JPMorgan China Income Fund Acc USD

摩根中國入息基金 Acc 美元

HK0000053956

Risk Rating: Level 5

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 five (5) or six (6), these are mainly aimed at providing capital appreciation to investors by investing primarily in single market equities, single industry equities or derivatives etc. For more details, please refer to the Due Diligence section under the Procedures page.

Dealing Hours

Dealing Information

Secure Transaction

Derivatives knowledge not required

HKD10,000.00Min. Subscription

1.75%

(maximum 2.5%)

HKD10,000.00Min. Subscription

HKD / JPY / EUR / GBP / RMB / USD / NZD

HKD10,000.00Min. Subscription

HKD10,000.00

HKD16,000.00

Daily

16:30

-

  • Subscription or Switch In to the fund is subject to availability of quota.
*Not include dividends (If applicable)

Fund Performances (including dividend, if any)

1 mth
+1.06%
3 mth
+4.61%
6 mth
+2.80%
1 yr
+10.66%
3 yr
+27.35%
5 yr
+78.55%

Analytical Figures (3 years)

Annualized Return
+8.39%
Annualized Volatility
+12.40%
Sharpe Ratio
+0.52

Fund Information

Fund Houses
JPMorgan Funds (Asia) Ltd.
Launch Date
2009-06-21
Fund Manager
Lilian Bik Han Leung
Shaw-Yann Ho
Jason Pang
Manager Start Date
Lilian Bik Han Leung (Start Date: 2013-01-01) Shaw-Yann Ho (Start Date: 2018-02-26) Jason Pang (Start Date: 2018-04-04)
Geographical Focus
China A Shares
Asset Class/ Sector
Equity - All cap
Risk Rating
Risk Level 5

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 five (5) or six (6), these are mainly aimed at providing capital appreciation to investors by investing primarily in single market equities, single industry equities or derivatives etc. For more details, please refer to the Due Diligence section under the Procedures page.

Fund AUM(As of 2019-10-30)
USD 547,217,888.23
Management Fee
1.75% (maximum 2.5%)
Latest Dividend
N.A.

Sector Leaders

    No Funds

Dealing Information

Secure Transaction

Derivatives knowledge not required

HKD10,000.00Min. Subscription

1.75%

(maximum 2.5%)

HKD10,000.00Min. Subscription

HKD / JPY / EUR / GBP / RMB / USD / NZD

HKD10,000.00Min. Subscription

HKD10,000.00

HKD16,000.00

Daily

16:30

-

  • Subscription or Switch In to the fund is subject to availability of quota.

Dividend Records

No Dividends

Investment Objective

The investment objective of the Fund is to provide investors with income and long-term capital growth by investing at least 70% of its non-cash assets in (a) equity securities of companies which are based in, listed on any stock exchange of, or operate principally in the PRC and that the Investment Manager expects to pay dividends and (b) Chinese debt securities issued and/or distributed in or outside the PRC.

