Market Overview - After a week of reduced trading volume and a rebound in late November, the A-share market experienced a pullback on December 2, with trading volumes for related ETFs in the ChiNext and STAR Market falling below the average levels of November [1][4]. Fund Flows - On December 1, nearly 10 billion yuan in net outflows were recorded for A-share ETFs, with broad-based theme ETFs experiencing the most significant outflows [3][9]. - The total trading volume for the A-share market was 1.6073 trillion yuan, a decrease compared to the previous trading day [4]. Performance of ETFs - Several Hong Kong dividend ETFs saw gains, with many increasing by over 1% on the same day [4]. - Year-to-date, multiple Hong Kong dividend-related ETFs have performed well, with some increasing by over 25% [6]. - As of December 1, the latest share count for the Hong Kong dividend ETF reached 6.469 billion shares, with a total scale of 8.694 billion yuan, reflecting a year-to-date share growth of 42.96% and a scale growth of 75.78% [6]. Sector Performance - The energy metals, CRO concepts, and medical services sectors saw the largest declines, while the road and railway transportation, as well as agriculture and forestry sectors, experienced gains [4]. - The trend of investors seeking stable cash flow and high-dividend assets is expected to continue as the year ends, driven by institutional investors locking in profits and a seasonal influx of insurance funds [6][11]. Specific ETF Data - The following ETFs showed notable performance on December 1: - The S&P Consumer ETF rose by 2.53% but is down 8.76% year-to-date - The Hong Kong Dividend Low Volatility ETF increased by 1.70% with a year-to-date gain of 28.86% [5]. - The A500 ETF maintained active trading, while other ETFs like the STAR 50 and ChiNext saw significant reductions in trading volumes compared to November's daily averages [7].

Core Insights - The report emphasizes that the high dividend yield strategy in Hong Kong stocks is expected to experience significant calendar effects from December to mid-January, leading to higher absolute and excess returns during this period [3]. Group 1: Market Trends - The report identifies three main reasons for the strong calendar effect on Hong Kong dividends at year-end: 1. Institutional investors, such as public funds, may rebalance their assets to lock in annual returns by shifting from high-valuation growth stocks to high-dividend stocks [3]. 2. December to January is a peak period for insurance premiums, prompting some insurers to quickly build positions in high-dividend assets to match liability costs, creating a rigid buying demand [3]. 3. Year-end policy catalysts may emerge, which could stimulate the Hong Kong dividend market if supportive dividend policies are implemented or if growth stabilization policies fall short of expectations [3]. Group 2: Historical Performance - From 2014 to the present, the report notes that the win rate for absolute returns from December to mid-January has been 91%, with a win rate of 82% compared to the 300 total return index, the CSI dividend total return index, and the Hang Seng index total return [3]. - The current trading volume proportion in this segment is only 6.1%, indicating a relatively low level of crowding and suggesting a potential opportunity for reallocation [3].

港股通红利低波ETF基金（159118）紧密跟踪标普港股通低波红利指数，成分股偏向大盘价值风 格，助力投资者低费率（管理费+托管费仅0.2%）、高效率（T+0交易）一键布局港股+红利+低波，此 外，港股通红利低波ETF基金可每季度进行评估及收益分配，在符合基金分红条件下，可安排收益分 配。 每日经济新闻 （责任编辑：董萍萍 ） 12月2日，A股三大指数小幅低开，沪指低开0.14%，深成指低开0.13%，创业板指低开0.04%。港股 通红利低波ETF基金（159118）震荡上涨，现涨约0.4%，持仓股国药控股、中国财险、恒安国际等领 涨。 广发证券分析称，港股红利在岁末年初日历效应如此之强的最核心原因是可能是公募基金等追求相 对收益的资金，在年底进行资产再平衡的关键窗口期。为了锁定当年收益，部分机构可能会卖出一些短 期估值较高、波动较大的成长股，短期转向高股息、高安全边际的港股红利板块。 标普港股通低波红利的历史长期业绩突出，以全收益指数（含分红收益）计算风险收益特征，自 2021年以来标普港股通低波红利全收益指数截至2025年10月22日，长期累计涨幅达94.95%，年化超 16%，显著高于恒生指数以及恒生红 ...

Core Insights - The article discusses the advantages of a dividend low-volatility strategy compared to traditional stock picking, highlighting its ability to reduce drawdowns and facilitate buying low and selling high [1][11] - It emphasizes the importance of asset allocation, suggesting a balanced approach between dividend low-volatility stocks and bonds to mitigate risks during market downturns [3][11] Summary by Sections Investment Strategy - A 55:45 allocation between dividend low-volatility stocks and bonds can yield an annualized return of approximately 7%, although a 4% loss may still occur in extreme market conditions like those in 2018 [1] - The strategy of using Bollinger Bands for managing positions is suggested, where selling occurs at the upper band and buying at the lower band, which can enhance returns compared to a static holding approach [1][5] Risk Management - The article notes that a 16% drop in the dividend low-volatility index in 2018 should be viewed as a historical buying opportunity, advocating for a reallocation strategy to enhance returns during recovery phases [3] - It discusses the potential of using put options for additional protection against extreme market downturns, although this may not be deemed necessary for strategies with low maximum drawdowns [11] Portfolio Construction - Recommendations include building a personalized portfolio based on the top holdings of the dividend low-volatility index, allowing for greater flexibility and responsiveness to market conditions [4][8] - The concept of passive rebalancing is introduced, where adjustments are made based on changes in asset ratios, promoting a disciplined approach to high selling and low buying [5][9]

