HONG KONG, Mar 20, 2017 – (ACN Newswire) – E Fund Management (HK) Co., Ltd (“E Fund HK”) has invited Yuanta Securities Investment Trust Co., Ltd (“Yuanta Funds”), one of Asia’s largest inverse ETF issuer1, to be its technical advisor for developing the E Fund Yuanta Hang Seng Index Daily (-1x) Inverse Product (7302.HK), which was officially listed on the Stock Exchange of Hong Kong today. This is E Fund HK’s first inverse product, offering an alternative investment instrument for investors in Mainland China and Hong Kong.
Ms Huang Gaohui, CEO of E Fund HK, said, “As the sole international business platform of E Fund, E Fund HK has had an established presence in Hong Kong for many years, providing bi-lateral and cross-border asset management services in equities, fixed income and alternative investments for global investors. A number of ETF products have been launched in Hong Kong, Europe and the US. We believe the Hang Seng Index Inverse ETF product（7302.HK）jointly developed with Yuanta Funds will meet the needs of the market and our customers. Yuanta Funds is the largest issuer of inverse ETFs in Asia, while E Fund HK has been named the Best Fund House of the Year (China offshore)2. The collaboration between the two firms has brought synergy in asset management capabilities, providing investors with professional services.” Ms Huang added, “E Fund HK will continue to expand its offerings in commodity-linked ETFs involving gold and oil as permitted by regulatory policies.”
Mr Julian Liu, President & CEO of Yuanta Funds remarked, “The development of leveraged/inverse (L&I) ETF markets in Hong Kong began last year and Yuanta Funds is honoured to have the opportunity to develop L&I products jointly with E Fund HK. We look forward to leverage our experience in L&I ETF products in Taiwan and invite industry players from Taiwan to act as participating dealers, thereby achieving differentiation in Hong Kong’s L&I ETF space. We are also considering further collaboration for developing more L&I products in the future.”
The E Fund Yuanta Hang Seng Index Daily (-1x) Inverse Product targets a return equivalent to the inverse (-1x) of the daily performance of the Hang Seng Index. Each board lot consists of 100 units priced at HKD 12.5 each. The product invests in Hang Seng Index futures contracts to establish a short position, which is then adjusted daily to achieve a daily inverse investment ratio against the Index consistent with the investment objective. In addition, no more than 90% of the product’s net asset value will be invested in bank deposits and Hong Kong dollar denominated cash management instruments such as Exchange Fund Bills and money market funds in Hong Kong. This would help balance the product’s futures margin requirements and may also generate additional return.
L&I products have seen rapid growth in Asian markets, currently accounting for 87%, 59% and 76% of the overall ETF markets in Japan, South Korea and Taiwan respectively3. E Fund HK expects the expansion of L&I products related to the Hang Seng Index and Chinese indices in Hong Kong would benefit the product’s penetration in the market, boosting transaction volume and activity of L&I products.
E Fund HK has been closely monitoring the development of L&I products in Hong Kong. In January this year, the Securities and Futures Commission of Hong Kong had given green light for L&I ETFs, accepting the application of products tracking broad-based indices of the Hong Kong market. This would provide greater choices for investors with a more local appetite who seek to track a familiar market index, and can also pique their interest in this space. In the light of this, E Fund HK joined forces with Yuanta Funds to launch an inverse product tracking the Hang Seng Index, aiming to enhance the penetration of related products in the market and attract the interest of retail and institutional investors.
1Source: Bloomberg, as of February 28, 2017
2Source: Asian Investor Asset Management Awards 2016
3Source: Bloomberg, as of December 31, 2016.
About E Fund Management (Hong Kong) Co, Ltd.
E Fund Management (HK) Co., Ltd (“E Fund HK”) was officially established in 2008 and is licensed by the Securities and Futures Commission of Hong Kong to conduct Type 1 (Dealing in Securities), Type 4 (Advising on Securities) and Type 9 (Asset Management) regulated activities. As a premier global business platform for E Fund Management Co., Limited (“E Fund”), E Fund HK has a subsidiary in New York, and listed several RQFII ETFs and RQFII/QFII public funds, at six stock exchanges across the US, Europe and the Asia-Pacific. Its award-winning products have been recognized by leading institutions such as Morningstar, Lipper, AsianInvestor and Benchmark for their strong performances relative to peers.
