China A-Share Style Guide "Momentum and Growth rally continued" Fang

Research evidence excerpt

China A-Share Style Guide "Momentum and Growth rally continued" Fang

Global Research

2 July 2026ab

China A-Share Style Guide Equities

ChinaMomentum and Growth rally continued

Quantitative

Cathy Fang, PhD

What is the current investing environment? Analyst

The explanatory power of macroeconomic drivers increased in June, driven primarily by cathy.fang@ubs.com

movements in the USD index and the increasing impact of gold prices. Pair-wise +86-21-3866 8891

correlations across the equity market dropped, while cross-sectional volatility increased Paul Winter

significantly. We think these trends indicate reduced price co-movements and more Analyst

individual stock opportunities. paul-j.winter@ubs.com

+61-2-9324 2080

What is the market valuation? Will Stephens

China's A-share market valuation remained at 15x 12-month forward PE in June. At the Analyst

sector level, valuations for information technology remained higher than those for other will.stephens@ubs.com

+852-3712 3892

sectors. In addition, real estate valuations remained at a historical high.

Lynce Wang, FRM

What is working? Analyst

S1460522090001

June was another strong month for risk-seeking styles in China's A-share market,

lynce.wang@ubs.com

supported by the continued AI-driven technology rally and improving risk appetite as +86-21-3866 8638

retail investor participation increased further. Momentum remained the best-performing

Jackson Shistyle factor, both12-month Price Momentum and Momentum Composite posted 19%

Associate

long-short returns. Growth factors also performed well, as 12-month forward EPS

S1460124110003

outperformed with a 12% gain. Large Caps performance remained positive, delivering jackson.shi@ubs.com

an 11% return. By contrast, Low Risk continued to underperform, as 12-month Low +86-21-3866 8878