Today, the market entered a roller-coaster mode in the afternoon. The Shanghai Composite Index fell by over 1% at one point before rising by over 1%, while the ChiNext Index briefly turned negative before刷新ing the day’s high and closing up 3.82%.
The market is now facing a "historical divergence" at the 3,900-point level of the Shanghai Composite Index.
Given the high levels that have not been easily breached in nearly a decade, the demand for profit-taking from earlier gains will significantly increase—particularly for funds deployed below the 3,000-point level, which have already accumulated substantial returns. Choosing to cash out and secure profits has become a rational decision.
As a result, the battle between bulls and bears intensifies around the 3,900-point level, leading to market volatility. Many investors are openly expressing anxiety.
At the current level, it is actually a good time to focus on dividend assets. The stability of dividends complements the high-growth nature of the technology sector, providing a "safety cushion" amid market fluctuations. Additionally, combining dividends with technology can create a "barbell portfolio":既不 missing out on growth opportunities nor sacrificing the solid foundation of dividend returns.
Here are two recommendations:
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Dividend State-Owned Enterprise ETF (510720)
The Dividend State-Owned Enterprise ETF (510720) tracks the SSE State-Owned Enterprise Dividend Index, focusing on central and state-owned enterprises with high dividends. The index has a high dividend yield.
This ETF is also one of the first dividend-focused ETF products in China with a contract stipulating monthly evaluations for income distribution. If fund dividend conditions are met, income distribution can be arranged. As of August, the Dividend State-Owned Enterprise ETF has distributed dividends for 16 consecutive months.
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Cash Flow ETF (159399)
The Cash Flow ETF (159399) tracks the FTSE China A-Share Free Cash Flow Focus Index, rigorously selecting the top 50 stocks with the highest cash flow rates. Large-cap stocks carry significant weight, with stocks having a total market capitalization of over RMB 100 billion accounting for approximately 70% of the weighted allocation. During historical periods of volatility, the cash flow index has demonstrated superior resilience.