Nature and Extent of Risks

Investment involves risk. Please refer to the offering document(s) for details, including the risk factors.
1. Emerging markets risk
Accounting, auditing and financial reporting standards may be less rigorous than international standards. There is a possibility of nationalisation, expropriation or confiscatory taxation, foreign exchange control, political changes, government regulation, social instability or diplomatic developments which could affect adversely the economies of emerging markets or the value of the Fund’s investments.
2. Diversification risk
The Fund is highly specialised. Although the portfolio is well diversified in terms of the number of holdings, investors should be aware that the Fund is likely to be more volatile than a broad-based fund, such as a global or regional equity fund, and the Fund may be adversely impacted.
3. China market risk
Investing in the securities markets in the PRC is subject to the risks of investing in emerging markets generally and the risks specific to the PRC market. Investments in the PRC will be sensitive to any significant change in political, social or economic policy in the PRC which includes possible government intervention. Such sensitivity may, for the reasons specified above, adversely affect the capital growth and thus the performance of these investments. The PRC government’s control of currency conversion and future movements in exchange rates may adversely affect the operations and financial results of the companies that issue the relevant PRC securities invested in by the Fund. In light of the above mentioned factors, the price of PRC securities may fall significantly in certain circumstances and may have an adverse effect on the Fund’s performance. The choice of “A”, “B” and “H” share issues currently available to the Manager may be limited as compared with the choice available in other markets. There may also be a lower level of liquidity and trading volume in the PRC “A” and “B” share markets, which are relatively smaller in terms of both combined total market value and the number of “A” and “B” shares which are available for investment as compared with other markets. This could potentially lead to severe price volatility.
In addition, trading band limits may be imposed by the PRC stock exchanges on China A-Shares, where trading in a China A-Share security on the relevant PRC stock exchange may be suspended if the trading price of such security has increased or decreased to the extent beyond the trading band limit. A suspension will render it impossible for the Fund to liquidate its positions (if any) in such security. Also, it may not be possible for the Fund to liquidate positions at a favourable price even when the suspension is lifted. Such trading band limit may therefore adversely affect the Fund’s investment in China A-Shares.
4. PRC tax risk consideration
There are risks and uncertainties associated with the current PRC tax laws, regulations and practice on the Fund’s investments in the PRC. Any increased tax liabilities on the Fund may adversely affect the Fund’s value. The Manager, Investment Manager and Sub-Manager reserve the right to provide for tax on gains of the Fund that invests in PRC securities thus impacting the valuation of the Fund. Based on professional tax advice, except for gains from China A-Shares which are specifically exempt under a temporary exemption from the Enterprise Income Tax Law effective from 17 November 2014, a tax provision of 10% is fully provided for all PRC sourced income (including gains from PRC securities, dividends and interest) until sufficient clarity is given by the PRC authorities to exempt specific types of PRC sourced income (eg. gains from PRC bonds).
With the uncertainty of whether and how certain gains on PRC securities are to be taxed, the possibility of the laws, regulations and practice in the PRC changing, and the possibility of taxes being applied retrospectively, any provision for taxation made by the Manager, the Investment Manager and/or the Sub-Manager may be excessive or inadequate to meet final PRC tax liabilities on gains derived from the disposal of PRC securities. Consequently, investors may be advantaged or disadvantaged depending upon the final outcome of how such gains will be taxed, the level of provision and when they subscribed and/or redeemed their units in/from the Fund. This is unavoidable where investors can subscribe and/or redeem their units in/from the Fund and where there is uncertainty as to taxation. The net asset value per unit of a Fund is calculated daily and units of a Fund can be redeemed at the net asset value per unit. After redemption, investors cannot be impacted either positively or negatively. Consequently, a past unitholder will receive nothing from a subsequent release of a provision or increase in the market value of investments and will not be adversely impacted by an increase in a provision where there is a shortfall. In case of any shortfall between the provisions and actual tax liabilities, which will be debited from the Fund’s assets, the Fund’s asset value will be adversely affected.
5. QFII risk
The Fund itself is not a QFII, but may invest directly in QFII eligible securities via the QFII status of the Investment Manager and/or other QFII holders. The QFII status could be revoked, in particular because of material violations of rules and regulations by the QFII. If the Investment Manager loses its QFII status, the Fund may not be able to invest directly in QFII eligible securities and may be required to dispose of its holdings which would likely have a material adverse effect on the Fund. There can be no assurance that the Investment Manager will be able to allocate a sufficient portion of its QFII investment quota to meet all applications for subscription to the Fund, or that redemption requests can be processed in a timely manner due to adverse changes in relevant laws or regulations, including changes in QFII repatriation restrictions. Such restrictions may result in suspension of dealings of the Fund. The capacity of the Fund to make investments in QFII eligible securities and the ability to repatriate funds may be thus adversely affected by the investments, performance and/or repatriation of funds invested by other client accounts or mutual securities will be made through the QFII in Renminbi. The Fund will be exposed to any fluctuation in the exchange rate between US dollars and Renminbi in respect of such investments.
