Shanghai Securities released a fund research report stating that the average return of various types of active equity funds in the second quarter was not positive. The average return of ordinary stock funds, partial equity mixed funds, and flexible allocation mixed funds all experienced a pullback, at 2.82%, 2.36%, and 1.19% respectively. The average return of index funds in the second quarter was -3.71%, with a narrower decline compared to the first quarter. In the second quarter of 2024, the top three industries in terms of market value of holdings by actively managed equity funds were electronics, food and beverage, and electric power equipment and new energy, accounting for 15.43%, 13.72%, and 12.79% respectively. The top three industries with increased holdings were food and beverage, automobiles, and light manufacturing, with increases of 1.71%, 0.13%, and 0.07% respectively. The top three industries with reduced holdings were electric power equipment and new energy, non-ferrous metals, and pharmaceuticals, with reductions of 0.47%, 0.33%, and 0.28% respectively. Overview of the basic market conditions in the second quarter of 2024: Market Performance Review: In the second quarter of 2024, except for the Hang Seng Index, major stock indices were still in a downward trend, with the Shanghai Composite Index falling by 2.43%, the Shenzhen Component Index falling by 5.87%, and the ChiNext Index falling by 7.41%. Overall, the decline in the CSI 300 was the smallest, at 2.14%. The banking, power and public utilities, transportation, and coal sectors saw significant increases. Market Fund Flow: In the second quarter of 2024, northbound funds flowed heavily into the non-ferrous metals sector. The top three sectors attracting northbound funds were non-ferrous metals, electronics, and banks, with inflows of 10.248 billion yuan, 8.829 billion yuan, and 8.531 billion yuan respectively. The top three sectors seeing outflows of northbound funds were food and beverage, household appliances, and automobiles, with outflows of 19.975 billion yuan, 11.393 billion yuan, and 9.294 billion yuan respectively. Public Fund Size: The total size of public funds continued to increase, with the bond fund size experiencing the largest growth. As of the second quarter of 2024, the total size of public funds was 30.71 trillion yuan, an increase of 1.89 trillion yuan from the end of the previous quarter. The sizes of money market funds, stock funds, hybrid funds, bond funds, and QDII funds were 13.19 trillion yuan, 2.83 trillion yuan, 3.34 trillion yuan, 10.6 trillion yuan, and 0.44 trillion yuan respectively. The sizes of stock, bond, alternative investment, and QDII funds increased, with bond funds experiencing the largest growth of 1.27 trillion yuan. In terms of fund management company size, there were 22 companies with total sizes above 500 billion yuan, 36 companies with sizes between 100 billion and 500 billion yuan, and 78 companies with sizes between 10 billion and 100 billion yuan. The top companies accounted for a large share of the overall market size, with the top 30 companies accounting for 74.73% of the total market size, indicating a significant concentration effect. Active Equity Funds: Performance: In the second quarter of 2024, the average return of various types of active equity funds was not positive, with ordinary stock funds, partial equity mixed funds, and flexible allocation mixed funds all experiencing a pullback of 2.82%, 2.36%, and 1.19% respectively. Position Changes: The positions of ordinary stock funds and partial equity mixed funds decreased slightly compared to the first quarter, while the positions of flexible allocation mixed funds decreased by an average of 9.14% compared to the end of the previous quarter. Industry Distribution: The top three industries in terms of market value of holdings by active equity funds were electronics, food and beverage, and electric power equipment and new energy, accounting for 15.43%, 13.72%, and 12.79% respectively. The top three industries with increased holdings were food and beverage, automobiles, and light manufacturing, with increases of 1.71%, 0.13%, and 0.07% respectively. The top three industries with reduced holdings were electric power equipment and new energy, non-ferrous metals, and pharmaceuticals, with reductions of 0.47%, 0.33%, and 0.28% respectively. Passive Equity Funds: Overall Performance: In the second quarter of 2024, the average return of index funds was -3.71%, with a narrower decline compared to the first quarter. 