Edit | Kang Juan
Among domestic fund managers, Yu Guang is definitely a very rare "veteran".
His investment experience has exceeded 10 years. Wind data shows that among more than 2,000 fund managers in China, less than 10 have managed products for more than 10 years, accounting for less than 5%. If retired and fixed-income fund managers are excluded, the proportion will be lower. These fund managers are called "veterans".
Yu Guang is less than 5%.
Yu Guang joined the Great Wall of Jing Shun as a researcher in 2005, and became a fund manager in May 20 10, with more than 10 years. During the period of 10, he managed six funds successively. Among them, three funds have left their posts, with annualized returns of 10. 12%, 13.97% and 16.57% respectively. In May 2020, he issued a new fund.
Under management, the core competence A was established on 20 1 1, the blue chip of Jingshun Great Wall was established on 20 14, and the core competence H of Jingshun Great Wall was established on 20 15. So far, the annualized returns of these three funds are 18.45%, 14.7% and 65438 respectively.
In April 2020, veteran Yu Guang issued a new fund after six years. The yield for more than two months since its issuance is 14.65%.
He holds CFA. Unlike many fund managers, Yu Guang spent seven years auditing before entering the securities industry. Joined the Great Wall of Jing Shun for nearly 16 years.
This fits his profile perfectly. Not only does he not change jobs often, but his investment style and stock holdings are no exception. Even he asked investors in his fund not to change frequently. His new fund requires investors to hold it for one year.
It is completely in line with what he said, "Going fast is not as good as going slow but going far."
Recently, Barron's Weekly interviewed him in Chinese, hoping to interpret his investment philosophy, style and operation mode and provide reference for other investors.
The following is an edited interview record:
Barron's Weekly Chinese Edition: You have been a stock fund manager 10 years. It is very important for a fund manager to choose the right stock. Every fund manager has his own housekeeping skills and different indicators. As you said before, you attach great importance to the company's return on net assets when choosing stocks. Can you tell me your opinion?
Yu Guang: I look at a company from the perspective of an industrial investor. Industrial investors are very cautious about investing. Because they made a mistake and couldn't sell it, they must see the long-term profit prospect of the company before investing. What I value most is the company's long-term profitability. In the long run, I will have some quantitative indicators for stock selection. The first is the company's return on shareholders (ROE), which is my core indicator.
Only if the ROE of a company is high enough, shareholders are willing to invest in this company; In addition, ROE is actually a good way to screen companies, and some companies that do well and have competitive advantages can be screened out through the level of ROE. Because if a company can get a high ROE, it means that it is better than its peers and has a more competitive advantage.
Secondly, through the decomposition of the return on equity, we can find out the reasons for the high return on equity of the company, so as to understand the company's business model and look forward to the changes of the company's return on equity in the future, such as whether it can maintain a relatively good return on equity in the future. This is also a good tool for us to do research and analysis.
Barron's Weekly Chinese Edition: Besides ROE, what other indicators do you look at?
Yu Guang: The second indicator I look at is the stability of the company's profits. I hope that a company's profits are relatively stable. If its profit fluctuates greatly, sometimes it makes money, and sometimes it doesn't, there are three possibilities:
First, this company may belong to a cyclical industry, making money when the cycle is good and not making money when the cycle is poor.
Second, there are some problems in the bargaining power of this company. For example, its cost has gone up, but its product price can't follow up, and the cost can't be passed on. This is one of the manifestations of some problems in the company's bargaining power.
Third, if a company's profit fluctuates greatly, it is actually difficult for us to make a profit forecast.
So from this perspective, I think the company's profit stability is also a very important quantitative indicator.
Chinese version of Barron's Weekly: Many fund managers attach great importance to cash flow.
Yu Guang: I also like cash flow. For a company, its announced profit is actually an accounting profit. If this profit is not matched by cash flow, its profit quality may be problematic.
It can be understood that if a company grows rapidly, but the growth does not match the operating cash flow, then its operating growth and profit growth may be wet.
