Riyup Investment Chairman Wang Wen Reveals His Heavily Weighted Stocks and Discusses Five Major Stock Selection Criteria

Ask AI · What policy dividends support the heavy holdings behind the financial sector?

Cailian News, March 17 (Reporter Wu Yuqi) — On March 13, the “Index Navigation, Gathering Strength to Move Forward” Spring 2026 Investment Strategy Conference was held in Shanghai, jointly organized by China Merchants Securities, China Merchants Fund, and Cailian News. During the keynote speech session, Wang Wen, Chairman of Shenzhen Ridu Investment Management Co., Ltd., shared his views on the 2026 market environment, asset valuation logic, and key allocation directions under the theme “Eastern Winds Bring Spring.”

In his speech, Wang Wen continued his consistent value investing approach. Unlike market discussions focused on short-term style rotations and hot topics, he emphasized analyzing from valuation, cash flow, dividend capacity, and industry cycles to find assets with both safety margins and growth potential. He believes that investment opportunities in 2026 are not based on high valuation expansion but more on the recovery of undervalued assets and revaluation space driven by policy, capital, and industry changes.

Wang Wen’s market outlook mainly revolves around several main themes: maintaining a low valuation stock selection framework, optimistic about the long-term space of capital markets under the background of a strong financial nation, and focusing on sectors such as finance, internet, energy, metals, and pharmaceuticals. Overall, Wang Wen holds a relatively positive attitude toward the 2026 market, but this optimism is not simply based on emotional uplift but on low valuations, increased policy support, and expectations of fundamental improvements in certain industries.

Chairman Wang Wen of Ridu Investment

Low valuation remains the core starting point, with value investing logic贯穿 in stock selection and allocation

Wang Wen first emphasized that his focus is not on a short-term hot trading clue but on value investing itself. He stated that, although subjective bullishness faces pressure from ETF and quantitative strategies, it still has its value. Truly excellent investment managers can deliver returns different from passive tools to their clients. The premise behind this is to adhere to value investing and integrate this approach into daily research and investment practices.

Specifically, Wang Wen listed five stock selection criteria: low valuation, high cash flow, high dividends, long-term business sustainability, and “having a dream.” He believes that investment first needs to address whether the purchase is cheap enough; low valuation is the starting point for long-term returns, while cash flow, dividend capacity, and business sustainability determine whether a company can withstand industry cycles.

Among these five standards, low valuation remains the most fundamental. Wang Wen repeatedly emphasizes that the source of investment returns primarily depends on whether the purchase price is sufficiently cheap. For him, valuation is not just a simple number comparison but a direct reflection of safety margin. Over the past few years, the market has long chased high prosperity and high-imagination sectors, with many companies being overly optimistic at high valuations. But as market conditions change, such pricing methods have undergone repeated corrections. Compared to that, undervalued assets, while not always the most popular in the short term, often imply lower downside risk and are easier to release potential during recovery phases.

This framework is not static valuation alone. Equally important is the high regard for cash flow. Wang Wen views cash flow as one of the most critical indicators of a company’s operations. It relates to whether the company truly has the ability to generate cash and also determines whether it can maintain sufficient resilience in the face of industry competition, capital expenditure, and external environment changes. Against the backdrop of rising AI investment enthusiasm, he emphasizes balancing投入与回报. In his view, if a leading company can maintain steady progress during a new technology cycle while also engaging in buybacks, dividends, and financial discipline, this capability itself indicates quality.

High dividends are the third screening criterion in his stock selection framework. Dividends are not just about financial returns but also reflect corporate governance and shareholder awareness. Compared to companies that continuously raise funds, expand, but delay sharing profits with shareholders, he prefers companies with strong capital distribution willingness and a willingness to share operational results. Extending this, he further emphasizes the importance of long-term business sustainability, clearly stating to avoid industries in decline or lacking long-term vitality.

However, merely having low valuation, high cash flow, and high dividends is not enough for a complete investment logic. Wang Wen emphasizes that the business must have long-term sustainability. He does not agree with simply buying seemingly cheap companies in industries that are already in decline, as such low valuations often reflect risks rather than opportunities. Truly investable assets should be in industries capable of持续经营、持续创造价值，企业本身也要具备较强的竞争力，能够在较长时间内维持盈利能力和市场地位。

In other words, low valuation is not about “picking up cigarette butts” but requires companies to be cheap while also possessing stable cash flow, reasonable dividends,持续经营能力, and growth potential for excess returns.

Beyond the first four standards, “having a dream” is a more subjective and active part of Wang Wen’s stock selection framework. He believes that the significance of subjective bulls and private equity is not just to achieve market-average returns but to pursue higher-level excess returns under risk control.

Therefore, the companies in his portfolio should not be mediocre but should have the potential for significant future appreciation, truly driving portfolio gains. For him, this does not mean taking risks beyond safety margins, but rather pursuing more returns on the basis of “not losing money, standing firm,” so that the entire portfolio can withstand volatility and still maintain an offensive capacity for growth.

