Vice Chairman of the National Social Security Fund Jin Luo: The social security fund has repeatedly increased its holdings decisively during sharp declines in A-shares.

On March 27, Jin Luo, Vice Chairman of the National Social Security Fund Council, stated at the Boao Forum for Asia 2026 Annual Conference’s sub-forum on “Creating a Good Market Environment and Advocating Long-term Value Investment” that since its establishment, the National Social Security Fund has always regarded long-term investment, value investment, and responsible investment as its core philosophies, with its investment scope covering various fields including stocks and bonds, thereby building a global, diversified, and decentralized asset allocation system. This investment structure enables the National Social Security Fund to withstand the impact of short-term market fluctuations and achieve relatively stable returns in the long term.

From the primary market perspective, Jin Luo introduced that due to the inherent nature of long-term investment, the National Social Security Fund will invest in some equity investment projects with relatively long life cycles and some infrastructure projects. She cited the example that last year, the National Social Security Fund established social security technology innovation funds in five regions including Jiangsu, with a total scale reaching 160 billion yuan. The selected fund managers for this social security technology innovation fund are all market-oriented, and a market-oriented co-investment and incentive mechanism has been established to ensure that fund managers can direct funds towards companies with long-term growth potential. “The social security technology innovation fund hopes to fully leverage the advantages of social security funds as patient capital, so investment periods will be appropriately extended based on the characteristics of the production cycles of technology innovation enterprises and investment targets, with the maximum duration reaching up to 18 years.”

Regarding the secondary market, Jin Luo stated that the National Social Security Fund is able to maintain strategic determination amidst short-term fluctuations and has decisively increased positions multiple times during significant declines in A-shares. Statistical data shows that over the past five years, the average turnover rate of public equity funds is about 370%, with an average holding period of 3.25 months. In the same period, the annual average turnover rate of the National Social Security Fund’s actively managed stock portfolio is less than 100%, with an average holding period exceeding 12 months. This all confirms the National Social Security Fund’s commitment to the principles of long-term investment, value investment, and responsible investment. Over its 25 years of establishment, the annual average investment return rate of the National Social Security Fund is 7.39%, with a cumulative investment return amount reaching 1.9 trillion yuan.

Regarding further creating a good market environment and advocating long-term value investment, Jin Luo suggested improving the multi-level capital market system, addressing shortcomings in equity exit channels, and providing more equity transfer channels for innovative small and medium-sized enterprises beyond IPOs. She stated that, based on international experience, mergers and acquisitions are also very important and are an indispensable exit channel. Additionally, “state-owned funds, due to assessment cycle reasons, still have areas for further improvement in valuation and pricing mechanisms, and we hope to improve the fund share transfer mechanism.”

(Source: Securities Times)