As the disclosure of the third quarter reports of mutual funds is completed, the market is paying attention to the repositioning trends of the funds. Has there been any change in the positions of mutual funds? How is the allocation in various industries? What changes have occurred in the top holdings? How is the concentration of individual stocks and preference for leading stocks? What is the allocation in Hong Kong stocks? How has the allocation of passive funds changed? We have summarized the eight key points of interest in the market regarding the third quarter report configuration of funds for investors to refer to. Key point 1: Passive index funds drive the proportion of public holdings to reach a historical high In the third quarter of 2024, the market value of A-shares held by mutual funds saw a significant increase, with the market value of A-shares as a percentage of the total A-market value reaching a historical high. By the end of September, as the market quickly recovered from its bottom, the total market value of A-shares held by public funds increased rapidly by 23.34% to 6.19 trillion yuan. Additionally, benefited by the large net inflows into stock ETFs in the third quarter, the proportion of the total market value of A-shares held by public funds increased from 6.83% in Q2 2024 to 7.37%, the highest level since 2010. On the other hand, the proportion of A-shares held by actively managed equity funds decreased to its lowest level since the second half of 2020. In the third quarter of 2024, the equity positions of actively managed equity funds rebounded, and after correcting for fluctuations, it was estimated that Q3 2024 saw a slight reduction in the positions of actively managed equity funds. The equity positions of actively managed equity funds increased from 84.07% to 85.18% in Q3 2024, with ordinary equity funds rising by 1.23% to 89.93%, mixed equity rising by 0.64% to 87.57%, and flexible allocation rising by 1.67% to 77.07%. Considering the passive increase in positions due to the rapid market rise at the end of September, after excluding the impact of market value inflation, the actual equity positions of actively managed equity funds in Q3 2024 may have decreased by 0.67%, continuing the trend of reduction in the first half of the year. To more accurately capture the characteristics of public mutual fund equity asset allocation, subsequent analyses on fund positions, stock industries, and top holdings are based on actively managed equity funds (ordinary equity funds + mixed equity funds + flexible allocation funds), as of October 25, 2024, 15:30 (disclosure rate of 100%). Key point 2: Increasing positions in technology growth and financial real estate, reducing positions in cyclical sectors At the sector level, the proportion of positions in innovation and entrepreneurship increased, while the proportion in the main board decreased. 1) The proportion of positions in the ChiNext board was 19.29%, an increase of 2.45 percentage points from Q2 2024, showing over-allocation to the ChiNext board, with the over-allocation ratio increasing from 6.26% to 7.52%. 2) The proportion of positions in the STAR Market was 10.54%, an increase of 0.78 percentage points from Q2 2024, showing an increase in over-allocation to the STAR Market, with the over-allocation ratio increasing from 3.39 to 3.85%. 3) The proportion of positions in the Main Board was 69.43%, a decrease of 3.25 percentage points from Q2 2024, showing further under-allocation to the main board, with the under-allocation ratio changing from -9.39% to -11.07%. 4) The proportion of positions in the Beijing Stock Exchange was 0.11%, an increase of 0.01 percentage points from Q2 2024. At the style level, positions in technology growth and financial real estate have increased, while positions in cyclical sectors have decreased. In Q3 2024, actively managed equity funds increased their positions in technology growth, financial real estate, and made slight additions to consumer sectors, while reducing positions in cyclical sectors, with healthcare holdings remaining the same as the previous period. The positions of actively managed equity funds in technology growth, financial real estate, consumer, healthcare, and cyclical sectors were 39.42%, 5.94%, 23.24%, 11.16%, and 20.15%, respectively, with changes compared to the previous quarter of 1.97%, 1.57%, 0.17%, 0.00%, and -3.70%. Additionally, the over-allocation ratios for technology growth, financial real estate, consumer, healthcare, and cyclical sectors were 13.44%, -15.98%, 7.72%, 4.45%, and -9.63%, with changes compared to the previous quarter of 1.50%, 0.64%, -0.33%, -0.16%, and -1.64%. At the industry level, investments shifted towards the power equipment and real estate sectors experiencing challenges, with support for the home appliances and automotive industries due to policies, as well as high flexibility in non-banking finance and defense industries. Looking at changes in positions at the primary industry level, actively managed equity funds significantly increased their positions in power equipment, non-banking finance, and home appliances. In Q3 