The world of investment is undergoing significant transformations, particularly in ChinaThe recent surge in capital inflows showcases how the Chinese market is evolving as a critical area for public offering investment funds (QDII). The driving force behind this trend can be traced to the performance of A-shares and Hong Kong stocksAs the two markets are experiencing a collaborative rise, the strategy concerning QDII fund allocations has become increasingly dependent upon positioning within Chinese equities.

Renewed investor interest has shown a marked shift, as seen in the statistics provided by Wind, including the robust performance of various QDII fundsThe top performers in 2025 are dominated by those whose primary holdings are Chinese stocksHistorically reliant on American equity markets for returns, this drastic pivot now exposes the shifting landscapes and confidence levels regarding the Chinese economy.

This pivot towards QDII funds directing their investments into A-share and Hong Kong markets hints at the substantial rise in the valuation attractiveness of Chinese tech stocksFund managers express optimism about the potential growth trajectories of these stocks, often citing their belief in the overarching narrative of technological advancement fueling future profitability.

The Dominance of Chinese Positioning in QDII Fund Performance

Determining the extent of exposure to A-shares and Hong Kong stocks has emerged as a decisive factor shaping the performance rankings of QDII funds.

According to Wind's data, the leading QDII funds achieving the highest returns in 2025 maintain strong positions in Chinese equities

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Notably, the top has been claimed by Wanjiam Global Growth Mixed QDII, realizing an impressive annual return of 16.05%. Following closely, the Creosus and Lexing Hong Kong Internet QDII recorded returns of 15.69%, while the third position held by Creosus Global Semiconductor Industry QDII noted an 11.81% gain since the start of the year.

The trend prevails with all top-ranked QDII funds concentrated heavily on Chinese stocks, marking a clear departure from previous years focused predominantly on U.S. equitiesFor example, Wanjiam’s QDII is primarily allocated with 43.54% in A-shares and 20.18% in Hong Kong stocks, totalling a remarkable 63% in these markets.

Even in funds explicitly named for global sectors, such as the Creosus Global Semiconductor Industry QDII, significant allocations remain in A-shares and Hong Kong markets, further illustrating the trendHere the Hong Kong stocks make up 29.66% of the allocation, while A-shares follow closely with 29.30%. Thus, investments in U.S. stocks form a mere fraction of the focus.

The robust performance of Chinese equities has compelled many QDII managers to seek flexibility within their asset allocations, capitalizing on short-term rebounds in the Chinese marketHowever, those funds burdened by country-specific themes have shown vulnerability, as evidenced by the struggling returns of India-themed and Vietnam-themed funds within the broader category of QDII.

Frequency of QDII Performance Escalation Reflecting Unique Investment Strategies

The valuation uplift of Chinese technology stocks has acted as a core driving factor behind the strong resurgence in the Chinese equities market

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The high elasticity of heavy-weight stocks within QDII portfolios has become critical to achieving top rankings amidst the fund competition.

For instance, the leading QDII fund, Wanjiam Global Growth Mixed QDII, attributes much of its success to its significant investment in Kingdee International, a stock that alone claims an 8.37% share of the fundSince January 2025, Kingdee's share price has soared nearly 70%, illustrating how specific equity selection is proving decisive in the fierce race for performance accolades.

Furthermore, funds like the Creosus Hong Kong Internet QDII and the Huaxia Frontier Economic Mixed QDII have also accrued substantial returns derived from investments in technology-leading companies, with the rapid ascent of Xiaomi's stock significantly contributing to their performance.

The rebound in the Hong Kong market witnessed across both large-cap and mid-to-small-cap stocks only serves to enhance the experience of various QDII fund managers, who are fielding significant gainsFor instance, the stock of Meitu Company underperformed for numerous quarters but has gained nearly 60% in just under two months this year, while Alibaba, another heavyweight in the QDII portfolios, has risen close to 40%, indicating a multi-layered recovery experiencing across sectors.

Fund Managers Anticipating Stronger Narratives in the Tech Sector

In their stock-picking endeavors amidst the prevailing market conditions, many public fund managers perceive the overarching narrative surrounding technology as a compelling area of investment, hinting at greater elasticities.

For example, Zheng Jian, the fund manager of the Creosus Hong Kong Internet QDII, noted that investors currently possess robust pricing power within the Hong Kong market

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