Equity Hybrid Fund Index Hits Record High, Surpassing the Pack

Securities Times Reporter Pei Lirui

After five years, the index of actively managed mixed equity funds has finally hit a new all-time high.

This not only signifies that over a thousand actively managed equity funds are experiencing steadily rising returns, but also indicates that many funds once mired in deep losses, with net values halved, have now “climbed out of the deep pit,” and the active investment capability of public funds is once again on an upward trajectory.

However, the driving force behind this peak is “a different scene,” as optical communications surpass the previous “Ning Portfolio” in collective strength to take the top spot, with Zhongji Xuchuang (300308) replacing CATL (300750) as the largest core holding in active equity funds. While the index of mixed equity funds reaches a new high, funds are flocking to bet on AI hardware tracks represented by optical communications, and a new round of extreme collective investment is unfolding.

Over a thousand active equity funds hit record highs

On May 7, the Wind Active Mixed Fund Index closed at 13,521.96 points, setting a new record. This is the index’s first new high since February 2021, when it reached 13,231.44 points, marking a five-year interval.

The Wind Active Mixed Fund Index is commonly used as a benchmark to measure the average performance of active equity funds and the overall active management capability of the public fund industry. This also means that after more than five years of ups and downs, active equity funds have finally “regained lost ground.”

Data from Wind shows that since May, over 1,700 active equity funds have achieved record-high unit net values on a cumulative basis. Excluding funds established during this rally in the past two years, about 1,400 funds still hit new highs, indicating that a large number of active equity funds have already “climbed out of the deep pit.”

Meanwhile, the first “doubling fund” of the year has officially emerged. According to Wind, as of May 6, GF Fund’s GF Vision Smart Selection Fund’s year-to-date return has reached 100.97%, making it the first active equity fund this year to double its net value. As of the latest data on May 8, the fund’s year-to-date return has already hit 112.29%, setting a new record.

Notably, four billion-level funds established at the market’s peak in early 2021 also hit new net value highs this May, managed respectively by Yang Jun and Ma Lei’s Huatai-Pinebridge Digital Future A, Yang Dong’s Fortune Qunheng Select, Li Xiaoxing’s Yin Hua Xin Jia Two-Year Holding Hybrid, and Wu Wei’s Bosera Hui Xing Return One-Year Holding.

Taking Huatai-Pinebridge Digital Future A as an example, this fund was launched with a total scale of 9.99B yuan on February 24, 2021. At that time, the market was at a high point, followed by a bear market lasting over three years, with its net value once halved. However, in February 2024, the fund bottomed out and rebounded, with nearly 142% return over the past two years, and a total return since inception of 42.54%.

The highest return over the past five years was from E Fund Rui Xiang I managed by Wu Yang, established in June 2015, with a five-year return of 405.8%, and a total since inception of 1020.86%. Additionally, Liu Yuanhai’s Dongwu New Trend Value Line and Dongwu Mobile Internet A, as well as Jiangshan’s Invesco Great Wall Stable Return, all posted returns exceeding 350% over five years.

Optical communications succeed new energy as core assets

After five years, the Wind Active Mixed Fund Index has hit a new record high, but the behind-the-scenes drivers have “changed dramatically.”

In 2021, the A-share market experienced a highly differentiated structured rally, with institutional collective investments focusing on the consumer sector represented by Baijiu and the new energy sector represented by lithium batteries. By the end of 2021, the top three holdings of active equity funds were CATL, Kweichou Moutai (600519), and Wuliangye (000858). As the two largest holdings, CATL and Kweichou Moutai were collectively held by over 1,000 funds, with shareholding ratios of 9.97% and 4.62% of circulating shares, respectively.

