Public funds should act as effective organizers of long-term capital

During the 2026 National Two Sessions, how to implement the plan to “fully create a market ecosystem of ‘long-term funds for long-term investments’” has become a focus of attention from all parties in the market. As a key bridge connecting medium- and long-term funds with the capital market, the role transformation and development path of public funds have attracted much attention. Recently, Zhong Zhe, General Manager of China International Capital Fund, gave an exclusive interview to Securities Daily, elaborating on his thoughts and practices regarding public funds serving the “long-term funds for long-term investments” ecosystem.

“Building a ‘long-term funds for long-term investments’ ecosystem is not only a political responsibility to implement national strategies but also an inevitable requirement for the industry to return to its original mission of ‘trusteeship and loyalty.’” Zhong Zhe stated that under policy guidance, public funds are transforming from asset management institutions driven by scale in the past to practitioners of policy implementation, organizers of long-term capital, stabilizers of the capital market, and guardians of residents’ wealth. The industry’s development must resonate with national strategies, practicing the original intention of serving the country through finance and managing people’s wealth in the development of new productive forces, truly achieving the unity of functionality and profitability.

Regarding how to meet the increasingly refined allocation needs of medium- and long-term funds, Zhong Zhe believes the key lies in building a precise, adaptable portfolio of professional products to ensure funds can “enter” and “stay.” He proposed three specific solutions: First, strengthen the supply of underlying tools, implement the requirement to vigorously develop various on- and off-exchange index funds, enhance passive products like ETFs, and focus on developing quantitative index products with active research capabilities. Second, refine strategic products, respond to the call to “launch various products and risk management tools suitable for long-term investment,” implement strict risk grading for “fixed income+” and multi-strategy products, emphasize absolute return concepts, and strive to safeguard wealth preservation and appreciation; explore floating fee models to deeply link management fees with investor returns. Third, improve one-stop solutions, implement the deployment to “enrich the asset classes available for public funds,” vigorously develop FOFs (funds of funds) and other cross-asset allocation systems, aiming to solve the industry pain point of “funds making money but retail investors not.”

“Comprehensive service capability is the key to the core competitiveness of public funds and an important foundation for serving ‘long-term funds.’” Zhong Zhe believes that the industry needs to build a core capability system suitable for long-term investment and proposed four transformation directions: First, extend assessment mechanisms to long cycles, strictly implement the weight requirements for medium- and long-term returns; second, standardize evaluation systems based on contracts and performance benchmarks to eliminate style drift; third, optimize sales services, strengthen accompanying services, and guide investors to hold long-term rationally; fourth, platformize research and investment capabilities by building an integrated, multi-strategy research system to enhance multi-asset allocation and risk control abilities.

On building a multi-party collaborative ecosystem, Zhong Zhe stated that public funds will become complementary and symbiotic partners with institutions such as insurance companies and bank wealth management subsidiaries. In investment management, leverage advantages in equity research and passive tools to serve long-term capital; in product layout, promote demand-driven customization and tailored solutions; in customer service, refine client benefit and risk stratification to pursue full lifecycle services; in cooperation mechanisms, maintain transparency and risk penetration, and strengthen regular communication.

Looking ahead to the “14th Five-Year Plan,” Zhong Zhe envisions an industry landscape where the “long-term funds for long-term investments” ecosystem becomes more complete: asset structures are more optimized, the proportion of equity assets significantly increases, and alternative assets such as global allocations and REITs (Real Estate Investment Trusts) become routine; investor structures are more mature, with institutional funds becoming the core incremental source, and “patient capital” gradually becoming mainstream; value orientation is more prominent, with industry evaluations shifting from scale rankings to investor returns, compliance, and service quality to the real economy.

“Standing at a new starting point for high-quality industry development, public funds will adhere to the principles of compliance, integrity, professionalism, and prudence, promoting policy implementation through practical efforts, earning market trust through professionalism, and serving the national strategy with responsibility.” Zhong Zhe concluded that China International Capital Fund is willing to demonstrate new achievements and contributions of the public fund industry in serving the capital market, residents’ wealth, and the modernization of China.

(Edited by: Xu Nannan)

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