The end of the year 2024 is drawing near, and as we reflect on the fund issuance market over the past year, the data paints a vivid picture of sustained activity and growthAccording to Wind, the number of newly issued funds has surpassed 1,130, with a total initial fundraising scale reaching 1,184.4 billion yuanThe recent performance in the fund issuance market remains robust, with a particular highlight being a significant number of new funds launching in December and extending their fundraising periods into the new yearA total of 36 funds have opted to run fundraising campaigns that stretch over the New Year, starting before the end of 2024 and concluding in 2025. Moreover, nearly 20 additional funds have scheduled their issuance for January 2025.

Industry insiders have expressed optimistic sentiments regarding the policy support and economic recovery anticipated in 2025. The introduction of a series of substantial policies has notably bolstered confidence in equity investments, suggesting that now may be an opportune time for allocating funds towards equity products

Within this scope, sectors such as consumer goods, technology, and manufacturing are drawing specific attention for their investment value.

Interestingly, December has seen a substantial increase in the number of equity-type funds launched, reflecting a strategic focus among investment firmsFrom the data collected, it is clear that a majority of the latest funds issued are equity-orientedWithin the broader universe of funds, 17 are dedicated to equity investments, while 11 fall under the mixed fund categoryThe notable influx of capital continues, with 36 funds entering the public market during December alone, according to Wind’s tracking.

Among the expanding array of new funds, there are notable trends: the majority of these funds are equity-driven, with many focusing on broad market indices such as the Shanghai and Shenzhen 300 or sector-specific indicesFor instance, prominent funds like 'Dongfanghong Select,' the 'Morgan Shanghai Stock Exchange Sci-tech Innovation Board New Generation Information Technology ETF,' and several from other financial institutions boast initial subscription days that surpass 90 days, reinforcing the belief in thorough and sustainable investment strategies

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In contrast, the Southern China Securities’ subscription duration for its Hong Kong Stock Connect automobile industry index was markedly shorter, only comprising 5 days.

The looming presence of well-known fund managers marks a significant development in this wave of new funds, indicating a strong level of expertise and strategic foresight guiding these launchesFor example, the actively managed fund 'Yongying Rui Jian Progress' is headed by Li Wenbin and began its issuance on December 23. Meanwhile, quantitative investments are seeing prominent figures like Yang Meng lead the 'Bodao CSI 500 Index Enhanced,' set to launch on December 30, while another fund to be led by noted quantitative manager Qiao Liang is set for an initial offering on January 6, 2025.

The thematic focus of many of these new products leans heavily towards technology and innovation, evident from the naming conventions

The Wind data indicates numerous funds related to tech themes, such as the 'ETF for the ChiNext 50,' among others, slated to launch in early 2025. Furthermore, various investment firms are announcing their strategic interests in cyclical and dividend-yielding products, as evidenced by announcements from Qianhai Kaiyuan Fund and China Universal Fund regarding upcoming launches centered around these themes.

Additionally, Fidelity is preparing to unveil its first-of-its-kind fund of funds (FOF)—the 'Fidelity Renyuan Stable Three-Month Holding Mixed FOF'—in January, which represents a significant addition to their portfolio offeringsAnother exciting product on the horizon is the 'Robeco Climate Change High-Quality Bond Index' which is making its debut as the firm's inaugural climate-themed investment.

Looking towards 2025, several fund managers have prophesied a pivotal shift in the economic landscape

Min Liangchao from HSBC Jintrust Fund has articulated expectations of a significant demand cycle accompanied by crucial turns in real estate and production capacities, suggesting a potential inflection point for capital marketsAlongside these shifts, the anticipated improvement in business operations is fostering an environment ripe with investment opportunities, hinting at a transformative phase for the entire capital market.

Meanwhile, insights from China Universal Fund indicate a potential surge in net inbound capital for ETFs in 2025, buoyed by improving economic fundamentalsAs the economic outlook for China strengthens, foreign investment proportions in A-shares are expected to continue risingThis sentiment reflects a burgeoning interest in sectors such as high-tech industries, particularly those benefiting from policy support, and innovations in sectors like artificial intelligence and renewable energy, which are poised for growth and success

The focus on consumer trends, particularly in lifestyle sectors such as dining, tourism, and clothing, underscores a hands-on approach towards meeting evolving consumer demands.

Moreover, the emphasis on supply-side reforms in the manufacturing sector has not gone unnoticedLu Bin from HSBC Jintrust highlights the significant investment prospects arising from reforms targeting midstream manufacturingThe ongoing expansion of overseas manufacturing capabilities encompasses a broader landscape of growth, revitalizing investments particularly in technologically driven sectors, which have struggled to demonstrate growth over the past two yearsNotably, many key sectors are now witnessing favorable indicators for recovery as we approach the second quarter of next yearIf market trends proceed as projected, there is great optimism surrounding the potential for mid-tier manufacturing firms to enjoy both valuation recoveries and improved profitability.

In conclusion, the dynamic movements observed within China's fund issuance market not only reflect a robust economic narrative but also highlight strategic shifts and emerging opportunities in various sectors as we step into 2025. With increased confidence in market recovery and influential reforms on the horizon, investors and fund managers alike are poised to navigate what promises to be an exciting year ahead.