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Risk Disclosure

Ping An of China SIF – RMB Bond Fund (the “Fund”) principally invests in RMB denominated Income Instruments (as defined below).

The value of the Fund can be volatile and can go down substantially within a short period of time. It is possible that a certain amount or the entirety of your investment could be lost.  The Fund is an investment product and is not equivalent to bank deposits. There is no guarantee in respect of repayment of principal. 

The Fund may invest in (i) debt securities rated below investment grade or unrated; (ii) debt securities issued or guaranteed by governments or authorities; (iii) debt instruments with loss-absorption features which are subject to the risk of being written down or converted to shares upon the occurrence of trigger events resulting in a significant or total reduction in value; (iv) urban investment bonds issued by Chinese local government financing vehicles; and (v) asset-based securities, all of which are typically subject to higher default, volatility and liquidity risks.  The Fund is also subject to other risk associated with debt securities (e.g. credit/counterparty, interest rate, credit rating and downgrading, valuation, credit rating agency, convertible bond and dim sum bond market risks).

The Fund’s investments are concentrated in RMB Income Instruments (as defined below) and in China which is an emerging market. The value of the Fund may be more volatile than that of a fund having a more diverse portfolio, and more susceptible to adverse event affecting the Chinese markets. Investing in emerging markets may involve increased risks, such as liquidity, currency, political, economic, legal, taxation, settlement and custody risks and higher volatility. The Fund is also subject to RMB currency and conversion risks and China tax risks.

The Fund may use derivatives for hedging or investment purposes.  Use of derivatives may expose the Fund to significant losses.

There is no guaranteed dividend payment. Distributions may be paid out of capital which amounts to a return or withdrawal of part of an investor’s original investment or from any capital gains attributable to that original investments and may result in an immediate reduction of the NAV per unit.

The investment decision is yours. You should not base your investment decision on this material alone. Please refer to the Fund’s explanatory memorandum and product key facts statement (including the risk factors and charges stated therein) for further details.

For the definition of RMB Income Instruments, please refer to the Explanatory Memorandum of the Fund.

Fund Information

Fund Manager Ping An of China Asset Management (Hong Kong) Co. Ltd.
Inception date 28/04/2011
Fund size RMB 146.12 million (30/07/2021)
Base currency RMB
Unit price
Class A RMB 105.47 per unit
Class A HKD 103.89 per unitClass A (Accumulation) HKD 102.98 per unit
Class A USD 9.97 per unitClass A (Accumulation) USD 10.30 per unit
Dealing frequency Daily (1)
Dividend policy Semi-annual basis for Class A (2)

Fund Objective

Ping An of China SIF-RMB Bond Fund (the "Fund") seeks to provide total return comprised of interest income and capital growth by investing principally in RMB denominated fixed or floating rate debt securities.

Fund Strategy

1The Manager seeks to achieve investment returns through active management of the major risks associated with RMB Income Instruments: duration, term structure, sector allocation, product selection and credit rating where applicable.

The Manager will construct the portfolio to take advantage of the expected change in the general level of RMB interest rates based on expectations of global and China's macroeconomic cycle, fiscal policy and monetary policy. The portfolio will consist of RMB Income Instruments of different maturities and credit quality and bank deposits, and each instrument in the portfolio will be selected based on extensive in-house and external fundamental research.

The Fund will not invest in any derivatives or structured deposits or products.

The Manager currently does not intend to enter into any securities lending or repurchase transactions in respect of the Fund.


