ChinaAMC Select RMB Bond Fund A Dis RMB

華夏精選人民幣債券基金 A類 Dis 人民幣

HK0000098829

Risk Rating: Level 4

iFund risk rating methodology is a qualitative and quantitative assessment of a single fund’s geographic and asset class focus, investment style and any potential risk factors, as measured from one (1) (lowest risk) to six (6) (highest risk). For the funds with risk rating three (3) or four (4), these are mainly aimed at providing income and capital appreciation to investors by investing primarily in balanced portfolio, including high yield bonds and global equities etc. For more details, please refer to the Due Diligence section under the Procedures page.

Non-dealing Hours

Dealing Information

Secure Transaction

Derivatives knowledge not required

HKD15,000.00Min. Subscription

1.25%

HKD15,000.00Min. Subscription

HKD / RMB / USD

HKD15,000.00Min. Subscription

HKD15,000.00

HKD15,000.00

Daily

15:30

-

*Not include dividends (If applicable)

Fund Performances (including dividend, if any)

1 mth
0.00%
3 mth
+0.49%
6 mth
+1.19%
1 yr
+2.99%
3 yr
+5.57%
5 yr
+15.10%

Analytical Figures (3 years)

Annualized Return
+1.82%
Annualized Volatility
+1.52%
Sharpe Ratio
+0.44

Fund Information

Fund Houses
China Asset Management (Hong Kong) Limited
Launch Date
2012-02-20
Fund Manager
Xiangbin Zhang
Manager Start Date
2012-02-21
Geographical Focus
China
Asset Class/ Sector
Fixed Income - Hybrid
Risk Rating
Risk Level 4

iFund risk rating methodology is a qualitative and quantitative assessment of a single fund’s geographic and asset class focus, investment style and any potential risk factors, as measured from one (1) (lowest risk) to six (6) (highest risk). For the funds with risk rating three (3) or four (4), these are mainly aimed at providing income and capital appreciation to investors by investing primarily in balanced portfolio, including high yield bonds and global equities etc. For more details, please refer to the Due Diligence section under the Procedures page.

Fund AUM(As of 2016-06-29)
RMB 505,000,000
Management Fee
1.25%
Latest Dividend
RMB 0.030000 (2019-10-29)

Sector Leaders

    No Funds

Dealing Information

Secure Transaction

Derivatives knowledge not required

HKD15,000.00Min. Subscription

1.25%

HKD15,000.00Min. Subscription

HKD / RMB / USD

HKD15,000.00Min. Subscription

HKD15,000.00

HKD15,000.00

Daily

15:30

-

Dividend Records

Dividend DateDividend Records (RMB)
2019-10-290.030000
2019-08-280.030000
2019-07-290.030000
2019-01-290.030000
2018-11-280.030000
2018-10-290.030000
2018-09-260.030000
2018-08-290.030000
2018-07-290.030000
2018-06-270.030000
2018-05-290.030000
2018-04-250.030000
2018-03-270.030000
2018-02-260.030000
2018-01-290.030000
2017-12-270.030000
2017-11-280.030000
2017-10-290.030000
2017-08-290.030000
2017-06-280.030000
2017-05-250.030000
2017-04-260.030000
2017-03-290.030000
2017-02-260.030000
2017-01-240.030000
2016-12-280.040000
2016-11-280.030000
2016-10-270.030000
2016-09-280.040000
2016-08-290.030000
2016-07-270.030000
2016-06-280.040000
2016-05-290.030000
2016-04-270.030000
2016-03-290.040000
2016-02-250.030000
2016-01-270.030000
2015-12-290.040000
2015-11-260.030000
2015-10-280.030000
2015-09-280.040000
2015-08-270.030000
2015-07-290.030000
2015-06-280.040000
2015-05-270.030000
2015-04-280.030000
2015-03-290.040000
2015-02-250.030000
2015-01-280.060000
2014-12-020.260000
2014-06-040.200000
2013-12-030.210000
2013-06-040.190000
2012-12-040.200000
2012-06-040.020000

Investment Objective

The Sub-Fund seeks to achieve capital appreciation and income generation by principally (i.e. up to 100% of its net assets) investing in (i) RMB denominated fixed income instruments, including bonds, issued or distributed within the PRC which (a) are denominated and settled in RMB and (b) are traded on the interbank bond market or are traded or transferred on the exchange market in the PRC (“PRC RMB Debt Securities”), and (ii) fixed income funds (including money market funds ) approved by the China Securities Regulatory Commission (“CSRC”) and offered to the public in the PRC* (collectively, “PRC RMB Fixed Income Securities”).
The Sub-Fund currently does not intend to invest in RMB denominated debt instruments issued outside the PRC, the Sub-Fund will seek the prior approval of the SFC and provide at least one month’s prior written notice to Unitholders before investing in these instruments.
* Investment in fixed income funds approved by the CSRC which are offered to the public in the PRC will not exceed 10% of the net asset value of the Sub-Fund.