Financial sector as a heavy holding, backed by a focus on recovery, revaluation, and institutional dividends

In terms of industry allocation, the financial sector is undoubtedly Wang Wen’s most prominent expression. He clearly states that he is heavily invested in finance, viewing insurance, banking, and securities firms as the most promising directions in the near future. The core reasoning is straightforward: first, valuations in the financial industry are still low; second, the operating environment is changing; third, the market’s long-term valuation of these sectors is still insufficient.

Regarding insurance, he pays more attention to both asset side and liability side improvements. On the asset side, there is room for enhancement in equity allocations; on the liability side, pressures are expected to ease as product costs decline. If the A-share market enters a longer-term slow bull environment, insurance companies, with their capital attributes and asset allocation capabilities, could benefit over a longer horizon. The current low valuation levels also strengthen this logic.

For banks, his judgment is more related to the correction of real estate-related bad debt expectations. Wang Wen believes that the market’s long-term low valuation of banks largely reflects concerns over non-performing risks related to real estate. Once real estate gradually recovers and expectations improve, provisions and bad debt pressures are expected to ease, leading to valuation repair. In other words, he does not see banks as purely high-dividend assets but as part of the macro recovery chain, with potential revaluation as a顺周期金融资产.

Securities firms are even more undervalued but have more resilience and are worth paying attention to. He states that he is one of the few investors optimistic about securities companies. The basis is that China’s wealth structure is still evolving toward securitization, financialization, and wealth management, which offers further expansion opportunities for securities firms’业务边界、行业集中度和资本市场服务能力.

Currently, the overall valuation of securities firms is not high, and market expectations for industry consolidation, wealth management transformation, and business expansion in a long bull market are not fully reflected in prices. Therefore, in his framework, finance is not a traditional defensive allocation but an important main line with both trend and undervaluation features.

This view is supported by his ongoing关注政策与制度环境变化. From active capital markets, a strong financial nation, to investor-centric policies, and interpretations of “strong currency,” “strong central bank,” “strong financial institutions,” and “strong international financial centers,” Wang Wen aims to illustrate that the financial system’s role in the economy is being re-strengthened, which will also be reflected in capital market and financial asset pricing.

Based on this understanding, he remains confident in the long-term revaluation of RMB assets. With a large trade surplus and China’s manufacturing competitiveness, RMB assets have significant upside potential. RMB appreciation will also be an important variable in boosting market confidence and attracting global capital to Chinese assets. He believes that currently, the proportion of global allocations to Chinese assets is not high, but if RMB appreciation becomes clearer, China’s quality assets could attract more foreign funds.

Not chasing high leverage, but seeking growth in “wealth, health, and enjoyment”

Although most of his emphasis is on the financial sector, Wang Wen’s portfolio is not limited to a single direction. From his statements, current allocations roughly follow three main themes: “wealth, health, and enjoyment,” corresponding to wealth management, healthcare, and industries that bring consumption pleasure and emotional value. This seemingly emotional summary actually aligns with a long-term demand, clear industry space, and relatively reasonable valuations.

For example, in internet giants, he does not see aggressive AI investment as the only correct approach. Instead, he values whether companies can maintain稳健的资本支出、持续回购股票和稳定分红 during the AI transformation process. Under this logic, internet platforms are not passive victims of the AI wave but can leverage their existing ecosystems, cash flow, and capital allocation capabilities to achieve more sustainable returns in the new technology cycle.

Energy, metals, and pharmaceuticals form another part of the portfolio’s support. Wang Wen mentions that these allocations are related to the extension of the AI产业链, and also reflect his approach of “not directly追逐高波动算力标的，而是通过更稳健的方式参与成长.” This aligns with his consistent style of starting from cheap valuations, gradually entering after long industry adjustments and valuation compression, and waiting for industry prosperity and corporate earnings to rebound, thus capturing both valuation recovery and earnings growth.

At a higher level, Wang Wen’s core outlook for 2026 remains that “this year is a very good year.” He sees the current macroeconomic recovery from lows, the marginal stabilization of real estate, and the overall market position and industry trends as being in a relatively favorable stage.

Especially, he believes that the large-scale participation of retail funds in the stock market has not yet fully arrived, meaning the market has not reached the end of euphoria but is closer to the middle or early stage of a bull market. Therefore, although his portfolio emphasizes prudence, it is not conservative but maintains a certain offensive stance between safety margins and industry trends.

The ultimate principle running through this approach is the repeated emphasis on “investment as cultivation.” This is not just an abstract statement but a reflection of the most pragmatic side of value investing: the real challenge is not knowing what a good company is but holding the portfolio through volatility, divergences, and long waits, and sticking to the method.

Wang Wen’s optimism for 2026 is neither based on linear extrapolation of hot topics nor on short-term sentiment bets. Instead, he tries to integrate valuation principles, industry comparisons, market cycles, and policy environment into a unified framework, seeking assets that can both safeguard the bottom line and open up gains during recovery and revaluation.

(Reporter Wu Yuqi, Cailian News)