Blue Lotus China New Economy Research, Blue Lotus Research Institute

Eric Wen

Blue Lotus China New Economy Research

China growth and global non-US Internet equities

Blue Lotus Research Institute

Blue Lotus Research is a Hong Kong Type 4 Licensed investment advisory firm focusing on Chinese growth equities and global non-US Internet equities

Thematic (Sector/Industry)

<ul>
<li>The just concluded Two Sessions contained little surprises but the market shrugged it off. Have animal spirits offset China's structural economic issues?</li>
<li>China's EV sector grew 38% YoY in the first two months of 2025, above our annual target of 30%. We stick to our bullish view. 2024 grew 41% YoY;</li>
<li>MINISO explored spin off of its toy chain business. We maintain SELL rating on deteriorating China business.</li>
</ul>


The just concluded Two Sessions contained little surprises but the market shrugged it off. Have animal spirits offset China's structural economic issues?
China's EV sector grew 38% YoY in the first two months of 2025, above our annual target of 30%. We stick to our bullish view. 2024 grew 41% YoY;
MINISO explored spin off of its toy chain business. We maintain SELL rating on deteriorating China business.


[Blue Lotus China New Consumer Weekly, 10/52] Smart Trump or Dumb Trump? Part II

Asset Allocation & Fund Positioning, Copley Fund Research

Steven Holden

Asset Allocation & Fund Positioning

Copley Fund Research

Copley Fund Research provide research and data on asset allocation among Global and Emerging Market equity funds.  The analysis details absolute and relative positioning across countries, sectors and industries together with highly granular data on single stock and single fund allocations.  The data is updated monthly with time series going back to January 2011.

Global Research - Analysis of 165 prominent Global equity funds, combined AUM $335bn
GEM Research - Analysis of 127 prominent global EM equity funds, combined AUM $250bn

Asset Allocation - Global and GEM Equity

Cross Asset Strategy

<ul>
<li>Screening for stocks at the extreme ends of their positioning or momentum ranges among active Asia Ex-Japan equity funds.</li>
<li>High Positioning, Positive Momentum: KE Holdings Ltd, Shriram Finance Limited     </li>
<li>Low Positioning, Negative Momentum: Baidu Inc, BOC Hong Kong Limited    </li>
</ul>


Screening for stocks at the extreme ends of their positioning or momentum ranges among active Asia Ex-Japan equity funds.
High Positioning, Positive Momentum: KE Holdings Ltd, Shriram Finance Limited     
Low Positioning, Negative Momentum: Baidu Inc, BOC Hong Kong Limited    


Technical Analyst, Vermilion Research

Joe Jasper

Technical Analyst

Technical and Quantitative Research

Vermilion Research

Vermilion’s objective is to deliver timely, actionable, and unique technical research to professional investors through the application of our various technical indicators.

Our research strategists seek to highlight securities which we believe are at major inflection points, based on our various technical and quantitative indicators, and offer asymmetric risk/return profiles. Our unique research methodology, centered on relative strength, enables our strategists to deliver superior investment recommendations.

Our process begins by organizing the universe of actively traded stocks into discrete sectors, then into industry groups. We then apply our technical and quantitative tools to identify developing price trends. Once attractive trends are identified within a selected sector or group, we screen for individual stocks which we believe offer the best risk/reward profile. We provide a historical perspective that often reveals, through our long-term charts, how price patterns often repeat themselves over time.

Technical Analysis

TSE Tokyo Price Index TOPIX / Technical Analysis

<ul>
<li>Major indexes in the three largest global equity markets (U.S., Europe, Japan) all remain below critical resistances of 5783 on SPX, 5000-5120 on EURO STOXX 50, and 2740-2820 on TOPIX</li>
<li>Additionally, broad global MSCI indexes (local currency) including the ACWI, ACWI ex-U.S., and EAFE all remain at/below resistance from their YTD highs; reduce exposure or shift to defensives.</li>
<li>In late-July we discussed expectations for a 1-to 4-month pullback/consolidation period on MSCI ACWI. We believe it seems likely to last closer to four months, and potentially 4- to 6-months</li>
</ul>


Major indexes in the three largest global equity markets (U.S., Europe, Japan) all remain below critical resistances of 5783 on SPX, 5000-5120 on EURO STOXX 50, and 2740-2820 on TOPIX
Additionally, broad global MSCI indexes (local currency) including the ACWI, ACWI ex-U.S., and EAFE all remain at/below resistance from their YTD highs; reduce exposure or shift to defensives.
In late-July we discussed expectations for a 1-to 4-month pullback/consolidation period on MSCI ACWI. We believe it seems likely to last closer to four months, and potentially 4- to 6-months