Finally, I also have a very important indicator, which is the balance sheet. To some extent, I think the balance sheet reflects the operating results of a company. If a company does well, it will be reflected in its healthy balance sheet. If not, it means that what it does is actually not good.
I hope the balance sheet of the company I invest in is relatively healthy. Many companies I have invested in have low leverage ratio and debt ratio, and the companies are in a state of net cash, and there are basically no bank loans.
Chinese version of Barron's Weekly: These indicators you just mentioned are all quantitative indicators. Do you look at some qualitative indicators?
Yu Guang: From the qualitative standard, there are two main points:
The first point is to look at the company's business value and business model. Knowing, understanding and recognizing a company's business model is the basis of my investment. In my opinion, a good company's business model can not only bring good returns to shareholders in the past two years, but also bring good returns to shareholders for a long time to come. Only in this way will I hold this company for a long time.
The second point is to look at the company's governance structure, management ability and integrity level. If the whole governance structure of a company has great defects and the management of the company is unreliable, this type of company is basically untouched.
Chinese version of Barron's Weekly: You mentioned this "reliable", which reminds me that you mentioned the value of investment on some occasions. Do you think investment needs values?
Yu Guang: It's like you want to do business with others and start a company. Of course, you will be very concerned about whether the partner is reliable and whether it will infringe your interests. As minority shareholders, we should pay more attention to corporate governance, the ability and integrity of management. We don't want to associate with "bad companies", not only to avoid stepping on the pit, but also to safeguard the values of the capital market. We may not be able to influence many other investors, but we insist on starting from ourselves.
Chinese version of Barron's Weekly: Speaking of which, we invest not only to gain profits, but also to avoid risks. How do you think the relationship between the two should be balanced?
Yu Guang: My understanding of risk control is divided into two levels:
The first level is the level of individual stocks, and it is hoped that it will be properly dispersed. My portfolio generally has about 30 stocks, with moderate concentration, which is conducive to diversifying risks.
For the top ten awkward stocks, my portfolio ratio generally does not exceed 50%. In the choice of heavy stocks, I will choose companies with strong certainty and high transparency; In terms of liquidity, I hope it has better liquidity and greater market value. I generally don't want to buy the top ten stocks with poor liquidity, because the process of buying the top ten stocks may be difficult, and it may not be easy to sell them when they are sold, especially when the company has any problems. At the same time, I usually follow up the heavy stocks for a long time, meet with company executives, communicate face to face, and do some field research.
In my opinion, if the risk is well controlled at the level of individual stocks, high-quality companies can be selected without stepping on thunder, then the income risk of the overall portfolio can be better controlled.
My investment style is to buy long-term optimistic companies and hold them for a long time, and the overall turnover rate is relatively low.
The second level is the industry level. I am a bottom-up stock picking strategy. Although the formed industry configuration is only a result of stock selection, I still hope that the industry can be properly dispersed and balanced at the level of industry configuration.
Generally speaking, my allocation in an industry does not exceed 20%, because in a certain industry sector, if the allocation is too heavy, the rate of return is of course considerable, but we still have to be cautious, because each of us makes mistakes. In this case, if a sector gambles heavily, it may have a greater impact on the portfolio.
Chinese version of Barron's Weekly: Liquor and medicine have been hot stocks since 2020, but there have been waves of securities, banking and insurance recently. How to treat the recent switching fluctuations between A-share sectors?
Yu Guang: In the stock market, it is normal to overestimate the adjustment of the sector and underestimate the need for valuation repair, which leads to some changes in the short-term market style.
In recent years, there has been a great differentiation among individual stocks, and the core factor of this differentiation is the great differentiation of fundamentals. With the continuous improvement of market concentration, the profitability of leading companies is getting stronger and stronger, which promotes the rise of leading companies' share prices.
