Asian Hedge Fund Manager, Long Short Equity, Macro

David Mudd

Cross Asset Strategy

<ul>
<li>The Hong Kong Alpha portfolio outperformed its benchmark and all Hong Kong indexes in July.  The portfolio achieved these results while increasing its Sharpe ratio and reducing beta and volatility.</li>
<li>The shift to the healthcare and materials sectors since Liberation Day in April has aided the portfolio's performance.  The consumer staples sector lost momentum, and we exited some positions there.</li>
<li>The HSI now trades above its long-term resistance levels for the first time since 2022.  This signals a good time to rotate back into market leaders in tech.</li>
</ul>


The Hong Kong Alpha portfolio outperformed its benchmark and all Hong Kong indexes in July.  The portfolio achieved these results while increasing its Sharpe ratio and reducing beta and volatility.
The shift to the healthcare and materials sectors since Liberation Day in April has aided the portfolio's performance.  The consumer staples sector lost momentum, and we exited some positions there.
The HSI now trades above its long-term resistance levels for the first time since 2022.  This signals a good time to rotate back into market leaders in tech.


HK/China Healthcare Analyst (ex-Fosun Pharma)

Xinyao (Criss) Wang

Thematic (Sector/Industry)

<ul>
<li>Although DeepSeek's continuous updates, iterations, and deep integration with more and more healthcare enterprises in China will bring positive market sentiment, we have seen certain limitations and even risks behind.</li>
<li>Currently, AI healthcare relies heavily on government subsidies or hardware sales in China, which lacks sustainable payment scenarios and profit model. The data security/privacy/compliance issue may not be completely solve.</li>
<li>For the companies that have integrated with DeepSeek, investors need to verify their afterwards financial performance and fundamentals. If it does not meet expectations, investors are recommended sell in time.</li>
</ul>


Although DeepSeek's continuous updates, iterations, and deep integration with more and more healthcare enterprises in China will bring positive market sentiment, we have seen certain limitations and even risks behind.
Currently, AI healthcare relies heavily on government subsidies or hardware sales in China, which lacks sustainable payment scenarios and profit model. The data security/privacy/compliance issue may not be completely solve.
For the companies that have integrated with DeepSeek, investors need to verify their afterwards financial performance and fundamentals. If it does not meet expectations, investors are recommended sell in time.


DeekSeek May Not Be The "Game Changer" In China Healthcare - Time to Be Rational

HK/China Equity Long-Short

Osbert Tang, CFA

<ul>
<li>The YTD rally in the Hong Kong and China markets has made it appealing for highly leveraged and outperforming stocks to make placements to raise fresh equity.</li>
<li>
<a href="https://www.smartkarma.com/entities/gds-holdings-ltd" target="_blank" data-smartkarma-citation="entities:32157:1" rel="noopener">GDS Holdings (9698 HK)</a>, <a href="https://www.smartkarma.com/entities/china-youran-dairy-group-ltd" target="_blank" data-smartkarma-citation="entities:31075:1" rel="noopener">China Youran Dairy Group (9858 HK)</a>, <a href="https://www.smartkarma.com/entities/shandong-gold-mining-co-ltd-4527fb98-bb5d-4d74-91fe-66f9c0224eb3" target="_blank" data-smartkarma-citation="entities:27455:1" rel="noopener">Shandong Gold Mining (1787 HK)</a>, <a href="https://www.smartkarma.com/entities/zhaojin-mining-industry-company-ltd-h" target="_blank" data-smartkarma-citation="entities:4626:1" rel="noopener">Zhaojin Mining Industry (1818 HK)</a>, and <a href="https://www.smartkarma.com/entities/byd-electronic-international-co-ltd" target="_blank" data-smartkarma-citation="entities:1927:1" rel="noopener">BYD Electronics (285 HK)</a> are possible candidates.</li>
<li>Four of the top 30 YTD best-performing Hang Seng Composite stocks have made placements in the last three months, raising a total of HK$1.3bn with mixed performance since then.</li>
</ul>


The YTD rally in the Hong Kong and China markets has made it appealing for highly leveraged and outperforming stocks to make placements to raise fresh equity.

GDS Holdings (9698 HK), China Youran Dairy Group (9858 HK), Shandong Gold Mining (1787 HK), Zhaojin Mining Industry (1818 HK), and BYD Electronics (285 HK) are possible candidates.
Four of the top 30 YTD best-performing Hang Seng Composite stocks have made placements in the last three months, raising a total of HK$1.3bn with mixed performance since then.


China & HK Strategy: Assessing Placement Risks, Who Needs Money?

Podcast by Joe Weisenthal & Tracy Alloway, Odd Lots

Odd Lots

Podcast by Joe Weisenthal & Tracy Alloway

Bloomberg's Joe Weisenthal and Tracy Alloway explore the most interesting topics in finance, markets and economics. Join the conversation every Monday and Thursday.

<ul><li>Odd Lots podcast announces live show in Washington D.C. discussing the Jones Act and other topics</li><li>Tim Opler from Ste discusses China's role in the pharmaceutical supply chain on the podcast</li></ul>This content is sourced through publicly available sources and has been machine generated. Information displayed is for general informational purposes only.

Odd Lots podcast announces live show in Washington D.C. discussing the Jones Act and other topicsTim Opler from Ste discusses China's role in the pharmaceutical supply chain on the podcastThis content is sourced through publicly available sources and has been machine generated. Information displayed is for general informational purposes only.

