Recently, the second quarterly report of the Ruiyuan Wenjin configuration fund managed by Rao Gang and Hou Zhenxin for two years was disclosed. The fund decreased its positions in both stocks and bonds in the second quarter, with the stock position decreasing from 30.66% in the first quarter to 28.98% at the end of the second quarter; and the bond position decreased from 67.61% to 66.13%. Regarding the adjustment of positions in stocks and bonds, the quarterly report mentioned that the fund made relatively small adjustments in the second quarter, focusing further on core targets with relatively high certainty in equity assets. Specifically, in terms of changes in holdings, compared to the first quarter of 2024, the fund increased its holdings of stocks such as Tianlian Precision (688210.SH) and Contemporary Amperex Technology (300750.SZ); and reduced its holdings in China Mobile (00941), Sinyuan Electrical (002028.SZ), Weiming Environmental Protection (603568.SH), and Industrial and Commercial Bank of China (01398). Regarding the adjustment of positions in stocks and bonds, the quarterly report mentioned that the fund made relatively small adjustments in the second quarter, focusing further on core targets with relatively high certainty in equity assets; in terms of convertible bonds, some financial convertible bonds approached the conversion conditions as the underlying stocks rose, resulting in a reduction in holdings that yielded good returns compared to the previous quarter. In terms of fund performance, as of the end of the reporting period, the net asset value of the Ruiyuan Wenjin configuration fund's two-year holding mixed A fund shares was 0.9969 yuan, with a growth rate of 4.66% during the reporting period, compared to a benchmark return of 1.30%; and at the end of the reporting period, the net asset value of the Ruiyuan Wenjin configuration fund's two-year holding mixed C fund shares was 0.9892 yuan, with a growth rate of 4.58% during the reporting period, compared to a benchmark return of 1.30%. In the second quarterly report, Rao Gang mentioned that in the second quarter of 2024, the overall economic operation was relatively stable, with demand-side characteristics largely continuing from the first quarter: overall, export demand was stronger than domestic demand, the rebound in global manufacturing PMI combined with the end of the overseas inventory clearance cycle provided support for export demand, and China's low-cost advantage in manufacturing was increasingly evident in more areas. On the domestic demand side, real estate demand continued to be weak overall, but with further policy support and rapid base effect, the year-on-year decline in real estate sales narrowed slightly; the pace and intensity of the real estate destocking policy will be a key observation point for the stability of the real estate market. Consumption continued to show structural characteristics of service consumption being stronger than physical consumption, and overall consumption momentum remained weak. On the investment side, infrastructure investment slowed down, real estate investment remained sluggish, and with the gradual manifestation of the effects of large-scale equipment upgrades and the impact of external demand, manufacturing investment stood out. In terms of market performance, resource stocks and "high dividend" assets continued to perform relatively well, with banking, utilities, electronics, coal, and transportation ranking among the top five industries in terms of returns. In terms of asset allocation, with both stock and bond market volatility narrowing in the second quarter compared to the first quarter, the overall adjustment of the fund was relatively small, with adjustments in equity assets focusing on increasing concentration on core targets with higher certainty, and continuing the operations from the first quarter, rebalancing the portfolio structure of some stocks with significant price changes based on expected return levels. Regarding convertible bonds, the fund mainly held undervalued convertible bonds such as those from financial companies with high pure bond yields and sufficient valuation protection, showing minimal impact amid the transitional shocks in the convertible bond market due to changes in market style. Some financial convertible bonds that had been held long-term approached the conversion conditions as the underlying stocks rose, leading the fund to reduce its positions and realize good returns, resulting in a slight decrease in convertible bond positions compared to the previous quarter. Rao Gang mentioned that considering the expected acceleration of deficit bond issuance within the budget and the central bank's attention to long-term interest rate risks, the fund moderately reduced the leverage and duration of its bond assets in the second quarter. Currently, real interest rates in China are still at relatively high levels, and inflation does not pose a constraint on monetary policy, suggesting that bond assets still have good allocation value in the medium to long term. Rao Gang stated that after experiencing rapid changes in the domestic and external environment in recent years, market pricing of risks has become increasingly explicit, reflected in the relative valuation between stocks and bonds, as well as within different sectors of the stock market. Some high-quality leading companies have proven in the past two years their ability to adjust, adapt, and evolve rapidly under macro pressures, and their expected returns, adjusted for risks, have become attractive enough to instill confidence and patience in holding onto them.