeng Fund in the same period. There is a view that the departure of core fund managers will not only weaken the influence of fund products, but also lead to the loss of a group of "iron fans" following core fund managers. It is worth mentioning that Qiu Dongrong is not only the outstanding "helmsman" of Zhonggeng Fund, but also the fourth largest shareholder with 9.73% of its shares.
The appointment of additional fund managers has been settled
Qiu Dongrong, a well-known fund manager, hired 2 products under management at the same time. On May 11, Zhonggeng Fund announced that it would hire Liu Sheng as the fund manager of Zhonggeng Value Pilot Mix with immediate effect to jointly manage the fund with Qiu Dongrong. According to public information, Liu Sheng joined Zhonggeng Fund in July 2018 and has served as a researcher, investment manager assistant, investment manager, and currently serves as the director of the research department of the investment department, but has no previous experience in managing public fund products.
On the same day, Zhonggeng Fund also hired Wu Chenggen as the fund manager of Zhonggeng Value Quality One-year Holding Period Mix, and co-managed the fund with Qiu Dongrong. It is reported that Wu Chenggen joined Zhonggeng Fund in January 2019 as the investment manager of the fixed income department, and since June 3, 2020, he has served as the manager of Zhonggeng Value Smart Flexible Allocation Mixed Fund, and co-manages the fund with Qiu Dongrong.
Image source: Screenshot of the announcement
Recently, rumors about Qiu Dongrong's imminent departure have been spreading. According to media reports, Qiu Dongrong does have a plan to leave his post, and said that he "wants to take a break for a while", and the products under his management will hire additional fund managers. There is a view that the addition of fund managers to Qiu Dongrong's products may pave the way for his resignation. However, in addition to the above-mentioned three funds co-managed by other fund managers, Zhonggeng small-cap value stocks and Zhonggeng Hong Kong Stock Connect value 18-month closed-end stocks are currently only managed by Qiu Dongrong.
As for the reason for hiring additional fund managers, Zhonggeng Fund responded to a reporter from Beijing Business Daily that in order to comply with the goal and overall framework of high-quality development of the industry, public funds need to strengthen the core capacity building of investment and research, and continuously strengthen the construction of a "platform-based, team-based, integrated, and multi-strategy" investment and research system. After careful consideration and discussion by the company's management and core members of the investment research team, it was decided to expand the team of fund managers, further enhance the investment management capabilities and boundaries, and embrace the high-quality development of the industry with a long-term mechanism.
Zhonggeng Fund said that the arrangement of hiring additional fund managers will maximize the alpha of investment research talents, so that everyone in the investment research team can better play the effectiveness of the systematic development of investment research. For the follow-up arrangements in terms of products, personnel appointments and dismissals, Zhonggeng Fund also mentioned that it will issue announcements in a timely manner and please refer to the company's announcement, and please do not believe or speculate arbitrarily about the information obtained through other unofficial channels.
However, investors did not buy the above statement of the fund manager, and planned to find Qiu Dongrong's "replacement". There are even more people who call on Qiu Dongrong to give a happy word. If the rumors are true, what impact will it have on Zhonggeng Fund? Will investors "vote with their feet"? Will Zhonggeng Fund's products encounter a wave of redemption?
Financial commentator Guo Shiliang believes that star fund managers are the soul of a fund company, and the departure of such core fund managers will not only weaken the influence of fund products, but also lead to a group of "iron fans" following core fund managers to leave. Once the core fund manager leaves, the existing fund products may lose a number of customers.
It holds 9.73% of the company's shares
Founded in 2018, Zhonggeng Fund is an individual public offering, and currently has only 6 fund products, except for Zhonggeng Value Pioneer Stocks, the remaining 5 are all funds managed by Qiu Dongrong. According to public data, as of the end of the first quarter of 2024, Qiu Dongrong's scale under management was 19.854 billion yuan, accounting for 79.28% of all Zhonggeng Fund's total scale under management in the same period.
From the perspective of tenure returns, the three funds currently managed by Qiu Dongrong have doubled. According to public data, as of May 10, the return on the mixed tenure of Zhonggeng Value Pilot managed by Qiu Dongrong was 133.17%, and the return on the tenure of Zhonggeng small-cap value stocks and Zhonggeng Value Smart Flexible Allocation Mix was also 120.03% and 109.15% respectively.
When it comes to Qiu Dongrong, the first label that comes to mind is "low valuation" and "value investor". In the previously released first quarter report of 2024, Qiu Dongrong also mentioned that in terms of investment ideas for the future market, he adheres to the low-valuation value investment strategy, and builds a portfolio with high expected returns by selecting stocks with good fundamentals, positive earnings growth, and undervalued values, and strives to obtain sustainable excess returns.
In addition to the identity of Zhonggeng Fund's outstanding fund manager, Qiu Dongrong is also the company's deputy general manager and a shareholder holding more than 5% of the shares.
As early as August 2018, Qiu Dongrong became the deputy general manager of Zhonggeng Fund. On September 4, 2023, the China Securities Regulatory Commission also approved Qiu Dongrong to become a shareholder of more than 5% of Zhonggeng Fund. The registered capital of Zhonggeng Fund was changed from 200 million yuan to 210.5 million yuan, and Qiu Dongrong subscribed for the company's new 10.5 million yuan in accordance with the law. According to the data on the official website of Zhonggeng Fund, there are currently 9 shareholders of Zhonggeng Fund, of which Qiu Dongrong's shareholding ratio is 9.73%, which is the fourth largest shareholder of Zhonggeng Fund.
It is not difficult to see that Qiu Dongrong is not only the "pillar" of Zhonggeng Fund, but also has a certain right to speak in the company. However, in recent years, there have been many "pillar" fund managers in the industry who have left one after another. For example, Fan Yan, who previously worked at Yuanxin Yongfeng Fund, left in April this year and recently confirmed that she will join Wells Fargo Fund; Qiu Dongrong's wife, Bai Bingyang, also resigned from BOC Securities in February 2023 and joined Wells Fargo Fund in December of the same year.
Guo Shiliang said that the resignation of public fund managers may be related to a number of factors such as high pressure on fund assessment, high pressure on asset management, and fund managers seeking income breakthroughs. At the same time, corporate culture, performance pressure, and income expectations have also become the main reasons affecting the resignation of public fund managers.
Although the authenticity of Qiu Dongrong's departure and the reasons for his departure are not yet known, Zhonggeng Fund said that it will continue to optimize the governance structure, strengthen the cultivation and echelon construction of investment and research talents, fully support the continuous evolution of the low-valuation value investment strategy system, and provide a solid guarantee for the effectiveness of the value investment strategy.
Beijing Business Daily reporter Li Haiyuan