When investing in index funds , we usually give priority to broad-based indices, such as the CSI 300 Index and the Shanghai Composite Index. The constituent stocks of the broad index are distributed across various sectors, with less risk and volatility, and are more novice-friendly.
However, since the beginning of this year, the structural market of the A-share market has continued to be interpreted, and the phenomenon of sector rotation has been running through. When broad-based indices lack opportunities, narrow-based index funds that focus on specific industries or themes can complement our investments.
There are various narrow-based indices in the market. There are a total of n types of CSI 500 industry index, CSI 800 industry index, CSI full index industry index and CSI theme index. We’ve sorted out common indices that funds are keen to track popular industries, so let’s take a look!
consumption index
According to the primary industry classification of CSI, the consumption index is divided into main consumption and optional consumption.
Main consumption refers to daily necessities, such as food and beverages, personal care daily chemicals, etc. The relevant indexes mainly include CSI consumption, CS consumption 50 and consumption 80.
Consumer discretionary includes automobiles, apparel, consumer durables, media, and more. Currently, there is only one relevant index for the entire market. Based on data from the past five years, the three major consumer indices have grown much faster than the entire index. The reason is that selective consumption exhibits greater elasticity of demand and stronger cyclicality than primary consumption, and is more susceptible to economic conditions. As the saying goes, hunger breeds dissatisfaction among the top ten heavyweights of the major consumer index. It can be seen that the low-level industries of food and beverage constitute the core of the consumer body, and the main force driving the rise of food and beverage is liquor. In the consumption breakdown, it also includes three food and beverage indices and two wine indices.
Pharmaceutical and Pharmaceutical Industry Index
Like consumption, medicine is a weak cycle sector through bulls and bears. According to the industry classification method of China Securities Index, the complex pharmaceutical industry can be roughly divided into two sub-sectors: pharmaceutical biology and medical devices and services.
There is overlap between the two, but Pharma Bio focuses on drug R&D and production, while the industrial chain of medical devices and services involves manufacturing companies such as electronic instruments and testing equipment.
medical biology
At present, the mainstream indicators of medical biology include traditional Chinese medicine, traditional Chinese medicine, Chinese medicine, 300 medicines, and 100 medicines. The basic situation and tracking funds are as follows:
From the data of the past three years, the growth of these indicators shows great differences. Due to the particularity of the pharmaceutical industry, leading companies often have strong innovation capabilities and channel platform capabilities, and have better sustainable growth capabilities.
The top ten of CSI Bio and CSI Biomedicine account for more than 70%, although the preparation scheme of the Pharma 100 Index stipulates that the weight of 100 samples is roughly equal, which reduces the concentration and makes the medical equipment and services on the market perform slightly worse , the three indicators of the medical industry are more common: China Securities Medical, China Securities refer to medical devices, and China Securities refer to healthcare. The positional composition of the three indicators is similar:
From the long-term data, the trend is also consistent
New Energy Index
At present, new energy-related indicators mainly include CS new energy vehicles, CSI new energy vehicles and new energy vehicles in the CSI index series.
Among them, CSIC’s new energy selection involves renewable energy production, new energy application, and new energy storage and new energy interactive equipment in Shanghai and Shenzhen as indicator samples, reflecting the overall performance of securities of listed companies related to the new energy industry.
CS New Energy Vehicle Index and New Energy Vehicle Index focus on new energy vehicles, including lithium batteries, charging piles, new energy vehicles and other businesses. Compared with CSSC New Energy, downstream companies such as BYD were also selected to enter the sample.
The relevant information and tracking funds are as follows:
Military Index
At present, the military indices tracked by the Military Index Fund in the market mainly include the CSI Military Industry Index, the Military Industry Index, the Aerospace Military Industry Index and the CSI National Defense Index:
Among them, the CSIC Military Industry and CSIC Military Industry Theme Index (hereinafter referred to as the “Military Industry Index”) select securities of listed companies controlled by the top ten military industry groups and whose main business is related to the military industry from the Shanghai and Shenzhen markets, as well as military industry-related securities. The securities of other representative listed companies whose main business is the index sample.
In addition to the securities of the top ten listed companies affiliated to the military industry groups in Shanghai and Shenzhen markets, the CSI National Defense Index also selects securities of related listed companies that provide weapons and equipment for the national army or have actual equipment manufacturing and sales amount with the army, or sign contracts as Index sample.
The aerospace military industry index selects listed companies whose main business is highly related to the aerospace integration strategy from the Shanghai and Shenzhen markets, or securities of leading listed companies in related sectors as index samples.
In terms of the number of samples, the CSI military index has the largest number of samples and relatively small fluctuations; China’s securities defense and aerospace defense industry has fewer samples and weaker anti-risk capabilities, but has a greater advantage in long-term performance. Investors need to consider their own risk appetite to make choices. The above are the main industry indicators of A shares and related funds. We can distribute these resources evenly across industries.