The market is heating up, public funds are bustling with activity - how should we invest in the fourth quarter?

The Shanghai Composite Index has broken through 3900 points for the first time in 10 years, with A-shares and public fund issuance markets simultaneously experiencing renewed warmth.

On October 9, A-shares achieved a strong opening on the first trading day after the holiday, with trading volume exceeding 2 trillion yuan for the 36th consecutive trading day. Public funds are also accelerating their pace to capture Q4 positioning opportunities, with 23 new funds launching concentrated starts just on the first post-holiday day alone, plus over 80 additional products currently in issuance or scheduled for launch, including new products managed by outstanding fund managers such as Yan Siqian and Jin Zicai.

Fund issuance pace is also accelerating. Data shows that compared to the same period last year, new fund issuances in the first three quarters of this year have nearly doubled year-over-year, with fundraising amounts surging 90%. Notably, 70% of equity new funds have preset fundraising periods of no more than 20 days.

With the new product issuance boom resonating with market recovery, public funds are providing more "ammunition" and "confidence" to the market in the upcoming fourth quarter. Combined with the intensive arrival of policy windows and third-quarter earnings verification period, which sectors will become the new focus for capital allocation has attracted significant market attention.

Yang Gang, Chief Economist at Golden Eagle Fund, analyzed that following the end of the National Day and Mid-Autumn Festival holidays, A-share markets are expected to become active again. Currently, China's economy is in a critical development period of new and old growth driver transformation. He suggests focusing on prosperity sectors around the "15th Five-Year Plan" and third-quarter reports, with technology growth directions still having valuation elasticity.

**Post-Holiday New Fund Issuance Heats Up**

Wind data shows that as of October 9, a total of 53 fund products (counting only initial funds) are currently being issued across the market, with the latest fundraising deadline at the end of December. On October 9 alone, 23 funds launched concentrated issuances, with subscription periods ranging from 1 to 23 days.

Currently, 51 funds are confirmed to be issued after the National Day holiday, with equity products including stock and hybrid funds occupying the absolute majority.

Index products continue their popularity, accounting for over 70% of issuances, covering multiple index-enhanced products tracking CSI 300, CSI A500, CSI 800 directions, as well as products in Hong Kong Stock Connect technology, dividend low volatility, and new energy sectors.

Active equity funds are equally impressive, with new products led by renowned fund managers attracting attention. For example, Penghua Manufacturing Upgrade, which began sales on October 9, is managed by fund manager Yan Siqian, whose managed Penghua Carbon Neutrality Theme A achieved a cumulative return rate of 111.79% in the first three quarters.

Caitong Quality Selection, set to launch on October 16, is a product led by renowned fund manager Jin Zicai after a two-year hiatus. Data shows that his six actively managed equity fund products all achieved returns above 52% in the first three quarters, with Caitong Integrated Circuit Industry A reaching 75.44%.

The improvement in market confidence is also reflected in fundraising pace. Looking at planned fundraising periods for equity products, 70% of products are expected to complete fundraising within 20 days (inclusive). As A-share markets continue to warm up, fund managers' expectations for future market conditions are relatively optimistic.

Additionally, among the 8 bond funds planned for October issuance, none are pure bond funds. Except for Caitong Asset Management Hongyao 90-Day Hold being a hybrid primary bond fund, the remaining 7 are all hybrid secondary bond funds. By comparison, 16 hybrid bond funds launched fundraising in September, indicating accelerated issuance of equity-containing bond funds.

This situation has two aspects of reasons.

On one hand, regulators encourage fund managers to actively deploy "fixed income plus" and other equity-containing products. Previous guidance indicated that for secondary bond funds with clearly stipulated minimum equity ratios, registration should be completed within 15 working days from the acceptance date in principle.

On the other hand, "fixed income plus" products have become a commonly favored direction for multiple companies due to their advantages in balancing returns and experience during volatile markets. "Under current market conditions where both stocks and bonds have opportunities but volatility remains, secondary bond funds spanning both stock and bond markets, pursuing both offensive and defensive capabilities, may be handy tools for investment positioning," said a fund company representative with relevant deployment plans.

