Important Information about CICC China Equity Fund (the “Sub-Fund”). Terms used in this website, unless otherwise stated, shall have the same meanings as those defined in the prospectus of the Sub-Fund (the “Prospectus”).
Important Information

Investment involves risk including loss of principal, and investments in Sub-Fund may not be suitable for everyone. Investors should read the Prospectus and the Product Key Facts Statement carefully for details including the product features and risk factors, and should consider their own investment objectives and other circumstances before investing in the Sub-Fund. The information provided herein is general in nature. If you are in any doubt about the contents of this website, you should consult your stockbroker, banker, solicitor, accountant or other financial adviser for independent professional advice before making any investment in the Sub-Fund.

CICC China Equity Fund, being a sub-fund of the umbrella unit trust constituted by the Trust Deed and called CICC Fund Series, seeks to primarily invest in companies of the People’s Republic of China (the “PRC”) to achieve long-term capital growth through exposure to PRC related companies. There can be no assurance that CICC China Equity Fund will achieve its investment objective.

The Sub-Fund seeks to achieve its investment objective by using a diversified long-only strategy through a disciplined investment process and detailed fundamental research. The term “long-only” means that the Sub-Fund does not intend to enter into any short-selling transactions. The Manager’s disciplined investment process is based on the identification of investment opportunities taking into account expected risk and return levels of such investment opportunities and the Manager’s analysis of the economic and political environment.

You are also drawn to attention of the following points with respect to the Sub-Fund:

Investors should carefully read the Prospectus and the Product Key Facts Statement for further details of all risk factors in particular those associated with investments in the Sub-Fund before making any investment decision. The Prospectus and the Product Key Facts Statement of the Sub-Fund may be obtained from the office of China International Capital Corporation Hong Kong Asset Management Limited which is located 29th Floor, One International Centre, 1 Harbour View Street, Central, Hong Kong and can also be downloaded from Website. In addition to above points, investors are also drawn to the attention of specific risk factors with respect to the Sub-Fund set out in the Prospectus and the Product Key Facts Statement.

CICC China Equity Fund has been authorized by the Securities and Futures Commission (the “SFC”) as a collective investment scheme. SFC authorization is not a recommendation or endorsement of a product nor does it guarantee the commercial merits of a product or its performance. It does not mean the product is suitable for all investors nor is it an endorsement of its suitability for any particular investor or class of investors. SFC take no responsibility for the contents of the Website, make no representation as to its accuracy or completeness and expressly disclaim any liability whatsoever for any loss howsoever arising from or in reliance upon the whole or any part of the contents of the Website.

Past performance information presented (if any) is not indicative of future performance.

All information displayed on this website is provided on an “as is” basis and China International Capital Corporation Hong Kong Asset Management Limited makes no representations and disclaims all warranties (whether express or implied) as to the accuracy or completeness of the information provided herein.

The contents of this website have not been reviewed by the SFC.

Manager: China International Capital Corporation Hong Kong Asset Management Limited

Risk Factors

Investors should not only base on this website alone to make investment decisions. Please read the Sub-Fund’s offering documents for details including the full text of the risk factors stated therein. 

General investment risk

The Sub-Fund’s investment portfolio may fall in value due to any of the key risk factors below and therefore your investment in the Sub-Fund may suffer losses.  There is no guarantee of the repayment of principal.

Risks of investing in equity securities

The Sub-Fund’s investment in equity securities is subject to general market risks, whose value may fluctuate due to various factors, such as changes in investment sentiment, political and economic conditions and issuer-specific factors.

Risk of specific investment strategy

The Sub-Fund’s diversified long-only strategy may not achieve the desired results under all circumstances and market conditions.

Concentration risk

The Sub-Fund is subject to concentration risk as a result of the concentration of its investments in companies which are domiciled in, or carrying out the main part of their economic activity in, the PRC (including Hong Kong, Macau and Taiwan). 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 also be more susceptible to economic, political, policy, foreign exchange, liquidity, tax or regulatory event adversely affecting the PRC markets.

Mainland China market risks

The Sub-Fund’s investments in Mainland China may involve increased risks and special considerations not typically associated with an investment in more developed markets, such as liquidity risks, currency risks/control, political and economic uncertainties, legal and taxation risks, settlement risks, custody risk and the likelihood of a high degree of volatility. “Mainland China” means all customs territory of the People’s Republic of China, excluding for the purposes of interpretation herein only, Hong Kong, Macau and Taiwan.

High market volatility and potential settlement difficulties in the Mainland Chinese markets may result in significant fluctuations in the prices of the securities traded on such markets, and may thereby adversely affect the value of the Sub-Fund.

Securities exchanges in Mainland China typically have the right to suspend or limit trading in any security traded on the relevant exchange. The government or the regulators may also implement policies that may affect the financial markets. All these may have a negative impact on the Sub-Fund.

Risks associated with the Stock Connect

The relevant rules and regulations on the Stock Connect are subject to change which may have potential retrospective effect. The Stock Connect is subject to quota limitations. Where a suspension in the trading through the programme is effected, the Sub-Fund’s ability to invest in China A-Shares through the programme will be adversely affected. Due to the difference in trading days, on days when the Mainland China market is open but the Hong Kong market is closed, the Sub-Fund may be subject to a risk of price fluctuations in China A-Shares as the Sub-Fund will not be able to trade through the Stock Connect. In such event, the Sub-Fund’s ability to achieve its investment objective could be negatively affected.

