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Speculates On Stock Performance Depends More On Corporate Governance.

2011/2/24 15:55:00 44

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Stock Performance Equity

Attracting quality growth

fund

Manager Zhang Bing:

Speculates on stock performance depends more on corporate governance.

Company performance and macro

Economics

The trend has always been invested by professional investors.

However, as

stock right

With the promotion of split share reform, fund managers also regard the improvement of corporate earnings and governance as the key factor of investment.

Zhang Bing, manager of China Merchants high quality growth fund, believes that in the process of comprehensive reform of stock reform, investors need to avoid those companies that are false and unable to grow continuously, and seek to manage stocks that are perfect and have long-term core competitiveness.

After a period of macroeconomic regulation and control, the development of domestic economy is facing an important turning point.

At the same time, in the process of promoting the overall reform of the stock market, investors need to pform their investment ideas and strategies in a timely manner in order to cope with the possible turning point in the stock market in the coming year.

Zhang Bing believes that in the next long time, the endogenous driving force of China's economy remains strong, especially under the influence of the upgrading of residents' consumption structure, the acceleration of urbanization process and the upgrading of industrial structure, China's economy will continue to maintain a rapid development trend.

Under such a background of economic growth, a large number of enterprises will benefit from it and grow rapidly.

But in these enterprises, some growth is superficial and false, not sustainable or even damaging shareholder value. This is inefficient growth; while some growth is really creating economic value for shareholders and has potential for sustainable growth in the future, this growth is the best growth.

Based on this judgment, the merchants quality growth fund will find a real growth target in the growth enterprises and create positive EVA (economic profits) for shareholders.

As to how to select a good stock with real economic value from the stocks that are mixed up, Zhang Bing believes that the following factors should be paid attention to: whether the company has good governance structure and long-term core competitiveness, whether the company has sustained economic profit growth, and whether the valuation of the company's stock is reasonable or not.

Specifically, the evaluation of corporate governance structure mainly includes a series of qualitative indicators, such as whether the supervision and checks and balances mechanism is effective, whether the incentive mechanism is reasonable, whether the management of the company has good integrity and so on.