Penghui Energy investor relations head Fang Liyi blamed quant trading factors for the company’s share-price decline in a WeChat post on July 13, while defending fundamental investing, according to Jiemian News. Fang said he was not opposed to quantitative trading or technological progress, but argued it should not undermine the basic role of fundamentals in capital markets.
His comments came as Penghui Energy’s operating results improved sharply. In its April 28 earnings release, the company said first-quarter 2026 revenue rose 182.14% year on year to 4.768 billion yuan and net profit climbed 819.09% to 323 million yuan. For 2025, revenue increased 50.04% to 11.944 billion yuan and net profit reached 206 million yuan, reversing a loss of 252 million yuan in 2024.
The stock had fallen from a recent high of 92.71 yuan on May 20. It then rose 4.2% on July 13 after Fang’s remarks, gained another 4.22% on July 14, and closed at 61.79 yuan on July 24, up 2.23% that day, with a 25.43% decline in July so far.
The debate over quant trading has intensified in China. Economist Ren Zeping recently said quantitative trading in A-shares has three problems: asymmetric pressure on retail investors, a drift away from value investing, and model homogeneity that can trigger synchronized selling. Several large quant private funds told media that the market’s view of homogeneous selling is mistaken, saying their positions are diversified and their models can buy panic selling during sharp declines.
China’s regulators have tightened oversight. In 2024, China Securities Regulatory Commission issued the trial rules on securities program trading, and in 2025 the Shanghai, Shenzhen and Beijing stock exchanges implemented detailed rules defining high-frequency trading and abnormal trading. At the 2026 Two Sessions, CSRC chairman Wu Qing said regulators would emphasize fairness and further refine supervision of high-frequency quant trading.
Penghui Energy IR Chief Blasts Quant Trading as Shares Swing
2026-07-24 12:01:24
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