The new energy sector was the core driver of the previous active fund bull market, with most “doubling funds” in 2020 and 2021 heavily concentrated in this track. In 2020, Zhao Yi’s Agricultural Bank of China-Huaxia Industrial 4.0 led with a 166.56% return, with top holdings including CATL, Ganfeng Lithium (002460), and Longi Green Energy. In 2021, Cui Chenlong’s Qianhai Kaiyuan Utilities and Qianhai Kaiyuan New Economy A took the top two spots with returns of 119.42% and 109.36%, respectively. Their top holdings included power utilities like China Resources Power and Huaneng International (600011), as well as lithium giants like Yunnan Yuntianhua (300059), BYD (002594), and CATL.

Five years later, this pronounced divergence has reappeared, but this time, the core investment position has shifted from the “Ning Portfolio” to optical communications.

Wind data shows that by the end of Q1 2026, Zhongji Xuchuang, a leading optical module company, remains the largest core holding among active equity funds. Additionally, Xinyisheng (300502) and Dongshan Precision (002384) are respectively the third and sixth largest holdings in sovereign wealth funds.

More notably, as of the end of Q1 2026, the proportion of active equity funds holding Dongshan Precision, Xinyisheng, and Zhongji Xuchuang reached 18.54%, 17.23%, and 11.7%, respectively—already surpassing the holdings of active funds in CATL and Longi Green Energy in 2021. This indicates that public funds’ collective investment in optical communications has exceeded that in the “Ning Portfolio.”

A research report from Galaxy Securities shows that in Q1 this year, the communication industry surpassed the electronics industry to become the top overweight sector among active equity funds, with an overweight ratio of 8.28%, up 1.63 percentage points from the previous quarter.

Optical communications has become the strongest driver of the new generation “doubling funds.” Take GF Vision Smart Selection Hybrid A as an example: its Q1 report shows a significant bet on fiber optic cables, with the top three holdings being Longfei Fiber (601869), Zhongtian Technology (600522), and Hengtong Optoelectronics (600487), accounting for nearly 30% of the portfolio. In terms of stock performance, since the beginning of the year, Longfei Fiber has surged 2.41 times, Zhongtian Technology 1.26 times, and Hengtong Optoelectronics 2.12 times—each a “doubling stock” this year.

Beware of risks from extreme collective investment

As public funds’ collective investment in optical communications surpasses the “Ning Portfolio” of 2021, concerns also arise: will market fragmentation and the collapse of collective positions seen since 2021 repeat?

Looking back at A-share history, institutional collective investment is not new. From the internet bubble in 2000, the rise of consumption in 2011, to the “Mao Index” from 2017–2019, the “Ning Portfolio” in 2020–2021, and now the optical communications rally driven by AI computing power demand, each cycle reflects economic transformation. Yet, almost every extreme collective investment has ended with valuation inflation followed by rationalization.

According to a report from Guojin Securities, as of the end of Q1 this year, the overall allocation ratio of active equity funds to the AI hardware sector reached 31.5%, an increase of 17.7 percentage points from the previous quarter, reaching a historical high. Compared to core historical tracks, this exceeds the peak of the “Ning Portfolio” in early 2021 but has not yet surpassed the “Mao Index” or the pre-2007 financial real estate bubble. For AI hardware, current collective investment is not yet extremely crowded, but given the accelerating trend since April, crowded trading warrants caution.

Pengyang Competitiveness Pioneer fund manager Dai Jie stated that, from the perspective of AI industry development, the industry transformation is still accelerating. However, it is also undeniable that the market assigns extremely high valuations to many unprofitable startups, reminiscent of the internet bubble at the turn of the century (the internet revolution was vigorous and changed the world, but the capital market still experienced a bubble burst). In terms of prosperity, upstream hardware for AI computing power is the most certain, but in the medium term, the current high profitability of upstream hardware is unsustainable. Historically, stock prices tend to lead the turning points of prosperity, and the crowded collective investment in the computing power sector is not without risks.

“Unlike in the past, the current market presents a split scenario: on one side, risk aversion due to geopolitical conflicts, and on the other, further collective investment in high-valuation new technologies. Behind this is a weak market environment where funds flock to high-growth, high-certainty assets. As long as high volatility and uncertainty persist, the strong will remain strong for a while,” said a fund manager in Shanghai.

(Edited by: Zhang Xiaobo)