6. PRC exchange traded stock index futures risk
The PRC futures exchanges are in the process of development. This may lead to greater trading volatility, difficulty in settlement and uncertainty in interpreting and applying the relevant regulations. The China Financial Futures Exchange (“CFFEX”) has granted a hedging quota to the Investment Manager (as the QFII) specifically for the use by the Fund to invest directly in PRC exchange traded stock index futures contracts for hedging purpose. The hedging quota is subject to an intra day turnover limit imposed by the CSRC. There is no guarantee that the hedging quota will be used, or if used, will achieve the desired result. In addition, the hedging quota has a fixed term. There is no guarantee that the Investment Manager (as QFII) will renew its application for the Fund after expiry of the term or the CFFEX will approve any application for renewal or whether the same amount of hedging quota will be granted. Any changes in the relevant regulations may also affect the hedging quota or any renewal application.
7. PRC brokerage risk
The execution and settlement of transactions or the transfer of any funds or securities may be conducted by PRC Brokers appointed by the Investment Manager (as QFII holder). There is a risk that the Fund may suffer significant losses from the default, disqualification or bankruptcy of the PRC Brokers, including losses of any futures margin held by PRC futures brokers in the event of their bankruptcy. In these events, the Fund maybe adversely affected in the execution or settlement of any transaction or in the transfer of any funds or securities. In selection of PRC Brokers, the Investment Manager (as QFII holder) will have regard to factors such as the competitiveness of commission rates, size of the relevant orders and execution standards. The Investment Manager will exercise reasonable care and diligence in the selection, appointment and ongoing monitoring of the PRC Brokers and ensure it is satisfied that the PRC Brokers remain suitably qualified and competent to provide the relevant service. If the Investment Manager considers appropriate, it is possible that a single PRC Broker will be appointed and the Fund may not necessarily pay the lowest commission available in the market.
8. RMB currency risk
RMB is currently not a freely convertible currency as it is subject to foreign exchange control policies of and repatriation restrictions imposed by the Chinese government. If such policies change in future, the Fund’s or the investors’ position may be adversely affected. There is no assurance that RMB will not be subject to devaluation, in which case the value of the investments will be adversely affected. Some investments acquired by the Fund will be denominated in RMB whereas the Fund is denominated in USD. Investors are exposed to the movements of the exchange rate between USD and RMB. Investors may suffer losses depending on the exchange rate movements of RMB relative to USD. Although offshore RMB (CNH) and onshore RMB (CNY) are the same currency, they trade at different rates. Any divergence between CNH and CNY may adversely impact investors. 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.
9. Risks associated with China Connect
The Fund will be able to trade certain eligible stocks listed on Shanghai Stock Exchange (“SSE”) and/or Shenzhen Stock Exchange (“SZSE”) through China Connect and thus is subject to the following risks:
The relevant rules and regulations on China Connect are subject to change which may have potential retrospective effect. There is no certainty as to how they will be applied.
The program is subject to daily quota limitations which may restrict the Fund’s ability to invest in China A-Shares through the program on a timely basis.
Where a suspension in the trading through the program is effected, the Fund’s ability to access the PRC market will be adversely affected. In such event, the Fund’s ability to achieve its investment objective could be negatively affected.
The program requires the development of new information technology systems on the part of the stock exchanges and exchange participants and may be subject to operational risk. If the relevant systems failed to function properly, trading in both Hong Kong and Shanghai/Shenzhen markets through the program could be disrupted. The Fund’s ability to access the China A-Share market (and hence to pursue its investment strategy) will be adversely affected.
PRC regulations impose certain restrictions on selling and hence the Fund may not be able to dispose of holdings of China A-Shares in a timely manner.
A stock may be recalled from the scope of eligible stocks for trading via China Connect. This may affect the investment portfolio or strategies of the Fund.
Trading in securities through the program may be subject to clearing and settlement risk. If the PRC clearing house defaults on its obligation to deliver securities/make payment, the Fund may suffer delays in recovering its losses or may not be able to fully recover its losses.
