Standing at present, on the one hand, the Fed's accelerated contraction plan, the liquidity changes of overseas funds may lead to a reduction in the risk appetite of emerging markets; on the other hand, the price of commodity assets such as crude oil will rise, resulting in rising production costs of enterprises, and profit margins may be compressed. There may be little room for adjustment in the A-share broad-cap index, but the high valuation growth style will still be under pressure.
So, why is there limited room for the broader market index to adjust? From the perspective of the composition of the shanghai index weighted industries, cyclical industries such as finance, energy infrastructure, and raw materials account for a relatively high proportion, and the low valuation characteristics are more obvious. Therefore, the commander has also "joked" before that if he feels that he cannot withstand high volatility, it is better to directly hold a fund that tracks the Shanghai Composite Index.
Of course, there is another strategy at the moment, perhaps more "cost-effective" than the large-cap index, that is, the dividend/dividend strategy. Under the background of the continuous development of the domestic stable growth policy, the high dividend characteristics of the industry or strategy index, taking into account the dual attributes of offense and defense, may be more attractive in the downward market.
Here are a few examples of tracking funds in the market with "dividend" and "dividend" indices, let's take a look at the outstanding performance this year! The following figures are as of February 9, 2022.
Dividend group: Since the beginning of this year, the Shanghai Securities dividend has risen by 2.84%, the CSI dividend has risen by 1.32%, the CSI dividend has risen by 4.91%, the CSI dividend has risen by 2.90% with low volatility, the CSI dividend has risen by 3.33% with low fluctuations, and the CSI Shanghai-Hong Kong deep dividend has risen by 5.93%;
Dividend Group: China Securities High Dividend Leader rose 5.70% this year, China Trading Services expected high dividends rose 6.30%, and CSI Shanghai-Hong Kong Shenzhen High Dividend rose 4.75%.
It can be seen that in addition to the two indexes selected by the Shenzhen Securities Dividend and the China Securities High Dividend Selection, the other dividend/dividend strategy indexes have significantly outperformed the CSI 300 (down -5.84%) this year.
The commander previously introduced the difference between dividends and dividends, from the order of distribution of after-tax profits of listed companies, first make up for the losses of the previous year, and then withdraw the "three golds" (statutory surplus provident fund, public welfare fund, provident fund) in order, and then pay the dividends of preferred shares and common stock in order, and finally it is the turn to distribute dividends. As you can see, dividends are a higher priority!
So, historically, "dividend" and "dividend" two strategic indices, who has performed better in the long run? Today, the commander intends to start with the relatively better "mass base" of the CSI Dividend Index and the CSI High Dividend Leading Index, and let's see what is the difference between the two? And in the current market context, who will be your "dish"?
The following data sources: Wind, China Securities Index official website, as of February 9, 2022
Judging from the introduction of the two indexes, in fact, it is very similar, and listed companies with high dividend yields, stable dividends and good liquidity are selected from the Shanghai and Shenzhen markets as constituent stocks. However, the number of constituent stocks varies greatly, with CSI Dividend (code: 000922) including 100 constituent stocks, while CSI High Dividend Leader (code: 931373) includes 33 constituent stocks.
Judging from the performance of the past 1 year and the past 3 years, the CSI dividend is far ahead. In the past 1 year, the CSI dividend has risen by 17.51%, and the dividend leader has fallen by -2.56%; the CSI dividend has risen by 29.86% in the past 3 years, and the dividend leader has risen by 14.21%. Stretching back to the performance of the past 5 years, the dividend leader has risen by 37.45%, and the performance is better. However, from the performance of a single year in history (2017-2021), the performance of dividend leaders in 2017, 2018, 2019 and 2020 is better than that of CSI dividends. In 2021, it lagged behind significantly, but it has rebounded this year.
Judging from the distribution of shenwan first-level industry weights, the top three heavy position industries of CSI dividend are: real estate, banking, and coal (a total of 36.70%); the top three heavy position industries of dividend leaders are: banking, coal, and steel (total 43.05%), and the cyclical industry characteristics of both are very significant. In addition, the CSI dividend covers a wider range of industries than dividend leaders, such as basic chemicals, media, trade and retail, medicine and biology, power equipment, textiles and apparel, and light industry manufacturing, which may be one of the important reasons for better performance in 2021.
Judging from the comparison of the top ten heavy stocks, the dividends of CSI are: Great Eastern, Yankuang Energy, Huafa Shares, China Shenhua, Huijie Shares, Qianjin Pharmaceutical, Jiangling Motors, Shoukai Shares, Nangang Shares, Chongqing Department Store, and the dividend leaders are: Industrial Bank, Ping An of China, Midea Group, China Merchants Bank, Yankuang Energy, Yangtze River Power, China Shenhua, Baosteel Shares, Gree Electric Appliances, industrial and commercial bank. Only 2 heavy stocks overlap, and the total weight of the top ten heavy stocks of the dividend leader is higher.
Finally, from the perspective of the distribution of the circulating market value, the total proportion of CSI dividends in stocks with a market value of more than 100 billion yuan is only 33%, and the total proportion of dividend leaders is as high as 66.66%. It can be seen that the CSI dividend is biased towards the small and medium-sized market capitalization style, while the dividend leader is biased towards the large-cap stock style, which is also one of the important reasons why the former will perform better in 2021.
Like dividends or dividend strategies, if you want to "bet" on the big market value style in 2022, you can give priority to the dividend leader; conversely, if you want to "bet" on the small and medium market value style, you can give priority to the CSI dividend. Of course, if investors are hesitant about the market capitalization style of large, medium, and small, it is recommended that the two can be allocated simultaneously.
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