The year 2025 is just around the corner, and with it comes a significant buzz regarding the performance and relevance of the CSI A500 IndexAs we approach this new year, there seems to be a common perception that this index has lost its fervorHowever, digging into the underlying data presents a starkly different picture; the index stands robust, continuing to attract interest from both public and private investment fundsIn fact, the data reveals that the pursuit of the CSI A500 has not diminished; rather, it remains a favorite among various investment entities.

According to the China Securities Investment Fund Association, as of January 8, 2025, a total of 61 private equity products have been launched under the banner of “Enhanced CSI A500 Index.” Remarkably, 30 of these products were introduced in December alone, illustrating a sustained engagement with the index amid ongoing market fluctuations.

Reflecting on the previous year, 2024 was undeniably pivotal for the CSI A500 Index and its associated ETFs

Not only did the index surge past the mark of 100 billion yuan in scale rapidly, but it also became the leading product in equity scale throughout the yearThese milestones signify that the CSI A500 Index has carved out a substantial space in the world of index funds, effectively indicating that it was indeed the year of the CSI A500.

This leads us to ponder: does the CSI A500 Index still hold promise for 2025? The short answer is a resounding yesIt is essential to evaluate several factors to ascertain the continuing investment value of the CSI A500 IndexKey among these considerations are whether the index aligns with developmental trends and its potential for profitability.

From my analysis, it is evident that the features of the CSI A500 Index align remarkably well with these two critical factorsLooking at 2025, it emerges as a consequential year, not just marking the culmination of the 14th Five-Year Plan but also serving as a bridge to the critical initiations of the 15th Five-Year Plan

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Starting from December of last year, the National Development and Reform Commission initiated preliminary studies for this next phase, with expectations that central themes will revolve around high-quality development, industrial upgrades, and new productivity categoriesThese thematic areas resonate deeply with what the CSI A500 Index represents.

To illustrate, a look at the measure of "new productivity" shows that, as of January 10 of this year, industries categorized under new productivity, such as electricity, electrical equipment, pharmaceuticals, and computer technology, account for nearly 50% of the CSI A500 IndexThis is a commendably high proportion, and the future potential tied to these sectors looks promising and ripe for the taking.

Furthermore, the index's methodology, characterized by an "industry balance" approach, will prove vital in its representation of high-quality A-Share enterprises and their new productivity aspects

Its implementation of ESG screening and cross-connectivity further solidifies the justification for the index to be a strong representation of the current landscape of A-Share's high-quality enterprises.

Next, the profitability of the constituents of the CSI A500 Index is notably promisingThe index's ability to undergo high-quality development and industrial upgrades is contingent upon whether these constituent firms can sustain their profitabilityProfitable firms lay the groundwork for future growth and upgrades.

The forecasts indicate a net profit growth rate of 10.67% year-on-year, with a compound annual growth rate (CAGR) for net profits over two years reaching 9.77% as of January 10. These figures outpace comparable indices such as the CSI 300 and the SSE 50—reaffirming that the profitability outlook for companies within the CSI A500 index remains positive.

Despite the broader market turbulence expected in 2025, the investment logic surrounding the CSI A500 Index appears unwavering

Its attributes of inclusivity, balance, and comprehensiveness remain appealing not just to domestic investors but also to foreign institutional participants looking to position themselves strategically within the A-Shares market.

With all this in mind, one of the standout developments is that the CSI A500 ETF is set to make its first dividend payoutAmidst the background noise regarding which index ETFs to select, the consensus leans towards choosing an ETF that boasts significant scale and liquidity—specifically, the A500 Index ETF (159351) from Harvest Fund Management, which has garnered attention for its robust performance and management.

Several key aspects about this ETF demand attentionFirstly, it will mark its inaugural dividend payout, setting it apart in a landscape where few other CSI A500 ETFs have done the sameThe announcement made by Harvest Fund on January 13 describes this upcoming dividend as a significant milestone, not only representing the ETF's first payout since its launch but also the first such distribution for 2024. This positions it among an exclusive group of CSI A500 ETFs to engage in dividend distribution.

This ETF's strength extends beyond the upcoming dividend

Its market scale and liquidity are incredibly compelling, standing out among the myriad of ETFs tracking the CSI A500. As of January 10, the A500 Index ETF reached a significant asset size of 12.4 billion yuan, with over 1.33 billion units now in circulation, underscoring its substantial market relevance.

Additionally, this ETF has demonstrated impressive trading liquidityData reveals that since its launch on October 15, 2024, its average daily trading volume has reached a notable 1.287 billion yuan, with net capital inflows amounting to 11.326 billion yuan, indicating a robust trading activity throughout the duration.

Furthermore, Harvest Fund Management has established itself as a substantial player in the field of broad-based ETFs, exemplified by the CSI 300 ETF (159919), which ranks among the few ETFs in the industry with a market capitalization exceeding 150 billion yuan