E Fund, the parent company of E Fund HK, was founded in 2001 and headquartered in Guangzhou. It has branch offices in Beijing, Guangzhou, Shanghai, and subsidiaries including E Fund HK and E Fund Asset Management Co., Ltd. E Fund’s total assets under management exceed RMB 1 trillion* (including E Fund HK and China subsidiaries) and has grown to become one of the top three fund management corporations in China**. It is licensed to cover a full spectrum of asset management services in China including, public funds, national social security fund, corporate annuities, discretionary accounts, QDII, QFII and RQFII. E Fund passed the independent verification of the Global Investment Performance Standards (GIPS) since August 2014, signifying an important step forward to become more internationalized with unified performance reporting.
Capitalizing the investment and research ability of E Fund, E Fund HK maintains three investment research teams, each specializing in RQFII/QFII, overseas and alternative investment. Integrated with E Fund?s global expansion strategies, E Fund HK is committed to providing quality asset management services for onshore and offshore investors in Greater China and US ADR markets. Via the construction of a global-facing asset allocation platform, E Fund HK serves as a window to investors in China for asset allocation exposures all over the world.
* as of 31 December, 2016
**Wind Info, as of 31 December, 2016
Index Provider Disclaimer
The mark and name “Hang Seng Index” is proprietary to Hang Seng Data Services Limited (“HSDS”) which has licensed its compilation and publication to Hang Seng Indexes Company Limited (“HSIL”). HSIL and HSDS have agreed to the use of, and reference to, the Hang Seng Index by E Fund Management (Hong Kong) Co., Limited (“the Issuer”) in connection with its Leveraged and Inverse Products (the ?Products?). However, neither HSIL nor HSDS warrants, represents or guarantees to any person the accuracy or completeness of the Hang Seng Index, its computation or any information related thereto and no warranty, representation or guarantee of any kind whatsoever relating to the Hang Seng Index is given or may be implied. Neither HSIL nor HSDS accepts any responsibility or liability for any economic or other loss which may be directly or indirectly sustained by any person as a result of or in connection with the use of and/or reference to the Hang Seng Index by the Issuer in connection with the Products, or any inaccuracies, omissions or errors of HSIL in computing the Hang Seng Index. Any person dealing with the Product shall place no reliance whatsoever on HSIL and/or HSDS nor bring any claims or legal proceedings against HSIL and/or HSDS in any manner whatsoever. For the avoidance of doubt, this disclaimer does not create any contractual or quasi-contractual relationship between any broker or other person dealing with the Products and HSIL and/or HSDS and must not be construed to have created such relationship.
Technical Advisor Disclaimer
E Fund HK has appointed Yuanta Securities Investment Trust Co., Ltd. (“Technical Advisor”) as the technical advisor to the Sub-Fund and the Technical Advisor is not a co-issuer of the Sub-Fund. Technical Advisor only provides technical advice on futures, leveraged and inverse ETF (e.g. product structure, operating processes, management techniques, transactions, etc.). E Fund HK shall reach its investment decision by independent judgment. The Technical Advisor shall not be liable for any matters relating to the Sub-Fund other than the liability pursuant to investment advisory g agreement entered into between E Fund HK and the Technical Advisor.
E Fund Disclaimer
E Fund Management (Hong Kong) Co., Limited is the issuer of this report. This report is neither an offer nor solicitation to purchase units of the fund; applications for units may only be made on forms of application available with the Explanatory Memorandum. Investments are subject to investment risks, fund value may go up as well as down and past performance is not indicative of future performance. Investors should read carefully the Explanatory Memorandum (including the section “Risk Factors”) for the relevant risks associated with the investment in the fund before investing.
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