On December 30th, the three major indices showed mixed performance. The petroleum and petrochemical sector continued its strong momentum, while the nonferrous metals sector opened lower but closed higher, with high-cash-flow assets delivering a standout performance. The 300 Cash Flow Index, which focuses on large-cap blue-chip "cash cow" stocks, also opened lower and closed higher, finishing up 0.90%, outperforming the broader A-share market.
From a free cash flow perspective, the petrochemical industry saw a significant improvement in cash flow in 2025, driven by a recovery in industry sentiment and reduced capital expenditures. In the first three quarters, the net operating cash flow of the petrochemical and basic chemical industries increased by 5.8% and 20.9% year-on-year, respectively. The return to positive operating cash flow and the rebound in net cash increase indicate easing pressure on enterprises, potentially driving profit and valuation recovery.
The nonferrous metals industry, which has performed strongly recently, also saw its fundamental improvements supported by cash flow. In the third quarter of 2025, the A-share nonferrous metals industry's net operating cash flow grew by 10.12% year-on-year. Although it experienced a slight sequential decrease of 1.59% (primarily influenced by the industry's collection cycle and seasonal factors, as Q2 cash flow is typically stronger than Q3), the intrinsic cash-generating ability of companies is steadily recovering. Notably, sub-sectors such as rare earths, tungsten, and cobalt showed particularly significant improvements in cash flow.
Western Securities pointed out that free cash flow strategies have performed exceptionally well against the backdrop of "anti-involution" and cross-border capital repatriation, with cash flows in related industries recovering rapidly. Compared to traditional dividend strategies (which focus on static dividend yields), cash flow strategies pay more attention to dynamic marginal changes in cash flow, allowing them to敏锐地捕捉 industry inflection points more敏锐ly.
Public information shows that the 300 Cash Flow Index employs a free cash flow stock selection strategy to pick 50 "cash cow" companies from the core assets of the CSI 300 Index. Currently, the latest price-to-book ratio (PB) of the 300 Cash Flow Index is 1.71 times, lower than it has been for over 96.15% of the past year, highlighting its attractive valuation and investment appeal.
As of the close on December 30th, the flagship product tracking this index, the 300 Cash Flow ETF (562080), rose 0.83% on a premium, with turnover exceeding 41.83 million yuan. Notably, since its listing on April 15th, the 300 Cash Flow ETF (562080) has recorded 9 monthly gains, underscoring the defensive and offensive配置 value of high-cash-flow assets during structural market trends.
Fund flows corroborate this attractiveness. As of December 29th, the 300 Cash Flow ETF (562080) attracted a net inflow of 74.95 million yuan over three consecutive trading days, with net inflows exceeding 117 million yuan in the past 10 trading days. "High-quality assets" measured by the standard of free cash flow are gaining favor with capital.
In terms of constituent stock performance, Yunnan Aluminium rose over 6%, Aluminum Corporation of China (Chalco) gained over 4%, while Jiangsu Eastern Shenghong, China Molybdenum, and CNOOC each advanced over 3%. Stocks like Baofeng Energy and Zijin Mining Group saw increases exceeding 2%.
Furthermore, the 300 Cash Flow Index completed its quarterly rebalancing on December 15th, further concentrating on characteristics of "high cash flow, high dividends, and low valuation." Post-adjustment, its top five weighted sectors are petroleum & petrochemicals, home appliances, nonferrous metals, transportation, and communications. This rebalancing introduced a new batch of "cash cows" from specific segments and increased the weightings of sectors with improving sentiment, such as nonferrous metals and automobiles.
As of December 30, 2025, the 300 Cash Flow Total Return Index has delivered a cumulative return of over 421% since 2014, with an annualized return exceeding 15%. For investors optimistic about corporate profit quality and seeking steady growth, allocating through the 300 Cash Flow ETF (562080) and its feeder funds (Class A 024367 / Class C 024368) may represent an efficient way to gain one-click exposure to high-quality "cash cows" among A-shares' core assets.
It is reminded that recent market volatility may be significant, and short-term gains or losses do not indicate future performance. Investors must make rational investment decisions based on their own capital situation and risk tolerance, paying high attention to position and risk management.
Risk Warning: This article is based on publicly available information, but does not guarantee the accuracy or completeness of such information. The content and opinions are based on analysis of historical data and do not guarantee that the included content and opinions will not change in the future. Individual stocks mentioned are for illustrative purposes only and should not be considered investment advice under any circumstances. The 300 Cash Flow ETF passively tracks the CSI 300 Free Cash Flow Index. The index's base date is December 31, 2013, and its release date is November 12, 2024. The fund is issued and managed by Hua Bao Fund. Selling agents do not bear responsibility for the product's investment, redemption, or risk management. Investors should carefully read the "Fund Contract," "Prospectus," "Fund Product Summary," and other legal fund documents to understand the fund's risk-return characteristics and choose a product suitable for their own risk tolerance. The fund manager assesses this fund's risk level as R3-Medium Risk, suitable for Balanced (C3) and above investors. Suitability matching opinions are subject to the selling institution. Selling institutions (including the fund manager's direct sales机构和 other selling机构) evaluate the fund's risk according to relevant laws and regulations. Investors should promptly pay attention to the suitability opinions issued by selling institutions and base their decisions on the matching results. Suitability opinions from different selling institutions may not necessarily be consistent, and the risk等级评价 results of fund selling institutions for the fund product shall not be lower than the risk等级评价 result made by the fund manager. There are differences between the fund's risk-return characteristics as described in the fund contract and its risk等级 due to different consideration factors. Investors should understand the fund's risk-return situation and carefully select fund products based on their own investment objectives, horizon, experience, and risk tolerance, bearing the risks themselves. The China Securities Regulatory Commission's registration of the fund does not indicate a substantive judgment or guarantee of its investment value, market prospects, or returns. The fund manager's views were updated on May 21, 2025, represent views only at that time, may change in the future, are for reference only, do not constitute any business promotion material, investment advice, or guarantee, and are not any legal document. The fund's past performance and its net asset value do not predict its future performance. The performance of other funds managed by the fund manager does not constitute a guarantee of this fund's performance. Fund investment requires caution!
