"Hidden Worry Emerges as Small and Micro-cap Stocks 'Huddle' Together, Private Equity Strategies Should be More Rational in Response"

On August 27th, the A-share market experienced a retreat, with previously strong small-cap stocks generally falling. By the end of the day, the CSI 2000 index had dropped by 2.32%, and the Wind small-cap stock index had fallen by nearly 4%. On this day, the investment director of a small quant private fund in Shanghai, Li Zhe, quickly adjusted the portfolio structure, taking out some small-cap stocks with high valuations. In the midst of market fluctuations, many private fund professionals openly stated that small-cap stocks were showing signs of fund hoarding. While many private funds were enjoying profits, they were also preparing for possible market changes.