Core Viewpoint - The Hong Kong insurance sector continues to perform strongly, driven by increased market demand for non-bank financial ETFs, particularly the Hong Kong Non-Bank ETF (513750), which has seen significant trading activity and a record high in assets under management [1][2]. Group 1: Market Performance - As of June 10, the Hong Kong Non-Bank ETF (513750) recorded a trading volume exceeding 200 million yuan, with a turnover rate surpassing 10%, indicating high liquidity compared to peers [1]. - The ETF has achieved a year-to-date increase of 18.95% as of June 9, with a continuous net inflow of funds for 14 consecutive trading days, pushing its total size to over 2.1 billion yuan, marking a historical peak [1]. Group 2: Catalysts for Growth - The recent rally in insurance companies is attributed to two main catalysts: the regulatory body's decision to expand the scope of insurance capital equity investment and optimize solvency regulations, which is expected to benefit the asset returns of insurance stocks [1]. - Additionally, the first-quarter reports of listed insurance companies exceeded expectations, showcasing significant growth in new business value for leading firms and improvements in core solvency ratios, reinforcing the industry's recovery narrative [1]. Group 3: ETF Characteristics - The Hong Kong Non-Bank ETF (513750) tracks the CSI Hong Kong Stock Connect Non-Bank Financial Theme Index, which has a high weight of 65.1% in the insurance sector, covering major companies like AIA, Ping An, and China Life [2]. - The index currently has a price-to-earnings ratio of 8.40, which is at a low percentile compared to the past decade, along with a dividend yield of 3.20%, indicating a rare combination of low valuation and high dividend [2]. Group 4: Future Outlook - Looking ahead, there are expectations of a decrease in preset interest rates, which may lower industry costs and improve liquidity, potentially boosting insurance stock valuations [2]. - The anticipated appreciation of the RMB is expected to positively influence trading volumes and market performance in Hong Kong, particularly benefiting financial stocks under non-trade items [2].