Nature and Extent of Risks

Investment involves risks. For further information on risk, refer to the Sub-Fund’s Explanatory Memorandum.
1. Investment risk
The Sub-Fund is an investment fund and not a bank deposit. The Sub-Fund may both gain and lose value and there is no guarantee of repayment of capital.
There can be no assurance that the Sub-Fund will make any dividend or distributions payment during the period an investor holds units in the Sub-Fund.
2. Debt instruments risk
Volatility and Liquidity risk
The RMB debt securities market is at a developing stage and the trading volume may be lower than those of more developed market. The Sub-Fund may invest in debt securities which are not listed. Even if the debt securities are listed, there may not be a liquid or active market for such securities. The RMB debt securities market may also be subject to higher volatility and lower liquidity compared to more developed markets. The prices of securities traded in such markets may be subject to fluctuations. The bid and offer spreads of the price of such securities may be large, and hence, the Sub-Fund may incur significant trading and realisation costs and losses may be suffered. In respect of the listed debt securities, the Sub-Fund may be subject to the risk of not being able to sell its bonds on the exchange on a timely basis, or will have to sell at a deep-discount to their face values. Therefore, the Sub-Fund’s value and liquidity will be adversely affected.
Credit Risk
The Sub-Fund is exposed to the credit/default risk of issuers of the PRC RMB Debt Securities that the Sub-Fund may invest in.
The PRC RMB Debt Securities that the Sub-Fund invests in are typically unsecured debt obligations and are not supported by any collateral. The Sub-Fund will be fully exposed to the credit/insolvency risk of its counterparties as an unsecured creditor.
Interest Rate Risk
Investment in the Sub-Fund is subject to interest rate risk. Generally, the prices of fixed income securities rise when interest rates fall, whilst their prices fall when interest rates rise.
Changes of macro-economic policies in the PRC, such as the monetary and fiscal policy, will have an influence over capital markets which may cause changes to market interest rates, affecting the pricing of the bonds and thus the return of the Sub-Fund.
Credit Rating Risk
Credit ratings assigned by rating agencies are subject to limitations and do not guarantee the creditworthiness of the securities and/or the issuers at all times. As the credit ratings of the debt instruments of the Sub-Fund are largely assigned by the credit agencies in the PRC, the credit appraisal system in the PRC and the rating methodologies adopted by the local rating agencies might not be consistent with or might be different from other international rating agencies. Credit ratings given by the local rating agencies recognized by the relevant authorities in the PRC may therefore not be directly comparable with those given by other international rating agencies.
For debt instruments issued by issuers that are either not rated or lower rated, greater risks will be assumed because of generally lower creditworthiness and liquidity, and greater fluctuation in value and higher chance of default than higher investment rated debt instruments.
Valuation Risk
Valuation of the Sub-Fund’s investments may involve uncertainties and judgmental determinations, and independent pricing information may not at all times be available. If such valuations turn out to be incorrect, this may affect the calculation of the net asset value of the Sub-Fund.
Downgrade Risk
The credit rating of an issuer or a debt instrument may subsequently be downgraded due to changes in the financial strength of an issuer or changes in the credit rating of a debt instrument. In the event of downgrading in the credit ratings of a debt instrument or an issuer relating to a debt, the Sub-Fund’s investment value in such security may be adversely affected. The Manager may or may not be able to dispose of the debt instruments that are being downgraded.
Risk associated with Urban Investment Bonds
The Sub-Fund may invest up to 100% of its net asset value in urban investment bonds. Urban investment bonds are issued by local government financing vehicles (“LGFVs”). Although local governments may be seen to be closely connected to urban investment bonds, such bonds are typically not guaranteed by local governments or the central government of the PRC. As such, local governments or the central government of the PRC are not obliged to support any LGFVs in default. In the event that the LGFVs default on payment of principal or interest of the urban investment bonds, the Sub-Fund could suffer substantial loss and the net asset value of the Sub-Fund could be adversely affected.
3. Risks associated with RQFII regime
The Sub-Fund’s ability to make relevant investments or to fully implement or pursue its investment objective and strategy is subject to the applicable laws, rules and regulations (including restrictions on investments and repatriation of principal and profits) in the PRC, which are subject to changes and such change may have potential retrospective effect.
