On October 11, Liang Hong, founder of billion-yuan private fund Hainan Shiva, discussed the recent decline in tech stocks, institutional capital flows, and his own fund's position adjustments in his latest weekly report. Liang Hong questioned the trading behavior of certain large insurance asset management institutions: "We understand that some insurance asset management giants bought a lot of tech stocks at high levels in July, but made substantial position cuts to stop losses in late September. This kind of large institution chasing rallies and dumping at lows is truly baffling." However, Liang Hong did not disclose which insurance asset management institutions were involved, nor did he reveal the specific trading details of these institutions.
At the same time, Liang Hong disclosed that most of his funds are expected to see net value declines of more than 2% this week (including the National Day holiday), and have retraced more than 20% from their June high this year. In this weekly report, Liang Hong also disclosed recent investment operations and market judgments, mainly including the following points:
In terms of investment operations, Liang Hong revealed that over the past few months, Shiva Private Fund cleared out US-listed storage stocks and some other small positions, retained a 20% position in wafer manufacturing stocks, and bought Hong Kong-listed internet stocks, wafer manufacturing stocks, and some A-share tech stocks with reasonable valuations and significant upside potential. Due to regulatory policy adjustments, currently US-listed individual stocks can only be sold, not bought, so Shiva only retains one heavily weighted stock in the US market. Liang Hong said this stock recently hit a historical high, but did not disclose its specific name.
Regarding the continued decline of A-share and Hong Kong tech stocks recently, Liang Hong believes the main reason is capital flow issues, not deterioration in corporate fundamentals. He stated that the AI industry's development prospects remain broad, and although some A-share tech stocks previously had bubbles, after recent adjustments, many quality companies have become cheap, especially in Hong Kong. Despite his funds retracing more than 20% from their June high, Liang Hong remains confident in tech stocks. He said he will not rotate into bank stocks like some capital has done, but will continue to stick to his own investment judgment. If the funds continue to decline, Shiva will purchase its own funds again.
The following is the full text of Liang Hong's October 11 weekly report:
Hello everyone, this week (including the National Day holiday) most funds are expected to see net value declines of more than 2%. The funds have retraced more than 20% from their June high. I think it is necessary to write something. Our operations over the past few months mainly involved clearing out US-listed storage stocks and some other small US-listed positions, while retaining a 20% position in wafer manufacturing stocks. Then we bought Hong Kong-listed internet stocks, wafer manufacturing stocks, and some A-share tech stocks that I believe have reasonable valuations and significant upside potential. However, looking at the trends of the Hang Seng Tech Index, ChiNext Index, and STAR Market over the past few months, the main reason for the fund's retracement is the poor beta of AH tech stocks, while some leading US tech stocks have hit historical highs. Especially in the past month, overseas and domestic trends have been completely opposite, and the only US stock we hold also recently hit a historical high. However, after regulatory policy adjustments, we can only sell US-listed individual stocks, not buy them, and everyone knows I am not fond of buying index-type allocations. So in the US market, we only hold one heavily weighted stock, the one I have always said has the highest certainty, and it has indeed hit a new high, while companies with the same business domestically are hitting new lows. I believe this is mainly due to capital flow reasons, not fundamental reasons. AI is developing very well and smoothly with still great prospects, but the domestic capital flow situation is not good, which indeed surprised me. We understand that some insurance asset management giants bought a lot of tech stocks at high levels in July, but made substantial position cuts to stop losses in late September. This kind of large institution chasing rallies and dumping at lows is truly baffling. I admit that initially many domestic tech stocks, especially A-share tech stocks, had bubbles, but now many good companies have become cheap, not to mention Hong Kong stocks. I believe our stock selection has alpha, but in just a few months, individual stock alpha is difficult to manifest and can only rely on market beta. Under the poor beta of the Hang Seng Tech Index, ChiNext Index, and STAR Market, the fund's past performance has been poor, but I personally remain full of confidence. First, the fundamentals are very good; second, increasingly cheaper stock selections also mean greater upside potential. If the fundamentals were bad, several US GPU, CPU, and wafer manufacturing leaders would not be hitting new highs. Companies in AH markets that are cheap and have good certainty will have great future potential. In the past, many domestic funds have hidden in large banks, but I will not do that. I will stick to my views. If the funds continue to decline, we will conduct another round of self-purchases. Thank you.
Shiva Private Fund Liang Hong
October 11, 2026
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