Core Viewpoint - The article discusses the reasons behind the discrepancies in dividend indices' percentile rankings and their valuation, emphasizing that percentile data serves as a reference rather than a definitive measure of value [2][3]. Group 1: Changes in Dividend Index Rules - The dividend index rules have undergone significant changes over the past decade, impacting the percentile rankings and valuations of stocks within these indices [5]. - The first major change occurred in 2013, where the selection method shifted from "dividend yield stock selection, market capitalization weighting" to "dividend yield stock selection, dividend yield weighting," leading to a more balanced representation across sectors [6]. - A second major adjustment took place around 2022, increasing the requirements for sample stocks regarding dividend stability and continuity, influenced partly by the issues faced by real estate companies [7]. Group 2: Impact of Real Estate Sector on Dividend Indices - The real estate sector's practices of high short-term dividends led to inflated dividend yields, which were unsustainable and resulted in significant losses when these companies faced financial difficulties [8]. - Following the rule changes, the requirement for consistent high dividends has mitigated the issues previously caused by real estate stocks, leading to an overall improvement in the valuation metrics of the dividend indices [9]. Group 3: Interpretation of Percentile Data - Percentile data should be viewed as a tool for identifying anomalies rather than a sole basis for investment decisions, as extreme percentile values may indicate underlying issues worth investigating [10].

Core Viewpoint - The article discusses the recent performance of the stock market, focusing on dividend indices and their valuation adjustments due to rule changes over the years, particularly in response to market anomalies and the real estate sector's impact on dividend stability [1][21][30]. Group 1: Market Performance - The overall market showed slight fluctuations, with large-cap stocks slightly up and small-cap stocks slightly down [2][6]. - The value style has seen significant gains recently [3]. - Free cash flow and dividends have been consistently rising [4]. Group 2: Dividend Indices and Valuation - The recent rise in the Shanghai-Hong Kong-Shenzhen dividend indices has brought them closer to normal valuation levels [5]. - There are variations in the percentile rankings of dividend indices, indicating some are undervalued while others are not [7][8]. - Percentile data serves as a reference for valuation but can be affected by index rule changes [10][33]. Group 3: Changes in Index Rules - The dividend index rules have undergone significant changes in the past decade, notably in 2013 and around 2022, to improve the stability and continuity of dividends [11][17]. - The 2013 change shifted from market capitalization weighting to dividend yield weighting, enhancing sector diversification [13][16]. - The 2022 adjustments increased requirements for dividend stability, including a longer assessment period and stricter criteria for dividend payments [19][20]. Group 4: Impact of Real Estate Sector - The changes in index rules were partly a response to issues in the real estate sector, where companies had unsustainable high dividend payouts [21][24]. - The removal of underperforming stocks from indices due to bankruptcy or default has led to improved overall index valuations [25][32]. Group 5: Valuation Tables and Data - The article includes valuation tables for various indices, highlighting metrics such as earnings yield, price-to-earnings ratio, and dividend yield for different dividend indices [36][49]. - The data provides insights into the performance and valuation of dividend-focused investment strategies [38][56].