Group 1 - The A-share market has seen significant growth, with the Shanghai Composite Index reaching a ten-year high of 4030 points, marking a rise from 3000 to 4000 points within a year [2][3] - Key sectors driving this growth include innovative pharmaceuticals, artificial intelligence, computing power, energy storage, and high-end manufacturing, indicating a developing market sentiment [3][4] - Economic indicators show slight improvements, with October CPI rising by 0.2% year-on-year and PPI increasing by 0.1% month-on-month, suggesting a gradual recovery in the Chinese economy [4][5] Group 2 - The dialogue with the chief economist of Bank of China highlights the challenges and uncertainties facing the Chinese economy, including insufficient domestic demand and external pressures on international trade [5][6] - The future of the RMB exchange rate against the USD is uncertain, with predictions indicating potential depreciation due to various internal and external factors [9][10][11] - The RMB's recent appreciation is characterized as passive, influenced by a weaker USD and improved market sentiment following reduced trade tensions between China and the US [14][15][16] Group 3 - The article discusses the ongoing transformation of the Chinese economy, emphasizing the importance of reform during the 14th and 15th Five-Year Plans, which are expected to create new opportunities [6][27][41] - The capital market is anticipated to benefit from comprehensive reforms aimed at enhancing market mechanisms and improving investor experiences, which could lead to a sustained bull market [37][39] - The potential for a "reform bull market" is highlighted, with expectations that the market is still in its early stages of growth, providing opportunities for long-term investments [41][48]

Core Insights - The Chinese capital market is experiencing high-quality development, with major stock indices showing a steady upward trend and increasing market vitality [1] - Broad-based ETFs are becoming a significant choice for individual investors in asset allocation, accounting for nearly half of the ETF market in Shanghai [1] - Broad-based ETFs effectively mitigate common behavioral biases of individual investors and offer diversification, low costs, and high transparency [1][3] Market Performance - In Q3 2025, broad-based ETFs significantly outperformed most actively managed funds, with the ChiNext Index rising by 50.4%, the Sci-Tech 50 Index by 49.02%, and the Shenzhen Component Index by 29.25% [1] - Over the past decade, annualized returns for broad-based indices like CSI 300, CSI 500, and CSI 1000 have stabilized between 5% and 7%, with CSI 2000 exceeding 9% [1] Investment Trends - Continuous inflow of two types of investment funds supports the strong market performance of broad-based ETFs: Central Huijin's net purchases of leading broad-based ETFs reached 207.27 billion yuan in H1 2025, while foreign and insurance funds also increased their allocations [2] - Institutional investors now hold about 60% of the market, enhancing pricing efficiency and reducing the space for individual investors to achieve excess returns through independent trading [2] Investor Advantages - Individual investors face disadvantages in information access and research depth compared to professional institutions, which conduct thousands of company visits and have specialized analysts [3] - Broad-based ETFs simplify market investment by allowing investors to buy the entire market in one transaction, providing a disciplined, diversified, low-cost, and transparent investment option [3] Investment Framework - Individual investors should understand the characteristics of different broad-based indices and their applicable scenarios, such as the SSE 50 for conservative investors seeking stable returns [4] - A "core-satellite" strategy is recommended, where most funds are allocated to low-cost broad-based ETFs, while a smaller portion is used for sector or thematic ETFs to capture additional market opportunities [4] - Risk management is crucial, with a focus on ETFs with over 5 billion yuan in size and daily trading volumes exceeding 100 million yuan, along with regular asset rebalancing [4] Market Growth Potential - The recognition of broad-based ETFs among individual investors is increasing, with personal holdings rising from 44.3% to 49.1% in H1 2025, and the proportion of personal holdings in Sci-Tech board ETFs reaching 72% [5] - Despite rapid development, the market share of broad-based ETFs in China's public fund total is only 8%, significantly lower than the 30% in the U.S., indicating substantial growth potential [6] - With the implementation of regulatory measures to promote index investment, broad-based ETFs are expected to become a key tool for individual investors in financial asset allocation and capitalizing on stock market growth [6]

