"From the perspective of investment cost performance, whether it is volatility or ROE level, the large consumer industry is in an advantageous position." Recently, Zhan Jia, the proposed fund manager of Everbright Innovation Life, said that consumer goods are naturally relatively stable industries, and with the average GDP of Chinese entering the list of medium-developed countries, the growth rate of consumption has declined slightly, but the future opportunities for consumption are upgrading and branding.
Zhan Jia has 13 years of experience in stock investment research in the Greater China region and the international market, 8 years of stock portfolio management experience, before joining Everbright Prudential, Zhan Jia worked in a number of well-known institutions in Hong Kong for nearly 10 years. At present, he is the director of the international business department of Everbright Prudential Fund, and is in charge of 7 funds, covering a variety of strategic portfolios, with a total management scale of nearly 10 billion.
Zhan Jia believes that at both the supply and demand levels, consumption has good investment prospects. On the supply side, China's manufacturing has gradually upgraded to create for China, and enterprises have gradually matured. Taking the home appliance industry as an example, many of the world's white and black leading brands are actually Chinese enterprises, and the soil for innovation is already available, and once the brand and channel are established, it is easy to reflect in the company's revenue and performance.
On the demand side, as the average GDP of Chinese reaches the global middle-income level, residents move from producer to consumer. Once the median population crosses the middle-class horizontal line, middle-class consumers will increase at a non-linear rate. Although the current per capita GDP growth rate has slowed down and the total retail sales of the whole society have also slowed down, many innovative consumption scenarios are in an explosive period.
"'Sugarcane is just emerging as the sweetest', when a new product or service method appears, if it meets the real needs of consumers, then this process from scratch is very explosive." For example, sweepers, laser TVs, blenders, etc. in the field of home appliances, sugar-free beverages in the food and beverage field, pre-mixed cocktails, etc., these innovative products have very good application scenarios. ”
When choosing an industry, Zhan Jia uses a three-high and one-low approach. "The three highs refer to the fact that enterprises must have high growth space, high competitive barriers and high capital efficiency, and all three can lay a good foundation for the long-term and steady development of enterprises, which is indispensable."
According to Zhan Jia, the return on invested capital (ROCE) is the main basis he uses to judge the capital efficiency of enterprises. "ROCE is the main basis for judging the level of return on investment relative to the actual investment of enterprises, and can reflect the true returns of the subdivision industry." Buffett has repeatedly shown that the ROE and ROCE of good companies should be above 20%. Companies with high ROCE usually have the ability to consistently be profitable and cross cycles. ”
In addition to the "three highs", "one low" refers to low volatility, and stocks with lower volatility are selected by using historical volatility in high-quality development enterprises. Zhan Jia pays attention to the pursuit of risk-adjusted returns, and establishes a combination with higher risk and cost performance, "ROE divided by annualized volatility is the cost performance of investment, if the space is small and volatile, it is not suitable for investment." ”
Therefore, the field of big consumption and big health has become the track that Zhan Jia focuses on because of its good ROE and relatively stable volatility.
Specific to the investment direction of Everbright Innovative Life, the fund mainly lays out brands and enterprises that can meet people's innovative consumption and quality consumption, including four areas of innovative consumption, innovative health, innovative technology and low-carbon life.
"The definition of innovative living is not limited to improving the quality of life, but also includes innovative experiences that can bring people more convenient, healthy, interesting and environmentally friendly. Historically, when we compare the consumer, medical, technology and new energy indexes with the CSI 300, we can see that these big tracks with future trends have gained obvious advantages. Zhan Jia said.
At this stage, Zhan Jia believes that the most difficult time for consumption has passed, "because of last year's high base, resulting in the lack of attractive performance of consumer companies this year." Recently, market hotspots have frequently focused on the consumption sector, indicating that consumption has shifted to marginal improvement. ”
According to reports, Everbright Prudential Innovative Life Fund can invest up to 50% of the hong Kong stock market. Deeply ploughing the Hong Kong stock market investment for many years, Zhan Jia said that the current certainty of technology stocks in the Hong Kong stock market has not yet appeared, in the early stage of the fund layout, for Hong Kong stocks partial technology giants will be more cautious, should currently look for enterprises with comparative advantages relative to the A-share market, including companies with innovation tracks such as national tide consumption and biotechnology.
Risk Warning: The fund is risky and the investment needs to be cautious. Before making an investment, investors are kindly requested to carefully read the "Fund Contract", "Prospectus", "Product Information Summary" and other legal documents, and the product risk level of Everbright Innovation Life Hybrid Fund is R3 (medium risk), which is suitable for investors with risk rating C3 (balanced) and above. Investors are invited to pay attention to the risk rating of the product and their own risk rating for independent decision-making. This material does not constitute any legal document or investment advice or recommendation. The Fund Manager undertakes to manage and use the assets of the Fund in good faith, diligence and responsibility, but does not guarantee that the above-mentioned funds will be profitable, nor does it guarantee a minimum return. The past performance and net worth of the Fund are not indicative of its future performance, and the performance of other funds managed by the Fund Manager does not constitute a guarantee of the performance of the Fund. The Fund's investment scope includes Hong Kong stocks and will face unique risks due to differences in investment environment, investment targets, market systems and trading rules. Fund assets are not necessarily invested in Hong Kong stocks. The fundraising scale of the Fund is capped at RMB8 billion (excluding interest during the offering period). If it exceeds the quota, it will be confirmed according to the proportion of the last-day subscription application (see the announcement of the offering of fund shares for details). This product is issued and managed by Everbright Prudential Fund, and the distributor, Everbright Bank, does not assume the responsibility for product investment, redemption and risk management.
Important Note: Zhan Jia served as a research analyst at Zhongli Insurance Company Limited from 2008/6 to 2011/6, as a Head of Equity and Investment Analyst at Fortis Investment Management Co., Ltd. in Hong Kong from 2011/7 to 2013/6, as a director and acting head of portfolio management at CCB International Asset Management Limited in 2013/7-2017/12, and joined Everbright Prudential Fund Management Limited in 2017/12 as head of overseas investment in the Equity Investment Department. 2018/6 so far management everbright Dingxin, 2019/12 so far management ever Everbright advanced service industry, 2020/5 so far management everbright Yongxin, 2020/6 so far management everbright Yuxin, 2020/10 so far management Everbright industry rotation, 2021/7 so far management Everbright quality life, 2021/8 so far management everbright Anhe, the following data from the fund regular reports and review by the custodian bank, Everbright quality life was established in 2021/7/19, is currently in the 6-month position building period, Relevant performance will not be shown.
This article originated from Blue Whale Finance
![Everbright Prudential Zhan Jia: In which industries are high ROE, low volatility and high capital efficiency distributed?[fig]](data:image/gif;base64,R0lGODlhAQABAIAAAP///wAAACwAAAAAAQABAAACAkQBADs=)