Premia China Treasury & Policy Bank Bond Long Duration ETF

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Important Notice

IMPORTANT: Investment involves risk, including the loss of principal. Investors should refer to the Prospectus and Key Facts Statement of Premia China Treasury and Policy Bank Bond Long Duration ETF (the "ETF") for details, including the risk factors. Investors should not base investment decisions on this marketing material alone. Investors should note:

The ETF aims to provide investment results that, before fees and expenses, closely correspond to the performance of ICE 10+ Year China Government & Policy Bank Index (“Index”).

Concentration / PRC market risks
The ETF’s investments are concentrated in the PRC with a focus on Treasury and Policy Bank Bonds. The value of the ETF may be more volatile than that of a fund having a more diverse portfolio of investments. The value of the ETF may be more susceptible to adverse economic, political, policy, foreign exchange, liquidity, tax, legal or regulatory event affecting the PRC market.

China related risks
PRC Sovereign Debt risks - The ETF’s investment in securities issued or guaranteed by governments may be exposed to political, social and economic risks. 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 ETF to participate in restructuring such debts.
PRC inter-bank bond market and Bond Connect risks – Investing in the PRC Inter-bank bond market via 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 PRC inter-bank bond market via Bond Connect are subject to change which may have potential retrospective effect.
Operational and settlement risk – To the extent that the ETF transacts in the inter-bank bond market in the PRC, the ETF may also be exposed to risks associated with settlement procedures and default of counterparties.
Volatility and liquidity risk - The debt securities in the PRC market may 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.
RMB currency and conversion risks - RMB is currently not freely convertible and is subject to exchange controls and restrictions. Non-RMB based investors are exposed to foreign exchange risk and there is no guarantee that the value of RMB against the investors’ base currencies (for example HKD) will not depreciate.

Debt securities market risks
Valuation risk – Valuation of the fund’s instruments may involve uncertainties and judgmental determinations. If such valuation turns out to be incorrect, this may affect the Net Asset Value of the ETF.
Interest rate risk - Interest rate risk is the risk that fixed income securities will decline in value because of an increase in interest rates and changes to other factors, such as perception of an issuer’s creditworthiness. Funds with higher durations generally are subject to greater interest rate risk.
Credit rating and downgrading risk – Credit ratings assigned by rating agencies are subject to limitations and do not guarantee the creditworthiness of the security and/or issuer at all times. The credit rating of a debt instrument or its issuer may subsequently be downgraded.

Foreign exchange, other currency distribution and distributions out of or effectively out of capital risk
All Units will receive distributions in the Base Currency (RMB) only. In the event that the relevant Unitholder has no RMB account, the Unitholder may have to bear the fees and charges associated with the conversion of such distribution from RMB to HKD or any other currency. The ETF’s base currency is in RMB but has Units traded in HKD and USD (in addition to RMB). Secondary market investors may be subject to additional costs or losses associated with fluctuations in the exchange rates between HKD or USD and the base currency and by changes in exchange rate controls when trading Units in the secondary market.

Payment of dividends out of capital or effectively out of 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 such distributions may result in an immediate reduction in the Net Asset Value per Unit of the ETF.

New Index Risk
The Index is a new index. The ETF may be riskier than other exchange traded funds tracking more established indices with longer operating history.

Securities Lending Transactions Risk
Securities lending transactions may involve the risk that the borrower may fail to return the securities lent out in a timely manner and the value of the collateral may fall below the value of the securities lent out.

Passive investments risk
The ETF is passively managed and the Manager will not have the discretion to adapt to market changes due to the inherent investment nature of the Sub-Fund. Falls in the Index are expected to result in corresponding falls in the value of the Sub-Fund.

Multi-counter risks
If there is a suspension of the inter-counter transfer of units between the counters and/or any limitation on the level of services by brokers and CCASS participants, unitholders will only be able to trade their units in one counter only, which may inhibit or delay an investor dealing. The market price of units traded in each counter may deviate significantly. As such, investors may pay more or receive less when buying or selling Units traded in one counter than the equivalent amount in the currency of another counter if the trade of the relevant Units took place on that other counter.

Reliance on market maker and liquidity risks
Although the Manager will ensure that at least one Market Maker will maintain a market for the Units in each counter, and that at least one Market Maker in each counter gives not less than 3 months’ notice prior to terminating the relevant market maker agreement, liquidity in the market for Units may be adversely affected if there is no or only one Market Maker for the Units. There is no guarantee that any market making activity will be effective.

PRC tax risk
There are risks and uncertainties associated with the current PRC tax laws, regulations and practice in respect of capital gains realised on the Sub-Fund's investments in PRC bonds (which may have retrospective effect). Any increased tax liabilities on the Sub-Fund may adversely affect the Sub-Fund’s value.
Based on professional and independent tax advice, the Manager does not currently make withholding income tax provision for gross realised or unrealised capital gains derived from trading of onshore Treasury and Policy Bank Bonds.

