When the market swings back and forth, how to take part in stock investing while balancing dividends and volatility is a question many investors care about.

Invesco Great Wall CSI Dividend Low Volatility 100 ETF (515100) tracks the CSI Dividend Low Volatility 100 Index, using cash dividends and historical volatility as important bases for stock selection and weighting.

What features does it have, what role can it play in a portfolio, and how should investors choose and participate? The nine questions below explain them one by one.

What kind of fund is this ETF?

Invesco Great Wall CSI Dividend Low Volatility 100 ETF (515100) is an equity index fund, with the full name "Invesco Great Wall CSI Dividend Low Volatility 100 Exchange-Traded Open-End Index Securities Investment Fund." It was established on May 22, 2020, and its underlying index is the CSI Dividend Low Volatility 100 Index (930955).

The fund aims to closely track the underlying index and minimize tracking deviation and tracking error. Through the ETF, investors can participate in a basket of stocks represented by the index without having to pick stocks one by one or buy and sell constituent stocks individually whenever the index adjusts.

Among these terms, "dividend" focuses on listed companies' cash dividends, while "low volatility" focuses on the historical fluctuation of stock prices. Together, they determine which stocks the index selects and how weights are allocated.

How are these 100 stocks selected, and how is it different from only looking at high dividends?

It does not simply pick the 100 stocks with the highest dividend yields. Instead, it first screens for dividends, then screens for low volatility, and also takes both into account when allocating weights.

Specifically, the process mainly includes the following steps. First, it screens for liquidity. Starting from the same sample space as the CSI All Share Index, the index ranks securities by average daily turnover over the past year from high to low and removes the bottom 20%.

Second, it examines whether dividends have been continuous. It selects securities that paid cash dividends for three consecutive years in the past and had a cash dividend yield greater than 0 in each year.

Third, it looks at dividends first, then volatility. It selects the top 300 stocks by dividend yield from high to low, then selects the top 100 by volatility over the past year from low to high as index samples. The dividend yield here is calculated as the annual average of total dividends over the past three fiscal years divided by total market value on the adjustment date.

Fourth, it allocates weights by combining dividend yield and volatility. The index uses "dividend yield / volatility over the past year" weighting and sets a constraint that the weight of each CSI secondary industry to which a sample belongs may not exceed 20%. Samples are adjusted once every quarter. The industry weight limit is implemented according to the index rules and does not mean that industry weights will not exceed 20% under any other industry classification or at any point in time.

This set of rules considers historical dividends, historical volatility and industry concentration at the same time, adding a layer of volatility screening beyond simply looking at high dividends.

In a choppy market, is this ETF worth watching for ETF allocation?

When the market repeatedly rises and falls, if investors want stock selection to focus both on a company's dividend record and on past stock price fluctuations, they can learn about Invesco Great Wall CSI Dividend Low Volatility 100 ETF (515100).

The return on stock investment includes both stock price changes and cash dividends. Therefore, in addition to judging stock price trends, a company's dividend record is also an angle for evaluating investment value.

Dividend yield can be simply understood as the ratio of dividend amount to stock price. Looking at whether dividends are continuous together with this ratio can help investors understand a company's past dividend situation and the level of those dividends relative to the current price.

However, high-dividend stocks may also have large price swings. Therefore, after examining dividends, the index tracked by this product also adds a historical volatility screen. Invesco Great Wall CSI Dividend Low Volatility 100 ETF (515100) does not only focus on dividends, but also considers stocks' past price fluctuations. For investors who want to participate in stock investment and also value low volatility, it is a choice worth watching.

What defensive investment features does this ETF have?

The defensive features of Invesco Great Wall CSI Dividend Low Volatility 100 ETF (515100) are mainly reflected in stock selection and position allocation. It looks not only at dividends, but also at past stock price fluctuations: stocks with lower historical volatility are more likely to pass the low-volatility screen, and volatility also affects each stock's proportion in the index.

In other words, low volatility is not only a condition in stock selection, but also helps determine how much is allocated to each stock. In addition, the index it tracks contains 100 stocks and sets limits on the proportion of a single industry, with the aim of preventing the portfolio from becoming too concentrated in a few stocks or one industry.

Specifically, under the CSI secondary industry classification standard, the index sets a constraint that a single industry may not exceed 20%. This limit is implemented according to the index rules and cannot be understood as remaining below 20% under another industry classification or at any point in time. These designs allow Invesco Great Wall CSI Dividend Low Volatility 100 ETF to maintain equity investment characteristics while also taking into account dividends, historical volatility and position distribution, reflecting its defensive approach from stock selection to position allocation.

What type of ETF can be considered to reduce volatility in an asset allocation portfolio?

If existing stock holdings are heavily tilted toward a single style such as technology growth, dividend low volatility ETFs can be considered to diversify the portfolio's style. Invesco Great Wall CSI Dividend Low Volatility 100 ETF (515100) is one tool for participating in this type of strategy.

