In recent years, in the market environment based on prosperity, fund managers of high-prosperity tracks have come out of the circle, and various explosive bases are highly sought after, and Yan Yao, the fund manager who talks about ICBC Credit Suisse, seems to have some insufficient flow. However, Yan Yao, who has 8 years of investment experience and holds 3 doubling bases, is one of the strong factions of ICBC Credit Suisse equity investment.
1
Yan Yao: steady and low-key, stock selection expert
Yan Yao currently manages 6 funds, with a total management scale of 19.088 billion yuan, which is relatively moderate for fund managers based on the broad market, of which "ICBC Financial Real Estate", "ICBC New Finance" and "ICBC Total Return Flexible Allocation" management time is more than 5 years, with annualized returns of 19.37%, 20.06% and 13.08% respectively, and the similar rankings are in the 1/4 centile, with excellent long-term performance and obvious excess returns.
Table: Incumbent Management Funds
Source: iFind, Noah's Public Research; data as of: 2021.10.20
Looking at Yan Yao's past industry allocation, it can be seen that this is a fund manager with financial as the bottom position to cooperate with the industry rotation, and the allocation ratio of banking and non-bank financial industries in almost each reporting period has reached more than 50%. The financial sector does not have the high elasticity of the growth track, and it is difficult to rely on short-term outbreaks to become "stars", but using ROE as an indicator to select high-quality leaders in the large financial field and superimpose the excess income created by the industry rotation, Yan Yao's long-term performance is stable, which can be described as a low-key strength faction.
Figure: Changes in the overall industry allocation of funds managed by Yan Yao
It is worth mentioning that a month ago, ICBC Credit Suisse won four Golden Bulls in the 18th China Fund Industry Golden Bull Awards, with Zhao Bei, Yuan Fang and Yan Yao's equity team with solid research skills, clear decision-making process, rich investment experience, and 10 active equity funds to achieve double returns in 2020.
2
ICBC New Finance Stock [001054.OF]: High-quality track, balanced layout
Judging from the historical performance of "ICBC New Finance", in addition to the relatively mediocre performance in 2017, the yield has outperformed the market and similar every year, and the cumulative return since its establishment in 2015 has reached 233.90%, crossing two rounds of bulls and bears and achieving good results in different market styles. Its performance in the past 1 year is particularly prominent, with a return of 60.45%, while the maximum drawdown is only 17.14%, which is less than the average of the same kind.
Table: Historical returns
In terms of investment strategy, the fund takes a combination of top-down and bottom-up approaches.
Top-down is mainly in the familiar track according to the macro and market environment balanced allocation and make certain industry deviations, such as in the economic recovery and overheating stage will be more allocation cycle and finance, in the downward stage of stagflation and recession to play more growth stock advantages. Bottom-up is about selecting individual stocks with growth in the segment.
Specifically, the choice of the fund in the industry rotation is relatively accurate at each time node. "ICBC Credit Suisse New Finance" is more equipped with banks, non-bank finance, real estate and food and beverage. Among them, banks and non-bank financials, as the bottom position of the fund, have a relatively stable allocation every quarter. In terms of industry rotation, Yan Yao cleared the real estate industry from the first half of 2020 and increased investment in electrical equipment, seized the subsequent surge in new energy, and then increased the position of military industry and nonferrous metals in the fourth quarter, which can be seen that Yan Yao's judgment of the market industry rotation is more accurate.
Table: Industry Allocation: % of Net Fund Value (%)
In addition to the fund's performance source in the industry, Yan Yao's stock selection ability is also very outstanding, showing the excess return ability of individual stocks in many industries. Therefore, the overall performance of the large financial industry this year is relatively average, and it can still achieve a good excess return. Yan Yao's shareholding concentration is not high, maintained at about 50%, the turnover rate in the past two years is basically controlled below 400%, earning long-term profit growth of high-quality companies while also controlling risks through moderate diversification.
Judging from the top ten heavy stocks, the investment direction of "ICBC New Finance" still revolves around large finance, large consumption and technology manufacturing, and then makes moderate deviations according to different market stages. The heavily positioned Ningde Times, Bank of Ningbo, and Oriental Wealth all belong to companies with high ROE, which shows Yan Yao's stock selection logic and will look for companies with superior profitability under the selected track. This also explains that in the case of the general prosperity of the financial industry this year, Yan Yao can still make excesses in this field, and it is Alpha that the ability to select stocks brings to the portfolio.
Table: Top 10 Heavy Stocks
Fund managers with big finance as the bottom position usually pay more attention to valuation, but Yan Yao pays more attention to the long-term growth and profitability of the target company itself, so the valuation level of the portfolio is not low. For example, power equipment, which is valued at historically high levels, has risen to the largest holding industry in Q2 this year, and the financial sector also prefers companies with growth attributes.
In general, Yan Yao takes big finance as the starting point, constantly expands the circle of ability, and has both offensive and defensive capabilities. In an environment of increased risk in a single track and deepening market uncertainty, a moderate industry deviation and a strategy of selecting individual stocks and a relatively balanced style may be a good choice, and Yan Yao's broad circle of stock selection capabilities is also more suitable for capturing Alpha for investors in a volatile market.
Warm reminder: All the contents of this article (including but not limited to opinions, conclusions, suggestions, etc.) are for reference only, do not represent any deterministic judgment, and do not constitute any investment advice.