Against the backdrop of structural market trends in 2025, several actively managed equity products from foreign-funded public fund companies have achieved significant excess returns, with their primary allocation strategies and portfolio preferences becoming increasingly clear. Throughout the year, many products from these foreign fund houses recorded impressive gains, with some standing out notably among their peers. An analysis of their portfolio structures reveals a concentrated focus on technology growth and resource sectors, demonstrating strong stock-picking and allocation capabilities. Combining this with the latest quarterly report commentary, foreign institutions show more nuanced decision-making in their specific operations. On one hand, allocations to pro-cyclical and resource sectors have warmed up; on the other hand, the core technology theme remains unshaken, but is shifting from high-expectation areas towards more cost-effective and certain sub-sectors, building positions around China's economic transformation and value re-rating narrative.
A review of the top-performing funds throughout 2025 shows that many actively managed equity products from foreign-funded public fund companies achieved impressive gains. Among them, BlackRock Advanced Manufacturing One-Year Hold A rose 63.34% for the year, Fidelity Low-Carbon Growth A gained 44.27%, Schroders China Dynamics A advanced 47.94%, and Allianz China Select A surged 65.83%. Notably, Neuberger Berman Resources Selection A led the pack with a staggering cumulative annual gain of 97.28%, highlighting the strong market navigation skills of foreign institutions during a period of structural market performance.
Looking at the portfolio structures, these foreign public fund products generally maintain manufacturing as their core allocation, while also maintaining a high level of attention on opportunities within technology growth and resource sectors. Specifically, BlackRock Advanced Manufacturing One-Year Hold's major holdings are highly concentrated in the manufacturing sector, with a significant focus on several tech stocks in the fourth quarter, including Zhongji Innolight, Cambricon-U, and Luxshare Precision, leaning towards high-end manufacturing-related fields. Fidelity Low-Carbon Growth also primarily allocates to manufacturing, with its top fourth-quarter holdings including Eoptolink, Shanghai Fudan Microelectronics, and Zhongji Innolight, overall balancing the dual themes of low-carbon transition and technology growth.
In contrast, Neuberger Berman Resources Selection's portfolio structure is relatively more diversified. Beyond manufacturing, it allocates considerably to raw materials and mining stocks, with major holdings such as Zijin Mining, Xinqidian, and Aluminum Corporation of China, indicating that resource commodities hold a significant position in the portfolio, with a clear characteristic of allocating to bulk commodities and their related industrial chains. The major holdings of Schroders China Dynamics are primarily concentrated in manufacturing, alongside some allocation to financial assets, and also include a certain proportion of resource and materials stocks, such as Zijin Mining, Huayou Cobalt, and China Molybdenum, reflecting a comprehensive consideration of both the cyclical sector and the manufacturing industry's prosperity.
Allianz China Select continues its manufacturing-centric strategy, with top fourth-quarter holdings including Hengli Hydraulic, Siling Intelligence Drive, and Weichuang Electric, focusing on industrial upgrading and equipment manufacturing. Examining the latest quarterly reports from several foreign public fund companies reveals that, in terms of allocation strategy, institutions remain optimistic about the medium- to long-term opportunities in pro-cyclical directions like resources on one hand. On the other hand, they are making structural adjustments within the technology sector, and generally believe that the logic for a value re-rating of Chinese stocks continues against the backdrop of economic transformation, technological advancement, and policy support.
From the quarterly report statements, Huang Daoli, fund manager of Neuberger Berman Resources Selection, pointed out that he remains optimistic about the resource sector over the medium to long term. He also mentioned in previous quarterly reports that he would continue to monitor the economic recovery process and its internal structural changes, as these changes will influence future allocation directions. After tracking and observing in the fourth quarter, his confidence in the resource sector has gradually strengthened, and he believes it is highly probable that a further broadening of the market trend will be seen in 2026, thus providing more options for portfolio positioning.
Based on the above judgment, during the fourth quarter and building upon the third-quarter allocation, Neuberger Berman Resources Selection further optimized its portfolio structure. Allocations across various sub-sectors tilted towards the pro-cyclical direction, gradually reducing exposure to the ferrous metals and early-cycle sub-sectors, appropriately increasing the chemical industry allocation, while retaining and moderately increasing the allocation to upstream industries related to the current technological innovation cycle.
On the other hand, Schroders China Dynamics fund managers An Yun and Xie Heng stated that the fund continued to adhere to its established investment strategy, implementing asset allocation conclusions, and maintaining a high equity position. A rebalancing was conducted within the portfolio structure, shifting some allocation from the previously red-hot technology sector to sectors with lower expectations and valuations, such as non-bank financials and chemicals. In their specific assessment, while profit expectations for the AI sector have been continuously revised upwards, the stock price performance has been relatively muted, suggesting expectations may have been priced in early. They have currently paused further increases to AI hardware positions, maintaining only a baseline allocation, and are shifting risk exposure towards the application layer, while simultaneously increasing allocations to related derivative chains like power equipment and power transmission & distribution.
Cheng Yu, fund manager of Allianz China Select, stated that regarding the fund's investment operations, a high equity position was maintained for most of the fourth quarter. Against the backdrop of global technological transformation and China's deepening economic transition, new quality productive forces, represented by high-quality technology assets, are leading the value re-rating of Chinese stocks. Based on this assessment, the fund focused its allocation on these high-quality technology assets, achieving favorable investment returns. Looking ahead to 2026, Cheng Yu further indicated that, given the positive progress in China's economic transformation and technological development, coupled with strong policy support, he continues to firmly believe in the ongoing value re-rating process for Chinese stocks. High-quality technology assets, as the core assets in this round of Chinese stock re-rating, are expected to continue delivering significant excess returns.