2024, the industries in which actively managed equity funds increased their positions the most were power equipment, non-banking finance, home appliances, automotive, and real estate, with increases of 2.26%, 1.00%, 0.61%, 0.57%, and 0.49%, respectively. Meanwhile, the industries in which actively managed equity funds reduced their positions the most were utilities, electronics, non-ferrous metals, food and beverages, and machinery, with decreases of -1.15%, -0.71%, -0.68%, -0.51%, and -0.48%. Excluding thematic/industry funds, mutual funds still significantly increased their positions in power equipment, non-banking finance, home appliances, and automobiles, with the increases in power equipment, non-banking finance, and home appliances being more significant. After excluding funds focused on new energy/medicine/consumer/TMT themes or industries, the industries in which actively managed equity funds increased their positions the most were power equipment, non-banking finance, home appliances, automotive, and real estate, with increases of 2.38%, 1.24%, 0.76%, 0.67%, and 0.63%, respectively, while the industries in which they reduced their positions the most were utilities, electronics, non-ferrous metals, machinery, and food and beverages, with decreases of -1.20%, -0.80%, -0.68%, -0.58%, and -0.53%, respectively. Compared to the total market, after excluding industry/theme funds, the increases in positions in power equipment, non-banking finance, and home appliances were more significant, with greater reductions in positions in utilities, electronics, and food and beverages. Looking at the differences and consensus in industry allocations between public funds and foreign capital, in the third quarter, both public funds and foreign capital increased their positions in power equipment and non-banking finance, while reducing their positions in utilities, electronics, non-ferrous metals, and coal. The main differences between public funds and foreign capital mainly involved...Appearing in the household appliances and food and beverage sectors, public offerings increased holdings of household appliances and reduced holdings of food and beverages, while foreign capital increased holdings of food and beverages and reduced holdings of household appliances.Looking at the changes in the positions of secondary industries, in 2024Q3, the actively stock-biased funds increased their positions in the industries of photovoltaic equipment, batteries, insurance, white goods, and medical services, with increases of 1.28%, 1.04%, 0.66%, 0.60%, and 0.57% respectively. The secondary industries in which the actively stock-biased funds reduced their positions the most in 2024Q3 were electricity, liquor, aquaculture, medical devices, and traditional Chinese medicine, with reductions of -1.13%, -0.56%, -0.44%, -0.41%, and -0.37% respectively. Looking at the absolute positions of primary industries, the electronics sector remained the largest overweight for public funds for two consecutive quarters, with a slightly lower position compared to the previous quarter. The top five industries in terms of positions for actively stock-biased funds were electronics, power equipment, pharmaceuticals, food and beverages, and automobiles, with allocation ratios of 15.30%, 12.35%, 11.16%, 9.01%, and 5.77% respectively. The bottom five industries in terms of positions were comprehensive, beauty care, steel, social services, and environmental protection, with allocation ratios of 0.09%, 0.23%, 0.35%, 0.37%, and 0.37% respectively. In terms of historical positions, the sectors of communication, electronics, automobiles, non-ferrous metals, and national defense were at historically high levels, while the sectors of commerce and retail, building materials, real estate, computers, and non-banking finance were at historically low levels. Additionally, in the overweight industries, the positions of pharmaceuticals, food and beverages were at relatively low levels, and the position of power equipment was at a relatively high level. Looking at the over-allocation ratio of primary industries, actively stock-biased funds were over-allocated in electronics, power equipment, pharmaceuticals, and food and beverages. The top five industries in terms of over-allocation for actively stock-biased equity funds in 2024Q3 were electronics, power equipment, pharmaceuticals, food and beverages, and household appliances, with over-allocation ratios of 7.20%, 6.50%, 4.45%, 3.48%, and 3.44% respectively. The bottom five industries in terms of over-allocation were banking, non-banking finance, petroleum and petrochemicals, utilities, and construction decoration, with under-allocation ratios of -10.11%, -5.91%, -4.05%, -2.00%, and -1.42% respectively. In terms of percentile rankings, the over-allocation ratios of electronics, non-ferrous metals, national defense, and steel were relatively high, while the over-allocation ratios of computers, beauty care, social services, non-banking finance, and food and beverages were at historically low levels. Looking at the absolute positions of secondary industries, the positions of liquor II, semiconductors, and