Posted inHead To Head

HEAD-TO-HEAD: China Universal Value Selected versus E Fund Kexiang

FSA compares two China equity products: the China Universal Value Selected Fund and the E Fund Kexiang Fund.
by Fund Selector Asia

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Conclusion

E Fund Kexiang is more volatile given its higher sector concentration and high growth-oriented approach. Volatility (as measured by standard deviation) was higher than both the China Universal Value Selected fund and the CSI 300 index over 1-year, 3-year, and 5-year periods ending 31 December 2021.

That said, it has performed well on the risk-adjusted basis over the same time spans, with 1-year, 3-year, and 5-year Sharpe ratios beating China Universal Value Selected and the index.

“Overall, we have a stronger conviction on E Fund Kexiang,” Qu said, explaining that this fund benefits from “a capable and long-tenured portfolio manager, and the dedicated and experienced analyst team also brings a competitive edge”.

“While its investment approach introduces higher volatility, investors are well compensated for the additional risks taken, and Chen’s investment savvy and implementation have also proved to add value over multiple market cycles,” she concluded.

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