General Information

Minimum investment:Class A RMB: RMB 10,000
Class A HKD: HKD 10,000
Class A USD: USD 1,000
Class A (Accumulation) RMB: RMB 10,000
Class A (Accumulation) HKD: HKD 10,000
Class A (Accumulation) USD: USD 1,000
Minimum holding:Aggregate minimum value of Units held:
Class A RMB: RMB 10,000
Class A HKD: HKD 10,000
Class A USD: USD 1,000
Class A (Accumulation) RMB: RMB 10,000
Class A (Accumulation) HKD: HKD 10,000
Class A (Accumulation) USD: USD 1,000
Minimum redemption:Aggregate minimum value of Units held:
Class A RMB: RMB 10,000
Class A HKD: HKD 10,000
Class A USD: USD 1,000
Class A (Accumulation) RMB: RMB 10,000
Class A (Accumulation) HKD: HKD 10,000
Class A (Accumulation) USD: USD 1,000
Subscription fee:Up to 5%
Switching fee:1% (Switching of Units is subject to the limitations as set out in the Explanatory Memorandum and that no switching is allowed to be made between Units denominated in RMB of the Sub-Fund and Units denominated in another currency of the Sub-Fund or other Sub-Funds (if any).)
Management fee:1% p.a.
Financial year end:30 June
Trustee:BOCI-Prudential Trustee Limited

Codes

ISIN Code (Class A RMB) HK0000079084 ;
(Class A HKD) HK0000096476 ;
(Class A USD) HK0000096484 ;
(Class A (Accumulation) RMB) HK0000688108;
(Class A (Accumulation) HKD) HK0000688116;
(Class A (Accumulation) USD) HK0000688124
Bloomberg Code (Class A RMB) PARRMBA HK ;
(Class A HKD) PARAHKD HK ;
(Class A USD) PARAUSD HK ;
(Class A (Accumulation) RMB) ;
(Class A (Accumulation) HKD) PARAAHK HK;
(Class A (Accumulation) USD)PARAAUS HK
Reuters Code (Class A RMB) LP68090801 ;
(Class A HKD) LP68180641 ;
(Class A USD) LP68180642 ;
(Class A (Accumulation) RMB) ;
(Class A (Accumulation) HKD) ;
(Class A (Accumulation) USD)
Lipper ID (Class A RMB) 68090801 ;
(Class A HKD) 68180641 ;
(Class A USD) 68180642 ;
(Class A (Accumulation) RMB) ;
(Class A (Accumulation) HKD) ;
(Class A (Accumulation) USD)

Dividend Record (3)

Fund Inception Date: 28/04/2011

Record DateEx-DatePayment DateDividend Distribution (per unit)
Class A
RMB
Class A
HKD
Class A
USD
24/06/202125/06/202108/07/20211.210.490.14
17/12/202018/12/202008/01/20211.51N/A0.14
24/06/202026/06/202003/07/20201.18N/A0.10
27/12/201930/12/201909/01/20201.6N/A0.14
24/06/201925/06/201905/07/20193.24N/A0.23
28/12/201831/12/201821/01/20191N/A0.09
08/06/201811/06/201806/07/20181.60N/A0.15
14/12/201715/12/201712/01/20182.40N/A0.22
09/06/201712/06/201705/07/20171.70N/A0.15
15/12/201616/12/201613/01/20172.40N/A0.21
10/06/201613/06/201607/07/20161.601.480.15
16/12/201517/12/201513/01/20162.302.140.21
12/06/201515/06/201509/07/20151.551.520.15
11/12/201412/12/201407/01/20152.302.260.22
13/06/201416/06/201410/07/20142.202.150.21
12/12/201313/12/201308/01/20141.801.810.18
13/06/201314/06/201310/07/20132.453.100.40
13/12/201214/12/201209/01/20131.10N/AN/A
14/06/201215/06/201210/07/20121.80N/AN/A
14/12/201115/12/201109/01/20121.00N/AN/A

Distribution figures represent past distributions declared and paid for by the fund. There is no guarantee that any distributions will be declared in the future, or that if declared, the amount of any distribution will remain constant or increase over time.

       

 - Dividend (ex-date)


Class A RMB : Calendar Year Performance (%)

20102011*201220132014201520162017201820192020 Since Fund Launch
N/A-3.84%7.45%4.93%2.83%4.56%6.98%5.86%3.57%5.03%2.29% 49.9%

* Since fund inception on 28 April 2011.

Class A HKD : Calendar Year Performance (%)

2010201120122013*201420152016** Since Fund Launch
N/AN/AN/A5.32%0.03%-0.97%5.17% 21.1%

* Since share class inception on 1 Mar 2013.
** Performance data of Class A HKD in 2016 was as of 28 September 2016, as the share class was fully redeemed on 28 September 2016; the share class was reactivated on 29 December 2020 with a NAV of HKD 100.

