Important Information

Investors should not base investment decisions on this website alone. Please refer to the Prospectus for details including the product features and the risk factors. Investment involves risks. There is no guarantee of the repayment of principal. Investor should note:

Global X Hang Seng TECH ETF (the “Fund”) seeks to provide investment results that, before deduction of fees and expenses, closely correspond to the performance of the Hang Seng TECH Index (the “Index”).
The Fund’s investments are concentrated in companies with a technology theme. Technology companies are often characterised by relatively higher volatility in price performance. Companies in the technology sector also face intense competition, and there may also be substantial government intervention, which may have an adverse effect on profit margins. These companies are also subject to the risks of loss or impairment of intellectual property rights or licences, cyber security risks resulting in undesirable legal, financial, operational and reputational consequences.
The Fund’s investments are concentrated in securities listed on the Stock Exchange of Hong Kong (the “SEHK”) of companies that are active in technology sector may result in greater volatility in the value of the Fund than more diverse portfolios which comprise broad-based global investments. The value of the Fund may be more susceptible to adverse economic, political, policy, foreign exchange, liquidity, tax, legal or regulatory event affecting the technology sector.
The Index is subject to concentration risk as a result of tracking the performance of securities incorporated in, or with majority of revenue derived from, or with a principal place of business in, the Greater China region. The Fund’s NAV is therefore likely to be more volatile than a broad-based fund.
As part of the securities lending transactions, there is a risk of shortfall of collateral value due to inaccurate pricing of the securities lent or change of value of securities lent. This may cause significant losses to the Fund. The borrower may fail to return the securities in a timely manner or at all. The Fund may suffer from a loss or delay when recovering the securities lent out. This may restrict the Fund’s ability in meeting delivery or payment obligations from realisation requests.
The trading price of the Fund unit (the “Unit”) on the SEHK is driven by market factors such as demand and supply of the Unit. Therefore, the Units may trade at a substantial premium or discount to the Fund’s net asset value.
Dividends may be paid from capital or effectively out of capital of the Fund, which may amount to a return or withdrawal of part of an investor’s original investment or from any capital gains attributable to that original investment and result in an immediate reduction in the Net Asset Value per Unit of the Fund.
Global X China Consumer Brand ETF’s (the “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.
The performance of companies in the consumer sector are correlated to the growth rate of the global market, individual income levels and their impact on levels of domestic consumer spending in the global markets, which in turn depend on the worldwide economic conditions, which have recently deteriorated significantly in many countries and regions and may remain depressed for the foreseeable future.
China is an emerging market. The Fund invests in Chinese companies which 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 trading price of the Fund’s unit (the “Unit”) on the Stock Exchange of Hong Kong is driven by market factors such as demand and supply of the Unit. Therefore, the Units may trade at a substantial premium or discount to the Fund’s net asset value.
The Fund’s synthetic replication strategy will involve investing up to 50% of its net asset value in financial derivative instruments (“FDIs”), mainly funded total return swap transaction(s) through one or more counterparty(ies). Risks associated with FDIs include counterparty/credit risk, liquidity risk, valuation risk, volatility risk and over-the-counter transaction risk. FDIs are susceptible to price fluctuations and higher volatility, and may have large bid and offer spreads and no active secondary markets. The leverage element/component of an FDI can result in a loss significantly greater than the amount invested in the FDI by the Sub-Fund.
As part of the securities lending transactions, there is a risk of shortfall of collateral value due to inaccurate pricing of the securities lent or change of value of securities lent. This may cause significant losses to the Fund. The borrower may fail to return the securities in a timely manner or at all. The Fund may suffer from a loss or delay when recovering the securities lent out. This may restrict the Fund’s ability in meeting delivery or payment obligations from realisation requests.
Global X China Electric Vehicle and Battery ETF’s (the “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.
Electric vehicle companies invest heavily in research and development which may not necessarily lead to commercially successful products. In addition, the prospects of Electric vehicle companies may significantly be impacted by technological changes, changing governmental regulations and intense competition from competitors.
China is an emerging market. The Fund invests in Chinese companies which 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 trading price of the Fund’s unit (the “Unit”) on the Stock Exchange of Hong Kong is driven by market factors such as demand and supply of the Unit. Therefore, the Units may trade at a substantial premium or discount to the Fund’s net asset value.