Core Insights - The Chinese capital market is experiencing high-quality development, with major stock indices showing a steady upward trend and increasing market vitality [1] - Broad-based ETFs are becoming a significant choice for individual investors in asset allocation, accounting for nearly half of the ETF market in Shanghai [1] - Broad-based ETFs have outperformed most actively managed funds, with notable index performances in Q3 2025 [1] Investment Trends - In the first half of 2025, central financial institutions net purchased 207.27 billion yuan worth of leading broad-based ETFs, while foreign and insurance funds continued to increase their allocations [2] - The influx of institutional funds provides strong support for the performance of broad-based ETFs, enhancing their resilience during market adjustments [2] Investor Behavior - Individual investors face disadvantages in information access and research depth compared to professional institutions, which conduct thousands of company visits and have specialized analysts [3] - Broad-based ETFs simplify market investment for individual investors, allowing them to invest in entire markets with a single transaction, thus providing a disciplined and low-cost investment option [3] Investment Framework - Individual investors should understand the characteristics of different broad-based indices and their applicable scenarios [4] - A "core-satellite" strategy is recommended, where the majority of funds are allocated to low-cost broad-based ETFs, while a smaller portion is used for sector-specific or thematic ETFs [4] - Risk management is crucial, with a focus on liquidity and regular asset rebalancing to maintain target allocations [4] Market Growth Potential - The net increase in domestic ETF scale reached 580 billion yuan in the first half of 2025, with individual investors' share rising to 49.1%, indicating growing recognition of broad-based ETFs [5] - Despite rapid development, the proportion of broad-based ETFs in China's public fund market is only 8%, suggesting significant growth potential compared to developed markets [5] - With the implementation of regulatory measures to promote index investment, broad-based ETFs are expected to become a key tool for individual investors in asset allocation and capitalizing on market growth [5]

Core Viewpoint - The Chairman of the China Securities Regulatory Commission, Wu Qing, emphasized the increasing importance of stability and balance in asset allocation during the risk repricing and asset rebalancing process, highlighting the growing consensus among international investors to diversify investments [1] Group 1 - The concept of "putting eggs in different baskets" is becoming a common strategy among international investors [1] - The value of Chinese assets, including A-shares and Hong Kong stocks, is being continuously reassessed, revealing their investment potential [1]

Group 1 - KKR's co-CEO Joseph Bae indicated that global investors are gradually reallocating funds towards Asia as the dollar weakens and Asian fundamentals strengthen [1][2] - The firm is significantly increasing its investments in Japan, which has become KKR's largest Asian market, accounting for 40% of its regional assets [1] - Japan's household wealth, totaling $14 trillion, presents substantial opportunities as half of it remains in cash, with a shift towards new asset classes expected [1] Group 2 - KKR is also increasing its investments in India, which is its second-largest Asian market, focusing on sectors like toll roads, renewable energy, and digital infrastructure [2] - Despite Asia being a major beneficiary of global diversification, North American investors remain cautious about China, with its share of Asia-Pacific deal volume dropping from over 50% in 2020 to just 27% by 2024 [2] - KKR continues to focus on domestic consumption and value-added services in China, which remain investment hotspots despite the cautious sentiment [2]

Core Viewpoint - The article emphasizes the importance of a diversified, long-term investment strategy, particularly through a "permanent investment strategy" that balances various asset classes to achieve stable returns while minimizing risk [4][5][12]. Group 1: Investment Strategy - The author advocates for a global multi-asset allocation approach, suggesting that investors should not overly concentrate on high-valuation sectors [4][5]. - A sample permanent investment portfolio is proposed, consisting of 12.5% in Nasdaq 100, 12.5% in S&P 500, 25% in gold, 25% in Chinese bonds, and 25% in U.S. bonds [6][12]. - Historical backtesting of this strategy shows a three-year return of 70.74%, outperforming the CSI 300's 18.41% and slightly lagging behind the S&P 500's 83.51% [9][12]. Group 2: Risk and Performance Metrics - The maximum drawdown for the permanent strategy is reported at 9.19%, significantly lower than the CSI 300's 24.8% and the S&P 500's 18.62% [9][12]. - The Sharpe ratio for the permanent strategy is calculated at 0.12, compared to 0.02 for the CSI 300 and 0.08 for the S&P 500, indicating better risk-adjusted returns [9][12]. - The strategy's positive return days are at 55.14%, slightly higher than the CSI 300's 49%, suggesting that while the strategy does not yield daily profits, it benefits from lower volatility [9][12]. Group 3: Long-term Performance - Over five years, the permanent strategy achieved a return of 79.1%, while the CSI 300 only returned 0.07% and the S&P 500 returned 115.36% [13]. - The article notes that rebalancing the portfolio over five years resulted in a decrease in performance from 76.3% to 66.6%, attributed to the strong upward trends in U.S. stocks and gold [17]. - The author argues that long-term rebalancing can enhance returns during market downturns by locking in profits and allowing for reinvestment at lower prices [17]. Group 4: Asset Correlation - The correlation between S&P 500 and Nasdaq 100 is very high at 0.97, indicating limited diversification benefits between these two assets [20]. - In contrast, the correlation between S&P 500 and gold is only 0.01, and between S&P 500 and U.S. bonds is 0.09, highlighting the importance of including low-correlation assets in a diversified portfolio [20]. - The article suggests that the current market is heavily concentrated in large-cap tech stocks, which may pose risks if the broader economy weakens [21].