On December 15, Hong Kong's three major indices retreated, with the Hang Seng Tech Index dropping over 2%. The HUABAO HONG KONG STOCK CONNECT HANG SENG CHINA 30 ETF (520560), which adopts a "tech + dividend" barbell strategy, followed the market trend, declining 1.48% intraday. Notably, the ETF showed a wide premium, indicating strong buying interest, with potential capital inflows during the dip.
In fact, the HUABAO HONG KONG STOCK CONNECT HANG SENG CHINA 30 ETF (520560) recorded five consecutive days of net inflows totaling RMB 43.49 million. Over the past 20 days, it attracted cumulative inflows of RMB 119 million, reflecting market optimism toward Hong Kong stocks and active adoption of the barbell strategy.
Sector-wise, Hong Kong's insurance stocks bucked the downtrend, with PING AN surging nearly 4% to a new high, while China Life Insurance rose over 1%. In the consumer sector, Yum China and ANTA Sports gained over 1%, leading the gains. Conversely, BeiGene, a biotech leader, fell nearly 7%, and tech giants like SMIC and Kuaishou dropped over 2%, dragging down the index.
The National Financial Regulatory Administration issued a notice adjusting risk factors for insurers' investments, further expanding insurance capital's market access. Risk factors for insurers investing in CSI 300 index constituents, CSI Dividend Low Volatility 100 index constituents, and STAR Market stocks were lowered.
CITIC Securities noted that compared to the September 2023 adjustment, this revision introduced holding period requirements, encouraging long-term investments. Estimates suggest the move could release approximately RMB 19.8 billion in minimum capital, potentially bringing RMB 72.6 billion in incremental funds if fully allocated to stocks.
Looking ahead, Hong Kong stocks offer improved valuations, with opportunities in both tech and dividend sectors. GF Securities recommends a barbell strategy: stable-value assets for long-term holdings and growth assets with solid fundamentals amid market fluctuations.
1. **Hong Kong Dividends**: CICC highlights that Hong Kong stocks offer higher dividend yields than A-shares (e.g., 6.1% for Hong Kong banks vs. 4.3% for A-share banks), enhancing their appeal. 2. **Hong Kong Tech**: AI advancements from domestic models and the Fed's rate-cut cycle underscore the long-term potential of Hong Kong tech stocks.
For investors seeking exposure to Hong Kong tech with lower volatility, the HUABAO HONG KONG STOCK CONNECT HANG SENG CHINA 30 ETF (520560) and its feeder funds (Feeder A LOF 501301; Feeder C 006355) provide a balanced barbell strategy, combining high-growth tech stocks like Alibaba and Tencent with stable dividend payers like China Construction Bank and PING AN. Its T+0 trading mechanism makes it an ideal core holding for Hong Kong market exposure.
**Risk Disclosure**: The ETF tracks the Hang Seng China (Hong Kong-listed) 30 Index (base date: January 3, 2000; launch date: January 20, 2003). Constituent stocks are adjusted per index rules. Individual stock mentions are not investment advice or indicative of fund holdings. The fund is rated R4 (higher risk) and suitable for aggressive (C4+) investors. Past performance does not guarantee future results. Investment involves risks.