Against the backdrop of "low interest rates + asset scarcity," tapping into companies' intrinsic value has become a core strategy for investment breakthroughs. Free cash flow, regarded by Warren Buffett as the "golden benchmark of corporate value," serves not only as a "buffer" against cyclical fluctuations but also as a "ballast" supporting long-term dividends and sustained R&D investments. High free cash flow assets are now entering a critical investment opportunity period.
Reflecting long-term confidence in such assets, Great Wall Fund has launched the Great Wall CSI 300 Free Cash Flow Index Securities Investment Fund (Class A: 024225, Class C: 024226), following its earlier issuance of the Great Wall China Securities Free Cash Flow Index Fund in August. This new fund tracks the CSI 300 Free Cash Flow Index, offering investors a high-quality option to gain exposure to core "cash cow" assets in the A-share market.
The CSI 300 Free Cash Flow Index (932366.CSI) is a key tool for efficiently investing in high-cash-flow A-share leaders. It selects 50 non-financial and non-real estate stocks from the CSI 300 Index constituents based on stringent criteria: positive free cash flow and enterprise value, five consecutive years of positive net operating cash flow, and profitability ranking in the top 80%.
Wind data shows that as of November 24, the index's constituents had an average market cap exceeding 300 billion yuan, with over 30 stocks surpassing 100 billion yuan, accounting for 88.18% of the index weight—highlighting their leading status. Financially, as of September 30, the index's debt-to-asset ratio stood at 43.55%, lower than the CSI 500 Free Cash Flow Index (49.91%) and CSI 1000 Free Cash Flow Index (44.94%). Its average return on equity (ROE) was 10.24%, outperforming the two comparative indices (8.35% and 7.30%, respectively). Additionally, the CSI 300 Free Cash Flow Index's trailing 12-month dividend yield reached 3.89%, surpassing the CSI 500 (3.14%) and CSI 1000 (2.76%) counterparts. (Past index performance does not guarantee future results.)
Historically, the CSI 300 Free Cash Flow Index has demonstrated strong long-term performance. Since its base date (December 31, 2013), the index has surged 225.30% (annualized return: 10.74%) through November 24, outpacing the CSI 500 (105.49%) and CSI 300 (90.90%) indices. Over 11 full calendar years, it delivered positive returns in eight, showcasing resilience across market conditions.
With the A-share market maintaining upward momentum but entering a high-volatility phase, high free cash flow assets may remain a focal point for investors.
Tao Shubin, the designated fund manager, believes that free cash flow assets offer both defensive value and growth potential. Stable free cash flow supports dividend payouts, enabling companies to weather market cycles, while ample cash reserves fuel technological upgrades and industry consolidation, enhancing flexibility during recoveries.
Great Wall Fund, a pioneer in index investing since 2004, has built a diversified index product lineup spanning multiple markets, assets, and strategies. Its recent focus on dividend-themed products includes free cash flow as a key segment.
Moving forward, Great Wall Fund aims to expand its index investment offerings to align with evolving capital market dynamics and investor needs.
*Index performance note: Annual returns for the CSI 300 Free Cash Flow Index since 2014: 42.06%, 3.95%, -5.17%, 41.21%, -17.43%, 17.55%, 12.29%, 10.16%, -10.31%, 6.94%, 35.16%. Past performance does not indicate future results.
*Risk Disclosure: Investments involve risks. Investors should assess their risk tolerance and review fund documents carefully. The fund is rated R3 (moderate risk) by the manager, suitable for C3 (conservative) or higher-risk investors. Fund performance is not guaranteed.
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