Class A USD : Calendar Year Performance (%)

2010201120122013*2014201520162017201820192020 Since Fund Launch
N/AN/AN/A5.25%0.10%-1.01%0.94%13.24%-1.96%3.84%9.31% 37.9%

* Since share class inception on 1 Mar 2013.

Note:

  • 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 Sub-Fund increased or decreased in value during the calendar year being shown. Performance data has been calculated in RMB including ongoing charges and excluding subscription fee and redemption fee you might have to pay
  • Where no past performance is shown there was insufficient data available in that year to provide performance

Class A RMB : Cumulative Performance (%)

1 month 3 months 6 months YTD 1 year 3 years 5 years
-0.3% -0.2% 1.1% 2.1% 2.6% 11% 20.1%

Total return performance is based on NAV-to-NAV with dividend invested (if any), in RMB.

Class A HKD : Cumulative Performance (%)

1 month 3 months 6 months YTD 1 year 3 years 5 years
0.7% 1.2% 2.7% 4.3% N/A N/A N/A

Total return performance is based on NAV-to-NAV with dividend invested (if any), in HKD.

Class A USD : Cumulative Performance (%)

1 month 3 months 6 months YTD 1 year 3 years 5 years
0.7% 1.2% 2.5% 3.9% 7.9% 20.7% 27.3%

Total return performance is based on NAV-to-NAV with dividend invested (if any), in USD.


Class A (Accumulation) HKD : Cumulative Performance (%)

1 month 3 months 6 months YTD 1 year 3 years 5 years
N/A N/A N/A N/A N/A N/A N/A

Class A (Accumulation) USD : Cumulative Performance (%)

1 month 3 months 6 months YTD 1 year 3 years 5 years
N/A N/A N/A N/A N/A N/A N/A


Note:
The performance quoted represents past performance of the Fund. Investment return and principal value of an investment will fluctuate so that an investor's units, when sold or redeemed, may be worth more or less than the original cost. Current performance may be lower or higher than the performance quoted. Past performance may not be repeated and is no guide for future returns.

Date

NAV/Unit (RMB)

Dividend payout (ex-date)

21/10/2021105.470.00
20/10/2021105.460.00
19/10/2021105.410.00
18/10/2021105.380.00
15/10/2021105.400.00
12/10/2021105.460.00
11/10/2021105.520.00
08/10/2021105.650.00
07/10/2021105.820.00
06/10/2021105.810.00

Fund Manager Commentary

July Review

The Chinese economy had experienced both idiosyncratic and cyclical drags entering into the second half of the year, with slowing and below expectation indicators observed in July, including export, import, retail sales, industrial production as well as industrial profits etc.
External demand was slowing while domestic economic activities were weighed down by the resurge of Delta COVID outbreak and the flood in Henan province which caused massive damages. Capex in private sector e.g. manufacturing and real estate were either growing at slower pace sequentially or contracted on year-over-year (YoY) basis. Public infrastructure investments also slowed due to local government deleveraging effort.
The People’s Bank of China (PBOC)’s 50bps Required Reserve Ratio (RRR) cut in July was deemed positive to market sentiment and a turnaround signal to their more cautious credit policy earlier, but nonetheless came a bit slow and deemed inadequate for revitalizing the economy.
Both onshore and offshore RMB rates bonds rallied in the month of July amid the slower growth backdrop, easing PBOC and safe haven flows into bonds as equities sold off. Onshore bond yield came lower by 20bps across the curve. Offshore dim sum bonds which are mostly IG credits underperformed in the rally as spread widened 20-30bps due to weakening risk appetite.
The Fund delivered in low volatility with a monthly return of +0.75% in July and an YTD return of +2.30% in RMB term^.

