The European and American stock markets experienced significant fluctuations in the two trading days before the Qingming Festival in mainland China, causing financial institutions on Wall Street to feel unsettled.
In contrast, investment institutions focused on the domestic market have been relatively stable recently.
However, this is not entirely the case, as some private fund holders in mainland China are also feeling anxious, such as clients of the billion-yuan private equity firm Dongfang Gangwan.
In recent years, Dongfang Gangwan's products and founder Dan Bin have ranked high in performance due to their firm optimism and exposure in U.S. tech stocks.
However, since the beginning of this year, with the continued decline of overseas markets, several of Dongfang Gangwan's products have shown significant adjustments in net value. Reports indicate that by the end of March, the year-to-date decline had exceeded 20% (see chart below).
With a significant downward fluctuation in U.S. stocks again in early April, where will the net value of the products under this institution go? What is the fund manager's perspective?
This has once again attracted high attention...
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<h2>Creating the Largest Drawdown in Two Years</h2>
The information from various sources is indeed quite concerning.
According to data from Private Equity Ranking, as of March 31, 2025, the drawdown of Dan Bin's representative products has exceeded 22% this year.
In comparison, the S&amp;P 500 index's return during the same period was -4.59%. The performance of the A-share Shanghai Composite Index was -0.48%, and the net value of Dongfang Gangwan's products has declined more than both conventional stock market indices.
Statistics from third-party private equity sales institutions indicate that the drawdown of the aforementioned products managed by Dan Bin has set a new record for the largest net value drawdown in nearly two years.
The so-called maximum net value drawdown refers to the maximum extent to which the net value of asset management products declines from the highest point to the lowest point over a period of time, representing the maximum potential loss investors may encounter during a downturn (though not necessarily an actual loss).
<h2>Possibly Due to Heavy Holdings in U.S. &#34;AI Stocks&#34;</h2>
The significant drawdown experienced by Dan Bin this year may be related to his substantial bets on U.S. tech stocks (such as NVIDIA).
On one hand, historically, the net value fluctuation curve of some Dongfang Gangwan products personally managed by Dan Bin has shown a good correlation with NVIDIA.
The past two years have been a period of repeated increases for NVIDIA, as well as a phase of explosive performance for Dan Bin's products, which achieved net value returns of 37% and 57% in 2023 and 2024, respectively, topping the list of China's billion-yuan private equity champions.
On the other hand, Dan Bin has had a very positive estimate of the impact of AI technology on the current global society for several years. His social media accounts and friend circles have consistently featured many pro-technology statements.
In early March of this year, he stated that NVIDIA belongs to durable consumer goods, has reusable characteristics, and provided a judgment that the stock price has very high cyclical volatility.
However, in terms of net value, Dan Bin's positions in companies like NVIDIA over the past two years may not have been particularly high
NVIDIA's annual growth rates reached 243% and 171% in 2023 and 2024, respectively, with a 19% pullback after the start of the year.
However, the net value fluctuations of Dan Bin's portfolio are not as significant as those of NVIDIA.
<h2>&#34;Response&#34; in the Circle of Friends</h2>
On April 4th, Beijing time, Dan Bin made a &#34;response&#34; regarding product operation issues through social media, revealing the following information:
First, he adjusted the holding proportion of NVIDIA for 2025, reducing its share, but it remains the largest holding stock.
Second, in February 2025, he sold 70% of the equity assets in his portfolio and completely liquidated two leveraged index tools (three times long on the Nasdaq index and three times long on the tech giants index).
Third, after selling in February, apart from Tesla, he held shares in six major U.S. tech giants (Apple, Amazon, Google, Facebook, Microsoft, and NVIDIA).
Dan Bin continued in his response: &#34;Unfortunately, fearing to miss the artificial intelligence era and thinking that a new regional war is a very low probability event, I quickly bought back in, resulting in a significant net value pullback!&#34;
Dan Bin's response on social media reveals two pieces of information:
<ol>
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Although he has consistently disclosed a firm stance on U.S. stocks, in the management of specific private equity products, Dongfang Hongyuan has made adjustments and is not just holding NVIDIA steadily.
</li>
<li>
During this round of U.S. stock declines, Dan Bin hesitated and significantly reduced his positions, but ultimately bought back in after some volatility, leading to a larger loss for the year.
</li>
</ol>
<h2>Is There &#34;Leverage&#34; in Investment?</h2>
However, even according to Dan Bin's &#34;review&#34; in his circle of friends, it seems unable to explain why the net value curve of the aforementioned products has been declining since February 14, dropping 27% by March 31.
It is worth noting that during the same time frame, NVIDIA's stock price fell by 20%, and the Nasdaq index fell by 13%.
Even after reducing positions and buying back in, the decline of over 1.2 times NVIDIA's stock price is still difficult to understand.
There are some speculations in the industry regarding this:
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<li>
Dan Bin holds some small-cap tech stocks in the U.S. with volatility far exceeding that of NVIDIA, which may have caused a much more severe negative contribution to the portfolio?
</li>
<li>
Dan Bin's bottom-fishing after this round of position reduction may have involved &#34;leveraged investment tools,&#34; with significant positions leading to a noticeable pullback in the portfolio?
</li>
</ol>
Previously, he mentioned in his circle of friends that he had completely liquidated two leveraged index tools (three times long on the Nasdaq index and three times long on the tech giants index) during the year.
However, he did not disclose the specific varieties of the &#34;buy back.&#34;
According to third-party market websites, the leveraged tool FNGU (three times long on the tech giants index) that Dan Bin has historically held saw a decline of up to 47% from February 14 to March 31 this year.
Having a significant position in such tools could potentially lead to a peak pullback of 27%.
However, according to the U.S. Securities and Exchange Commission website, as of the end of December 2024, Dan Bin's offshore fund had a market value of U.S. stock holdings reaching $995 million, with NVIDIA, FNGU, Facebook, Microsoft, and Apple ranking as the top five heavy holdings. The relationship between this combination and the positions of the domestic asset management products discussed in this article requires more information for verification
<h2>How to Control the &#34;Prisoner's Dilemma&#34; in &#34;Grand Theme&#34; Investments</h2>
The net value fluctuations of the Dan Bin portfolio have also served as a reminder to asset management institutions:
Even with grand investment themes, how to control risks within the portfolio and effectively utilize financial derivatives remains a key measure that impacts an investment career.
Especially with concentrated investments and heavy positions in a few companies, it is easy for investors to fall into the &#34;prisoner's dilemma&#34; of accelerated selling or steadfast holding when there are drastic fluctuations in the company's fundamentals.
Between making significant profits for investors and increasing their &#34;heart&#34; pressure, investment managers still have many things they can do

NVDA

The European and American stock markets experienced significant fluctuations in the two trading days before the Qingming Festival in mainland China, causing Wall Street financial institutions to be "uneasy." In contrast, focusing on domestic

- Recent fluctuations in U.S. stock markets have caused anxiety among financial institutions, contrasting with the relative stability of domestic investment firms.  
- Notably, the private equity fund Dongfang Gangwan, led by investor Dan Bin, has experienced significant losses, with some products showing a decline of over 22% this year, largely due to heavy investments in U.S. tech stocks like Nvidia.  
- Dan Bin's adjustments to his portfolio and the use of leveraged investment tools have raised concerns about risk management, highlighting the challenges of maintaining stability amid volatile market conditions.

Dan Bin, from NVIDIA "War God" to Nasdaq "Prisoner"