Dividend index funds are worthy of long-term investment, and the advantages of short-term and medium-term dividend index funds may not be brought into play. Because dividend index funds have high cash dividend rate and stable long-term stock returns and dividends, tracking deviation and tracking error are usually minimized through passive investment management of complete replication, which can bring good long-term investment returns to investors and meet their diversified investment needs.

Compared with other index funds, dividend index funds have the theoretical possibility of obtaining excess returns for a long time. The main reason is that the weight factor of dividend index constituent stocks mainly depends on dividend yield. If a stock rises too much, it will inevitably lead to a decline in dividend yield, which will be excluded from the dividend index or reduced in weight. On the contrary, when a stock falls too much, the dividend yield will rise passively and be included in the dividend index. The result is passive realization of high selling and low sucking. This natural operation mode is the core advantage of dividend index fund, and the long-term upward index makes dividend index fund a very suitable tool for long-term investment. However, dividend index funds may not be able to outperform other index funds in the short and medium term, especially when the market is good, the dividend index funds fluctuate relatively little, reducing some room for growth. In addition, the industries and companies tracked by dividend index funds account for a large proportion in industries with relatively strong periodicity. If you invest in dividend index funds in the short and medium term, the possibility of buying at the top of the cycle is not ruled out.