The fund "Tan Hua" is the first to disclose its quarterly report, with popular stocks becoming the largest holdings upon new entry

Liang Furui from Great Wall Fund is the "third place" in the fund performance rankings for the first half of the year. He started as a pharmaceutical researcher at Guangzhou Securities in 2018, joined Great Wall Fund in March 2019, and later became the fund manager of the Great Wall Pharmaceutical Industry Selected Fund. It has been proven that the young Liang Furui is a "blessing general." He only manages one fund, but this fund achieved third place in performance for the first half of this year.

Recently, the Great Wall Pharmaceutical Industry Selected Mixed Initiation Fund was the first to disclose its Q2 report.

How does he view the future of the pharmaceutical industry? What arrangements has he made for his holdings?

Three Perspectives for the Third Quarter

Liang Furui stated that in the third quarter, he will continue to focus on the innovative drug sector, with overall holdings and trading strategies centered around three perspectives: clinical data readouts, overseas pipeline authorizations, and domestic sales volume expansion.

In the previous second quarter, the A-share market showed an overall range-bound trend, especially in May when the market quickly rebounded to previous highs following the achievement of a phased agreement in international trade negotiations, while the market remained relatively flat in June. In the context of the overall market's range-bound fluctuations lacking high-yield sector trends, the innovative drug industry became the main theme of the market in the second quarter, driven by policy encouragement, clinical data readouts catalyzed by academic conferences, and the continuous realization of overseas authorization fundamentals.

Liang Furui specifically reminded that against the backdrop of the National Healthcare Security Administration's release of "Several Measures to Support the High-Quality Development of Innovative Drugs" & the adjustment work plan for the medical insurance and commercial insurance catalog, he believes that in the third quarter, innovative drugs will develop in two directions: overseas pipeline authorizations and domestic sales volume expansion. The industrial trend of overseas pipeline authorizations is expected to continue, as Chinese innovative drugs have surpassed overseas pharmaceutical companies in terms of research progress and efficacy for many targets. Overseas pharmaceutical companies have an objective demand for supplementing their pipeline layouts, while the potential for domestic sales expectations to improve will depend on quarterly reports and the results of medical insurance & commercial insurance negotiations.

3SBIO Becomes the Largest Holding

A close observation of Liang Furui's holdings reveals that 3SBIO and CSPC Pharmaceutical Group have newly entered the heavy holdings of the Great Wall Pharmaceutical Industry Selected Mixed Initiation Fund, while CanSino Biologics and Zai Lab have exited.

Moreover, 3SBIO has directly jumped to become the largest holding of this fund (see the chart below).

3SBIO is a popular innovative drug stock this year. Even considering only the performance of the first quarter, its stock price has nearly doubled.

Of course, after that, this stock continued to rise, and as of July 15, its year-to-date increase has exceeded 370%.

Rapid Large Capital Inflows and Outflows

From the Q2 report, many fund investors have paid attention to this fund, with the subscription amount significantly higher than the initial amount However, some funds do not have plans for long-term holding, and more funds are entering and exiting Class C shares during this period. In the second quarter, the total subscription for Class C shares approached 1.732 billion shares, but the redemption shares also exceeded 1.188 billion shares.

With the net value fluctuating upward since July, as of July 14, the annual increase of Great Wall Pharmaceutical Industry Selected has exceeded 94%, continuing to strive towards doubling its base.

This means that the subsequent funds will still face the sweet problem that this high-performing fund needs to confront: how to manage the product amidst significant inflows and outflows of capital.

Risk Warning and Disclaimer

The market has risks, and investment requires caution. This article does not constitute personal investment advice and does not take into account the specific investment goals, financial conditions, or needs of individual users. Users should consider whether any opinions, views, or conclusions in this article align with their specific circumstances. Investing based on this is at one's own risk