Futu Research | ETF Investment Research

Views 14202024.05.30

What are the high yield ETFs on the Hong Kong stock market? Learn more in one article!

Accompanying the market forReduction of Dividend Tax on Hong Kong SharesIt is expected that the attraction of the Hong Kong stock market to Mainland investors is continuing to grow. We have previously introduced many high-dividend products, so adjusting the tax rate or directly impacting the actual rate of return of high-dividend products will further encode their investment attractiveness. And if you want to match a seriesHIGH DIVIDENDInvesting in assets and holding high-dividend products spread around the world, ETFs remain a simple and convenient option for diversifying risk.

Below, we will introduce you to several high-dividend ETF products on the Hong Kong stock market, some of which not only have high dividend returns, but which have increased in price since the beginning of the year so far, the so-called “income and income”:

$Ping An of China CSI HK Dividend ETF(03070.HK)$

The ETF component is dominated by financial bank stocks listed in Hong Kong. Currently, the 5 largest holdings of the ETF weigh 5% and move in the middle $CHINA MOBILE(00941.HK)$、Oil of the Mediterranean $CNOOC(00883.HK)$, Bank of China $BANK OF CHINA(03988.HK)$、Construction $CCB(00939.HK)$& Workshops $ICBC(01398.HK)$。 THESE COMPANIES HAVE HIGH DIVIDENDS, STABLE DIVIDENDS AND SOME LIQUIDITY. The management fee is 0.55% per annum, the asset size is HK$9.87 billion, the dividend is paid once every six months, the dividend is 5.76%, and the share price has increased by 20.25% since 2024.

$Global X Hang Seng High Dividend Yield ETF(03110.HK)$

The ETF has been listed for ten years, with an asset size of HK$20.88 billion and a management fee of 0.68%, making it the largest high-dividend ETF in Hong Kong. Its main feature is to “invest at low volatility and pursue dividend returns”, tracking the performance of the Hang Seng High Yield Index. Its stock option concept is to exclude the most volatile 25% stocks, reduce volatility and make dividend returns more stable, such as China's Shenhua $CHINA SHENHUA(01088.HK)$, moving in $CHINA MOBILE(00941.HK)$、Communication $CHINA UNICOM(00762.HK)$etc. The ETF is distributed once every six months with a dividend yield of 7.58%, up 11% in early 2024 to date.

$Fubon Hang Seng Shanghai-Shenzhen-Hong Kong(03190.HK)$

It is the first high-yield equity ETF in Hong Kong to cover three HKEx territories, so its selected companies are not limited to Hong Kong listings, but also to those listed on the HQF, such as Gili Appliances in 10 major holding positions. $Gree Electric Appliances,Inc.of Zhuhai(000651.SZ)$and Shaanxi Coal $Shaanxi Coal Industry(601225.SH)$。 Currently, the largest share is China Sea Oil, with a holding ratio of 6.01%.

So far, the ETF has an asset size of HK$9721 million, a management fee of 0.6%, a quarterly dividend yield of 7.62%. The share price is up 13.65% from 2024 to date. It has not only high interest rates, but also the potential to outperform the market.

$TRACKER FUND OF HONG KONG(02800.HK)$

It is the first ETF to be listed in Hong Kong, with assets of HK$13.76 billion. It tracks several blue chip stocks on the Hong Kong market. Investors can follow the performance of the Hang Seng Index in one trade. Although it is not a specialized high-dividend product, the ETF has a yield of 3.75%, which is also at a higher level. And liquidity is the most abundant of all ETFs in Hong Kong, so investors don't have to worry about spreads.

In addition, the main tax charges involved when investing in a Hong Kong High Dividend ETF include:

1. Trading commissions: Trading commissions are usually charged at a certain proportion of the amount traded. For a Hong Kong stock ETF, the default transaction rate is around three thousandths of a cent, but the specific rates may vary depending on the securities and there is a minimum fee for a single transaction, such as HK$5.

2. Transaction Fees and Settlement Fees: In addition, there are transaction fees (such as transaction fees and SEC fees) and transaction settlement fees, which typically add up to about 0.002%-0.005% of the transaction amount.

3. Dividend tax: For dividends received, non-Hong Kong resident investors may be required to pay tax in accordance with the tax laws of their country or territory. Mainland investors in the past paid a 20% dividend tax when buying Hong Kong shares through Hong Kong stocks, but according to Bloomberg, China Securities and Exchange Commission is considering exempting the tax to make it fairer for Hong Kong investors.

4. Other Possible Fees: This also includes possible management fees, custodial fees, etc., which are usually deducted from the ETF's net asset value and indirectly affect investor returns.

In summary, before investing in a Hong Kong High Yield ETF, you should learn more about the specific fee standards of each securities dealer and consider the potential tax implications. At the same time, it should be noted that investing in high-dividend ETFs still requires careful consideration of risks such as market volatility, component quality and liquidity. After a comprehensive analysis, decisions are made based on personal risk tolerance and investment strategy.

How to Buy Stocks
Before investing (buying and selling) stocks, you first need to open a securities (stocks) account. Just like depositing money in a bank, you need to open a bank account first.

