IMPORTANT:Investment involves risks, including loss of principal. Investment value may rise or fall. Past performance information presented is not indicative of future performance. Investors should refer to Prospectus and Product Key Facts Statement for further details, including product features and risk factors. Investors should not solely base on this material alone to make investment decisions.

CSOP MSCI China A Inclusion Index ETF

  • CSOP MSCI China A Inclusion Index ETF (the “Fund”) is a physical index tracking ETF and it aims to provide investment results that, before deduction of fees and expenses, closely correspond to the performance of MSCI China A Inclusion Index (“Underlying Index”).
  • The Underlying Index captures large and mid-cap representation and includes A-Shares constituents of the MSCI China All Shares Index. All of the constituents of the Underlying Index are listed on the SSE and the SZSE.
  • China is considered as an emerging market and investing in China market may subject to greater economic, political, tax, foreign exchange, regulatory, volatility and liquidity risks than investing in more developed countries.
  • The concentration of the Fund's investments in a single geographical region (i.e. China) may subject it to greater volatility than portfolios which comprise broad-based global investments.
  • Retail investors can only buy or sell units of the Fund on the SEHK. The trading price on the SEHK is driven by market factors and may trade at a substantial premiums or discount to its net asset value.
  • The Manager may, at its discretion, pay dividends out of capital or effectively pay dividends out of the capital. Payment of dividends out of capital or effectively out of the capital amounts to a return or withdrawal of part of an investor's original investment or from any capital gains attributable to that original investment and may result in an immediate reduction of the NAV per unit.
  • Investors without RMB accounts may buy and sell HKD traded units only. They will not be able to buy or sell RMB traded units and should note that distributions are made in RMB only. As such, investors may suffer a foreign exchange loss.

The CSOP FTSE China A50 ETF

  • The CSOP FTSE China A50 ETF (“ETF”) aims to provide investment results that, before fees and expenses, closely correspond to the performance of FTSE China A50 Index, which is an index consisting the top 50 A-Share companies by market capitalization listed on the Shanghai Stock Exchange or the Shenzhen Stock Exchange. There is no assurance that the ETF will achieve its investment objective and investors may not get back part of or the entire amount they invest.
  • The ETF is one of the first RMB physical A-share exchange traded funds issued outside PRC to invest directly in the A-share market which is inherently a market with restricted access. Investing solely in China market may also subject the ETF to emerging market risk (such as greater economic, political, tax, foreign exchange, regulatory, volatility and liquidity risks) and concentration risk.
  • Investors who bought units on the HKD counter may be subject to currency exchange risk as the assets of the ETF are denominated in RMB.
  • The liquidity and trading price of the ETF RMB traded units may be adversely affected by the limited availability of RMB outside the PRC and the restrictions on the conversion between foreign currency and RMB
  • The units of the ETF are traded on the SEHK. Their prices on the SEHK are based on secondary market trading factors and may deviate significantly from the net asset value of the ETF and may trade at a substantial premium or discount to its NAV.
  • The Manager may, at its discretion, pay dividends out of capital. Payment of dividends out of capital or effectively out of the capital amounts to a return or withdrawal of part of an investor's original investment or from any capital gains attributable to that original investment. Any distributions involving payment of dividends out of the capital or effectively out of the capital of the ETF may result in an immediate reduction of the NAV per Unit.

The true ETF
for MSCI
inclusion#

CSOP
MSCI China A
Inclusion Index ETF

HKD Counter
Stock Code
3149
RMB Counter
Stock Code
83149

The investment tool that fully replicates MSCI inclusion

Key features:
  • Full replication of the MSCI inclusion steps: Tracks the MSCI China A Inclusion Index#
  • More diverse portfolio: Holds more than 230 China A shares
  • Largest Scale: The largest MSCI China A inclusion ETF in HK*
An investment tool that fully replicates MSCI inclusion
100%
# Track MSCI China A Inclusion Index
* Source: Bloomberg, as of 14 May, 2018

The most liquid
A shares ETF
in Hong Kong*

CSOP FTSE
China A50 ETF

HKD Counter
Stock Code
2822
RMB Counter
Stock Code
82822

Hong Kong's most liquid tactical trading tool for A
shares investment

Key features:
  • Investing in blue chip China A shares: Tracks the FTSE China A50 index*
  • The most liquid A shares ETF in Hong Kong: Suitable for tactical trading and capturing short term investment opportunities
  • Low valuation: Compared with the CSI300 and the MSCI A Inclusion indices, the valuation of the FTSE China A50 index is relatively lower#
An investment tool that substantially replicates MSCI inclusion
98.21%
* Source: Bloomberg, from 30 April, 2017 to 30 April, 2018.
# Source: Bloomberg & CSOP, calculatedbased on P/E & P/B, from 30 April, 2017 to 30 April, 2018.

What is MSCI China
A shares inclusion?

What are
the benefits?

Which A shares
will be included?

Source: MSCI, as of 14 May 2018

What is MSCI China A shares inclusion?

  • MSCI is one of the most popular standards that global asset managers set as an investment benchmark
  • At the end of 2017, the total global assets benchmarked to MSCI EM Index was around USD1.6 trillion.
  • Prior to June 2018, China A shares were not included in the MSCI EM Index due to China's historically closed capital market.
  • China A shares will gradually be included in the MSCI EM Index from June 2018. Global assets that track the index will therefore be allocated to the China A shares market.
Source: MSCI, as of 14 May, 2018

What are the benefits of MSCI China A shares inclusion?

  • From 2018, China A shares will progressively be included in the MSCI EM Index, initially constituting 0.78% of the MSCI EM Index, indicating around $20billion global capital inflows.
  • Ultimately, China A shares will have an 18% weight in the MSCI EM index after full inclusion, representing global capital inflows in the order of around USD 400bn.

Current MSCI
EM Index
China A shares
0%
MSCI EM Index Partial A Share Inclusion
Inclusion Factor of 5%, Expected 2018
China A shares
0.78%

MSCI EM Index with Full A Share Inclusion
China A shares
18%
  • China H Share
  • China B/Overseas
  • China A Share
  • Other EM
Source: MSCI, as of 14 May, 2018

Which A shares will be included in the MSCI China A Inclusion Index?

Top 10 holdings of MSCI China A Inclusion Index
Exchange Ticker Name Weighting Sector
60519 HD KWEICHOW MOUTAI CO LTD-A 4.58% Consumer Staples
601318 CH PING AN INSURANCE GROUP CO-A 3.81% Financials
600036 CH CHINA MERCHANTS BANK-A 3.16% Financials
002415 CH HANGZHOU HIKVISION DIGITAL-A 1.95% Information Technology
000333 CH MIDEA GROUP CO LTD-A 1.85% Consumer Discretionary
Sector Allocation of MSCI China A Inclusion Index
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