Investment involves risks, including the loss of principal. The price of units or shares of the Funds may go up as well as down. Past performance is not indicative of future results. The value of the Funds can be extremely volatile and could go down substantially within a short period of time. You should read the Fund’s Placing Memorandum or Explanatory Memorandum and Product Key Facts Statement for details, including risk factors. Investors should not base investment decisions on this marketing material alone. Please note:
• ChinaAMC Return Securities Investment Fund (“Fund”) is a fund authorized for public offering in Hong Kong pursuant to Mainland-Hong Kong Mutual Recognition of Funds (“MRF”) arrangement.
• The Fund is a mixed fund primarily investing (i.e. at least 80% of net asset value) in both equity and debt securities. The equity investment of the Fund shall focus on value stocks, while the debt investment of the Fund shall focus on treasury bonds, financial bonds and enterprise (corporate) bonds (including convertible bonds) with credit rating of BBB or above being rated by any of the Mainland Chinese credit rating agencies (or guaranteed by the institution with high credit rating or collateralized by high quality assets). The Fund may invest in urban investment bonds and asset-backed securities.
• The Fund is subject to requirements applicable to MRF arrangement, including quota restrictions and eligibility requirements and risks associated with MRF, including Mainland China tax risk and different market practices.
• The Fund invests primarily in securities related to the Mainland China market and may be subject to additional concentration risk. Investing in the Mainland China market may give rise to different risks including political, policy, tax, economic, foreign exchange, legal, regulatory and liquidity risks.
• The Fund is denominated and settled in RMB, subscription and redemption must be made in RMB. RMB is currently not freely convertible and is subject to exchange controls and restrictions. Non-RMB based investors are exposed to foreign exchange risk.
• Investment in Mainland China debt securities involves volatility and liquidity risks, counterparty risk, interest rate risk, downgrading risk, credit rating agency risk, and risk associated with urban investment bonds and asset-backed securities.
• The Fund invests in the securities markets in Mainland China that will be subject to market risk, volatility risk, policy risk, risk associated with small-capitalisation / mid-capitalisation companies, high valuation risk and liquidity risk.
• The Fund manager may enter into repurchase/reverse repurchase transactions for the account of the Fund. For the reverse repurchase transaction, the collateral pledged in the interbank market may not be marked to market and the Fund may suffer substantial loss as there may be delays and difficulties in recovering the cash placed out or realizing the collateral or proceeds from the sale of the collateral may be less than the cash placed with the counterparty due to inadequate valuation of the collateral and market movements upon default of the counterparty.
• The Fund may at its discretion pay dividend out of the capital of the Fund. Unitholders should note that the distributions paid out of capital or effectively out of capital amount to a return or withdrawal of part of a unitholder’s original investment or from any capital gains attributable to that original investment. Any distributions involving payment of distributions out of the Fund’s capital or (as the case may be) payment of distributions effectively out of the Fund’s capital may result in an immediate reduction of the net asset value per unit.