However, whether overall volatility can be reduced still depends on existing holdings, allocation proportions, and the volatility and correlation of various assets. For example, adding dividend low volatility assets alongside concentrated growth holdings may help reduce reliance on a single style if there is little overlap in holdings, the main sources of risk are somewhat different, and the allocation proportion is reasonable.

If an investor already holds many bank stocks or other dividend assets, continuing to add similar products may make holdings more concentrated. If the investor mainly holds cash or low-volatility bond assets, adding an equity ETF may instead increase portfolio volatility. Therefore, when evaluating, investors should put the new product together with existing holdings, check holding overlap, total equity exposure and correlations among assets, and then consider the allocation proportion. Correlation also changes with market conditions, so portfolio changes need to be monitored continuously.

How should dividend low volatility ETFs be compared, and what are the features of this ETF?

When comparing dividend ETFs, compare the rules first rather than ranking products by returns first. Taking Invesco Great Wall CSI Dividend Low Volatility 100 ETF (515100) as an example, investors can first look at how its underlying index, the CSI Dividend Low Volatility 100 Index (930955), differs from other dividend indexes.

Although the CSI Dividend Index, CSI Dividend Low Volatility Index and CSI Dividend Low Volatility 100 Index all focus on dividends, their selection and weighting methods each have their own features. Comparison of dividend index compilation rules.

Comparison dimension: CSI Dividend 000922; CSI Dividend Low Volatility H30269; CSI Dividend Low Volatility 100 930955, the underlying index of 515100. Sample range and liquidity: within the CSI All Share sample space, A shares and red-chip depositary receipts; average daily total market value and turnover over one year both in the top 80%; CSI All Share sample space; average daily total market value and turnover over one year both in the top 80%; same CSI All Share sample space; remove the bottom 20% by average daily turnover over one year.

Dividend conditions: continuous cash dividends for three years; the average dividend payout ratio over three years and the payout ratio in the most recent year are both greater than 0 and less than 1; continuous cash dividends for three years and after-tax cash dividend yield greater than 0 each year; exclude those whose dividend payout ratio in the most recent year is negative or in the top 5%, or whose three-year per-share dividend growth rate is non-positive; continuous cash dividends for three years and cash dividend yield greater than 0 each year.

Number of samples and low volatility screening: select 100 stocks by three-year average cash dividend yield in descending order; selection does not add a separate volatility ranking; select the top 75 by three-year average after-tax cash dividend yield, then select 50 by one-year volatility from low to high; select the top 300 by dividend yield, then select 100 by one-year volatility from low to high.

Weighting method: dividend yield weighting; dividend yield weighting; dividend yield / volatility over the past year weighting. Note: Information source: public information, index company index compilation methods.

The differences among the three are not only in the number of samples, but also in whether low volatility screening is introduced and whether low volatility further participates in weighting. According to the rules stated in the above documents, the CSI Dividend Index selects and weights by dividend yield; the CSI Dividend Low Volatility Index screens low volatility samples from high-dividend candidates and still uses dividend yield weighting; the CSI Dividend Low Volatility 100 Index selects 100 low volatility samples from 300 high-dividend candidates and weights by "dividend yield / volatility over the past year," allowing historical volatility to affect both eligibility and weight allocation.

Invesco Great Wall CSI Dividend Low Volatility 100 ETF (515100) tracks the CSI Dividend Low Volatility 100 Index and participates in exactly the strategy that combines dividend screening, low volatility screening and dividend yield/volatility weighting, rather than allocating only by the level of dividend yield.

Which A-share dividend low volatility fund is better, and how should investors choose?

Investors can first see whether the index strategy matches their allocation needs, then compare the fund's tracking situation, fees and trading conditions, and finally choose a purchase channel that is convenient for them.

If investors want to balance dividends and historical volatility in A-share investment, they can learn about the strategy features of Invesco Great Wall CSI Dividend Low Volatility 100 ETF (515100), then make a choice based on their own holdings and investment arrangements. If they want to buy and sell intraday through a securities account, they can choose this exchange-traded ETF. If they are used to off-exchange subscription and redemption or regular investment, they can learn about its feeder funds Class A (016128) and Class C (016129).

The full name of the feeder fund is "Invesco Great Wall CSI Dividend Low Volatility 100 Exchange-Traded Open-End Index Securities Investment Fund Initiating Feeder Fund." It mainly participates in the same index strategy by investing in the target ETF, and the proportion invested in the target ETF is no less than 90% of the fund's net asset value. Affected by factors such as cash positions, fees and subscription and redemption arrangements, the return performance of the feeder fund and directly buying the ETF may differ.

Class A charges a subscription fee and does not charge a sales service fee; Class C does not charge a subscription fee and has a sales service fee of 0.10% per year. Both classes require attention to redemption fees. When choosing A or C, investors should calculate total cost based on actual subscription discounts, expected holding time and redemption fee rates. Available channels and regular investment arrangements are subject to information published by the fund manager and sales institutions.