batteries were the highest. Specifically, the top 10 secondary industries in terms of positions for actively stock-biased equity funds included liquor II, semiconductors, batteries, communications equipment, white goods, consumer electronics, chemical pharmaceuticals, photovoltaic equipment, industrial metals, and medical devices, with allocation ratios of 7.99%, 7.43%, 6.27%, 4.44%, 4.33%, 4.08%, 3.92%, 3.77%, 3.27%, and 3.18% respectively. Looking at the over-allocation ratio of secondary industries, actively stock-biased funds were mainly over-allocated in sub-industries within the consumer and growth sectors. Specifically, the top 10 over-allocated secondary industries for actively stock-biased equity funds in 2024Q3 were liquor II, batteries, semiconductors, communications equipment, white goods, photovoltaic equipment, consumer electronics, chemical pharmaceuticals, industrial metals, and medical devices, with over-allocation ratios of 4.01%, 3.95%, 3.74%, 3.19%, 3.04%, 2.25%, 2.17%, 1.77%, 1.73%, and 1.71% respectively. Key Point Three: TMT holdings slightly decline, over-allocation ratios are at historically moderate levels In 24Q3, the TMT holdings as a percentage of actively stock-biased funds and the over-allocation ratios both decreased slightly. The TMT holdings calculated by summing electronics, computers, media, and communications decreased by 0.51pct to 23.42%, and the over-allocation ratio also decreased by 0.61pct to 5.57%. The allocation ratios of actively stock-biased funds to the TMT sector are at the 75.8th percentile since 2010, and the over-allocation ratio is at the 55.1st percentile since 2010. Looking at secondary industries, actively stock-biased funds show a significant differentiation in TMT allocation, with over-allocation ratios for semiconductors, consumer electronics, components, and communication equipment at 3.74%, 2.17%, 1.66%, and 3.19%, respectively, ranking at the 94.80th percentile, 87.90th percentile, 98.20th percentile, and 100th percentile since 2010. Key Point Four: Dividend holdings remain stable overall, over-allocation ratios remain low The dividend holdings ratio of actively stock-biased funds remained stable in 24Q3. Specifically, in the top ten industries in terms of average dividend yield from 2022 to 2024, the positions were increased for banks, household appliances, real estate, building materials, and non-banking finance, with increases of 0.07pct, 0.61pct, 0.49pct, 0.01pct, and 1.00pct, respectively; positions were reduced for coal, petrochemicals, steel, textiles and clothing, and transportation, with decreases of -0.35pct, -0.43pct, -0.15pct, -0.04pct, and -0.21pct, respectively. In terms of over-allocation ratios, among the top ten industries in terms of dividend yield, the over-allocation ratios increased for banks, petrochemicals, household appliances, real estate, and building materials by 0.75pct, 0.55pct, 0.49pct, 0.30pct, and 0.05pct, respectively; while they decreased for coal, steel, textiles and clothing, transportation, and non-banking finance by -0.07pct, -0.13pct, -0.01pct, -0.09pct, and -0.41pct, respectively. The allocation ratio for the low volatility dividend index decreased, while the allocation ratio for the CSI Dividend Index slightly increased. The position of the low volatility dividend index in the top holdings of equity funds decreased by 0.30pct to 2.46%, while the position of the components of the CSI Dividend Index increased by 0.06pct to 6.23%, both of which are at the 20.50% and 33.30% percentile levels in the past decade. In terms of over-allocation ratios, among the top holdings of equity funds, the over-allocation ratio for the low volatility dividend index decreased by -The over-allocation ratio of the index and the constituents of the CSI Dividend Index has increased by 0.31% and 0.86% respectively to -3.30% and -3.88%, placing them at the 35.80% and 51.20% percentile levels in the past decade.Key Point 5: Gree Electric Appliances, Wanhua Chemical, and China Merchants Bank are the newly added top 20 major holdings of public mutual funds In the third quarter of 2024, the top 5 stocks with the highest increase in positions for actively managed stock funds were Ningde Times (300750.SZ), GCL-Poly Energy, Midea Group (000333.SZ), BYD (002594.SZ), and Ping An Insurance (601318.SH), with their respective holdings increasing by 1.02pct, 0.71pct, 0.45pct, 0.39pct, and 0.36pct compared to the previous quarter. Ningde Times further solidified its position as the largest holding of actively managed stock funds; the top 5 stocks with the highest decrease in positions were Industrial Fulian, Mindray Medical, Luzhou Laojiao, Zijin Mining, and Pengding Holdings, with their respective holdings decreasing by 0.56pct, 0.44pct, 0.42pct, 0.31pct, and 0.25pct compared to the previous quarter. As of Q3 2024, the top ten major holdings of actively managed stock funds were Ningde Times, Guizhou Maotai, Luxshare Precision, Midea Group, Zijin Mining, Wuliangye, Inter-Xuchuang, GCL-Poly Energy, BYD, and Hengrui Medicine, with their holdings accounting for 4.29pct, 2.93pct, 2.39pct, 2.33pct, 1.75pct, 1.73pct, 1.71pct, 