Is DeepSeekV4 nearing release? What’s the focus as domestic AI once again aims for a breakthrough and overtakes on the curve? Huabao Fund’s Sci-Tech Innovation Artificial Intelligence ETF (589520) surged nearly 4% at its peak.

April Opens to a Strong Start! On April 1, the major A-share indexes all rose across the board, with all three major indexes gaining more than 1%. The Huabao Kechuang Artificial Intelligence ETF (589520), which focuses on the domestic AI industrial chain, was active throughout the day at high levels. The highest intraday gain in the market reached 3.96%, closing up 3.78%, and it regained both the 5-day and 10-day moving averages in one go.

What’s worth noting is that yesterday the Huabao Kechuang Artificial Intelligence ETF (589520) attracted net inflows of 10.11 million yuan in a single day. Looking over a longer period, over the past 20 trading days it has cumulatively raked in 76.25 million yuan, reflecting that capital is optimistic about the domestic AI track’s prospects—positioning early, entering at low levels, and laying a concealed stake!

As for constituent stocks, Xin Yuan Co., Ltd. and Uknowde-W led the gains by more than 10%. Tongdao Technology rose by more than 7%, Cambricon and Lingyun Optics rose by more than 6%, while Yun Tian Lifei-U, Xinghuan Technology-U, and other individual stocks also followed higher.

On the news front, DeepSeek crashed and jumped to a trending search overnight. Industry speculation suggests it was caused by DeepSeekV4 conducting stealth testing, which may indicate that DeepSeekV4 is possibly nearing release. Citic Securities believes that DeepSeek’s next-generation new model is expected to continue the high-performance, high-value open-source model route, bringing new investment opportunities in directions including the model original manufacturer, AI applications, and AI infrastructure*.

On the fundamentals front, Xin Yuan Co., Ltd.’s performance is outstanding. In 2025, revenue hit a new high. Among them, revenue related to AI computing power increased sharply to 64%, and newly signed orders surged 103% year over year. Previously, Cambricon, a benchmark domestic AI chip company, disclosed its 2025 annual report: for the full year, net profit reached 2.06B yuan, signaling that AI enterprises have moved from a technology investment phase into a commercial return phase.

Data show that as of the end of March, among the Huabao Kechuang Artificial Intelligence ETF (589520)’s 13 companies that have released their 2025 annual reports, 10 listed companies achieved profitability; 9 companies’ net profit attributable to shareholders increased by double digits year over year; and Cambricon’s net profit attributable to shareholders, up 555% year over year, is currently the top.

It’s worth mentioning that Huawei’s Meng Wanzhou stated that AI will be the biggest development opportunity in the next decade—even longer—and also the most certain strategic opportunity. Dongxing Securities believes that the AI industry is currently in a phase of a three-dimensional resonance among policies, technology, and demand. Domestic chip and cloud computing leaders are gradually validating their performance; large companies’ CapEx continues to drive up industry development certainty, leaving room for further upward momentum in industry sentiment*.

【A Beacon of Domestic Substitution, Kechuang Self-Reliance and Strengthening】

The Huabao Kechuang Artificial Intelligence ETF (589520) and its connection fund (Linkage A: 024560, Linkage C: 024561) focus on the domestic AI industrial chain. The constituent stocks include domestic GPU leaders (such as Cambricon), domestic ASIC leaders (such as Xin Yuan Co., Ltd.), and AI application leaders (such as Kingsoft Office). The weighting of the semiconductor industry is nearly half, giving it strong offensive capability. The software industry weighting exceeds 30%, which may benefit from a rebound rally in AI applications. In addition, this ETF is a margin financing and securities lending eligible product, and it is an efficient tool for one-click exposure to domestic computing power.

*Institutional views for reference—source materials: ① “Model manufacturers, AI applications, and AI infrastructure opportunities to watch amid dense iterations and upgrades of large models,” issued by Citic Securities on April 1; ② “Multidimensional resonance, welcoming a new journey for AI,” issued by Dongxing Securities on December 22, 2025.

ETF fee-related note: The Huabao Kechuang Artificial Intelligence ETF does not charge a sales service fee. The subscription and redemption agent institutions may charge a commission according to a standard not exceeding 0.5%, including related fees charged by the securities exchange, registration institution, and so on. Market trading fees are based on what the securities company actually charges

Linkage fund fee-related note: The Huabao Venture on the Science and Technology Innovation Board Artificial Intelligence ETF Initiated Linkage Fund (Class A) has a subscription fee rate of 1,000 yuan per order when the subscription amount is 2 million yuan (inclusive) or above; 0.6% when it is 1 million yuan (inclusive) to 2 million yuan; and 1% when it is below 1 million yuan. The redemption fee rate is 1.5% when the holding period is less than 7 days; and 0% when the holding period is 7 days (inclusive) or more. No sales service fee is charged. The Huabao Venture on the Science and Technology Innovation Board Artificial Intelligence ETF Initiated Linkage Fund (Class C) does not charge a subscription fee. The redemption fee rate is 1.5% when the holding period is less than 7 days; and 0% when the holding period is 7 days (inclusive) or more; the sales service fee is 0.3%.

Risk notice: The Huabao Kechuang Artificial Intelligence ETF passively tracks the Huashang Kechuang Board Artificial Intelligence Index. The index base date is 2022.12.30, and it was published on 2024.7.25. The index’s annual total returns for 2023 and 2024 were 12.68% and 32.36% respectively. The index constituent composition is adjusted in a timely manner according to the index compilation rules, and its historical backtest performance does not indicate the index’s future performance. Individual stocks and index constituents mentioned in this article are for display purposes only. Descriptions of individual stocks do not constitute any form of investment advice, nor do they represent any information about holdings or trading directions of any fund under the management company. The fund manager assesses the risk level of the Huabao Kechuang Artificial Intelligence ETF as R4—medium-high risk. It is suitable for aggressive investors (C4) and above. For matters of suitability matching opinions, refer to what the sales institution provides. Any information appearing in this article (including but not limited to individual stocks, comments, forecasts, charts, indicators, theories, any forms of statements, etc.) is for reference only. Investors are responsible for any investment actions they make independently. In addition, any views, analyses, and forecasts in this article do not constitute any form of investment advice to readers, nor do they bear any responsibility for direct or indirect losses arising from the use of the content of this article. Investing in funds involves risk. Past performance of a fund does not represent future performance. The performance of other funds managed by the fund manager does not guarantee the performance of the fund. Investors should be cautious when investing in funds.

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Responsible editor: Yang Hongbo