In recent months, the stock market has shown little momentum, fluctuating around the 3400-point markThis lull has been accompanied by a disorganized investment landscape, where strategies have quickly oscillated between dividends and growthSuch swift rotations have created a challenging environment for investors, leading to a rapid decline in risk appetite and a significant drop in trading volumeMany market participants have resumed a defensive posture, reverting to strategies aimed at preserving capital.

Compounding these issues is the sharp decline in interest rates across China, particularly at the longer end of the curveFor instance, the yield on the 10-year government bond has dipped below 2%, with the 30-year bonds also hovering on the brink of this historic lowThis has triggered a pronounced state of asset panic among institutional investors, such as insurance companies, which have notably increased their allocations towards high-dividend sectors.

Additionally, the past few weeks have witnessed a notable uptick in the popularity of dividend strategy ETFs, particularly as investors scramble to capitalize on favorable valuationsIn fact, there has been an influx of capital into these ETFs, with the number of shares in several of these funds experiencing exponential growthFor example, the Low Volatility Dividend ETF has seen more than 4.2 billion new shares added in just the last month alone.

The standout among these ETFs is the Low Volatility Dividend ETF (Code: 512890), which boasts the highest new share issuance in recent weeks — an impressive 4.2 billionThe total number of shares for this ETF has exceeded 11.7 billion, representing a significant achievement given its total assets now surpass 13.1 billion yuan, marking a historic high since its inception.

Observing the share growth curve of this ETF reveals a near-vertical trajectory, indicating a robust influx of funds, making it one of the fastest-growing periods since the fund's launch

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Furthermore, institutional investors hold a considerable portion of the fund, owning over 88% of the shares, underscoring its popularity among these entitiesMajor shareholders include significant insurance firms like Ping An and Taikang, along with numerous private equity firms heavily invested in the fund.

This Low Volatility Dividend ETF tracks an index that specifically screens for 50 stocks within the Shanghai and Shenzhen A-share market, targeting those with high dividend yields and low volatilityThese selections utilize a dividend yield weighting method, which balances the exposures effectively.

From an industry standpoint, a considerable chunk of the fund is weighted toward the banking sector, including major state-owned banks and joint-stock commercial banks, accounting for nearly 40% of the total weight.

However, recent surges in stock prices have led to declines in dividend yields for sectors such as coal and oilCompanies like Shenhua and Inner Mongolia Power have been expelled from the index during December's adjustment period, resulting in a diminished representation of resource industries, which are now nearly negligible.

Evaluating the performance of the China Dividend Low Volatility Index reveals impressive resultsSince the index's inception in 2005, accounting for reinvested dividends, its annualized return has approached 17%, surpassing the Nasdaq 100 index by a solid 4 percentage points during the same period.

Examining the annual performance over a span of 20 years, the index has only experienced negative returns in three years, with the remaining 17 showing positive returns, asserting a 90% probability of profitabilityThis consistent upward trend speaks volumes about the long-term investment validity.

Turning our attention to another significant ETF, the Yi Fangda Dividend ETF (Code: 515180), it too has experienced remarkable growth, adding over 1.4 billion new shares in just the past month, pushing its total to over 6.1 billion shares at an all-time high, reflecting the fastest growth phase since its launch.

A look at the top ten shareholders of this ETF further reveals a substantial investment from insurance companies, including Ping An and Taikang, who have amassed significant holdings across various products including universal insurance and dividend insurance.

This ETF tracks an index that specifically selects 100 stocks from the Shanghai and Shenzhen markets that feature high cash dividend yields and relatively stable dividends, again applying a dividend yield weighting method.

The sector distribution for this index is more balanced than that of the Low Volatility Dividend ETF, with the banking sector holding a 22% weight

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In contrast, the coal sector constitutes a slightly higher 14% of its weight.

Furthermore, during the most recent sample adjustments in December, stocks with low dividend yields like Yangtze Power and Sichuan Investment Energy were removed, paving the way for the inclusion of stocks with higher dividends, which has resulted in a significant rebound in the overall yieldCurrently, the dividend yield for the China Dividend Index stands at approximately 5%, placing it at the 71st percentile compared to the past decade.

We also have the Dividend ETF (Code: 510880), which is the oldest in the dividend strategy ETF category, having been established in 2006. Its market recognition remains notably high.

This ETF is credited with being one of the first to implement a mandatory dividend distribution model and has performed commendably in its dividend distribution efforts, having declared dividends annually since 2009.

Recently, growth within this ETF has surged, adding 1.3 billion new shares in the past month, bringing its total to over 7 billion shares, with assets exceeding 22.9 billion, thus establishing itself as the largest dividend strategy ETF in the market.

This fund tracks the Shanghai Dividend Index, which was first issued in the early 2000s, making it the earliest dividend strategy index in China targeting the largest stocks with high dividend yields, stability, and liquidity.

The industry distribution for this ETF shows a high concentration in banking, coal, and transportation, notably, the banking segment alone accounts for over 26% of its weight, being the dominant industry.

Despite recent price increases, the valuation for the dividend index remains moderately positioned, with a recent yield reported at 5.12%, which is now around the 55th percentile compared to the past decade, indicating that its cost-effectiveness has somewhat diminished.

Lastly, the Low Volatility Dividend 50 ETF (Code: 515450) has witnessed remarkable growth, adding in excess of 1.2 billion new shares recently, effectively doubling its size, signaling strong market interest and your highest-growth time period since inception.

Importantly, this ETF also engages in dividend payments, albeit at less frequent intervals; since 2022, it has declared two rounds of dividends within the year, distributing high payout ratios that provide substantial cash flow.

The ETF tracks the S&P China A-share Large Cap Low Volatility Dividend 50 index, selected from stocks within the S&P China A-share large cap index based on high dividend yields and low volatility, applied on a weighted basis.

Sector allocation has highlighted that banking holds the highest share, surpassing 30%, while the food and beverage sectors also represent a substantial 13% of the total.

Similarly, the Hong Kong Dividend Index ETF (Code: 513630) focuses on high-dividend stocks within the Hong Kong market

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