Public fund disclosure welcomes new regulations, with indicators such as "fund shareholder profit ratio" and stock turnover rate to be published.

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The new regulations on public fund information disclosure have been officially released.

On March 13, the China Securities Regulatory Commission revised and issued the “Guidelines for Content and Format of Information Disclosure of Publicly Offered Securities Investment Funds No. 2—Periodic Reports” (hereinafter referred to as the “Guidelines”), which will take effect from May 1, 2026.

This revision systematically integrates the longstanding rules for annual, semi-annual, and quarterly disclosures. The most notable change is that the Guidelines for the first time explicitly require fund managers to disclose the “Proportion of Profitably Investing Investors” (commonly known as “Profitability Ratio of Fund Investors”) and stock turnover rate, extending the performance display period to ten years.

Introduction of “Profitability Ratio of Fund Investors”

To address the industry pain point of “funds making money but investors not,” the Guidelines clearly state that for actively managed equity and hybrid funds that have been established for over a year, fund managers must disclose the “Proportion of Profitably Investing Investors” in semi-annual and annual reports, along with a clear calculation formula:
Proportion of Profitably Investing Investors = Number of profitable investors / Total number of investors.

“Investors” refer to those who held fund shares during the calculation period, and “profitable investors” are those whose net returns over the interval are not less than zero.

Net return over the interval = interval return - fund transaction fees (subscription, redemption, conversion fees, etc.).
Interval return = ending market value - beginning market value + (redemptions + transfers out + non-trading transfers out) - (subscriptions + purchase fees + systematic investment + transfers in + non-trading transfers in) + cash dividends.
Additionally, transactions with a holding period of less than 7 days are excluded from this calculation.

In simple terms, “Net Return of Investors” in the formula is based on the traditional asset value changes but further deducts all trading costs such as subscription/purchase fees, redemption fees, conversion fees, and excludes short-term trades with less than 7 days holding, aiming to reflect the true net gains received by investors.

Industry experts point out that this introduction shifts the regulatory and market focus from the superficial “net value growth rate” to the actual “investment return” for holders. It directly links the profitability of fund companies with the actual benefits received by investors, potentially guiding managers to pay more attention to product profitability and holding discipline from the source.

Addition of Long-term Performance Disclosure for the Past 7 and 10 Years

According to the new regulations, fund companies are required to regularly disclose multiple indicators, including fund share growth rates and standard deviations of performance benchmark returns, over periods of three months, six months, one year, three years, five years, seven years, ten years, and since the fund’s inception.
The “past seven years” and “past ten years” performance metrics are newly added.

Industry insiders note that this means a fund established for over ten years will no longer focus solely on “the past three years” or “the past five years” when showcasing performance. Instead, the evaluation period for investment ability will be extended to a full economic cycle.

Stock Turnover Rate as a New Disclosure Metric

To address issues such as frequent trading and style drift in some funds, the Guidelines have added a mandatory disclosure of “stock turnover rate.” In the future, actively managed equity and hybrid funds must clearly report the stock trading turnover rate during the reporting period in their annual reports.

“High turnover often indicates higher trading costs and potential instability in investment strategies,” industry experts say. Making this relatively neutral data public provides investors with a “ruler” to measure whether fund managers’ actions are consistent with their claims. If a fund claiming to adhere to long-term value investing has a consistently high turnover rate, investors can question the stability of its strategy execution. This move aims to enhance transparency of fund investment behaviors, urging managers to uphold long-term and rational investment principles and curb short-term, aggressive investment tendencies.

Targeted and Personalized Information Disclosure Requirements

Beyond these three major highlights, the Guidelines also systematically optimize the existing disclosure framework. The Guidelines consist of 3 chapters and 36 articles, with key revisions including:

1. Integrating disclosure content across periodic reports. Similar or related disclosures in annual, semi-annual, and quarterly reports are consolidated to build a unified, clear, and focused disclosure system.
2. Clarifying the focus of different reports. Tailored, personalized disclosure requirements are proposed based on the specific functions of annual, semi-annual, and quarterly reports.
3. Making adjustments based on higher-level legal requirements and industry practices. Borrowing from mature overseas markets, some disclosure requirements are simplified and modified.
4. Clarifying self-regulation requirements for information disclosure. The Asset Management Association of China will develop expandable business report language templates (XBRL), requiring fund managers to prepare and disclose periodic reports according to these templates.

By Ding Xinqing, The Paper News

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责任编辑：杨赐