The Fund’s synthetic replication strategy will involve investing up to 50% of its net asset value in financial derivative instruments (“FDIs”), mainly funded total return swap transaction(s) through one or more counterparty(ies). Risks associated with FDIs include counterparty/credit risk, liquidity risk, valuation risk, volatility risk and over-the-counter transaction risk. FDIs are susceptible to price fluctuations and higher volatility, and may have large bid and offer spreads and no active secondary markets. The leverage element/component of an FDI can result in a loss significantly greater than the amount invested in the FDI by the Sub-Fund.
As part of the securities lending transactions, there is a risk of shortfall of collateral value due to inaccurate pricing of the securities lent or change of value of securities lent. This may cause significant losses to the Fund. The borrower may fail to return the securities in a timely manner or at all. The Fund may suffer from a loss or delay when recovering the securities lent out. This may restrict the Fund’s ability in meeting delivery or payment obligations from realisation requests.
Global X China MedTech ETF’s (the “Fund’s”) objective is to provide investment results that, before fees and expenses, closely correspond to the performance of the Solactive China MedTech Index (the “Index”).
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 Fund may be riskier than other exchange traded funds tracking more established indices with longer operating history.
The Fund may invest in small and/or mid-capitalisation companies. The stock of small-capitalisation and mid-capitalisation companies may have lower liquidity and their prices are more volatile to adverse economic developments than those of larger capitalisation companies in general.
The Fund’s investments are concentrated in companies in the medical technology industry. The value of the 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, liquidity, tax, legal or regulatory event affecting the relevant industry.
Many of the companies with a high business exposure to a medical technology theme have a relatively short operating history. Rapid changes could render obsolete the products and services offered by these companies and cause severe or complete declines in the prices of the securities of those companies. Additionally, companies with medical technology themes may face dramatic and often unpredictable changes in growth rates and competition for the services of qualified personnel. They may potentially subject to (i) substantial government intervention in the technology industry (including restrictions on investment in internet and technology companies), (ii) complex laws and regulations including privacy, data protection, content regulation, intellectual property, competition, protection of minors, consumer protection and taxation, (iii) heavy and significant capital investment on research and development, (iv) risks of medical failure (including injury or death of patients), negligence or product liability claims, recall or withdrawal of products. These risks may result in adverse impact of the operating results of the companies.
The Mainland China is an emerging market. The Fund invests in Mainland Chinese companies which may involve increased risks and special considerations not typically associated with investment in more developed markets, such as liquidity risk, currency risks or control, political and economic uncertainties, legal and taxation risks, settlement risks, custody risk and the likelihood of a high degree of volatility. Securities exchanges in the Mainland Chinese markets 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 Fund.
Listed companies on the ChiNext market and/or STAR Board are subject to higher fluctuation on stock prices and liquidity risk, over-valuation risk, less stringent regulation risk, delisting risk and concentration risk.
The Fund’s synthetic replication strategy will involve investing up to 50% of its net asset value in financial derivative instruments (“FDIs”), mainly funded total return swap transaction(s) through one or more counterparty(ies). Risks associated with FDIs include counterparty/credit risk, liquidity risk, valuation risk, volatility risk and over-the-counter transaction risk. FDIs are susceptible to price fluctuations and higher volatility, and may have large bid and offer spreads and no active secondary markets. The leverage element/component of an FDI can result in a loss significantly greater than the amount invested in the FDI by the Fund.
As part of the securities lending transactions, there is a risk of shortfall of collateral value due to inaccurate pricing of the securities lent or change of value of securities lent. This may cause significant losses to the Fund. The borrower may fail to return the securities in a timely manner or at all. The Fund may suffer from a loss or delay when recovering the securities lent out. This may restrict the Fund’s ability in meeting delivery or payment obligations from redemption requests.
The trading price of the Shares on the Stock Exchange of Hong Kong is driven by market factors such as the demand and supply of the Shares. Therefore, the Shares may trade at a substantial premium or discount to the Fund’s Net Asset Value.
Payments 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 Net Asset Value per Share of the Fund and will reduce the capital available for future investment.