 

Outlook

Recovery momentum could be somewhat slower in the second half of the year, with higher likelihood of fiscal stimulus and monetary easing to come in order to provide support to the economy. Despite the less certain growth outlook in the coming months, the 10 years China Government Bond (CGB) yielded at circa 2.8% is quite a strong psychological support that is hard to break lower without another trigger of dire black swan event. Credit spreads on the other hand, have widened quite a bit in the last 2 months pricing in most of the recent headline risks. Selective sectors’valuations are looking attractive now for a muddle through macro dynamics in the next few months.
The yield gap between the 10-year CGB vs U.S. Treasuries of the same tenor still looks relatively wide at 176bps despite the July bond rally and spread narrowing. The wide rate differential between China and U.S. bonds and likely divergence in monetary policies will continue to drive international investors’inflow into RMB bonds. A good 50bn yuan foreign inflow had invested into the onshore China bond market in July alone. We expect onshore bonds to outperform offshore ones due to its proximity to underlying assets of the issuers, deeper market liquidity and its relatively more attractive yield.

 

Note: CNH is the currency symbol for offshore RMB. Offshore RMB bonds are also known as dim sum bonds. 
^ Based on Class A RMB.
Asset Allocation:
Fund allocations are a percentage of investments in asset categories as of the end of the period. The asset category of the Fund is based on its predominant investments under normal market conditions. The Fund may shift allocations among asset classes at any time. Percentage may not equal 100% due to rounding. Top Holdings: These securities do not represent all of the securities purchased, sold or recommended for clients, and the reader should not assume that investment in the securities listed was or will be profitable. The portfolio manager for the Fund reserves the right to withhold release of information with respect to holdings that would otherwise be included in the top holdings list.


Top Ten Holdings

CHINA ORIENT ASSET MANAGEMENT CO LTD 4.33% A 23AUG2029 SHCH7.12%
GUANGZHOU METRO GROUP CO LTD 3.72% A 10JAN2025 CDC6.96%
CHINA DEVELOPMENT BANK CORP 3.3% A 03MAR2026 CDC6.94%
DALIAN WANDA COMMERCIAL MANAGEMENT GROUP CO LTD 5.38% A 29JUL2023 SHCH6.77%
AGRICULTURAL DEVELOPMENT BANK OF CHINA CO LTD 2.96% A 17APR2030 CDC6.67%
VANKE REAL ESTATE HONG KONG CO LTD 3.85% S/A 13JUN20225.51%
FIRST ABU DHABI BANK PJSC 3.5% A 02JUL20254.85%
CNI CAPITAL LTD 3.97% S/A 01NOV20224.09%
CHARTER STYLE INTL LTD 5.8% S/A 15SEP20243.57%
BANK OF CHINA LTD 4.15% A 19MAR2031 CDC3.53%

As of 30 July 2021

Documents

1.Explanatory MemorandumView
2.Product Key FactsView
3.Annual ReportView
4.Interim ReportView
5.Monthly Fund Fact SheetView

Notices

1.Dividend Notice to Unitholders (24/06/2021) View
2.Fund Dividend Composition Information (06/2021) View
3.Notice to Unitholders (10/12/2020) View
4.Notice to Unitholders (06/11/2020) View
5.Notice to Unitholders (19/06/2020) View
6.Notice to Unitholders (29/11/2019) View

(1) The Fund will have dealing on any Business Day.
(2) Currently June and December. Dividend distribution is subject to the manager's discretion, and there is no guarantee on any minimum dividend payment amount.

Ping An of China SIF – RMB Bond Fund (the “Fund”), a sub-fund of Ping An of China Select Investment Fund Series, has been authorized by the Securities and Futures Commission of Hong Kong (“SFC”) (SFC authorization is not an official recommendation or endorsement of the Fund nor does it guarantee the commercial merits of the Fund or its performance. It does not mean the Fund is suitable for all investors nor is it an endorsement of its suitability for any particular investor or class of investors). Certain information contained in this fact sheet is obtained and prepared from sources which Ping An of China Asset Management (Hong Kong) Co. Ltd (“PAAMC”) believes to be reliable. For information sourced externally (as disclosed), PAAMC believes that such information is accurate and complete. This fact sheet is for your information and reference only, and does not constitute an offer. Investment involves risks. Investors should not only base investment decisions on this material alone. The past performance is not indicative of future performance. The price of the Fund may rise or fall and investors may lose some or all of their investment. This material is issued by PAAMC and has not been reviewed by the SFC.