>> Futu Securities Hong Kong Stock Exchange is free for one day! GET FREE LV1 EXPERIENCE, OPEN IT NOW AND ENJOY IT WITH YOUR WALLETMosquitoesWelcome Rewards

Securities (Stock) Account Opening Process

Step 1: Head over to the Futubull network and sign up for a new account.(Register now)

Step 2: Open a securities account on the basis of the Futu account.(Open account now)

Step 3: Fill in your personal and financial details (includingBank Code and Account Number), and then deposit funds via EdDA Quick Deposit, Fast Transfer (FPS), Bank Transfer.(Invest immediately)

Step 4: Download the Futubull Customer Portal and log in.(Download now)

One-stop trading with Futubull

Enjoy welcome rewards and lifetime 0 commission on HK stocks

Terms and conditions apply right-arrow

| GENERAL DISCLAIMER |

This report (the “Report”) is prepared by Futu Securities International (Hong Kong) Limited (“Futu Securities”). The person who retained this Report either via receiving and/or reading  (including any relevant attachment), shall agree to be bound by the terms and limitations set out below as has the right to retained this Report. Any failure to comply with these limitations may constitute a violation of the law.

This Report shall not be reproduced in whole or in part, distributed or published by you for any purpose. Futu Securities shall not be liable for any direct or consequential loss arising from any use of material contained in this Report.

The information contained in this Report has been obtained from public sources which Futu Securities has no reason to believe are unreliable and any analysis, forecasts, projections, expectations and opinions (collectively the “Research”) contained in this Report are based on such information and are expressions of belief only.

Futu Securities has not verified this information and no representation or warranty, express or implied, is made that such information or Research is accurate, complete or verified or should be relied upon as such. Any such information or Research contained in this Report is subject to change, and Futu Securities and/or its affiliated companies (collectively the “Futu Group”) shall not have any responsibility to maintain the information or Research made available or to supply any corrections, updates or releases in connection therewith. In no event will Futu Securities be liable for any special, indirect, incidental or consequential damages which may be incurred from the use of the information or Research made available, even if it has been advised of the possibility of such damages.

Any opinions, forecasts, assumptions, estimates, valuations and prices contained in this Report are as of the date indicated and are subject to change at any time without prior notice.

This Report is intended for general circulation only and does not take into account the specific investment objectives, financial situation or particular needs of any particular person. This Report should not and does not constitute an offer, solicitation, invitation, recommendation for buying or selling of investment products or as basis on making any investment decision, or constitute as professional advice from any member of Futu Group. The products mentioned in this Report may not be suitable for all investors and a person receiving or reading this Report should seek advice from a financial adviser regarding the suitability of such products, taking into account the specific investment objectives, financial situation or particular needs of that person, before making a commitment to invest in any of such products.

This Report should not be relied upon as authoritative without further being subject to the recipient’s own independent verification and exercise of judgment. The fact that this Report has been made available constitutes neither a recommendation to enter into a particular transaction nor a representation that any product described in this Report is suitable or appropriate for the recipient. Recipients should be aware that many of the products which may be described in this Report involve significant risks and may not be suitable for all investors, and that any decision to enter into transactions involving such products should not be made unless all such risks are understood and an independent determination has been made that such transactions would be appropriate. Any discussion of the risks contained herein with respect to any product should not be considered to be a disclosure of all risks or a complete discussion of such risks.

This report is provided by Futu Securities, which is regulated by the Securities and Futures Commission of Hong Kong (SFC) in Hong Kong. If you have any questions about the Futu Securities Research Report, please contact Futu Securities. The CE number of SFC held by the author has been disclosed next to the author's name on the front page of the Report.

Nothing in this Report shall be construed to be an offer or solicitation for the purchase or sale of a security. Any decision to purchase securities mentioned in this research should take into account existing public information, including any registered prospectus in respect of such security.

| Certification |

Analyst(s) certified that (i) the views expressed in this Report accurately reflect his/her personal views on the listed corporation in this Report; and (ii) no part of his/her compensation was, is or will be, directly or indirectly, related to the specific recommendations or views expressed in this Report.

Analyst(s) certified that he/she and/or his/her associate did not deal in or trade the listed corporation or its relevant securities within the 30 days prior to and 3 business days after the issue of this Report.

| Disclosure of Interest |

Analyst Disclosure: Neither the analyst(s) preparing this Report nor his/her associate has any financial interest in or serves as an officer of the listed corporation covered in this Report.

Firm’s Disclosure: Futu Securities does not have any investment banking relationship with the listed corporation covered in this Report in the past 12 months nor any financial interest of 1% or more of the market capitalization in the listed corporation. In addition, no executive staff of Futu Securities serves as an officer of the listed corporation.

| Availability |

The information, tools and material presented herein are not directed, intended for distribution to or use by, any person or entity in any jurisdiction or country where such distribution, publication, availability or use would be contrary to the applicable law or regulation or which would subject Futu Securities to any registration or licensing or other requirement, or penalty for contravention of such requirements within such jurisdiction.

Information contained herein is based on sources that Futu Securities believed to be accurate. Futu Group and/or relevant personnel (i.e., employees of Futu Group) may have positions and transactions in relevant investment products. Futu Group and/or relevant personnel does not bear responsibility for any loss suffered by the investor from the use of or reliance on the information set out in this report.

For details of different product's risks, please visit the Risk Disclosures Statement on http://www.futuhk.com.

This Report is written in Chinese and English, and the two versions are equally valid. If there is any contradiction between the two versions, the English version shall prevail.

Recommended