Having been established for only half a year and already considered "mini," why did the veteran in fixed income launch two funds in succession and end up losing money?

China Securities Journal, March 12 — (Reporter Li Di) An experienced fixed-income veteran maintains steady performance, with two funds achieving excess returns in a volatile market, yet both products are facing significant scale reductions. One of these products even became a mini fund in less than half a year. Where did the mistake occur?

Recently, a liquidation warning notice sparked widespread market discussion: China Life Anbao Zunyue Pure Bond issued a liquidation alert, indicating that as of March 2, this fund had been below 50 million yuan in net asset value for 30 consecutive business days. The fund was established less than half a year ago, managed by veteran桑迎, who has 13 years of experience managing fixed-income products.

Coincidentally, another fund managed by桑迎—Guoshou Anbao Zunfu 30-Day Holding Period Bond—also became a mini fund within less than a year of its launch, repeatedly issuing liquidation warnings. Considering that management fees for bond funds are relatively low, and both products quickly shrank after their inception, the company’s issuance of these products was essentially a loss-making endeavor.

Notably, the performance of these two funds is not poor; they achieved excess returns despite market turbulence. For example, Guoshou Anbao Zunfu 30-Day Holding Period Bond A had a net value growth rate of 0.54% in the second half of last year, delivering an excess return of 1.99 percentage points.

Industry insiders told reporters that the funds’ performance and the fund managers’ experience are not obvious shortcomings, but the scale issues likely stem from sales strategy errors. On one hand, some public funds rely heavily on specific sales channels; if subsequent marketing efforts are insufficient, the scale can shrink rapidly. On the other hand, both funds were launched during periods of bond market turbulence and relatively strong stock markets, and the timing of issuance was not ideal. Some industry experts believe this may be related to sales teams pushing for KPIs, prioritizing issuance over market conditions, ultimately harming the overall interests of the fund company.

Veteran Fixed-Income Manager Achieves Positive Returns Amid Turbulence, Yet Two Funds Face Liquidation

Recently, China Life Anbao Zunyue Pure Bond issued a liquidation warning. The notice states that as of March 2, 2026, the fund’s net asset value had been below 50 million yuan for 30 consecutive business days.

This fund was established on October 9, 2025, and is less than half a year old. The fund manager is veteran桑迎, with 13 years of experience managing public fixed-income products, managing assets totaling 71.65 billion yuan as of the end of last year’s fourth quarter.

Interestingly, another fund managed by桑迎, also newly established, is nearing liquidation.

Guoshou Anbao Zunfu 30-Day Holding Period Bond’s manager is also桑迎. It was launched on March 28, last year, with an initial size of 468 million yuan. Yet, less than a year after its inception, it quickly became a mini fund.

By the end of last year, the fund issued multiple liquidation warnings. As of December 17, 2025, its net asset value had been below 50 million yuan for 45 consecutive business days.

In late 2025, the fund’s size grew to 61.19 million yuan, temporarily avoiding liquidation. This was likely due to the fund manager mobilizing resources to find “helping funds” to get through the tough period.

Remarkably, despite the turbulent bond market environment, these two funds performed well and achieved excess returns.

In the second half of 2025, the bond market was turbulent, with the ChinaBond New Composite Full Price Index returning -1.45%. However, Guoshou Anbao Zunfu 30-Day Holding Period Bond achieved positive returns against the trend, with Class A shares’ net value increasing by 0.54%, and an excess return of 1.99 percentage points.

Additionally, China Life Anbao Zunyue Pure Bond, launched on October 9, 2025, had a return of 0.34% by the end of last year’s fourth quarter, achieving an excess return of 0.3 percentage points.

A senior researcher from a major public fixed-income department told reporters, “If it’s a stock fund, a small scale can sometimes boost performance because the minimum investment amount for most stocks is relatively low. But bond funds are different. A very small scale increases management difficulty. Plus, since these two funds shrank rapidly after launch and faced frequent redemptions, it affected the fund manager’s trading rhythm, often forcing them to sell bonds. In such circumstances, it’s quite an achievement for the fund manager to withstand bond market turbulence and still deliver such excess returns.”

Two Loss-Making Funds Released in Succession, Company’s Sales Strategy Under Scrutiny

Given that management fees for bond funds are relatively low, and these two funds quickly became mini funds after launch, their management fee income since inception might only amount to a few hundred thousand yuan.

Industry insiders told reporters that issuing a public fund involves costs such as initial issuance, marketing materials, channel operations, and ongoing expenses like marketing, compliance, and research personnel. Overall, launching these two products was likely a loss-making effort. If they are eventually liquidated, the fund company’s efforts will have been in vain.

Some industry experts also noted, “Currently, approval for bond fund licenses is becoming more stringent, making new approvals difficult. The existing bond fund shells have some value. If these funds are ultimately liquidated, it would be quite unfortunate.”

Despite桑迎’s solid performance and stable sizes of his other funds—such as Guoshou Anbao Money Market and Guoshou Anbao Zunhong Short-Term Bonds—why are these two products facing imminent liquidation?

Industry insiders suggest that if the performance is good and the fund manager experienced, but the product scale is problematic, the issue likely lies in sales strategy.

On one hand, some public funds rely on specific channels for sales. Even with steady performance, if the sales team does not continue marketing effectively, the product’s scale can decline rapidly.

On the other hand, these two funds were launched in March and October last year, during a period of ongoing bond market turbulence and relatively strong stock markets. Many investors at that time were not keen on bond fund allocations, making it an unfavorable time for issuance. This reflects some misjudgment in the timing and sales strategy of the fund company.

Why issue bond funds when market conditions are poor? Some industry insiders believe it’s related to sales teams’ KPIs. For frontline sales, if no new funds are launched throughout the year, it’s hard to demonstrate results at year-end. As a result, some sales push for senior fund managers to help with issuance. But if this is done without considering market conditions and solely to meet targets, subsequent operations may suffer, harming the overall interests of the fund company. Once the funds are liquidated, unredeemed investors face capital costs, which is also detrimental to investor interests.

(China Securities Journal, Li Di)