Why 2817 HK?

  1. Sovereign Credit: 100% investing in Chinese treasury and policy bank bonds with A1 China sovereign rating
  2. Access to Long Duration Chinese Government Securities: Unique exposure for investors with long duration asset-liability management or diversification needs
  3. Attractive Yield Potential: Long duration China government bonds consistently provide attractive yield and favourable yield differential with major government bonds
  4. Operational Efficient: Listed on HKEx with intraday liquidity and minimal operational hassle
  5. Cost Efficient: ongoing expenses of only 0.28% p.a.

Fund Objective and Investment Strategy

The investment objective of the Sub-Fund is to provide investment results that, before fees and expenses, closely correspond to the performance of the ICE 10+ Year China Government & Policy Bank Index. There can be no assurance that the Sub-Fund will achieve its investment objective.

In seeking to achieve the Sub-Fund’s investment objective, the Manager will use an optimised representative sampling strategy by investing directly in a representative sample of the RMB denominated and settled bonds issued by the Government of China, the China Development Bank, the Agricultural Development Bank of China or the Export-Import Bank of China and distributed within the PRC that collectively reflects the investment characteristics of the Index.

NAV

Key Facts

Stock Code2817 HK (HKD Counter)
9817 HK (USD Counter)
82817 HK (RMB Counter)
Management Fees0.28% per annum
Fund Size
(As of Apr 15, 2021)
592 million (RMB)
Fund Inception DateApril 12, 2021
Fund Listing DateApril 14, 2021
ExchangeSEHK – Main Board
Distribution PolicySemi-annual Distribution
Base CurrencyRMB
Trading CurrencyHKD / USD / RMB
Underlying IndexICE 10+ Year China Government & Policy Bank Index
Index TickerG9GP Index
ISINHK0000723202 (2817 HK)
HK0000723210 (9817 HK)
HK0000723228 (82817 HK)
SEDOLBMW2687 (HKD)
BMW2698 (USD)
BMW26B0 (RMB)
Lot Size20 units-HKD counter
20 units-USD counter
20 units-RMB counter
Index TypeTotal Return Index
Index ProviderICE Data Indices, LLC
Investment AdvisorBOCHK Asset Management Limited
(wholly owned by BOC Hong Kong (Holdings) Limited)
Fund Financial Year End31st December
Shares Outstanding
(As of Apr 15, 2021)
5,900,000

Participating Dealers

Goldman Sachs (Asia) Securities Limited
Haitong International Securities Company Limited
Korea Investment & Securities Asia Limited
Mirae Asset Securities (HK) Limited
(4 total) 1

Market Makers

Flow Traders Hong Kong Limited
(1 total)1

Related Documents

Performance

Performance Chart
Data would be provided in due course.

Past performance information is not indicative of future performance. Investors may not get back the full amount invested.

The computation basis of the performance is based on the calendar year end, NAV-to-NAV, with dividend reinvested.

These figures show by how much the fund increased or decreased in value during the period shown.

Performance data has been calculated in RMB including ongoing charges and excluding trading costs on SEHK you might have to pay.

Where no past performance is shown there was insufficient data available in that year to provide performance.

YTD 1 Month 6 Month 1 Year Since Listing
Premia China Treasury & Policy Bank Bond Long Duration ETF
(As of Apr 15, 2021)
- - - - -
ICE 10+ Year China Government & Policy Bank Index
(As of Apr 15, 2021)
- - - - -

Past performance information is not indicative of future performance. Investors may not get back the full amount invested.

The computation basis of the performance is based on the calendar year end, NAV-to-NAV, with dividend reinvested.

These figures show by how much the fund increased or decreased in value during the period shown.

Performance data has been calculated in RMB including ongoing charges and excluding trading costs on SEHK you might have to pay.

Where no past performance is shown there was insufficient data available in that year to provide performance.

Portfolio Holdings

As of Apr 15, 2021
Name Number of
Share Held
Market Price
(RMB)
Weight %
CGB 3.86 07/22/49 278,000,000 103.32 48.92%
CGB 4 06/24/69 103,000,000 105.94 18.64%
SDBC 3.9 08/03/40 71,000,000 101.64 12.51%
CGB 3.81 09/14/50 43,000,000 102.14 7.44%
CGB 3.39 03/16/50 46,000,000 94.18 7.34%
CGB 3.73 05/25/70 24,000,000 100.22 4.12%
CGB 3.76 03/22/71 4,000,000 101.13 0.68%
Holdings are subject to change.
(7 total)1

Fund Characteristics

Average Quality A1
Effective Duration 17.851
Average Yield to Maturity (%) 3.692
Convexity 4.6913