Star China Stock Fund Manager Suffers a Disastrous 2021

(Bloomberg) -- 2021 was a difficult year for Zhang Kun, a celebrity Chinese fund manager whose early bets on mainland liquor stocks and eye-popping returns had made him famous. 

Three funds managed by him at China's biggest money manager E Fund Management Co. ranked near the bottom among their peers last year, according to data from financial information provider East Money Information Co., as Beijing's intensified tech clampdown and the nation's slow consumer spending soured his once profitable investments.

Among them, Zhang's flagship $11 billion Blue Chip Selected Mixed Fund lost 10% last year, after nearly doubling in 2020, according to Bloomberg-compiled data. Four of the top 10 holdings in the fund were major distillers such as Kweichow Moutai Co. and Wuliangye Yibin Co. The former rose just shy of 3% last year, compared with a gain of nearly 70% in 2020, while the latter slumped 24% in 2021, versus a 119% surge in the previous year. 

Another fund heavily exposed to tech and bank shares slumped 31%, exceeding the MSCI China Index's 22% decline. 

The performance marked a sharp reversal of fortunes for Zhang, who has risen to stardom in recent years riding an earlier boom in consumer and tech stocks. E Fund didn't immediately reply to an email sent during a Chinese holiday seeking comment.

Zhang's E Fund Quality Selected Mixed Fund, more than 23% of which was invested in Hong Kong-listed tech stocks including Tencent Holdings Ltd. and JD.com Inc. as of end-September, lost 22% last year. 

The Hang Seng China Enterprises Index, which tracks some of mainland's largest tech and financial firms, was the world's worst performer in 2021, followed by the broader Hang Seng Index.

An early investor in the once red hot Kweichow Moutai, Zhang was the first mainland mutual fund manager with managed assets exceeding 100 billion yuan ($15.7 billion). 

©2022 Bloomberg L.P.