1. Basic Market Overview 1.1 Market Performance Review In the second quarter of 2024, except for the Hang Seng Index, major stock indices were still in a downward trend, with the Shanghai Composite Index falling by 2.43%, the Shenzhen Component Index falling by 5.87%, and the ChiNext Index falling by 7.41%. Overall, the decline in the CSI 300 was the smallest, at 2.14%. Major industry indices of China Securities in the second quarter of 2024 mostly experienced a pullback; the banking, power and public utilities, transportation, and coal sectors saw significant increases, rising by 7.63%, 5.22%, 2.71%, and 2.33% respectively, while the comprehensive, consumer services, media, and retail trade sectors experienced significant pullbacks, with decreases of 25.43%, 20.38%, 19.80%, and 16.23% respectively. 1.2 Market Fund Flow In the second quarter of 2024, most sectors had a negative net inflow of active funds, with only the banking sector experiencing a net inflow. The amount of funds flowing into the banking sector was 27.235 billion yuan; the computer, machinery, and electronics sectors had the highest outflow amounts, at 147.396 billion yuan, 140.951 billion yuan, and 123.015 billion yuan respectively. In the second quarter of 2024, northbound funds flowed heavily into the non-ferrous metals sector. The top three sectors attracting northbound funds were non-ferrous metals, electronics, and banks, with inflows of 10.248 billion yuan, 8.829 billion yuan, and 8.531 billion yuan respectively. The top three sectors seeing outflows of northbound funds were food and beverage, household appliances, and automobiles, with outflows of 19.975 billion yuan, 11.393 billion yuan, and 9.294 billion yuan respectively. 1.3 Public Fund Size As of the second quarter of 2024, the total size of public funds was 30.71 trillion yuan, an increase of 1.89 trillion yuan from the end of the previous quarter. The sizes of money market funds, stock funds, hybrid funds, bond funds, and QDII funds were 13.19 trillion yuan, 2.83 trillion yuan, 3.34 trillion yuan, 10.6 trillion yuan, and 0.44 trillion yuan respectively. The sizes of stock, bond, alternative investment, and QDII funds increased, with bond funds experiencing the largest growth of 1.27 trillion yuan; the sizes of hybrid and FOF funds decreased, with hybrid funds experiencing the largest decrease in total size.Reduced by 0.14 trillion yuan.As of the end of the second quarter of 2024, there are 22 fund companies with a total size of over 500 billion, 36 companies with a size of 1000-500 billion, and 78 companies with a size of 100-1000 billion. The top companies account for a large proportion of the market total size, with the total size of the top 30 companies accounting for 74.73% of the market, demonstrating a clear aggregation effect. 2. Active Equity Funds 2.1 Performance In the second quarter of 2024, the average return of various types of active equity funds did not achieve positive results. The average returns of equity funds, equity balanced funds, and flexible allocation balanced funds were all negative, at 2.82%, 2.36%, and 1.19% respectively. The active equity funds with better and weaker returns in the second quarter of 2024 are shown in the following chart. 2.2 Portfolio Changes As of the second quarter of 2024, the positions of equity funds and equity balanced funds slightly decreased compared to the first quarter; the average positions of flexible allocation balanced funds decreased by 9.14% from the end of the previous quarter. 2.3 Industry Distribution As of the second quarter of 2024, the top three industries with heavy holdings in active equity funds in terms of market value held are electronics, food and beverages, and electric equipment and new energy, accounting for 15.43%, 13.72%, and 12.79% respectively. The top three industries with increased holdings are food and beverages, automobiles, and light industry manufacturing, with increases of 1.71%, 0.13%, and 0.07% respectively. The top three industries with reduced holdings are electric equipment and new energy, non-ferrous metals, and pharmaceuticals, with reductions of 0.47%, 0.33%, and 0.28% respectively. 3. Passive Equity Funds The average return of index funds in the second quarter of 2024 was -3.71%, with a narrower decline compared to the first quarter. The passive equity funds with better and weaker returns in the second quarter of 2024 are shown in the following chart: