Investment value analysis of Shanghai Composite Index ETF (510760)
Core conclusions
Recently, the Shanghai Composite Index ETF has joined the ranks of fee cuts, becoming one of the best tools for market wide investment with the lowest rate and high efficiency. As the wind vane of the A-share market, the Shanghai Composite Index has good market representativeness and stability. At present, the equity market has a high cost performance ratio. In the context of the release of the New National Nine Rules, the market has kept a high focus on high dividend assets and high-quality big market leaders. The Shanghai Composite Index, which has a high proportion of "Chinese characters", has certain investment opportunities. For specific subject matter, the Shanghai Composite Index ETF (510760) can be selected as a tool product; The fund rate is low, the target index is tracked efficiently, and good excess returns have been achieved since its establishment.
When the reform of public offering rate continues, the Shanghai Composite Index ETF will reduce its fees
According to the fund announcement, recently the management rate of Shanghai Composite Index ETF (510760) and its feeder fund (011319) has been lowered from 0.50% to 0.15%, and the custody rate has been lowered from 0.10% to 0.05%. After this fee cut, the Shanghai Composite Index ETF will become one of the most low-cost and efficient investment tools in the market.
Shanghai Composite Index: the wind vane of A-share market, with a high proportion of "Chinese characters", and is expected to maintain its advantages under the background of the New National Nine Rules
The Shanghai Composite Index has a long history, wide coverage and high market recognition. The stability and representativeness of the index have been further improved after the optimization of the compilation rules. It is a better broad-based index for investing in A-shares.
The Shanghai Composite Index is weighted by the total market value. Compared with the broad based index such as the CSI 300 weighted by the free circulation market value, the proportion of the "Chinese prefix" target in its weighted shares is higher. The performance in the past three years is significantly better than that of the CSI 300, and the medium and long-term investment value is prominent in the context of the New National Ninth Article.
Analysis of investment value of Shanghai Composite Index
Market value style: the overall market style is prominent. Over 100 billion super large cap stocks accounted for more than 50% of the total weight, which laid the foundation for the style of the index as a leader with large market value and high stability.
Weighted industries and individual stocks: balanced dispersion, value oriented growth supplemented. Among the industries weighted by the index, there are not only traditional industries with relatively stable undervalued values (mainly finance and cycles), but also emerging industries with relatively high growth potential (medicine, electronics, new energy, etc.). The industry distribution is balanced and decentralized, and the weighted shares cover the undervalued and high dividend central state-owned enterprises in all industries.
Valuation level: There is room for valuation improvement, and dividend yield is at a historical high. Recently, the index has rebounded and the valuation has rebounded slightly, but there is still room for improvement in the medium and long term. The P/E ratio and P/B ratio quantile are about 50% and 10% respectively in the past decade. The dividend yield of the index continues to rise and is currently at a historical high, with the historical quantile of more than 80% in the past decade.
Index performance: steady performance in the medium and long term, leading performance in the past year. Since 2022, the performance of the Shanghai Composite Index has been significantly ahead of that of CSI 300, CSI 500 and CSI 1000. As the industry of constituent stocks is balanced, individual stocks are scattered, and the overall market is larger, the overall performance of the Shanghai Composite Index is relatively stable, and the volatility and pullback are relatively controllable.
Shanghai Composite Index ETF (510760): The low rate and excess return are outstanding. While the fund has the advantage of low rate after the fee reduction, the historical performance of the fund is excellent. The product adopts the method of optimal sampling and replication, and the fund returns in the past three years are 10.41%, the Shanghai Composite Index is -7.98%, and the Shanghai Shenzhen 300 Index is -26.56%, with outstanding excess returns; Compared with the Shanghai Composite Index and the CSI 300, the excess reached 18.39% and 36.97% respectively.