U.S., Europe, and Japan Still Holding Below Resistance; Favor Defensives

<ul>
<li>Uptick in Real Estate positioning driven by a shift towards Indian Real Estate stocks, which has outweighed reductions in exposure to China &amp; HK Real Estate</li>
<li>Three names stand out: Phoenix Mills, Macrotech Developers, and DLF Limited, all of which have seen ownership rise to record levels.</li>
<li>New positions in Indian Real Estate by Allianz and JKC have been offset by closures in Chinese Real Estate by LO Funds and SEB, among others.</li>
</ul>


Uptick in Real Estate positioning driven by a shift towards Indian Real Estate stocks, which has outweighed reductions in exposure to China &amp; HK Real Estate
Three names stand out: Phoenix Mills, Macrotech Developers, and DLF Limited, all of which have seen ownership rise to record levels.
New positions in Indian Real Estate by Allianz and JKC have been offset by closures in Chinese Real Estate by LO Funds and SEB, among others.


Real Estate:  India/China Rotation Sparks Sector Growth

<ul>
<li>Record Low Allocations: Real Estate holdings in active China equity funds have plummeted to a new low of 2.51%, with only 76.4% of funds maintaining any position.</li>
<li>Recent Fund Rotation: Closures by key investors and a downturn in ownership metrics since October last year highlight the sector’s declining appeal.</li>
<li>KE Holdings Exception: Amidst the decline, KE Holdings (2423 HK) stands out, achieving an all-time high in fund ownership.</li>
</ul>


Record Low Allocations: Real Estate holdings in active China equity funds have plummeted to a new low of 2.51%, with only 76.4% of funds maintaining any position.
Recent Fund Rotation: Closures by key investors and a downturn in ownership metrics since October last year highlight the sector’s declining appeal.
KE Holdings Exception: Amidst the decline, KE Holdings (2423 HK) stands out, achieving an all-time high in fund ownership.


China Real Estate: Continued Fund Rotation Drives New Lows

China

KE Holdings operates an integrated online and offline platform for housing transactions and services in China, encompassing existing and new home sales, home rentals, and home renovation and furnishing. It leverages brands like Beike and Lianjia to connect buyers, sellers, landlords, tenants, and service providers. Incorporated in 2018, it is headquartered in Beijing, China.

Price Gauge
52-week Range	0.00 - 0.00
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KE Holdings (2423 HK)

[Blue Lotus China New Consumer Weekly, 10/52] Smart Trump or Dumb Trump? Part II

China's market shrugged off Two Sessions as the balance of events with US the main driver. EV sector opened 2025 with a bang while MINISO...

Blue Lotus Research Institute

Asia Ex-Japan: Extreme Stocks

Screening for stocks at the extreme ends of their positioning or momentum ranges among active Asia Ex-Japan equity funds.

Steven Holden

U.S., Europe, and Japan Still Holding Below Resistance; Favor Defensives

U.S., Europe, and Japan Still Holding Below Resistance; Favor Defensives. Actionable Themes: Real Estate, Utilities, Telecommunications, Energy,...

Vermilion Research

Real Estate: India/China Rotation Sparks Sector Growth

Real Estate exposure grows among active Asia Ex-Japan funds, sparked by a rotation in to Indian Real Estate, as China & HK positioning falls.

Steven Holden

China Real Estate: Continued Fund Rotation Drives New Lows

Closures by key investors and a downturn in ownership metrics since October last year highlight the Real Estate sector’s declining appeal.

Steven Holden

Price Gauge

52-week Range

Market Cap (USDm)

P/E

Dividend (Yield)

[Blue Lotus China New Consumer Weekly, 10/52] Smart Trump or Dumb Trump? Part II

​China's market shrugged off Two Sessions as the balance of events with US the main driver. EV sector opened 2025 with a bang while MINISO...

Blue Lotus Research Institute

Asia Ex-Japan: Extreme Stocks

Screening for stocks at the extreme ends of their positioning or momentum ranges among active Asia Ex-Japan equity funds.

Steven Holden

U.S., Europe, and Japan Still Holding Below Resistance; Favor Defensives

U.S., Europe, and Japan Still Holding Below Resistance; Favor Defensives. Actionable Themes: Real Estate, Utilities, Telecommunications, Energy,...

Vermilion Research

Real Estate: India/China Rotation Sparks Sector Growth

Real Estate exposure grows among active Asia Ex-Japan funds, sparked by a rotation in to Indian Real Estate, as China & HK positioning falls.

Steven Holden

China Real Estate: Continued Fund Rotation Drives New Lows

Closures by key investors and a downturn in ownership metrics since October last year highlight the Real Estate sector’s declining appeal.

Steven Holden

China's market shrugged off Two Sessions as the balance of events with US the main driver. EV sector opened 2025 with a bang while MINISO...