Seize the market correction opportunity as some new funds accelerate their "building positions"

Staff Reporter Wan Yu

Recently, market adjustments have led to a slowdown in new fund launches, but many fund companies are still launching new products at low levels against the trend. Meanwhile, several recently established funds are quickly building positions. Industry insiders say that short-term external disturbances do not change the long-term investment value of A-shares. The rapid building of positions in new funds during market adjustments reflects optimism about long-term investment opportunities in A-shares, and a desire to actively seize the opportunities brought by the correction. However, some new funds are cautious in building positions, remaining on the sidelines after their establishment.

New Fund Launches Slow Down

Recently, the A-share market has experienced volatility and adjustments, leading to a cooling in the number of new fund launches compared to previous hot periods. Wind data shows that in the first week of March (March 2–6) and the second week (March 9–13), 45 and 40 new funds (by subscription start date) respectively began issuing, while in the third week (March 16–20), the number decreased to 25. As of March 26, 22 new funds started issuing this week.

Market fluctuations have somewhat dampened investor enthusiasm for subscribing to new funds, but some funds still completed fundraising within a short period. For example, Xin Yuan Cycle Wise Selection and Dongfanghong Cycle Research Selection both completed their fundraising in one day. The GuoFeng CSI Hong Kong Stock Connect Information Technology ETF and Anxin Balanced Ziyuan Hybrid took only five days to raise funds. Notably, Anxin Balanced Ziyuan Hybrid reached a scale of 20.15 billion units.

Some fund companies are choosing to launch new products against the trend during market adjustments. Wind data shows that from March 27 to April 4, another 27 new funds began issuing.

It is worth noting that the China Securities Regulatory Commission recently approved a new batch of hard technology-themed funds, totaling 15 products. These include passive funds tracking the “Shuangchuang” (Mass Entrepreneurship and Innovation) AI index and actively managed funds based on the China Strategic Emerging Industries Index, focusing on core technology and strategic emerging industry growth. Bank of China CSI Sci-Tech Innovation and Entrepreneurship AI Index started issuing on March 23; Xingyin CSI Sci-Tech Innovation and Entrepreneurship AI Index and GuoFeng CSI Sci-Tech Innovation and Entrepreneurship AI ETF began on March 27 and March 30, respectively. Other approved products are expected to start fundraising soon.

Different Paces of Building Positions in New Funds

Recently, market corrections have prompted many newly established equity funds to seize the opportunity and quickly build positions. For example, the Shanghai Silver Medical Select Stock Initiating Fund was established on March 4, and by March 6, its A-shares net asset value had reached 0.9999 yuan, indicating it may have begun building positions.

E Fund Research Wise Stock was established on March 17, and by March 20, its A-shares net asset value was 0.9988 yuan. The same day, the China Merchants Bank Yuanjian Select Hybrid also saw its net asset value change quickly, reaching 0.9990 yuan. The Huatai Consumer New Opportunities Hybrid initiated fund, established on March 10, saw its net asset value rise to 1.0014 yuan on March 13, then fall to 0.9924 yuan on March 20. These net value changes suggest that these new funds may have started building positions shortly after their establishment.

However, some funds have chosen to remain on the sidelines. The Bai Jia Bai Yu Growth Hybrid Initiating Fund, established on March 19, still has a net asset value of 1 yuan. Similarly, recently established funds such as PICC Ruiyi Wisdom Select Hybrid, Hu’an Innovation Momentum Hybrid, Invesco Great Wall Hengrui Select Hybrid, and Anxin Balanced Ziyuan Hybrid still have net asset values of 1 yuan or have not yet begun building positions.

Long-term Direction of A-shares Remains Unchanged

Industry insiders say that the rapid building of positions by new funds during market adjustments reflects confidence in the long-term investment value of A-shares and a desire to actively seize opportunities. Looking ahead, Invesco Great Wall Fund believes that while the market has priced in considerable short-term risks, geopolitical disturbances still pose challenges, and medium-term prospects remain relatively optimistic. The AI industry trend is driving productivity improvements and growth across multiple sectors. In terms of allocation, given current external uncertainties, investors should focus on defensive sectors and segments less affected by geopolitical shocks: first, upstream energy and raw materials, especially those benefiting from ongoing capacity reductions; second, defensive sectors, particularly high-dividend stocks with strong cash flow and dividend-paying ability; third, sectors driven by external demand with solid fundamentals; and fourth, growth tracks with clear profitability and cyclical trends.

Wei Fengchun, Chief Economist at Chuangjin Hexin Fund, states that under the trend of AI-led technological revolution and industrial upgrading, geopolitical tensions will only alter investment pace and intensify structural differentiation, not change the long-term direction. The current market is turbulent, with ongoing uncertainties. Investors should adopt a cautious strategy, focusing on assets with certainty. The “HALO strategy” (heavy assets with low淘汰率) and hard assets remain effective. It is crucial to firmly allocate to energy, coal, and other secure assets with supply-demand rigidity to build a safety cushion. The growth sector should not be abandoned lightly; focus on genuine growth stocks with real technological barriers and performance realization, especially in AI infrastructure, advanced computing power, robotics, and biomanufacturing.

Minsheng JiaYin Fund states that geopolitical conflicts have shifted the market’s core contradictions toward supply security and strategic resources, changing the logic from risk aversion to concerns about re-inflation. Rising oil prices reinforce inflation expectations, suppress the Fed’s rate cuts, and impact most assets. The ongoing rise in oil prices may delay the market’s re-inflation trades and the Fed’s rate cut expectations, affecting risk appetite. In the short term, the A-share market may mainly fluctuate with clear sector differentiation. If geopolitical tensions ease, risk appetite and liquidity could recover. Overall, under liquidity shocks, the market is likely to see a structural trend in the short term, with opportunities in AI and resource sectors.

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