The Fund may not be able to participate in some corporate actions in respect of the SSE/SZSE securities in a timely manner. Also, the Fund may not be able to appoint proxies to attend or participate in shareholders’ meetings in respect of the SSE/SZSE securities.
Further, the Fund’s investments through the program are not covered by the Hong Kong’s Investor Compensation Fund.
10. Risks associated with the investments in stocks listed on the Small and Medium Enterprise Board (“SME Board”) and/or the ChiNext Board of the SZSE – The Fund may invest in the SME Board and/or the ChiNext Board of the SZSE via the Shenzhen-Hong Kong Stock Connect and thus may result in significant losses for the Fund and its investors. Such investments are subject to the following risks:
Listed companies on the SME Board and/or ChiNext Board are usually of emerging nature with smaller operating scale, subject to higher fluctuation in stock prices and liquidity and have higher risks and turnover ratios than companies listed on the main board of the SZSE.
Stocks listed on the SME Board and/or ChiNext Board may be overvalued and such exceptionally high valuation may not be sustainable. Stock price may be more susceptible to manipulation due to fewer circulating shares.
The rules and regulations regarding companies listed on ChiNext Board are less stringent in terms of profitability and share capital than those on the main board and SME Board.
It may be more common and faster for companies listed on the SME Board and/or ChiNext Board to delist. This may have an adverse impact on the Fund if the companies that it invests in are delisted.
11. Risks associated with CIBM
Investing in the CIBM via the CIBM Initiative and/or Bond Connect is subject to regulatory risks and various risks such as volatility risk, liquidity risk, settlement and counterparty risk as well as other risk factors typically applicable to debt securities. The relevant rules and regulations on investment in the CIBM via the CIBM Initiative and/or Bond Connect are subject to change which may have potential retrospective effect. In the event that the relevant PRC authorities suspend account opening or trading on the CIBM, the Fund’s ability to invest in the CIBM will be adversely affected. In such event, the Fund’s ability to achieve its investment objective will be negatively affected. There are also risks and uncertainties associated with the current PRC tax laws, regulations and practice on the Fund’s investments in the PRC
12. Risks related to debt securities
The Fund may invest in, but are not limited to debt securities. There is no assurance that losses will not occur with respect to investment in debt securities. Factors that may affect the value of the Fund’s debt securities holdings include: (i) changes in interest rates; (ii) the credit worthiness of the issuers; and (iii) the liquidity of the debt securities held by the Fund. The prices of bonds generally increase when interest rates decline and decrease when interest rates rise. Longer term bonds are usually more sensitive to interest rate changes. Decline in credit quality of the issuer may adversely affect the valuation of the relevant bonds and the Fund. The liquidity of the debt securities may fluctuate significantly depending on market sentiment. The debt securities may not be readily sold at the desired time or price, and the Fund may have to accept a lower price to sell the debt securities or may not be able to sell the debt securities at all.
13. Liquidity risk
The Fund may invest in instruments where the volume of transactions may fluctuate significantly depending on market sentiment. There is a risk that investments made by the Fund may become less liquid in response to market developments or adverse investor perceptions. An inability to sell a portfolio position can adversely affect the Fund’s value or prevent the Fund from being able to take advantage of other investment opportunities.
14. Equity risk
Equity markets may fluctuate significantly with prices rising and falling sharply, and this will have a direct impact on the Fund’s net asset value. When equity markets are extremely volatile, the Fund’s net asset value may fluctuate substantially and the Fund could suffer substantial loss.
15. Valuation risk
Valuation of the Fund’s investments may involve uncertainties and judgmental determinations. If such valuation turns out to be incorrect, this may affect the net asset value calculation of the Fund.
16. Credit risk
If the issuer of any of the securities in which the Fund’s assets are invested defaults, the performance of the Fund will be adversely affected and the Fund could suffer substantial loss. For fixed income securities, a default on interest or principal may adversely impact the performance of the Fund. Decline in credit quality of the issuer may adversely affect the valuation of the relevant bonds and the Fund. The credit ratings assigned by credit rating agencies do not guarantee the creditworthiness of the issuer.
17. Risk relating to dynamic asset allocation strategy
The investments of the Fund may be periodically rebalanced and therefore the Fund may incur greater transaction costs than a fund with static allocation strategy.
18. Investment grade bond risk
Investment grade bonds are assigned ratings within the top rating categories by rating agencies (including but not limited to Fitch, Moody’s and/or Standard & Poor’s) on the basis of the creditworthiness or risk of default of a bond issue. Rating agencies review such assigned ratings and bonds may therefore be downgraded in rating if economic circumstances (e.g. subject to market or other conditions) impact the relevant bond issues. Downgrading of the bonds may adversely affect the value of the relevant bonds and therefore the performance of the Fund. The Fund may or may not be able to dispose of the bonds that are downgraded. Also, the Fund may face higher risks of default in interest payment and principal repayment. As a result, investors may get back less than they originally invested.
