Among the first batch of cross-listing ETFs between HKEX and SZSE
HONG KONG–(BUSINESS WIRE)–CSOP Asset Management Limited (“CSOP”) announce the listing of CSOP Yinhua CSI 5G Communications Theme ETF (stock ticker: 3193.HK) on Hong Kong Stock Exchange. As one of the first batch of ETFs under the HKEX and SZSE ETF cross-listing scheme, 3193.HK will track the performance of the CSI 5G Communication Index, before deduction of fees and expenses, by investing in the CSI 5G Communication ETF listed on SZSE via the RQFII quota. With listing price at around HKD 8.1 per unit, trading lot of 100 and management fee of 0.99%, CSOP Yinhua CSI 5G Communications Theme ETF will start to trade on October 23, 2020.1 Upon inception, 3193.HK has received around USD 5 million initial investment. On the same day, the feeder ETF investing in CSOP’s HKEX listed ETF – ICBC CSOP S&P China New Sectors ETF (3167.HK) will also list on Shen Zhen Stock Exchange. The feeder ETF has already brought CNY 900 million inflows to 3167.HK, doubling its size of the master fund. 2
5G is the 5th generation mobile network upgraded from the current 4G network we are using. Because of its higher data speeds, ultra-low latency, more reliability and massive capacity, 5G makes the mobile network more powerful and the connection of everyone and everything together including machines, objects and devices possible. Thanks to 5G, numerous conceptual experiences and services such as virtual reality, augmented reality, Internet of Things, auto driving, remote healthcare, and more will become real. Moreover, the economic benefits brought by 5G are also gigantic. By 2035, the 5G’s full economy effect is expected be fully realized, supporting a wide range of industries from retail to education, transportation to health care and potentially enabling up to USD 13.2trillion worth of goods and services. 3
Given the importance of 5G, the world’s major economies are investing a lot of resources to win out the 5G competition. In view of the exclusion of Chinese enterprises in construction of 5G in several countries, China seems to have already led the race in this 5G competition. Focusing on the deployment of 5G network domestically, China’s 5G themed companies are expected to welcome a robust growth as a key part of the China “New Infrastructure Plan” in the coming decade.
CSI 5G Communication Index is composed of A-share stocks which related to 5G communication technology, including but not limited to telecommunications service, communication device, computer and electronic equipment, computer application and other sub-industries. Since inception on 31 December 2015, it significantly outpaced Chinext by 10.44%.4 In consideration of its early stage, the market expect 5G sector to witness an expansionary period in future ten years.
Ms. Ding Chen, CEO of CSOP comments “CSOP feels deeply honoured to work with Yinhua Fund Management as the first batch of asset management companies to participate in the HKEX and SZSE ETF cross-listing scheme, and we are very glad to introduce this Chinese 5G themed ETF to Hong Kong and global investors. In China, the aggregate AUM of 5G themed ETFs is CNY 25,130 million reflecting the market confidence on the development of the 5G themed sector. As part of the HKEX and SZSE ETF cross-listing scheme, our ICBC CSOP S&P China New Sectors ETF also recorded CNY 900 million inflows from its feeder fund listed on SZSE, doubling the size of the master fund, marking a very successful fund raising in domestic China. 5”
Ms Melody He, Managing Director and Head of Sales and Product Strategy, adds “In this year, the launch of 3033.HK, together with the cross-listing of 3193.HK and 3167.HK have broadened the thematic product lines of CSOP. With more thematic ETFs to be introduced to global market, CSOP will help investors to capture the China’s growth from all angles. ”
For details, including risk factors and the index provider disclaimer, please refer to the offering documents.
About CSOP Asset Management Limited
CSOP Asset Management Limited (“CSOP”) was founded in 2008 as the first offshore asset manager set up by a regulated asset management company in China. With a dedicated focus on China investing, CSOP manages public and private funds, as well as providing investment advisory services to Asian and global investors. In addition, CSOP is best known as an ETF leader in Asia. As of 31 July 2020, CSOP had US$ 8.2 billion in assets under management.
This material has not been reviewed by the Securities and Futures Commission. Issuer: CSOP Asset Management Limited
IMPORTANT: Investment involves risks. Investment value may rise or fall. Past performance information presented is not indicative of future performance. Investors should not base on this material alone to make investment decisions.
CSOP Yinhua CSI 5G Communications Theme ETF (the “Sub-Fund”) aims to provide investment results that, before deduction of fees and expenses, closely correspond to the performance of the CSI 5G Communication Index (the “Underlying Index”). The Sub-Fund is a feeder fund. Its master fund, Yinhua CSI 5G Communication ETF (the “Master ETF”), is not authorized by the Securities and Futures Commission for direct offering to the public in Hong Kong. Investors should note that:
• The Sub-Fund and the “Master ETF” are not principal guaranteed and your investments may suffer losses. There is no assurance that the Sub-Fund and the Master ETF will achieve their respective investment objectives.
• The Sub-Fund invests substantially in the Master ETF, and may therefore be subject to the risks associated with the Master ETF. The performance of the Sub-Fund depends on the price of the Master ETF. The ability of the Sub-Fund to meet its investment objective is also largely dependent on the Master ETF.
• Both the Sub-Fund and the Master ETF are passively managed and neither the Manager nor the manager of the Master ETF will have the discretion to adapt to market changes due to the inherent investment nature of the Sub-Fund and the Master ETF. Falls in the value of the Underlying Index and the Master ETF may result in a corresponding fall in the value of the Sub-Fund.
• The Sub-Fund does not have control of the investments of the Master ETF and there is no assurance that the investment objective and strategy of the Master ETF will be successfully achieved which may have a negative impact to the Net Asset Value of the Sub-Fund. Unitholders also do not have any direct interest in the units of the Master ETF and will not be able to exercise any voting right in respect of the Master ETF.
• Generally, retail investors can only buy or sell units of the Sub-Fund on the SEHK. The trading price of the units on the SEHK is driven by market factors and may trade at a substantial premiums or discount to its net asset value.
Please note that the above listed investment risks are not exhaustive and investors should read the Prospectus for further details, including the risk factors, before making any investment decision.
1 Please refer to the section headed “Fees and Charges” in Part 1 of the Prospectus for further details
2 Wind, as of September 30, 2020
3 IHS Markit ‘The 5G Economy – How 5G will contribute to the global economy’ November 2019
4 Wind, as of September 30, 2020
5 Bloomberg, as of September 30, 2020