Looking at the first three quarters, A-share markets showed volatile upward movement, with significantly enhanced capital inflow willingness and accelerated product deployment by public fund institutions. Wind data shows that calculated by fund establishment date, 1,149 new funds were issued during the year, an increase of more than 30% compared to the same period last year, even exceeding last year's full-year total (1,135).

Among these, third-quarter new fund issuances reached 477, a 27% increase from the previous quarter and nearly doubling year-over-year (93.12%); total fundraising shares increased nearly 90% year-over-year. From the third week of August to the fourth week of September, weekly new fund issuance shares all exceeded 20 billion, with stock product weekly issuance scales all surpassing 11 billion shares.

**Institutions Predict Q4 Volatile Upward Movement**

On October 9, A-shares welcomed the first trading day after the National Day holiday, with markets continuing pre-holiday warming trends to achieve a strong opening. The Shanghai Composite Index showed volatile upward movement, standing above 3900 points again after 10 years. At market close, the Shanghai Composite rose 1.32% to 3933.97 points, expanding year-to-date gains to 17.32%. The Shenzhen Component Index and ChiNext Index performed even more strongly, with year-to-date gains of 31.79% and 52.31% respectively.

Market trading activity also heated up again, with daily turnover reaching 2.67 trillion yuan, an increase of 474.57 billion yuan from the last trading day before the holiday. This marks the 36th consecutive trading day since mid-August that A-shares' daily turnover exceeded 2 trillion yuan.

From sector performance, differentiation was significant, with non-ferrous metals leading gains strongly; media, real estate, and tourism sectors showed notable adjustments, with multiple stocks including Guomai Culture, Huace Film & TV, Enlight Media, and Shenzhen Shenda falling over 10%.

Regarding daily market performance, relevant personnel from Yongying Fund analyzed: "During the National Day holiday, global stock markets rose, with Japanese and Korean markets leading gains. A-shares followed global markets to catch up, with gold, semiconductors, nuclear fusion and other sectors leading gains, similar to global market performance and generally meeting expectations."

The personnel expects that over the coming period, markets may continue broad fluctuations, but maintain an optimistic "volatile upward" judgment for the medium term. From a global equity market valuation comparison perspective, "A-shares are currently still at relatively low levels. Along with clear domestic industrial trends in AI, innovative drugs, robotics, and phased improvement in China-US relations, market medium-term risk appetite is expected to have support."

Entering the fourth quarter, markets will face intensive policy windows and third-quarter earnings verification periods. Multiple interviewed personnel judge that Q4 policy expectations are generally positive, with China entering the policy introduction period for the "15th Five-Year Plan," during which key industrial planning is expected to provide new thematic investment opportunities for markets.

"In October, domestic policy directions and quarterly earnings guidance will provide upward catalysts for A-shares," Yang Gang explained: In the short term, the "15th Five-Year Plan's" important incremental guidance for industrial development directions may become October's core macroeconomic variable. Additionally, with October being the third-quarter report disclosure period, attention should be paid to earnings guidance for industry prosperity; current markets have some divergence between earnings realization and expectation front-running, awaiting further clarity from earnings guidance.

Relevant investment research personnel from Southern Fund's Macro Strategy Department analyzed that after experiencing volatile consolidation since September, as crowding pressure eases, third-quarter report trading again builds consensus for prosperity mainlines, and October's intensive major meetings boost expectations, new upward momentum is building, with October market center expected to reach new levels.

In structural positioning, the investment research personnel suggests still focusing on prosperity and industrial trends, emphasizing third-quarter report prosperity clues and "15th Five-Year Plan" beneficiary industries, including innovative drugs, AI (computing power, gaming), military, batteries, and "anti-involution." Among these, previous military parade catalysis-driven overheating sentiment has been sufficiently digested, with current military industrial chain crowding across directions having fallen to low levels, allowing for subdivision direction positioning opportunities.

The aforementioned Yongying Fund personnel suggests that allocation-wise, attention can be paid to two types of opportunities: one category is high-position, high-win-rate opportunities, such as overseas computing power, domestic computing power, AI applications, innovative drugs and other areas where institutions continue increasing positions; another category is low-position sectors with potential catalysts, such as photovoltaics, chemicals, lithium batteries, etc., with focus on structural opportunities brought by supply-demand imbalances in subdivision areas within these assets.