China Rebound
Who are the Key Outperformers during the Rally?

By: Lizzy Liu, Jeff Huang

Just days after PBOC’s unprecedented monetary stimulus package, the first ever September politburo economic meeting held on 26 Sep came as a positive surprise and once again fueled China market. During the meeting, China has vowed to save the private economy, stabilize its property sector from further slumping and ensure necessary fiscal expenditures. No detailed numbers on fiscal stimulus has been reported yet, but we expect more follow-up policies in the coming months with the supportive regulatory stance.

Reasons behind some Global X China ETFs to Rally

In light of China government’s policy bazooka to boost economy, China stock market has surged with HSI/HS Tech/CSI 300 recording 9%/13%/10% returns since 24 Sep. In this article, we will take a closer look at the key outperformers in the current rally. (Bloomberg, Data as of 26 Sep close)

Global X China ETF Recorded Strong Performance Amid Market Rebound

Global X Hang Seng Tech ETF (2837 HK)

Global X Hang Seng Tech ETF (2837 HK) has experienced a significant rebound following the announcement of the PBOC’s strong stimulus package. Core internet platforms and technology companies rank among the top choices for global investors seeking opportunities in the Chinese market after the strong stimulus package. The unique investment value for Hang Seng Tech is also defined by its attractive valuation, ongoing margin expansion, and continued ramp up in shareholder returns. With well-established ecosystem containing large user base and leading technology in place, we see further upside potential for these leading technology companies coming from the rapid development of structural growth themes such as EV and AI in China.

Global X China EV and Battery ETF (2845 HK)

The Global X China EV and Battery ETF (2845 HK) has shown substantial recovery, riding on the strong rally in the Chinese market following the recent stimulus announcements. August EV sales exceeded 1mn unit, +32% YoY, with EV penetration reaching 54%. On policy front, the trade-in stimulus has been doubled to Rmb20k (from Rmb10k) per NEV, and Rmb15k (from Rmb7k) per eligible ICE Vehicle. As of 25 Sep, over 1.1mn trade-in applications have been received. The intense price competition could be taking a pause as automakers take more disciplined pricing strategy and consumer EV demand remains robust. In addition, as Fed enters rate cutting cycle, automakers (especially EV startups) will be benefiting from the lowering financing costs.

For battery industry, we could be seeing an inflection point in industry landscape as supply-demand dynamics continue to improve. Capex for Chinese battery makers decreased by over 50% from the peak, which should drive a subsequent decrease in capacity. Improving supply-demand dynamics should drive a gradual recovery in capacity utilization rate and support improving margin for key players. Meanwhile, demand remain robust with China battery domestic shipment growing by c.40% YoY in 1H24. The continue decrease in lithium prices should also lower the costs for battery and automakers and thus support better profitability outlook across the value chain.

Global X China Consumer Brand ETF (2806 HK)

China Consumer Brand ETF (2806 HK) has experienced a significant recovery since late September. We attribute the outperformance to: 1) Attractive valuation: China consumer sector has been under pressure YTD with compressed valuations. Consumer sector is currently trading at 11x PE, 2std below its long-term average, according to BofA (data as of September 6, 2024).

2) Ongoing policy support from local governments on top of central government’s initiatives: On September 25, Shanghai announced Rmb500mn vouchers for the public to stimulate spending in various sectors — Rmb360/90/30/20mn for dining/accommodation/movie tickets/sports. This initiative represents the first major action by a local government following the PBOC stimulus package and showcases positive attitude from local authorities.

3) Evident impact of previous policy support: The effects of earlier policy initiatives are becoming increasingly apparent, particularly with the consumer trade-in programs launched by NDRC in July. In August, passenger car sales increased by 10.8% MoM, with NEV sales growing by 17%. As of September 24, China has approved nearly Rmb11bn subsidies through the national automobile trade-in platform. In the home appliance sector, over 5.2m home appliance units have benefited from subsidies so far, amounting to Rmb4.67bn.

Global X China MedTech ETF (2841 HK)

The Global X China MedTech ETF (2841 HK) offers investors an opportunity to gain exposure to Chinese companies involved in the manufacturing and distribution of medical devices. 2841 HK has demonstrated impressive recovery since late September. This outperformance can be attributed to enhanced liquidity post stimulus, which could support fiscal spending and medical insurance in a more favorable economic environment. Additionally, the YTD relative underperformance has contributed to this recent surge, while the improving consumption may also lead to the increase of the health expenditure.

