The revival of quantitative active funds in the Chinese public offering sector has captured significant attention recently. Since the beginning of the year, there has been a noticeable uptick in the activity within the A-share market, providing a conducive environment for public quantitative funds to achieve excess returns. The data from Wind shows that several funds, including Jin Xin Quantitative Selected, Hua Shang Computer Industry Quantitative, and Pu Yin An Sheng Hong Kong Stock Connect Quantitative Optimal, have delivered returns exceeding 10% year-to-date. Additionally, there are funds like Bosera Intelligent Select Quantitative Multi-Factor and Tianfeng Quantitative Selection, which have recorded net values reaching all-time highs since their inception.

Previously, excess returns from public quantitative funds were largely derived from small and micro-cap stocks. However, over the past few quarters, these funds have shifted to increase their allocation towards growth stocks, becoming one of the pivotal factors driving the ongoing performance improvements in public quantitative funds. The upward trajectory in performance coincides with favorable national policies and a significant resurgence in daily trading volumes on the A-shares, maintaining levels above one trillion RMB, illustrating a robust recovery of investor confidence.

After a period of correction lasting several months, many public quantitative funds have managed to navigate past the severe dips caused by liquidity crises in the micro-cap sector. As reported, funds like Tianfeng Quantitative Selection have steadily reclaimed their position, achieving positive returns of 15.27% for 2024 and over 6% this year, signifying three consecutive years of positive performance.

The reported success is not limited to larger funds; several smaller-sized funds have also shown aggressive performance. For instance, Jin Xin Quantitative Selected has registered over 18% positive returns this year, while Hua Shang Computer Industry Quantitative, managed by Dr. Ai Dingfei, has achieved positive returns exceeding 10% for the last two years consecutively. Similarly, the Pu Yin An Sheng Hong Kong Stock Connect Quantitative Optimal, overseen by Dr. Yu Jin, has enjoyed the same success over the same period.

Taking a closer look at the past year's trends, it becomes very evident that funds such as Hua Shang Computer Industry Quantitative achieved returns above 60%. Other funds like Guangfa Quantitative Multi-Factor and Shenyin Wanguo Intelligent Life Quantitative Stock Picking also performed strongly, delivering positive returns exceeding 50%.

A crucial observation from these developments is the significant contributions from the increased allocations in growth sectors. In the tumultuous market of 2023, funds with a specific focus on micro and small caps initially shined, accumulating substantial excess returns amidst volatility. Nevertheless, the onset of 2024 revealed that many of these strategies faltered, leading to major downturns for several funds heavily invested in these small-cap stocks, sparking controversy over their performance strategies. Many still struggle to recover from this downturn.

In contrast, numerous funds that recalibrated their strategies towards growth sectors have benefited significantly. A notable example comes from Liu Zhao, who maintained a high allocation to growth factors and over-allocated to innovative industries. His strategy integrates a quantitative model for stock selection complemented by subjective research, thus amplifying specific stock weightings effectively.

Additionally, Wang Ping highlighted in the fund's quarterly report that the focus would remain on optimizing stock selection models based on fundamental factors and depth learning algorithms, which suggests a strategic pivot towards a more systematic approach in stock selection.

Risk management has also been underscored as a primary focus. Tan Jiajun mentioned the significance of diversifying investments to mitigate industry and style concentration risks while striving for stable returns across various market conditions. He emphasized the importance of constantly optimizing quantitative models based on real-time economic data, policy changes, and sector performance.

Looking ahead, fund managers are leaning towards maintaining and optimizing industry rotation strategies, especially emphasizing sectors like cloud services and computing, given their robust growth potential. This includes incremental allocations to the real estate sector amid recovery signs and consumption spaces backed by supportive policies.

In broadening the scope of quantitative investing further, these funds are not just autonomous but are merging with advancements in technology. The surge in public interest in AI applications in finance is increasingly being recognized. By leveraging massive datasets and analytical techniques, many public funds are crafting investment models that promise an element of sophistication to decision-making.

In 2024, the public offering market in China saw an unprecedented boom, with quantitative fund scales nearing 300 billion RMB. Recent data highlighted a historic increase in the spectrum of such products, with 99 newly established quantitative funds, paving the way for enhanced investor choices in this evolving landscape.

Managers of these funds are continuously evolving by welcoming talent with rigorous academic backgrounds in mathematics and statistics. This influx of expertise is fortifying the quantitative teams within public funds, providing support for the complex models employed in investment strategies.

In summary, 2024 is shaping up to be a renaissance for quantitative strategies in China, with fund managers increasingly inclined towards growth-oriented investments and diversified portfolios. As they continue to harness advanced analytics to guide their strategies, the potential for sustained success in this burgeoning domain appears bright.