1) E Fund (HK) FTSE AI Select Index ETF (the “Sub-Fund”) is a sub-fund of E Fund ETFs Trust, an umbrella unit trust established under Hong Kong law. The Sub-Fund is a passively-managed ETF falling within Chapter 8.6 of the Code on Unit Trusts and Mutual Funds issued by the Securities and Futures Commission (the “SFC”). Units of the Sub-Fund (the “Units”) are traded on The Stock Exchange of Hong Kong Limited (the “SEHK”) like stocks. The investment objective is to provide investment results that, before fees and expenses, closely correspond to the performance of the FTSE Custom Global AI Select Index (the “Index”).
2) Investment involves risks. The Fund is subject to a) Investment risk, b) Equity market risk, c) New Index risk, d) Geographical concentration risk, e) Technology sector themes concentration risk, f) Risk associated with mega-capitalisation companies, g) Securities lending transactions risk, h) Trading differences risk, i) Passive investments risk, j) Trading risk, k) Tracking error risk, l) Multi counter risks, m) Currency risk, n) Distribution out of/effectively out of capital risk, o) Reliance on market maker risk, P) Termination risk. The value of the Sub-Fund can be volatile and may go down substantially. Investors may suffer losses.
3) The Sub-Fund may invest in derivatives for hedging or investment purposes to the extent permitted by the Code and in adverse situations its use of financial derivative instruments may become ineffective and/or cause the Sub-Fund to suffer significant loss.
4) Distributions of the Sub-Fund may be paid out of the capital of the Sub-Fund. Investors should note that payment of distributions 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 and such distributions will result in an immediate reduction of the net asset value of the relevant units.
5) The Index is a new index. The Index has minimal operating history by which investors can evaluate its previous performance. There can be no assurance as to the performance of the Index. The Sub-Fund may be riskier than other exchange traded funds tracking more established indices with longer operating history.
6) The constituents of the Index, and accordingly the Sub-Fund’s investments, may be concentrated in the technology sector and in two geographical regions/countries (China and the United States). The value of the Sub-Fund may be more volatile than that of a fund having a more diverse portfolio of investments and may be more susceptible to adverse economic, political, policy, foreign exchange, liquidity, tax, legal or regulatory event affecting the relevant sector.
7) You should not invest in the Sub-Fund unless the intermediary who sells it to you has explained to you that the Sub-Fund is suitable for you having regard to your financial situation, investment experience and objectives.
8) Investors should not invest in the Sub-Fund based on this document alone. Before making any investment decision, the investor should read the Sub-Fund’s offering documents carefully including the risk factors.