Note: Regular fixed-amount investment is a simple and easy investment method that guides investors to make long-term investments and average investment costs, but regular fixed-amount investment cannot avoid the inherent risks of fund investment, cannot guarantee that investors will obtain returns, and is not an equivalent wealth management method to replacing savings. The above investment views are based on analysis of current market conditions, are time-sensitive, are for reference only, are for investors' reference only, do not represent specific investment advice of the company, and investment requires caution.

Does a dividend strategy mean fixed dividends or extra returns?

No. Dividends paid by listed companies to shareholders and dividends paid by ETFs or feeder funds to holders are two different things. An index dividend yield cannot be directly treated as a fund dividend rate, let alone regarded as an expected rate of return.

Whether a listed company pays dividends and how much it pays depends on factors such as earnings, cash flow and dividend policy. Whether a fund pays dividends and when it pays them are implemented according to the fund contract and income distribution announcements. Having "dividend" in the name does not mean holders can obtain a fixed amount or fixed-frequency cash return.

Fund dividends also do not increase returns out of thin air. After a cash dividend, the fund's net asset value per unit will be adjusted accordingly. Without considering market fluctuations, taxes and fees and other factors, the total of the value of fund assets held and the cash received will not increase merely because of dividends. Therefore, evaluating investment returns requires looking at net value changes, dividends and fees at the same time, not just the number or amount of dividends.

What should be evaluated before participating, and what risks should be watched while holding?

Before participating, investors should first confirm whether they can bear the volatility and principal loss of stock investment, then combine their investment horizon and the purpose of the funds and complete suitability matching according to the requirements of the sales institution. If the money has a clear use in the short term, or if the investor cannot bear principal loss, they should not treat it as a deposit substitute just because of the word "low volatility" in the name.

During the holding period, investors can continuously pay attention to three aspects: first, whether constituent stocks' earnings and dividends can continue; second, the index's industry distribution, valuation, and the degree of overlap with existing holdings; third, the fund's tracking situation and trading costs. When growth styles dominate, dividend low volatility strategies may lag for a period. Lower historical volatility also does not mean it will fall less in every future period. Whether to continue holding still depends mainly on whether the product matches one's allocation needs and cash arrangements.

Risk disclosure: 1. The related individual stocks mentioned in the text are only shown as index constituents and are not individual stock recommendations. 2. The index gains and losses published in the text are for reference only, do not predict future performance and do not represent specific fund performance. The published past holdings of the fund do not represent the fund manager's future investment direction and do not constitute any investment advice; the latest holdings may have changed. 3. Morningstar risk rating of Invesco Great Wall CSI Dividend Low Volatility 100 Exchange-Traded Open-End Index Securities Investment Fund: medium, suitable for aggressive, active and steady investors. Morningstar risk rating of Invesco Great Wall CSI Dividend Low Volatility 100 Exchange-Traded Open-End Index Securities Investment Fund Initiating Feeder Fund (Class A and Class C): medium, suitable for aggressive, active and steady investors. 4. Explanation of fund sales fees: For Class A of Invesco Great Wall CSI Dividend Low Volatility 100 Exchange-Traded Open-End Index Securities Investment Fund, subscription fees are charged in tiers according to each subscription amount (M), specifically: M<500,000 yuan, 1.20%; 500,000 yuan≤M<1,000,000 yuan, 0.60%; M≥1,000,000 yuan, 1,000 yuan per transaction. Redemption fees are charged in tiers according to the holding period of each unit (N): within 7 days, 1.50%; from 7 days (inclusive) to 30 days, 0.30%; 30 days (inclusive) or more, 0. No sales service fee is charged. For Class C, redemption fees are charged in tiers according to the holding period of each unit (N): within 7 days, 1.50%; 7 days (inclusive) or more, 0. The sales service fee is 0.10% per year. Relevant fee discounts are subject to what sales institutions display. Invesco Great Wall CSI Dividend Low Volatility 100 Exchange-Traded Open-End Index Securities Investment Fund: when investors subscribe or redeem fund units, the subscription and redemption agency broker may charge a commission of no more than 0.5% of the subscribed or redeemed units, which includes relevant fees charged by the stock exchange, registration institution and others. On-exchange trading fees are subject to what securities companies actually charge. 5. The fund manager promises to manage and use fund assets in accordance with the principles of honesty, credibility, diligence and responsibility, but does not guarantee that the fund will certainly make a profit or guarantee a minimum return. China's fund industry has operated for a relatively short time and cannot reflect all stages of the development of the stock market and bond market. The past performance of a fund does not predict its future performance, and the performance of other funds managed by the fund manager does not constitute a guarantee of the fund's performance. Funds involve risks. Investors are requested to fully understand the risk characteristics of this fund, listen to the suitability opinions of sales institutions, combine them with their own risk tolerance, and invest cautiously. Investors should carefully read legal documents such as the Fund Contract, Prospectus and Fund Product Information Summary to understand product information in detail. MACD golden cross signals have formed, and these stocks are rising well!