Vice President of China Life Liu Hui: Focus on the allocation opportunities brought by the rising long-term bond yields, with the next five years emphasizing three major directions for equity investment.

(Image source: Visual China)

Blue Whale News, March 26 — Reporter Chen Xiaojuan Today, China Life Insurance (601628.SH) held its 2025 annual performance release conference. Liu Hui, Vice President, Board Secretary, and Chief Investment Officer of China Life, addressed several hot topics related to insurance asset investments.

Data shows that in 2025, China Life achieved its best investment performance in recent years, with a total investment return of 387.694 billion yuan, up 25.8% year-over-year, and an overall investment yield of 6.09%, an increase of 0.59 percentage points from the previous year.

“Insurance investments need to span 20, 30, or even 50 years. Flowing water does not compete to be first; it strives to be endless. Long-term funds and patient capital must persist in the still waters of deep currents to cross cycles,” Liu Hui summarized the essence of insurance asset investment.

Regarding the company’s investment results in 2025, Liu Hui said this was due to the high-quality development of the Chinese economy, the stabilization and warming of the capital markets, as well as the company’s long-standing strategic focus on value investing and prudent investment, along with accurate market analysis and flexible tactical operations.

He explained that last year, the company continued to strengthen asset-liability management, deepened product and business diversification, scientifically controlled liability costs, and effectively improved investment efficiency. At the same time, it proactively seized market opportunities, optimized asset allocation structures, enhanced the stability of investment portfolio returns, and increased long-term growth potential. The company’s operating performance steadily grew, further solidifying the foundation for sustainable development.

On investment strategies, Liu Hui stated that equity investments are key to boosting returns, fixed income investments serve as the stabilizer, and alternative investments are the growth driver for diversified income. In 2025, China Life actively promoted the entry of medium- and long-term funds into the market, strategically increased equity exposure by 5 percentage points, and focused on high-quality assets with new productive capabilities and high dividends. The overall equity investment scale exceeded 1.2 trillion yuan. Meanwhile, the company maintained steady long-term fixed income allocations, accumulating 3 trillion yuan in high-quality long-term assets. In a low-interest-rate environment, it further strengthened strategic allocations and active management, continuously optimizing asset-liability matching, and solidifying the fixed income base. Additionally, leveraging the advantages of long-term and patient capital, the company increased product and strategy innovation, building a comprehensive alternative investment ecosystem across all asset classes and lifecycle stages, with total alternative investments exceeding 1 trillion yuan, opening long-term growth space.

Regarding bond investment allocation, Liu Hui pointed out that China’s bond market is currently showing a trend of rising oscillation around a lower central level. The 10-year government bond yield is between 1.75% and 1.9%, slightly higher than last year’s central rate of 1.74%. The recent rapid decline in interest rates has eased, and long-end spreads have widened. China Life will focus on opportunities arising from rising long-term bond yields.

“Interest rates are still relatively low historically, so in fixed income allocation, we adopt diversified strategies and varieties to find cost-effective options. During this process, we will also allocate some relatively good fixed income products like secondary bonds and alternative debt plans. Additionally, by increasing liquidity premiums and credit premiums, we aim to enhance the resilience of our overall fixed income portfolio.”

Furthermore, Liu Hui stated that the company’s overseas asset allocation is relatively small, and geopolitical risks have less impact on the overall assets. “We will continue to monitor geopolitical influences on energy prices, inflation expectations, and global asset pricing. As an insurance fund, we will leverage the stability of long-term insurance capital, dynamically adjust our asset allocation strategies, seize market volatility opportunities, and deploy high-quality core assets to achieve steady long-term investment performance.”

Liu Hui also revealed that China Life’s investment plans for 2026 and the “14th Five-Year Plan” period will focus on supporting the cultivation of emerging industries and future industries, utilizing diversified tools such as M&A funds, PE funds, and S funds to promote the development of new productive capabilities. The focus of equity investments will be on three major areas:

1. Artificial intelligence and semiconductors, emphasizing technological iteration and domestic substitution, identifying targets with explosive growth potential across the entire industry chain;

2. Healthcare and biotechnology, based on aging population and upgraded health consumption, focusing on innovative drugs and medical devices, intelligent diagnosis and treatment, and chronic disease management;

3. Green energy and new infrastructure, aligned with dual carbon goals, focusing on wind power, nuclear power, and other clean energy sectors, as well as new energy storage and computing power collaboration investment opportunities.