Since July, Hong Kong stocks have become a key destination for the global "rebalancing" of capital. As of August 5, southbound capital and international intermediaries recorded net inflows of HKD 75.1 billion and HKD 6.9 billion, respectively, becoming the main forces adding to Hong Kong positions. Meanwhile, foreign capital began returning from mid-July, with cumulative net inflows exceeding HKD 60 billion since July 16. This shift has moved from passive position replenishment to a co-drive of both active and passive funds. Guosen Securities noted that, based on clearing data from HKEX’s Central Clearing and Settlement System, stable foreign capital inflows into Hong Kong stocks reached HKD 18.4 billion in the week of July 29 to August 4, while flexible foreign capital inflows totaled HKD 8.1 billion. Sectors including banking, non-bank financials, and hardware equipment became key destinations for foreign inflows, pushing the weekly inflow of foreign capital into Hong Kong dividend assets to a record high.

As domestic and international enthusiasm for allocating to high-dividend assets intensifies, Wind data shows that the Huatai-PineBridge Hang Seng Connect High Dividend ETF (513530), the first ETF in the market to invest in the Hang Seng Connect High Dividend (CNY) index via a QDII structure, has seen a significant uptick in trading activity since August 1. Its average daily turnover for the period from August 1 to August 10 reached RMB 253 million, exceeding the 2026 year-to-date average of RMB 187 million (from January 1 to July 31). In terms of net inflows, the product has recorded daily net inflows exceeding RMB 10 million for three consecutive trading days (August 6 to August 10). Since June, it has experienced net capital outflows on only nine trading days, with cumulative net inflows of RMB 557 million during the period, making it the only Hong Kong dividend-themed ETF in the A-share market to accumulate over RMB 500 million in net inflows during that time. As of August 10, 2026, the fund shares of the Huatai-PineBridge Hang Seng Connect High Dividend ETF (513530) have reached a record high of 2.727 billion shares for three consecutive trading days, while the fund’s size has also risen to a historically high level of RMB 4.346 billion, making it a key allocation focus for many investors in volatile markets.

Meanwhile, impacted by factors such as month-end liquidity fluctuations and weak PMI data, long-term interest rates have continued to decline. Wind data shows that as of August 10, the yield on the 10-year government bond dropped to 1.71%, falling to a near one-year low. This creates a significant yield spread with the current dividend yield of 5.04% for the benchmark index of the Huatai-PineBridge Hang Seng Connect High Dividend ETF (513530) — the Hang Seng Connect High Dividend (CNY) index — which is higher than 42.81% of the time over the past decade (from August 10, 2016 to August 10, 2026). The consistent and high level of cash dividends from constituent stocks is likely a key reason behind the prominent high-dividend advantage of Hong Kong dividend assets. Taking the Hang Seng Connect High Dividend (CNY) index as an example, a group of constituent companies, including financial and energy firms, have entered a concentrated period of cash dividend payments. According to listed company periodic reports, the total cash dividends paid since July amount to RMB 153.655 billion, representing 43.20% of the total RMB 355.7 billion in cash dividends paid by all Hong Kong stocks. This has strengthened the appeal of Hong Kong dividend assets to long-term investors.

With Hong Kong market sentiment having rapidly recovered to near-neutral levels, uncertainties may persist as the interim reporting season approaches. For portfolio allocation, dividend assets could still serve as a core holding to achieve a balanced approach. Over a longer time horizon, as of August 10, 2026, the Hang Seng Connect High Dividend (CNY) Total Return Index has recorded a cumulative gain of 64.98% over the past three years. This performance significantly outperforms major A-share dividend total return indices like the CSI Dividend Total Return Index (24.02%) and the Shenzhen Dividend Total Return Index (4.16%), as well as some major Hong Kong tech indices like the Hang Seng Tech Total Return Index (15.95%), demonstrating strong long-term performance.

In terms of trading mechanism, the Huatai-PineBridge Hang Seng Connect High Dividend ETF (513530) is the first ETF in the market to invest in the Hang Seng Connect High Dividend (CNY) index via a QDII structure. Its tax structure offers advantages over the traditional Hong Kong Stock Connect channel, potentially reducing the cost of dividend taxes over the long term and improving the investor experience. Furthermore, according to its contract, the Huatai-PineBridge Hang Seng Connect High Dividend ETF (513530) and its feeder funds (Class A: 018387 / Class C: 018388) can evaluate dividend distributions monthly, potentially offering investors more flexible cash flow through cash dividends.

Issued by Huatai-PineBridge Fund, one of China’s first ETF managers, the company has accumulated over 19 years of management experience in dividend-themed index investing. This has built a diversified "Dividend Family Bucket" product suite with a total size of RMB 60.072 billion, accounting for nearly one-third of the total size of all dividend-themed ETFs in the market. Among them, the Huatai-PineBridge SSE Dividend ETF (510880) is the first dividend-themed index fund in A-shares, with 416,700 holders as of the end of 2025, making it the only dividend-themed ETF in the market with over 400,000 holders at that time. The Huatai-PineBridge SSE Dividend Low Volatility ETF (512890) is the first and currently the only dividend low-volatility themed ETF in A-shares with a size exceeding RMB 30 billion, and its feeder fund has 1.4711 million holders. The Huatai-PineBridge CSI Central State-Owned Enterprise Dividend ETF (561580) is the first "SOE + Dividend" dual-themed ETF in A-shares. The Huatai-PineBridge Hang Seng Connect High Dividend ETF (513530) and the Huatai-PineBridge Hang Seng Connect High Dividend Low Volatility ETF (520890) focus on high-dividend assets in Hong Kong stocks. The former uses a QDII structure, offering advantages in Hong Kong dividend taxes, while the latter incorporates a low-volatility factor, potentially providing stronger defensive characteristics in the volatile Hong Kong market. The Huatai-PineBridge CSI Dividend Quality ETF (561630) employs a "Dividend + Quality" dual-factor stock selection strategy, aiming to screen for high-dividend stocks with solid fundamentals and strong profitability, with a more pronounced growth style. The Huatai-PineBridge CSI Dividend Low Volatility 50 ETF (561450), based on the "Dividend + Low Volatility" dual factors, focuses on high-quality blue-chip stocks.