<p><strong>[Hong Kong Stocks/Dog Stocks]</strong> As 2026 begins, Hong Kong stocks take the lead on the first day, soaring 700 points to achieve a strong opening. The &#34;Dog Stocks&#34; strategy (Dogs of the Dow) once again becomes the focus of investors, who are eager to find high-yield stocks with significant rebound potential. Looking back at 2025, the dog stock strategy was a resounding success, with the best-performing stocks rising more than twice. Looking ahead to 2026, a new list of the top 10 dog stocks has been released, featuring sectors such as &#34;China Special Valuation,&#34; energy, and consumption. In an interview with Sing Tao Daily, Hong Kong Stock Analysts Association director Wen Jie pointed out that the dog stock strategy has its merits, but emphasized that stock selection should still be based on fundamental factors, and commented on three stocks worth noting.</p>
<ul>
<li>What is the dog stock theory?</li>
<li>2025 dog stock returns</li>
<li>2026 dog stocks involve five major investment themes</li>
<li>2026 dog stock list</li>
<li>Wen Jie: Fundamentals first, pay attention to two key points</li>
<li>Link REIT and China Resources Power are worth noting</li>
<li>China Mobile offers both dividends and interest</li>
<li>If purely seeking dividends, choosing ETFs is more stable</li>
</ul>
<h2>What is the dog stock theory?</h2>
<p>The dog stock theory (Dogs of the Dow) originates from a passive investment strategy in the U.S. stock market, where the traditional practice is to select the 10 stocks with the highest dividend yields from the components of the Dow Jones Industrial Average at the beginning of each year (the &#34;dog stocks&#34;). The underlying idea is that these high-yield stocks typically have increased yields due to falling stock prices, and if the fundamentals of blue-chip stocks remain unchanged, low valuations imply a greater rebound potential in the coming year. The Hong Kong stock market also adopts this theory, usually screening for the 10 stocks with the highest dividend yields from the Hang Seng Index blue-chip stocks.</p>
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<h2>2025 Dog Stock Returns Shine, Hongqiao Rises Over 2 Times</h2>
<p>Returning to the traditional strategy of the top 10 highest dividend yield blue-chip stocks, the performance of the top 10 dog stocks in 2025 was quite impressive, with the vast majority recording strong rebounds. The list includes Hang Lung Properties (101), Xinyi Glass (868), Sinopec (386), Link REIT (823), PetroChina (857), Xinyi Solar (968), Haidilao (6862), Henderson Land Development (012), China Hongqiao (1378), and Chow Tai Fook (1929). Among them, China Hongqiao's performance was the most remarkable, with an annual increase of over 203%, leading the entire dog stock portfolio; the remaining stocks also generally performed well, with only Xinyi Solar recording a decline of about 4.13% for the year.</p>
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<h2>2026 Dog Stocks Involve Five Major Investment Themes</h2>
<p>The 2026 dog stock list continues to select stocks based on the highest dividend yields, calculated based on dividends paid over the past 12 months. The final list of 10 stocks includes Orient Overseas International (316), Link REIT (823), Sinopec (386), China Resources Power (836), CNOOC (883), Henderson Land Development (12), China Shenhua (1088), Haidilao (6862), China Mobile (941), and PetroChina (857). This list mainly involves five major investment themes, including &#34;China Special Valuation,&#34; energy, consumer dining, real estate, and shipping sectors</p>
<h2>Quick Look at the 2026 Dog Stock List:</h2>
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<h2>Wen Jie: Focus on Fundamentals, Pay Attention to Two Key Points</h2>
<p>Wen Jie, a director of the Hong Kong Stock Analysts Association, believes that the &#34;dog stock theory&#34; has some merit, as it focuses on large index constituent stocks. If the stock price lags significantly, leading to a higher dividend yield, it usually reflects that the valuation has become cheap, with considerable upside potential. If investors buy a basket of &#34;dog stocks,&#34; there is a good chance of a rebound in the coming year.</p>
<p>However, he emphasizes that investments must still be based on fundamental factors. Investors need to assess whether the lagging stock price is due to market sentiment dragging it down or if the company's fundamentals have deteriorated. &#34;If the fundamental factors are solid, the rebound of such dog stocks will be more pronounced.&#34;</p>
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<h2>Link REIT and China Resources Power Worth Noting</h2>
<p>In the 2026 list, Wen Jie specifically mentions Link REIT. He points out that although Link REIT faces pressure on rental income, the valuation has already fully reflected this. As we enter a low-interest environment, funds will tend to flow into high-yield stocks, and this part of Link REIT's valuation has not yet been reflected, thus presenting investment opportunities in 2026.</p>
<p>As for China Resources Power, Wen Jie states that although the stock performed mediocre last year, coal prices remain low, which can lead to better profitability for thermal power operations; coupled with the expectation that the national &#34;14th Five-Year Plan&#34; will have sections focusing on new energy development, this is favorable for China Resources Power. In contrast, he holds a relatively cautious attitude towards oil and petrochemical stocks and may not directly recommend them.</p>
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<h2>China Mobile: Income and Growth</h2>
<p>China Mobile, included in the list, is also favored by Wen Jie. He notes that although telecom stocks have performed poorly recently, he expects China Mobile's performance to grow by about 7% in 2026, with a current dividend yield exceeding 6 cents. He assumes that even if the stock price does not rise this year, investors can still earn over 6 cents in returns, making it attractive.</p>
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<h2>For Pure Income Seekers, Choosing ETFs is Safer</h2>
<p>For some investors seeking only &#34;income,&#34; Wen Jie reminds them that the initial intention of buying dog stocks is not just for income but also hopes for a rebound in stock prices. If investors purely want to earn income, he suggests considering high-yield stock ETFs, such as Fubon CSI Hong Kong High Dividend (3190) or Huaxia Asia High Dividend Stock ETF (3145), or even the recently popular covered call ETFs. Compared to dog stocks, these ETFs carry lower risk than buying a single stock while also providing attractive dividend returns.</p>
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<p>Hong Kong stocks started strong in 2026, rising 700 points, and the "dog stock" strategy has once again become the focus of investment. Among the "dog stocks" that performed well in 2025, CHINAHONGQIAO saw an increase of over 203%. The new list of "dog stocks" for 2026 has been released, covering areas such as "China Special Valuation," energy, and consumption. Analyst Wen Jie pointed out that stock selection should prioritize fundamentals, recommending attention to Link REIT and China Resources Power, among others</p>

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CHINAHONGQIAO

The "dog stocks" in Hong Kong surged 2 times last year. The new list for 2026 is out, and experts have named 3 stocks to watch, with one guaranteed to earn 6 cents