19. Below investment grade/unrated investment risk
The Fund may invest in bonds and other debt securities which are unrated or with ratings below investment grade. Accordingly, such investment will be accompanied by a higher degree of credit and liquidity risks than is present with investment in higher rated securities. During economic downturns such bonds typically fall more in value than investment grade bonds as such are often subject to a higher risk of issuer default. The NAV of the Fund may decline or be negatively affected if there is a default of any of the high yield bond that the Fund invests in or if interest rates change.
20. “Dim Sum” bond (i.e. bonds issued outside of the PRC but denominated in RMB) market risks – The “Dim Sum” bond market is still a relatively small market which is more susceptible to volatility and illiquidity. The operation of the “Dim Sum” bond market as well as new issuances could be disrupted causing a fall in the net asset value of the Fund should there be any promulgation of new rules which limit or restrict the ability of issuers to raise RMB by way of bond issuances and/or reversal or suspension of the liberalisation of the offshore RMB (CNH) market by the relevant regulator(s).
21. Class currency risk
The Class Currency of each Class may be different from the Fund’s base currency, the currencies of which the Fund’s assets are invested and/or investors’ base currencies of investment. If an investor converts its base currency of investment to the Class Currency in order to invest in a particular Class and subsequently converts the redemption proceeds from that Class Currency back to its original base currency of investment, the investor may suffer a loss due to the depreciation of the Class Currency against the original currency. For example, if an investor whose base currency of investment is Hong Kong dollars (i.e. not RMB) and chooses to invest in the RMB Class, the investor may be exposed to a higher currency risk. The investor may suffer a higher loss as a result of exchange rate fluctuations between Hong Kong dollars and RMB upon the reconversion of its RMB investment back to Hong Kong dollars as compared to an investor whose base currency of investment is originally in RMB.
22. Currency Hedged Classes risk
Each Currency Hedged Class may hedge the Fund’s denominated currency back to its currency of denomination, with an aim to provide a return on investment which correlates with the return of the Class of unit which is denominated in the base currency of the Fund. The costs and resultant profit or loss on the hedging transactions will be reflected in the net asset value per unit for the units of the relevant Currency Hedged Classes. The costs relating to such hedging transactions which may be significant depending on prevailing market conditions shall be borne by that Currency Hedged Class only.
The precise hedging strategy applied to a particular Currency Hedged Class may vary. In addition, there is no guarantee that the desired hedging instruments will be available or hedging strategy will achieve its desired result. In such circumstances, investors of the Currency Hedged Class may still be subject to the currency exchange risk on an unhedged basis (which means that, for example, if the hedging strategy in respect of the RMB Hedged Class is ineffective, depending on the exchange rate movements of RMB relative to the base currency of the Fund, and/or other currency(ies) of the non-RMB denominated underlying investment of the Fund, (i) investors may still suffer losses even if there are gains or no losses in the value of the non-RMB denominated underlying investments; or (ii) investors may suffer additional losses if the non-RMB denominated underlying investments of the Fund fall in value). If the counterparties of the instruments used for hedging purposes default, investors of the Currency Hedged Classes may be exposed to the currency exchange risk on an unhedged basis and may therefore suffer further losses. While the hedging strategy may protect investors of the Currency Hedged Classes against a decrease in the value of the Fund’s base currency relative to the denominated currency of that Currency Hedged Class, the hedging strategy may substantially limit the benefits of any potential increase in the value of a Currency Hedged Class expressed in the Class currency, if the Currency Hedged Class’ denominating currency falls against the base currency of the Fund.
23. Payment of distributions out of capital risk
Where the income generated by the Fund is insufficient to pay a distribution as the Fund declares, the Manager may in its discretion determine such distributions may be paid from capital including realized and unrealized capital gains. Investors should note that the payment of distributions out of capital represents a return or withdrawal of part of the amount they originally invested or from any capital gains attributable to that original investment. As a result, the capital that the Fund has available for investment in the future and capital growth may be reduced. Any payments of distributions by the Fund may result in an immediate decrease in the net asset value per unit. Also, a high distribution yield does not imply a positive or high return on the total investment. The distribution amount and net asset value per unit of a Currency Hedged Class may be adversely affected by differences in the interest rates of the reference currency of the relevant Currency Hedged Class and the Fund’s base currency, resulting in an increase in the amount of distribution that is paid out of capital and hence a greater erosion of capital than other Classes of units.

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