In the event of any bankruptcy/default/disqualification from performing its obligations of either a PRC broker or the RQFII Local Custodian in the execution or settlement of any transaction or in the transfer of any funds or securities in the PRC, the Sub-Fund may encounter delays in recovering its assets which may in turn impact the net asset value of the Sub-Fund.
The Sub-Fund is subject to restrictions and requirements applicable to RQFII investment. The regulations which regulate investments by RQFIIs in the PRC have only been announced recently and are novel in nature. Application of these relevant rules depends on the interpretation of the PRC authorities. Any uncertainty and change to the relevant laws and regulations in the PRC may adversely impact the Sub-Fund. The Sub-Fund may suffer substantial losses if the approval of the RQFII is being revoked/terminated or otherwise invalidated as the Sub-Fund may be prohibited from trading of relevant securities and repatriation of the Sub-Fund’s monies.
Repatriation by RQFIIs in respect of a fund such as the Sub-Fund conducted in RMB is not subject to any restrictions, lock-up periods or prior approval. There is no assurance, however, that PRC rules or regulations will not change or that repatriation restrictions will not be imposed in the future. Any restrictions on repatriation of the invested capital and net profits may impact on the Sub-Fund’s ability to meet redemption requests from Unitholders.
A RQFII has the flexibility to allocate its RQFII quota across different fund products under its management. The Sub-Fund does not have exclusive use of all the investment quota of the RQFII.
There can be no assurance that sufficient RQFII quota can be allocated to the Sub-Fund to meet all application for subscriptions to the Sub-Fund, and the Sub-Fund may suffer substantial losses.
4. RMB currency risk
RMB is not freely convertible and is subject to exchange controls and restrictions. Under exceptional circumstances, payment of redemptions and/or dividend payment in RMB may be delayed due to the exchange controls and restrictions applicable to RMB.
As the Sub-Fund’s base currency is in RMB, investors may be adversely affected by the movements of the exchange rates between RMB and other currencies. There is no guarantee that RMB will not depreciate. If investors convert HKD, USD or any other currencies into RMB in investing in the Sub-Fund and subsequently convert the RMB redemption proceeds back to HKD, USD or such other currencies, they may suffer a loss in the event that RMB depreciates against HKD, USD or such other currencies.
5. Currency conversion risk
Where an investor subscribes for Units denominated in a non-RMB currency, the Manager will convert such subscriptions into RMB prior to investment at the applicable exchange rate and subject to the applicable spread. Where an investor redeems Units denominated in a non-RMB currency, the Manager will sell the Sub-Fund’s investments denominated in RMB and convert such proceeds into non-RMB currency at the applicable exchange rate and subject to the applicable spread.
Currency conversion is also subject to the Sub-Fund’s ability to convert the proceeds denominated in RMB into non-RMB currency which, in turn, might affect the Sub-Fund’s ability to meet redemption requests from the Unitholders or delay the payment of redemption proceeds.
In calculating the net asset value of Units of non-RMB class, the Manager will apply the CNH rate (i.e. the exchange rate for the offshore RMB market in Hong Kong). The CNH rate may be at a premium or discount to the exchange rate for the onshore RMB market in the PRC (i.e. the CNY exchange rate); there may be significant bid and offer spreads for the offshore RMB market in Hong Kong. Consequently, there may be significant trading costs incurred and investing in classes of Units denominated in a non-RMB currency may suffer losses.
6. Settlement risk
There are various transaction settlement methods in the interbank bond market. Although the Manager may endeavour to negotiate terms which are favourable to the Sub-Fund (e.g. requiring simultaneous delivery of security and payment), there is no assurance that settlement risks can be eliminated. Where its counterparty does not perform its obligations under a transaction, the Sub-Fund will sustain losses.
Although it is the intention of China Securities Depository and Clearing Corporation Limited to deliver payment and listed securities to delivering participant and receiving participants, respectively, a delay may occur if either party fails to fulfill its payment or delivery obligation and the Sub-Fund may
be adversely affected.
7. PRC / single country risk
The Sub-Fund’s investments are concentrated in the PRC markets . The value of the Sub-Fund may be more volatile than that of a fund having a more diverse portfolio of investments.
The value of the Sub-Fund may be more susceptible to adverse political, tax, economic, foreign exchange, liquidity, policy, legal and regulatory risk affecting the markets in which the Sub-Fund invests.
