Important Information
Investors should not base investment decisions on this material alone. Please refer to the Prospectus for details including the product features and the risk factors. Investment involves risks. Past performance is not indicative of future performance. There is no guarantee of the repayment of the principal. Investors should note:
- The investment objective of Global X China Electric Vehicle and Battery ETF’s (the “Fund”) is to provide investment results that, before fees and expenses, closely correspond to the performance of the Solactive China Electric Vehicle and Battery Index.
- The Fund is exposed to concentration risk by tracking a single region or country.
- The Index constituents may be concentrated in a specific industry or sector, which may potentially more volatile than a fund with a diversified portfolio.
- Investment in Emerging Market, such as A-share market, may involve increased risks and special considerations not typically associated with investments in more developed markets, such as liquidity risk, currency risks, political risk, legal and taxation risks, and the likelihood of a high degree of volatility.
- The Stock Connect is subject to quota limitations. Where a suspension in the trading through the Stock Connect is effected, the Sub-Fund’s ability to invest in A-Shares or access Mainland China markets through the programme will be adversely affected.
- Listed companies on the ChiNext market and/or STAR Board are usually subject to higher fluctuation in stock prices and liquidity risks, over-valuation risk, differences in regulation, delisting risk, and concentration risk.
- There are risks and uncertainties associated with the current Mainland China tax laws, regulations and practice in respect of capital gains realized via Stock Connect on the Fund’s investments in Mainland China. Any increased tax liabilities on the Fund may adversely affect the Fund’s value.
- The trading price of the Fund’s unit on the SEHK is driven by secondary market trading factors, which may lead to a substantial premium or discount to the Fund’s net asset value.
- The Fund’s synthetic replication strategy may invest up to 50% of its net asset value in financial derivative instruments (“FDIs”), which may expose the Fund to counterparty/credit risk, liquidity risk, valuation risk, volatility risk and over-the-counter transaction risk. The Fund may suffer losses from its usage of FDIs.
- The Manager may at its discretion pay dividends out of the capital of the Fund. Distributions paid out of capital, represent a return of an investor’s original investment or its gains and may potentially reduce the Fund’s Net Asset Value per Share as well as the capital available for future investment.
- The Fund may suffer from a losses or delays when recovering the securities lent out. This may potentially affect its ability to meet payment and redemption obligations. Collateral shortfalls due to inaccurate pricing or change of value of securities lent, may cause significant losses to the Fund.
China EV battery update
The latest industry feedback shows that Chinese major battery companies’ total scheduled production for September 2025 is 129.2GWh, +46%YoY and +7%MoM, respectively, much faster than overseas peers. Additionally, CATL’s September output is reportedly 69.5GWh, +43%YoY and +8%MoM, followed by two anonymous domestic battery producers of 23.3GWh and 10.7GWh, +20%YoY and +2%MoM, and +60%YoY and +15%MoM, respectively. People’s expectation on Q4 outlook remains positive, driven by front-loading EV demand due to EV purchase tax subsidies cut starting from 2026. (Source: Jefferies, 29 August 2025)
In the semi-annual earnings calls, the battery equipment companies also updated the solid-state battery development in China is accelerating. China government announced to subsidize by more than $830million to domestic companies who are eligible in technology competitiveness to develop solid-state batteries in 2024. Wuxi Lead’s management shared they have got Rmb400-500mn solid-state battery new orders in 1H25 and expect more from the top Chinese players in 2H25, since it is the time point for the regulator to review the progress. They shared some of their clients aim to double their total capacity in the next three years and the new round of upcycle may last longer given the strong demand seen from clients. (Source: Company Data, 29 August 2025)