Here Comes the Booming Chinese Biotech Sector

<ul>
<li>Our "Buy the Worst" strategy has outperformed the HSI by 1.7pp in the first two months. Meanwhile, the basket of best-performing constituents have underperformed 1.9pp. </li>
<li>More news on stimulating consumptions should be positive to <a href="https://www.smartkarma.com/entities/budweiser-brewing-co-apac-ltd" target="_blank" data-smartkarma-citation="entities:28077:1" rel="noopener">Budweiser Brewing APAC (1876 HK)</a>, <a href="https://www.smartkarma.com/entities/chow-tai-fook-jewellery-group" target="_blank" data-smartkarma-citation="entities:549:1" rel="noopener">Chow Tai Fook Jewellery (1929 HK)</a>, and even <a href="https://www.smartkarma.com/entities/hang-lung-properties-ltd" target="_blank" data-smartkarma-citation="entities:49:1" rel="noopener">Hang Lung Properties (101 HK)</a>. </li>
<li>
<a href="https://www.smartkarma.com/entities/trip-com-group-ltd-23a341d0-4f63-4175-a8c5-ee990906cacd" target="_blank" data-smartkarma-citation="entities:36424:1" rel="noopener">Trip.com Group (9961 HK)</a> has been weighed down by weaker profitability on higher costs. Earnings risks may negatively affect <a href="https://www.smartkarma.com/entities/meituan" target="_blank" data-smartkarma-citation="entities:26970:1" rel="noopener">Meituan (3690 HK)</a> and <a href="https://www.smartkarma.com/entities/china-hongqiao-group-ltd" target="_blank" data-smartkarma-citation="entities:1909:1" rel="noopener">China Hongqiao (1378 HK)</a>. </li>
</ul>


Our "Buy the Worst" strategy has outperformed the HSI by 1.7pp in the first two months. Meanwhile, the basket of best-performing constituents have underperformed 1.9pp. 
More news on stimulating consumptions should be positive to Budweiser Brewing APAC (1876 HK), Chow Tai Fook Jewellery (1929 HK), and even Hang Lung Properties (101 HK). 

Trip.com Group (9961 HK) has been weighed down by weaker profitability on higher costs. Earnings risks may negatively affect Meituan (3690 HK) and China Hongqiao (1378 HK). 


"Buy the Worst" HSI Strategy: Initial Win Against HSI This Year

Hong Kong

Alibaba Health is the flagship healthcare platform of Alibaba Group, providing digital health services and resources. It operates pharmaceutical direct sales, an e-commerce platform for medications and health products, and offers healthcare and digital services including telemedicine consultations. The company is headquartered in Beijing, China, and was founded in 1998.

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Alibaba Health (241 HK)

HONG KONG ALPHA PORTFOLIO (July 2025)

The Hong Kong Alpha portfolio outperformed its benchmark and all Hong Kong indexes in July. The portfolio achieved these results while increasing...

David Mudd

DeekSeek May Not Be The "Game Changer" In China Healthcare - Time to Be Rational

DeepSeek's integration with companies brings market optimism, but risks remain due to unsustainable profit model and data security...

Xinyao (Criss) Wang

China & HK Strategy: Assessing Placement Risks, Who Needs Money?

Zhaojin Mining Industry (1818 HK) is the first one in our top 5 list to make a placement. The company is placing 140m H-shares at HK$14.08 to raise...

Osbert Tang, CFA

Here Comes the Booming Chinese Biotech Sector

Odd Lots podcast announces live show in Washington D.C. discussing the Jones Act and other topics Tim Opler from Ste discusses China's role in the...

Odd Lots

"Buy the Worst" HSI Strategy: Initial Win Against HSI This Year

"Buy the worst" strategy outperforms HSI by 1.7pp, while best-performing stocks lag by 1.9pp. Stimulating consumption news could benefit...

Osbert Tang, CFA

Price Gauge

52-week Range

Market Cap (USDm)

P/E

Dividend (Yield)

HONG KONG ALPHA PORTFOLIO (July 2025)

The Hong Kong Alpha portfolio outperformed its benchmark and all Hong Kong indexes in July. The portfolio achieved these results while increasing...

David Mudd

DeekSeek May Not Be The "Game Changer" In China Healthcare - Time to Be Rational

​DeepSeek's integration with companies brings market optimism, but risks remain due to unsustainable profit model and data security...

Xinyao (Criss) Wang

China & HK Strategy: Assessing Placement Risks, Who Needs Money?

Zhaojin Mining Industry (1818 HK) is the first one in our top 5 list to make a placement. The company is placing 140m H-shares at HK$14.08 to raise...

Osbert Tang, CFA

Here Comes the Booming Chinese Biotech Sector

Odd Lots podcast announces live show in Washington D.C. discussing the Jones Act and other topics Tim Opler from Ste discusses China's role in the...

Odd Lots

"Buy the Worst" HSI Strategy: Initial Win Against HSI This Year

​"Buy the worst" strategy outperforms HSI by 1.7pp, while best-performing stocks lag by 1.9pp. Stimulating consumption news could benefit...

Osbert Tang, CFA

DeepSeek's integration with companies brings market optimism, but risks remain due to unsustainable profit model and data security...

"Buy the worst" strategy outperforms HSI by 1.7pp, while best-performing stocks lag by 1.9pp. Stimulating consumption news could benefit...