Mainland Chinese tax risks

There are risks and uncertainties associated with the current Mainland China tax laws, regulations and practice in respect of capital gains realized via the Stock Connect and/or indirectly by way of funded swap transactions or access products (e.g. CAAPs) or funds investing in China A-Shares on the Sub-Fund’s investments in Mainland China (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 Sub-Fund does not currently make any withholding corporate income tax provision on the gross realized or unrealized capital gains derived from the trading of China A-Shares (via the Stock Connect and/or indirectly by way of funded swap transactions or access products (e.g. CAAPs) or funds investing in China A-Shares). It is possible that the applicable tax laws may be changed, and the Mainland China tax authorities may hold a different view as to the enforcement of the Mainland China withholding tax collection on capital gains, which may adversely affect the Sub-Fund’s value.

RMB currency and conversion risks

The underlying investments of the Sub-Fund are mainly denominated in RMB. RMB is currently not freely convertible and is subject to exchange controls and restrictions.

The Sub-Fund is exposed to foreign exchange risk and there is no guarantee that the value of RMB against the Sub-Fund’ base currency (i.e. HKD) will not depreciate. Any depreciation of RMB could adversely affect the value of investor’s investment in the Sub-Fund. Further, the NAV of the Sub-Fund may be affected unfavorably by fluctuations in the exchange rates between RMB and its base currency and by changes in exchange rate controls.

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 may be delayed due to the exchange controls and restrictions applicable to RMB.

Risk associated with small and mid-capitalization companies

The Sub-Fund may invest in small and mid-capitalization companies. The stocks of such companies may have lower liquidity and their prices are more volatile to adverse economic development than those of larger capitalization companies in general.

Risks associated with the ChiNext market and/or the STAR Board

Higher fluctuation on stock prices and liquidity risk: Listed companies on the ChiNext market and/or the STAR Board are usually of emerging nature with smaller operating scale. Listed companies on the ChiNext market and the STAR Board are subject to wider price fluctuation limits, and due to higher entry thresholds for investors may have limited liquidity, compared to other boards. Hence, companies listed on these boards are subject to higher fluctuation in stock prices and liquidity risks and have higher risks and turnover ratios than companies listed on the main board.

Over-valuation risk: Stocks listed on the ChiNext market and/or the STAR 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.

Differences in regulation: The rules and regulations regarding companies listed on the ChiNext market and the STAR Board are less stringent in terms of profitability and share capital than those in the main boards.

Delisting risk: It may be more common and faster for companies listed on the ChiNext market and/or the STAR Board to delist. The ChiNext market and the STAR Board have stricter criteria for delisting compared to the main boards. This may have an adverse impact on the Sub-Fund if the companies that it invests in are delisted.

Concentration risk (applicable to the STAR Board): The STAR Board was established relatively recently and may have a relatively limited number of listed companies during the initial stage. Investments in the STAR Board may be concentrated in a small number of stocks and subject the Sub-Fund to higher concentration risk.

Investments in the ChiNext market and/or the STAR Board may result in significant losses for the Sub-Fund and its investors.

Risks associated with depositary receipts

Exposure to depositary receipts including ADRs and GDRs may generate additional risks compared to a direct exposure to the underlying stocks, including the risk of non-segregation of the underlying stocks from the depositary banks’ own assets and liquidity risk (as depositary receipts are often less liquid than the underlying stock). These may negatively affect the performance and/or liquidity of the Sub-Fund. Also, depositary receipts holders generally do not have the same right as the direct shareholders of the underlying stocks. The performance of depositary receipts may also be impacted by the related fees.

Volatility risks

The Sub-Fund may be exposed to the risk of high market volatility and potential settlement difficulties of the equity markets in which it invests. This may result in significant fluctuations in the prices of the securities traded on such markets and thereby adversely affect the value of the Sub-Fund.

Risks attached to the use of FDIs

Investment in FDIs (e.g. funded swap transactions, CAAPs, warrants, and futures) is subject to additional risks, including counterparty and credit risk, liquidity risk, valuation risk, volatility risk and over-the counter transaction risk. The leverage element/component of FDIs can result in a loss significantly greater than the amount invested in the FDIs by the Sub-Fund. In adverse situation, the Sub-Fund’s use of FDIs may become ineffective in hedging or risk mitigation / reduction and the Sub-Fund may suffer significant losses.

Termination risks

The Sub-Fund may be terminated early under certain circumstances, for example, if the size of the Sub-Fund falls below US$10,000,000 (or equivalent). Investors may not be able to recover their investments and suffer a loss when the Sub-Fund is terminated.

Distributions out of or effectively out of capital risk

Payment of distributions 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 NAV per Unit of the Sub-Fund.

CICC China Equity Fund
Investment Objective

The investment objective of CICC China Equity Fund (the “Sub-Fund”) seeks to primarily invest in companies of the People’s Republic of China (the “PRC”) to achieve long-term capital growth through exposure to PRC related companies. There can be no assurance that CICC China Equity Fund will achieve its investment objective. The Sub-Fund seeks to achieve its investment objective by using a diversified long-only strategy through a disciplined investment process and detailed fundamental research. The term “long-only” means that the Sub-Fund does not intend to enter into any short-selling transactions. The Manager’s disciplined investment process is based on the identification of investment opportunities taking into account expected risk and return levels of such investment opportunities and the Manager’s analysis of the economic and political environment.

NAV per Unit

Date: 2022-12-02

HKD 84.5845
Fund Information
Inception Date  21 July 2022
Fund Financial Year End 31st December
Distribution Policy Annual Distribution (Subject to the Manager's discretion)
Ongoing charges over a year (Class A) Estimated to be 1.93%
Management Fees (Class A) 1.25% per annum
Base Currency HKD
Net Asset Value (As of 2022-12-02) HKD 73,996,237.54