China’s top money manager adds Alibaba, Tencent, trims liquor stocks as funds beat market with portfolio tweaks

Name: Shanghai fears summer lockdown as millions undergo Covid-19 tests in sweltering heat
Uploaded: 2022-07-20T07:29:04.000Z
Duration: 1 min 35 s
Description: Shanghai fears summer lockdown as millions undergo Covid-19 tests in sweltering heat

Zhang Kun, who manages US$14.4 billion of assets in four funds, added tech stalwarts last quarter, trimmed liquor stocks as valuations stretched

Money manager says he will rely on fundamentals, less on macro environment as his stock-picking strategy

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A worker waters the flowers around an installation reading “Follow Our Party Start Your Business” in front of the Tencent headquarters in Shenzhen in March 2021. Photo: Bloomberg

Zhang Shidong

Published: 3:29pm, 20 Jul 2022

China’s biggest money manager, with US$14.4 billion of assets, bought more shares in Alibaba Group Holding and Tencent Holdings last quarter, as investors profited from one of the sharpest rallies in technology stocks in Hong Kong.

Zhang Kun of E Fund Management based in the southern city of Guangzhou, added 500,000 shares of WeChat operator Tencent in his flagship 62.8 billion yuan (US$9.3 billion) Blue Chip Selected Mixed Fund, according to his latest report to clients.

He also raised his stake in Alibaba to 11.1 million shares in his 19.9 billion yuan E Fund Quality Selection Fund, lifting the e-commerce group into its top 10 holdings for the first time this year. Alibaba is the owner of this newspaper.

The portfolio changes reflect the thinking among global fund managers from JPMorgan Asset Management to Capital Group who have ploughed more money into Alibaba, Tencent and Meituan stocks since a rout in mid-March. The Hang Seng Tech Index has rebounded 50 per cent since then, recovering US$150 billion of market value along the way.

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Shanghai fears summer lockdown as millions undergo Covid-19 tests in sweltering heat

“Few investors could make correct judgments about such a big swing [in stock prices] at the end of the first quarter,” Zhang said in his report. “That will also be the case for predicting the Chinese and American economies for the third quarter. These short-term moves do not matter in the long run and they offer good buying opportunities for high-quality companies.”