8. PRC tax risk
There are risks and uncertainties associated with changes in current PRC tax laws, regulations and practice in respect of capital gains realised by RQFII on its investment in the PRC, which may have retrospective effect and may adversely affect the Sub-Fund. After careful consideration of the Manager’s reassessment and having taken and considered independent professional tax advice regarding the Sub-Fund’s eligibility for treaty relief in the relevant double taxation arrangements between Hong Kong and the PRC and acting in accordance with such advice, the Manager considers that the Sub-Fund should be regarded as a Hong Kong tax resident and should be able to enjoy the treaty relief, i.e. a PRC withholding income tax (“WIT”) exemption on capital gains derived from PRC RMB Fixed Income Securities. As such the Manager has determined that, with effect from 18 August 2014 no WIT provision will be made on the gross realized and unrealized capital gains derived from the investment in PRC RMB Fixed Income Securities. The Manager has been making WIT provision at a rate of 10% for the account of the Sub-Fund in respect of interest income from PRC RMB Fixed Income Securities, which will be deducted from the Sub-Fund’s assets. The Manager will continue to adopt the same tax provisioning policy in respect of such interest income.
Based on professional and independent tax advice, the Manager has determined to make a WIT provision at 10% of the Sub-Fund’s gross realised capital gains derived from trading of PRC A-Shares since the Sub-Fund’s date of inception up to and including 14 November 2014. This excludes the realised gains derived from the Sub-Fund’s trading of PRC A-Shares issued by land rich companies (for which a provision had already been made previously). “Land rich companies” refers to PRC companies in which at least 50% of their assets are comprised, directly or indirectly, of immovable properties situated in the PRC.
It is possible that the applicable tax laws, regulations and practice may be changed, that the PRC tax authorities may hold a different view as to the enforcement of the PRC WIT collection on capital gains, that the assessment of “land rich companies” by the Manager may be incorrect or that the PRC tax authorities may require the Sub-Fund to provide a Hong Kong Tax Resident Certificate (“HKTRC”) (the Sub-Fund has not currently obtained a HKTRC) and the Manager may not be able to obtain a HKTRC on behalf of the Sub-Fund. In such case, the Sub-Fund may have greater tax liabilities in the PRC than provided for. Any shortfall between the provision and actual tax liabilities, which will be deducted from the Sub-Fund’s assets, will cause the Sub-Fund’s net asset value to be adversely affected. In this case, existing and subsequent investors will be disadvantaged as they will bear a disproportionately higher amount of tax liabilities as compared to the liability at the time of investment in the Sub-Fund. The actual tax liabilities may be lower than the tax provision made.
Depending on the timing of their subscriptions and/or redemptions, investors may be disadvantaged as a result of any shortfall of tax provision and will have no right to claim any part of the overprovision (as the case may be).
9. Risks associated with distributions out of capital
The Manager may at its discretion pay distributions out of the capital of the Sub-Fund or pay distributions out of gross income while charging / paying all or part of the Sub-Fund’s fees and expenses to / out of capital of the Sub-Fund.
Where distributions are paid out of gross income while charging/ paying all or part of the Sub-Fund’s fees and expenses to/ out of the capital of the Sub-Fund, this will result in an increase in distributable income for the payment of distributions by the Sub-Fund and therefore, the Sub-Fund may effectively pay distributions out of capital.
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 Sub-Fund’s capital or payment of distributions effectively out of a Sub-Fund’s capital (as the case may be) may result in an immediate reduction of the net asset value per Unit. The Manager may amend the distribution policy subject to SFC’s prior approval and by giving not less than one month’s prior notice to Unitholders.
10. Sovereign debt risk
Investment in sovereign debt obligations issued or guaranteed by governments or their agencies of certain developing countries and certain developed countries involves a higher degree of political, social and economic risks. A government entity’s willingness or ability to repay principal and interest due in a timely manner may be affected by various factors. In adverse situations, the sovereign issuers may not be able or willing to repay the principal and/or interest when due or may request the Sub-Fund to participate in restructuring such debts. The Sub-Fund may suffer significant losses when there is a default of sovereign debt issuers.

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