In addition, this has a lot to do with China's economic restructuring. The consumption, medicine, science and technology industries represented by consumption upgrading and industrial upgrading are the long-term development direction of the future economy, and the current and future prosperity is relatively high, which is also the main reason why the market pursues such sectors.
I pay more attention to the matching between the long-term value of the company and the rationality of the valuation, so as to balance the industry allocation of the portfolio. This is also the main logic of my position adjustment. I will make adjustments according to the valuation and market conditions. Even if some stocks are optimistic for a long time and the valuation is expensive, I will take the initiative to lighten up.
Chinese version of Barron's Weekly: In the current market environment, from the perspective of the sector, how should it be configured more reasonably?
Yu Guang: In the long run, consumption and technology are still more important directions.
Large consumption and technology tend to produce some companies with large market value. Companies with large market capitalization in the United States are basically big consumer stocks or technology stocks. Among the top ten companies with market value, technology stocks account for a relatively large proportion. There will also be some large-scale consumer stock companies and technology stock companies in China in the future.
I pay more attention to stock selection than choosing an industry. As mentioned above, consumption, medicine and science and technology represent the future direction of domestic economic development, so they are still combined redistribution industries.
Generally speaking, companies with relatively reasonable valuations and strong profit growth in the industry should be selected.
Chinese version of Barron's Weekly: Investors are keen on a strategy that can leapfrog bulls and bears and keep profits. In the current market environment, will your investment strategy be different from before?
Yu Guang: No matter what market stage, my investment style will remain stable and my investment philosophy will not change.
With the maturity of domestic capital market, value investment has become the mainstream way of institutional investors, which is close to foreign capital.
The investment philosophy of Jingshun Great Wall is "Better to die than to die", that is, to follow the fundamental investment, not to pursue short-term performance, not to follow the trend, not to speculate on the theme, to invest in real high-quality companies with a medium-and long-term perspective, and to pursue medium-and long-term returns. This is the investment concept determined at the beginning of the establishment of Jingshun Great Wall, which was influenced by foreign shareholders in that year. This concept has been practiced for many years, and most domestic fund companies have long pursued the concept of long-term investment.
Barron's Weekly Chinese Edition: The concept of long-term investment has indeed become the mainstream concept in the fund, but the concept and operation are two different things. The stock market is a market that tests human nature very much. When you see other stocks soaring and your holdings are as stable as Mount Tai, what should you rely on to stick to your choice?
Yu Guang: Changes in market style reflect market sentiment, which often changes, but the fundamentals of good companies will not change. If a company's profits can achieve long-term sustained growth, the long-term stock price performance is often amazing.
From this perspective, it is much more certain to grasp the fundamentals of the enterprise than to follow the market sentiment. Therefore, I choose to downplay market fluctuations in investment and hold high-quality stocks for a long time.
In my experience, the contribution of timing to portfolio returns is unstable, and the probability of doing it right is about 50-50, and the timing is wrong. Over the years, I have basically made a negative contribution at the transaction level. In fact, it's not just me, most fund managers are like this. Only a few people are good at timing. I spend more time and energy on stock selection and portfolio management, and will not be affected by market style.
Chinese version of Barron's Weekly: Before you entered the securities industry, you had done a long audit. Why are you interested in investing? What qualities do you think you need to be a fund manager who can get sustainable income?
Yu Guang: I have been auditing for 7 years, and I am responsible for auditing many listed companies. Have a certain understanding of the operation and financial situation of listed companies, and then have an interest in investment.
I have also been a researcher, involving many industries, such as banking, machinery, home appliances, automobiles, steel, building materials, textiles and clothing, agriculture, forestry, animal husbandry and fishery. This experience is very helpful for me to improve the stock selection framework. The idea and angle of stock selection are constantly optimized in research and investment practice.
To be a fund manager who can get long-term benefits, we must adhere to our own investment style and philosophy, pursue long-term and sustained investment returns, and not be eager for quick success and instant benefit. Making money for a long time is more important and more solid than making quick money. Many times, walking fast is not as good as walking slowly, but going far.