The world of investment management can often be a turbulent one, with leadership changes frequently making headlinesOne such headline emerged just before the Chinese New Year of 2025, when ICBC Credit Suisse Asset Management announced three significant changes to its fund management teamThis announcement heralded the departure of Zhang Yufan, who had been at the helm of three different funds, including the ICBC Logistics Industry Stock fund, the ICBC Emerging Manufacturing Mixed fund, and the ICBC Quality Development Mixed fundThe timing of this news, coming on the eve of a major holiday, was no mere coincidence; it marked a culmination of planning that had likely been brewing for the last six months.

Education often plays a pivotal role in the financial worldZhang Yufan, a well-educated individual holding a master's degree, joined ICBC Credit Suisse in 2007. Throughout his career, he rose to become the investment director of the equity investment department while simultaneously managing several fundsAt the time of his resignation, Zhang was responsible for managing assets totaling approximately 3.39 billion yuan across these three fundsHis tenure was marked by performances that earned him significant recognition; he began managing his first fund in March 2016, followed by the initiation of his subsequent two funds in August 2020 and May 2022, respectively.

During his time managing the ICBC Logistics Industry Stock fund, Zhang Yufan delivered a remarkable 277% return from its inception until January 2025, translating to an annualized return of over 16%. This robust performance positioned the fund as one of the top performers in its categoryComparatively, the ICBC Emerging Manufacturing Mixed fund also displayed impressive results, boasting an 85.07% return since its establishment and clinching the top rank across a large sector of similar fundsHowever, despite these accolades, Zhang's overall fund management scale never really took off, consistently hovering around a lower threshold, raising questions about the reasons behind his departure.

In the investment management arena, size can sometimes matter as much as performance

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While it's undeniable that Zhang Yufan's funds consistently outperformed many in their respective categories, his management scale has not seen the same growth trajectoryFor instance, the combined asset value of the two significant funds he managed made up the vast majority of his entire portfolioDespite showing outstanding annual growth rates in recent years—over 35% for one fund and nearly 70% for the other—Zhang saw little in the way of an increase in the size of his portfolio after a temporary peak period in late 2021.

In stark contrast to Zhang Yufan's performance and fund sizes, Zhao Bei, another well-known fund manager at ICBC Credit Suisse, managed to amass nearly five times the capital but with decidedly poorer performance metricsZhao's funds, despite consistently trailing behind the Shanghai-Shenzhen 300 Index, managed to attract significant investments, showcasing that institutional and individual investors often prioritize asset size over relative performance.

This situation at ICBC Credit Suisse brings to light a broader narrative within China's mutual fund industry, which has increasingly favored ETF (exchange-traded funds) and fixed-income products over traditional actively managed equity fundsThe dominance of passive investment strategies and the growing popularity of ETF funds have been particularly pronounced within this institutionIndeed, a substantial portion of ICBC Credit Suisse's assets is allocated to fixed-income instruments, reflecting a reliance on these products rather than emphasizing the more traditional equity strategies that Zhang was known for.

As of the end of 2024, ICBC Credit Suisse managed approximately 837.57 billion yuan in total assets, with monetary funds accounting for over half of that pie and bond funds making up a significant chunk as wellThe equity products were dwarfed by these figures, as much of the focus appeared to be on passive index products, leaving little room for actively managed funds to flourish

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