thecubegame| This year, it has increased by nearly 15%! How long can it last?

Source: Tian Tian Fund

Since the beginning of this year, the high dividend and dividend style has continued to dominate, and the dividend index has also performed brightly.

As of May 23, the CSI dividend index has rebounded by more than 18% since it hit bottom on January 22, with an annual increase of nearly 15%, substantially outperforming Shanghai and Shenzhen 300 (+ 6) in the same period.Thecubegame.14%) and Shanghai Composite Index (+ 4.75%).

Dividend indexThecubegameThe strength is not just this year.

In the long run, the CSI dividend index has achieved a record of "seven wins in ten games" in the past decade. The CSI dividend total income index has increased by more than 10% in five years, and has been higher than that of Shanghai and Shenzhen 300 in seven years.

Why does the market prefer dividend assets?

The strength of dividend assets since the beginning of the year is supported by multiple factors, such as economic fundamentals, market environment, policy support and so on.

1. Market environment-low interest rate + asset shortage

Since February 21, 10-year Treasury yields have continued to decline, and correspondingly, the dividend index has emerged from a better market than the broader market.

For a long time, the interest rate of long-term debt has been in the process of "going down" step by step in recent years, and in this process, the dividend index has also gone out of the reverse market, and the more typical range is from January 2014 to October 2016.

Time has come now, on the one hand, market interest rates are on a downward track, and on the other hand, there is a relative abundance of funds and a relative "shortage" of assets. Funds want higher returns than risk-free returns, resulting in a craze for high-dividend assets.

2. Economic fundamentals-weak recovery

Judging from the current data, the fundamentals of the domestic economy are still in a weak recovery environment. New social finance turned negative in April, and credit growth and M2 growth also continued to decline, indicating that the current demand side still needs to be repaired.

In the face of uncertainty, the wait-and-see mood of funds increases, and the demand for allocation changes from the pursuit of growth to the pursuit of certainty for risk hedging. Due to the relatively stable dividend, dividend assets have become the current choice of capital risk aversion.

3. Policy support-pay attention to dividends

With the continuous progress of capital market reform, the CSRC issued the "two strong and two strict" policy, the core of which is to protect the interests of investors, boost investor confidence, and pay more and more attention to the improvement of shareholder returns and dividends.

The release of the "New Nine articles" in the capital market has made relatively stringent requirements on the dividend, repurchase and market capitalization management of listed companies. With the continuous strengthening of supervision, the number of listed companies paying dividends continues to increase.

On the one hand, the policy helps to increase the return of listed companies to shareholders and increase the dividend yield, thus increasing the supply of high dividend assets.

On the other hand, policy support also helps to boost investor confidence in high-dividend assets, thereby attracting more money to flow to such assets to reshape the valuation of high-dividend assets.

How to arrange the dividend market?

From the above three catalytic factors, dividend assets actually have medium-and long-term allocation value. If there are obvious new industrial trends in the future market, the dividend style may lose in stages, but it still takes time to verify, so the dividend market is still sustainable in the short term.

For ordinary investors, there are many ways to layout the dividend market, but it may be easier to allocate through the index.

Taking the CSI dividend index as an example, the index selects 100 stocks with high cash dividend yield, relatively stable dividend, certain scale and liquidity in Shanghai and Shenzhen stock markets. When setting the stock weight, it is not the traditional market value weighting, but the dividend yield weighting, that is, the higher the dividend yield, the higher the weight.

Companies with high dividend yields tend to have the following characteristics:

1. The company has abundant cash flow and stable and sustainable profitability.

2. The company is in a mature stage of development and does not have much new capital expenditure, so it has a strong ability to continue to pay dividends.

3. The corporate governance mechanism is good, and the management has the willingness to give back to shareholders and investors.

4. The stock price of a company with high dividend yield is relatively not too high and is more defensive.

Therefore, through the layout of the CSI dividend index, it is equivalent to one-click allocation of this kind of high-quality enterprises with the highest dividend rate in the market, which not only has a certain degree of defense, but also has long-term growth.

At the same time, the periodic content of CSI dividend index is also very high. From the perspective of the composition of the CSI dividend index, the banking sector accounts for the highest proportion (21.72%), followed by coal (16.17%) and transportation (9.96%). These three cyclical industries have accounted for nearly 50% of the index.

In the period of economic recovery, the demand support of pro-cyclical plate is often strong, and the allocation of dividend index can also share the market of cyclical plate.

The relevant indexes can find the corresponding ETF and linked funds for allocation.

If you want to make a small and sustained fund investment, and do not want to open a separate stock account, then ETF linked to the foundation is a better choice; if you have plenty of money to trade, want to buy and sell flexibly and enjoy lower rates, then you can choose ETF. We can make a reasonable configuration according to our own situation and needs.

(article source: Boshi Foundation)

(responsible Editor: 138)