Against the backdrop of rising global interest rate cut expectations and heightened market volatility, high dividend strategies are becoming an important choice for investors to navigate uncertainty due to their attractive dividend yields and lower volatility. Global X Hang Seng High Dividend Yield ETF (03110) announced on September 9 that it will distribute a dividend of HK$1.6 per share to holders, with an ex-dividend date set for September 24 and payment expected on September 30. This dividend distribution stems from the strong performance of the Hang Seng High Dividend Yield Index that it tracks.
As of August 29, the index's dividend yield stood at 6.9%. Following the annual rebalancing in June, the index's dividend yield increased to 7.8%, with the subsequent decline in dividend yield attributed to stock price growth. Since 2024, the index has maintained a steady upward trend in both dividend per share and stock prices.
The macroeconomic environment is also boosting attention toward high dividend strategies. Recent weak U.S. labor data and dovish signals from the Federal Reserve have continuously strengthened market expectations for the start of an interest rate cutting cycle in September. In this context, high dividend assets have become an important direction for capital seeking safe havens due to their provision of stable cash flows and relatively low volatility.
For China's mainland market, low bank deposit rates and bond yields may prompt more household savings to flow into the stock market, with high dividend products potentially being among the first beneficiaries. Additionally, China's strong policy support provides backing for high dividend strategies: The People's Bank of China's establishment of a share buyback refinancing facility is expected to stimulate corporate buyback activities, while the "Nine National Policies" launched in 2024 have also promoted more stable and frequent corporate dividend payments.
Regarding constituent stock performance, the latest earnings season shows that high dividend constituent companies generally demonstrate strong dividend payment intentions. Among the 50 index constituent stocks, 42 companies announced interim dividends for the first half of 2025, with 30 companies (71%) maintaining or increasing their dividend per share year-over-year. Based on interim dividends for the first half of 2025 and full-year 2024 dividends, the trailing twelve-month dividend per share (DPS) grew 7.9% year-over-year. Beyond cash dividends, some companies are also enhancing shareholder returns through share buyback programs.
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