In Q4 2025, passive fund assets under management continued to rise, while active fund AUM declined. Holdings across various fund types saw a phased reduction, while stock concentration continued to increase. The allocation to Hong Kong stocks decreased significantly, with the main buying focused on pro-cyclical sectors, AI, and non-bank financials, particularly emphasizing metals & mining, communications, and insurance. The overall style leaned towards cyclical and small-cap growth. Passive funds also showed a greater preference for cyclical and value styles.
Core Views ⚑ Passive fund AUM continued to rise in Q4 2025, while active fund AUM declined. Since Q4 2025, the A-share market experienced volatile upward movement, with investor risk appetite increasing again by the quarter's end, leading to an overall outperformance by growth styles. Both active and passive funds delivered strong performance, yet active fund AUM decreased while passive fund AUM saw a significant rebound. Holdings across fund types generally fell. The stock concentration of active equity-focused funds continued to rise. Looking at the subscription and redemption situation of existing funds, net redemptions for existing active funds narrowed further in Q4 2025, while net subscriptions for existing passive funds expanded further.
⚑ The buying strategy of active equity-focused funds in Q4 2025 primarily revolved around pro-cyclical sectors, AI, and non-bank financials, with a持仓 style偏向顺周期和小盘成长. First, the focus was on the pro-cyclical theme, heavily increasing positions in metals & mining, chemicals, oil & petrochemicals, steel, and building materials. The allocation to metals & mining saw a noticeable quarter-on-quarter increase, as global commodities are currently undergoing a "repricing" driven by multiple converging factors. On the demand side, 2026 is expected to see a共振 in Sino-US macro policies, alongside rising new demand represented by AI data centers and new energy. On the supply side, long-term underinvestment in global mining capital expenditure continues to constrain supply, while the long-term credit expansion of the US dollar and the "de-dollarization" trend are reshaping the pricing logic of commodities. Furthermore, as 2026 marks the beginning of a new Five-Year Plan, pro-cyclical sectors highly correlated with PPI and commodity prices, such as chemicals, oil & petrochemicals, steel, and building materials, also attracted fund interest in Q4. Second, funds increased allocations to the AI theme, focusing particularly on computing power and power infrastructure. Intensifying global AI competition is driving an持续爆发 in demand for high-performance chips, boosting the entire hardware supply chain from advanced packaging to servers. The communications equipment sector, concentrated in AI computing power, and electronic PCBs received significant buying from active funds. The massive energy consumption of AI data centers and their exponential growth in power demand also led to increased allocations to the power grid equipment sector. Third, funds added to non-bank financials, particularly insurance. The insurance sector started the year strongly, with the liability side benefiting from interest rate environments and product demand changes, and the asset side seeing improved investment returns amid active markets. Coupled with relatively low valuations, the insurance sector also saw increased allocation from active equity-focused funds in Q4.
⚑ Regarding changes in passive fund holdings, the weightings of Communications, Metals & Mining, and Banks increased significantly, while the weightings of Electronics, Power Equipment, and Pharmaceuticals & Biotechnology declined. In Q4 2025, the weighting of Main Board stocks in passive fund top holdings increased, while the weightings of Growth Enterprise Market (GEM) and STAR Market sectors declined. In terms of style preference, the holdings weightings of the CNI Value, Large Cap Value, and CSI Dividend indexes saw the largest quarter-on-quarter increases, while the holdings weightings of the CSI A100, Large Cap Growth, and GEM Index saw the largest declines. Compared to active funds, the sectors where passive funds increased their overweight positions relative to active funds in Q4 2025 were mainly concentrated in: Banks (+1.6%), Media (+1.3%), and Communications (+0.6%).
⚑ The allocation to Hong Kong stocks by active funds decreased significantly in Q4 2025. The total market value of Hong Kong stocks in active fund top holdings reached 312.1 billion yuan in Q4 2025. Their proportion of the total market value of all top holdings fell from 19.26% in Q3 2025 to 16.23%, a quarter-on-quarter decrease of 3.03%. The number of Hong Kong stocks held in top holdings decreased from 376 in Q3 2025 to 361. The number of Hong Kong stocks among the top 10, 50, and 100 largest holdings all declined, indicating a clear reduction in the proportion of Hong Kong stocks within active fund portfolio allocations.
⚑ Risk提示: Economic data and policies falling short of expectations; overseas policies tightening beyond expectations.