August's market rebound in the A-share sector drove a broad recovery in performance for private securities fund managers.

Data from PaiPaiWang indicates that as of August 31st, 1,949 private fund firms with recorded performance posted an average monthly product return of 5.52%, with 1,621 of them achieving positive returns, accounting for 83.17%.

This momentum helped lift the average investment return for private institutions over the first eight months of the year to 9.00%, with 1,403 firms, or 71.99%, generating positive results.

Performance varied by firm size, with larger players standing out. Institutions managing over 10 billion yuan and those in the 5 billion to 10 billion yuan range posted average monthly returns of 7.44% and 6.63%, respectively. These firms often favor contrarian positioning and maintain higher overall exposure, enabling them to capture greater gains during market upswings.

High-return cases were mainly concentrated among smaller firms. In August, 58 institutions with recorded performance saw monthly returns rebound by over 20%. Of these, 32 managed assets below 500 million yuan, while 12 managed between 500 million and 1 billion yuan, totaling 44 and representing more than 75.86%.

Additionally, among the 90 private fund firms with returns exceeding 50% in the first eight months, 63 fell into the below-500 million yuan or 500 million to 1 billion yuan categories, comprising 70% of that group.

Large-scale institutions, however, demonstrated superior performance stability. Over the January-to-August period, 103 firms managing over 10 billion yuan achieved an average return of 9.46%, with a positive-return ratio of 89.32%. Meanwhile, 66 institutions in the 5 billion to 10 billion yuan bracket posted an average return of 9.20%, with 81.82% staying in positive territory.

Alongside performance recovery, shifts in fund management scale have attracted attention. Following July's market correction, August saw a slowdown in scale expansion. Only 14 firms moved up in size that month, a sharp drop from 321 in July. Among them, Zhuhai Jiashi Dayan Private Securities Fund Management Co., Ltd. advanced from the 5 billion to 10 billion yuan range to over 10 billion yuan, rejoining the ranks of the so-called "billion-yuan private fund club." Still, as of the end of August 2026, the total number of such institutions remained stable at 157.

New entrants continue to join the industry. In August, two private fund firms completed registration, bringing the cumulative total for the first eight months to 28. These new registrants come primarily from two routes: seasoned professionals from public funds and brokerage asset management divisions leaving to start their own ventures, such as Cao Mingchang establishing Shanghai Puqiao Private Fund Management Co., Ltd., Xu Zhimin founding Wufeng Private Fund Management (Shanghai) Co., Ltd., and Wang Peng setting up Pengju (Beijing) Private Fund Management Co., Ltd.; and core talents from leading private funds spinning off to create independent businesses.

Commenting on the current market environment, Chen Juntao, fund manager at Xueqiu Asset Management's Danshu Tiejuan, noted that market style is undergoing rebalancing. The earlier high-conviction crowding in a single track has weakened, with return sources likely shifting from a high-beta, single-sector-driven rally toward diversified alpha across multiple sectors. A balanced approach that accommodates varied style assets suits the current environment of frequent rotation. This assessment aligns with August's structural performance patterns: smaller private funds displayed stronger rebound elasticity, while larger ones benefited from high positioning and contrarian strategies, resulting in notable performance divergence across different approaches.

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