The topic of "50 trillion yuan in time deposits maturing soon" is gaining increasing attention.

Huatai Securities' fixed income team, based on calculations from the maturity balances of various deposit terms in listed banks' annual reports, estimates that approximately 50 trillion yuan in one-year and longer time deposits will mature in 2026, representing an increase of about 10 trillion yuan compared to 2025. The maturity pressure is significantly higher in the first half of 2026 than in the second half, making the need for deposit reinvestment increasingly urgent.

The direction of this massive wave of maturing funds has become a key market focus. Although the stock market's strong start to the year has attracted some capital, time deposit holders generally exhibit low risk tolerance and may struggle to adapt to stock market volatility in the short term, with capital preservation remaining their primary concern.

Consequently, FOFs emphasizing diversified asset allocation are poised to attract greater investor interest.

The core value of FOFs lies in their consistent multi-asset allocation philosophy. Historical market performance shows that major asset classes like stocks, bonds, commodities, and overseas assets typically exhibit low correlation. FOFs strategically leverage this characteristic and the resulting hedging effects to diversify away unsystematic risks associated with the volatility of any single asset.

Taking the CSI Multi-Asset Risk Parity Index as an example of multi-asset allocation, this index comprises three core assets: A-shares, bonds, and gold. Over the past decade, its maximum drawdown was merely -3.97%, significantly lower than that of bond assets represented by the CSI Aggregate Bond Index, and substantially better than equity assets represented by the CSI 300 Index or commodity assets represented by the Nanhua Gold Index, demonstrating exceptional risk resilience.

The index's Calmar ratio over the past 10 years reached 1.25, far exceeding that of other single-asset indices. This indicates its ability to generate higher annualized returns for investors per unit of maximum drawdown risk undertaken, strongly validating the scientific rationale and effectiveness of multi-asset allocation.

For the average investor, the diversified allocation approach of FOFs offers a compelling investment choice. It builds a safety margin through cross-asset hedging while aiming for long-term returns that surpass those of deposits through scientific allocation.

This is corroborated by the performance of top-tier FOF products:

Topping the 2025 FOF performance rankings, Guotai Optimal Navigation One-Year Hold achieved an annual return of 66.14%, also ranking first in its category over the past two and three years. Another product, Guotai Industry Rotation, delivered an annual return of 54.65%, significantly outperforming the industry average.

The fund manager behind these two products is Zeng Hui, Investment Director of the Multi-Asset Allocation Department at Guotai Fund. With 23 years of asset allocation experience and 9 years of investment management experience, he possesses a unique and profound understanding of asset allocation. Regarding the steady development of FOFs, Zeng Hui believes future evolution will focus on three key dimensions: tactical timing and rotation, drawdown control, and versatile manager capabilities.

First, Tactical Timing and Rotation.

Traditional FOF allocation often resembles a "static platter" of assets—setting proportions based on historical data and holding long-term. However, the shortcomings of this method are becoming increasingly apparent, particularly its inability to withstand systemic risks during periods of high volatility. Therefore, FOFs need to evolve their investment models, with tactical timing and rotation emerging as a solution.

The periodic reports of Guotai Optimal Navigation reveal this dynamic timing approach.

In Q1 2025, the fund manager anticipated signals in resources and growth sectors, decisively increasing positions in gold, Hong Kong-listed healthcare, and technology stocks. In Q2, the focus shifted further to resource assets like rare earths, gold, and silver, while simultaneously boosting allocations to innovative drugs, capturing the policy-driven rally in May. By Q3, the fund flexibly adjusted again, reducing exposure to rare earths and healthcare, maintaining a core gold position, and aggressively purchasing battery ETFs to capitalize on the new energy rebound.

This precise maneuvering was based on the "Taiji Quantitative Rotation Model" developed by fund manager Zeng Hui.

This model uses "overbought-oversold" extremes as its core framework, encompassing four modules: macro risk-controlled timing, meso-industry risk-controlled rotation, enhancement for four underlying asset classes, and rigid quantitative risk control principles. It connects various assets through medium-to-long-term cycles while continuously refining algorithm models to accurately identify and capture investment opportunities arising from asset inflection points.

Second, Drawdown Control.

While dynamically capturing returns, rigorous drawdown control provides another layer of assurance for the stability of FOFs.

Zeng Hui summarizes this succinctly: "Pursuing alpha is an art; controlling drawdowns is a science of execution and process." Subjective judgment can uncover excess return opportunities, but drawdown control requires eliminating uncertainty, relying on quantitative systems to institutionalize, algorithmize, and automate risk management processes.

Consequently, under his leadership, the entire Guotai multi-asset allocation team possesses programming skills and deep expertise in underlying assets, ensuring the high-quality implementation of scientific risk control procedures.

Third, Versatile Manager Capabilities.

Zeng Hui's requirements for FOF managers are also evolving: they must not only be expert fund selectors but also evolve into demanding "versatile" professionals. FOF managers must be able to compete alongside single-asset fund managers, quantitative teams, and cross-border strategists, requiring simultaneous mastery of four asset classes—stocks, bonds, commodities, and overseas markets—and a deep understanding of their underlying logic.

Ultimately, through flexible dynamic timing, strict drawdown management, and the cultivation of versatile talent, FOF investing is transitioning from reliance on "selecting star fund managers" to dependence on "a sophisticated and evolving system." This systematic empowerment aims to create products with clearer, more predictable risk-return characteristics, maximizing market opportunity capture, optimizing the investor experience, and aligning with the allocation needs of ordinary investors.

For investors, this means no longer needing to grapple with complex allocation logic. They simply need to find a product matching their risk tolerance to leverage professional systems and share in market gains, effectively achieving the goal of "leaving professional matters to professionals" and progressing steadily through market rotations.

Now, a new product has emerged under this sophisticated investment system: the Guotai Multi-Asset Steady Navigation 6-Month Holding Period FOF (025798), managed by Zeng Hui, is currently available for subscription. It can invest in equities, bonds, commodities, and more, with equity asset allocation ranging between 5%-40% of the fund's assets. Investors seeking risk diversification and steady returns may wish to consider it.

Investors should be aware of the risks involved. The views expressed are for reference only and may change with market conditions, constituting neither investment advice nor a promise. All investments carry risk. The Chinese stock market has a relatively short history, and past performance does not guarantee future results.