Is the coverage of the index industry broad enough? Huaxin Wealth Hang Seng Technology ETF Connect Initiated (QDII)C(013128)Component Composition Analysis

In the asset allocation of the Hong Kong stock technology sector, the Harvest Hang Seng Tech ETF Connect Initiator (QDII) C (013128), which tracks the Hang Seng Tech Index (HSTECH), is generally regarded as the flagship broad-based index in this field. Unlike indices focused on core manufacturing or single sub-sectors, this index exhibits significant cross-sector characteristics of “pan-technology” and “big consumption” in its construction logic. Based on the latest industry weight data as of the Spring Festival 2026, this article conducts a purely static analysis of the constituent composition of the index, aiming to reveal its underlying structural features as a core broad-based tool.

1. Industry Distribution: Cross-sector Driven “Consumer + Technology” Map

According to the Hang Seng Industry Classification System (HSICS), the Hang Seng Tech Index is not limited to traditional information technology categories but achieves multi-dimensional coverage of China’s new economy ecosystem. As of the Spring Festival 2026, the industry weight distribution shows a clear dual mainline pattern:

1. Non-essential Consumption (55.3%): The core carrier of digital life, this sector has become the largest component of the index. In the context of Hong Kong tech indices, it includes internet e-commerce platforms like Meituan and JD.com that deeply change residents’ consumption patterns, as well as highly technological new energy vehicle supply chains (such as Li Auto, Xpeng, NIO). This over-half weighting indicates that the index’s performance depends not only on technological cycles but also heavily on the recovery of residents’ consumption capacity and the proliferation of smart mobility industries.

2. Information Technology (40.8%): As the second largest pillar, this sector provides the foundational core of the index, accounting for about 40%. Its constituents include social media, gaming, cloud services (e.g., Tencent, NetEase), as well as semiconductor manufacturing and precision electronics (e.g., SMIC, Xiaomi). This segment contributes the technical robustness of the index, ensuring alignment with trends in AI computing power and domestic substitution.

3. Supplementary Sectors: Healthcare and Industry (total about 4.0%) The index also includes some healthcare (2.9%) and industrial (1.1%) companies. These are mainly internet healthcare platforms and precision optical manufacturing firms, filling gaps and extending coverage to segments of livelihood technology and high-end manufacturing.

Figure: The Hang Seng Tech Index Industry Distribution Shows a “Consumer + Information Technology” Dual-Driven Pattern

Note: As of the Spring Festival 2026, the weights of non-essential consumption and information technology in the tracked index of Harvest Hang Seng Tech ETF Connect Initiator (QDII) C (013128) are 55.3% and 40.8%, respectively, demonstrating a clear “consumer + tech” dual-drive feature. This pan-technology broad-based structure achieves panoramic coverage of digital consumption ecosystems and underlying technological foundations through balanced allocation. Source: Wind Data.

2. Weight Dispersion Mechanism: Risk Hedging and Flexibility Buffer

Beyond broad industry coverage, the way constituent stock weights are allocated is a key indicator of its broad-based nature. Harvest Hang Seng Tech ETF Connect Initiator (QDII) C (013128) maintains a good level of balance in its constituent distribution.

The index imposes an 8% maximum weight limit on any single constituent stock. This rule restricts the influence of any one giant on the index, preventing excessive volatility from Tencent, Alibaba, Xiaomi, and other core weights. This “cap” logic ensures the index reflects overall sector prosperity rather than becoming a shadow asset of a single stock.

The fixed number of 30 constituents (“30 stocks”) provides diversification. While the top ten stocks account for about 70% of the total weight, the remaining 20 stocks (about 30%) form an important long tail. These mid-tier companies are often focused on cutting-edge segments such as AI algorithms, vertical SaaS, and autonomous driving.

Index characteristics: From an asset allocation perspective, this 30% weight preserves upward flexibility from small- and mid-cap tech stocks during technological breakthroughs. While capturing the certainty of leading stocks, it also reduces the idiosyncratic risk associated with reliance on any single segment.

3. Summary of Index Attributes: Positioning as a Broad-Based Tool

Based on the constituent analysis as of the Spring Festival 2026, the attributes of Harvest Hang Seng Tech ETF Connect Initiator (QDII) C (013128) can be summarized as follows:

Extremely Wide Coverage: Not only includes IT hardware and software but also, with over 55% in consumer sectors, achieves horizontal coverage of China’s digital consumption ecosystem.

Structural Balance: Through an 8% weight cap and a 30-stock composition, it strikes a good statistical balance between the certainty of giants and the flexibility of mid-tier companies.

Standardized Allocation Tool: For investors seeking transparency and a one-click approach to capturing the “China version of Nasdaq,” its pure broad-based construction provides a standardized beta anchor.

Overall, the “pan-technology” nature of the Hang Seng Tech Index enables it to demonstrate greater resilience across different market cycles compared to narrow-sector indices. Understanding this rule-based industry allocation is key to assessing the overall performance of Hong Kong’s tech sector.

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