1.66pct, 1.30pct, and 1.28pct of the total value of major holdings, respectively. Compared to the previous quarter, there were the following changes: Gree Electric Appliances, Wanhua Chemical, and China Merchants Bank have entered the top 20 holdings of actively managed stock funds. Industrial Fulian, Gujing Tribute Liquor, and Yangtze Power have exited the top 20 holdings of actively managed stock funds. Key Point 6: Continuing the trend of focusing on large-cap companies, the concentration of individual stocks and major industry holdings has increased In the third quarter, the concentration of individual stocks in actively managed stock funds continued to increase, with a trend towards focusing on industry leaders. The concentration of top 5/10/30/50/100 major holdings has slightly increased compared to the second quarter, increasing by 1.26pct, 1.77pct, 1.01pct, 0.66pct, and 0.66pct, respectively. From an industry perspective, the allocation of major industry holdings in actively managed stock funds has increased by 1.54pct, 0.77pct, 1.41pct for the top 3/5/10 major industry holdings, respectively, compared to the second quarter. Key Point 7: The allocation of Hong Kong stocks continues to increase, with non-essential consumer goods and information technology industries leading the way In Q3 2024, the allocation of Hong Kong stocks in actively managed stock funds continued to increase. As of the third quarter, the total value of major holdings of Hong Kong stocks held by actively managed funds reached 230.389 billion RMB, an increase of 18.99%% compared to the end of the previous quarter, with the allocation of Hong Kong stocks increasing from 11.62% to 12.51%. In terms of industries, actively managed funds have increased their allocation to non-essential consumer goods, information technology, and healthcare industries in Hong Kong stocks, while reducing their allocation to energy, utilities, and telecommunications industries. In terms of major holdings, the industries with the most increase in allocations in Q3 2024 were non-essential consumer goods, information technology, and healthcare, with increases of 7.78pct, 1.46pct, and 0.94pct, respectively. The industries with the most reductions in allocations were energy, utilities, and telecommunications, with reductions of 6.61pct, 1.99pct, and 1.79pct, respectively. At the major holding level, Tencent has maintained its position as the largest holding of Hong Kong stocks for three consecutive quarters. As of the third quarter of 2024, the top 5 major holdings of Hong Kong stocks were Tencent Holdings, Meituan, CNOOC, Alibaba, and China Mobile, with holdings values of 46.343 billion RMB, 20.842 billion RMB, 13.488 billion RMB, 13.382 billion RMB, and 11.773 billion RMB, respectively. Compared to Q2 2024, new additions to the top 20 major holdings of Hong Kong stocks include Alibaba, Xiaomi Group, Bilibili, XPeng Motors, Kangfang Life, China Pacific Insurance, and Zhongtong Express. Key Point 8: Significant expansion of stock-based ETFs, focusing on large-cap leading companies In the third quarter of 2024, stock-based ETFs saw a significant expansion, with an increase in the proportion of holdings. The scale of stock-based ETFs increased from 1.81 trillion RMB at the end of the second quarter to 2.76 trillion RMB. The significant net inflows of investors and the performance of the indices were important contributors to the growth of stock-based ETFs. Based on changes in ETF circulating shares and average trading prices, the net inflow of stock-based ETFs in the first three quarters of 2024 totaled 888.4 billion RMB, with a net inflow of 484 billion RMB in the third quarter. In addition, the net asset value of existing ETFs increased by 431.9 billion RMB in the third quarter, and new stock-based ETFs were established with a total of 26.472 billion RMB, with the 10 CSI A500 ETFs totaling 20 billion RMB being the main increase. The significant expansion of stock-based ETFs has propelled the trend of passive investments in the A-share market, with the proportion of passive fund holdings continuously increasing in recent years. As of Q3 2024, passive index funds held 51.11% of A-shares in actively managed funds (including actively managed stock funds and passive index funds), surpassing actively managed stock funds. In terms of investment scope, stock-based ETFs are still focusing on large-cap leading companies. Currently, ETFs tracking large-cap indices such as the Shanghai and Shenzhen 300, ChiNext 50 and ChiNext 100, and Shanghai 50 are still mainstream in the market. As of the end of Q3 2024, the proportion of broad-based ETFs to total stock-based ETFs reached 75%, with nearly half of the products investing in the Shanghai and Shenzhen 300, focusing on large-cap leading companies. Among thematic ETFs, TMT (6%), consumer healthcare (5%), and financial real estate (4%) are relatively prominent. Risk Warning: This report is a historical data analysis report and does not constitute recommendations or advice on industries or individual stocks; This article is from the "CITIC Strategy" official account, GMTEight editor: Jiang Yuanhua.