Related Global X ETFs’ Product¹

	Global X Hang Seng TECH ETF (2837 HK)	Global X China Consumer Brand ETF (2806 HK)	Global X China Electric Vehicle and Battery ETF (2845 HK)	Global X China MedTech ETF (2841 HK)
Listing Date	30 Mar 2023	17 Jan 2020	17 Jan 2020	04 Aug 2023
Reference Index²	Hang Seng TECH Index²	Solactive China Consumer Brand Index NTR³	Solactive China Electric Vehicle and Battery Index NTR⁴	Solactive China MedTech Index⁵
Primary Exchange	Hong Kong Stock Exchange	Hong Kong Stock Exchange	Hong Kong Stock Exchange	Hong Kong Stock Exchange
Ongoing Charges Over A Year	0.44% p.a.⁶	0.68% p.a.⁷	0.68% p.a.⁸	0.68% p.a.⁹
Product Page	Link	Link	Link	Link

Footnotes

¹ Source: Mirae Asset, September 2024.
² The Underlying Index is a net total return, modified free float-adjusted market capitalization weighted index. A net total return index reflects the reinvestment of dividends or coupon payments, after deduction of any withholding tax (including any surcharges for special levies, if applicable).
³ The Underlying Index is a net total return, free float market capitalization weighted index. A net total return index reflects the reinvestment of dividends or coupon payments, after deduction of any withholding tax (including any surcharges for special levies, if applicable).
⁴ The Index is a net total return, free float market capitalisation weighted index. A net total return index seeks to replicate the overall return from holding a portfolio consisting of the Index constituents and in the calculation of the Index considers payments such as dividends after the deduction of any withholding tax or other amounts to which an investor holding the Index constituents would typically be exposed.
⁵ The Underlying Index is a net total return, total market capitalisation weighted index. A net total return index seeks to replicate the overall return from holding a portfolio consisting of the Index constituents and in the calculation of the Index considers payments such as dividends after the deduction of any withholding tax or other amounts to which an investor holding the Index constituents would typically be exposed.
⁶ The ongoing charges figure is an annualised figure based on the ongoing expenses of the Sub-Fund, expressed as a percentage of the Sub-Fund’s average Net Asset Value of the Listed Class of Units of the Sub-Fund over the same period. The figure may vary from year to year. Please refer to the Product Key Facts Statement and the Prospectus for further details.
⁷ The Fund adopts a single management fee structure, whereby a single flat fee will be paid out of the assets of the Fund to cover all of the costs, fees and expenses of the Fund. The ongoing charges figure is an annualised figure based on the ongoing expenses of the Fund, expressed as a percentage of the Fund’s average net asset value over the same period. The figure may vary from year to year. The Fund adopts a single management fee structure, whereby a single flat fee will be paid out of the assets of the Fund to cover all of the costs, fees and expenses of the Fund. The single management fee does not include the fees related to FDIs (including swaps) entered into by the Fund. The ongoing charges of the Fund are fixed at 0.68% of the Fund’s net asset value, which is equal to the current rate of the management fee of the Fund. For the avoidance of doubt, any ongoing expenses of the Fund exceeding the ongoing charges of the Fund (i.e. the management fee) shall be borne by the Manager and shall not be charged to the Fund. Please refer to the Key Facts Statement and the Prospectus for further details.
⁸ The Fund adopts a single management fee structure, whereby a single flat fee will be paid out of the assets of the Fund to cover all of the costs, fees and expenses of the Fund. The ongoing charges figure is an annualised figure based on the ongoing expenses of the Fund, expressed as a percentage of the Fund’s average net asset value over the same period. The figure may vary from year to year. The Fund adopts a single management fee structure, whereby a single flat fee will be paid out of the assets of the Fund to cover all of the costs, fees and expenses of the Fund. The single management fee does not include the fees related to FDIs (including swaps) entered into by the Fund. The ongoing charges of the Fund are fixed at 0.68% of the Fund’s net asset value, which is equal to the current rate of the management fee of the Fund. For the avoidance of doubt, any ongoing expenses of the Fund exceeding the ongoing charges of the Fund (i.e. the management fee) shall be borne by the Manager and shall not be charged to the Fund. Please refer to the Key Facts Statement and the Prospectus for further details.
⁹ The Fund adopts a single management fee structure, whereby a single flat fee will be paid out of the assets of the Fund to cover all of the costs, fees and expenses of the Fund. As the Fund is newly set up, this figure is an estimate only and represents the sum of the estimated ongoing charges over a 12-month period, expressed as a percentage of the estimated average Net Asset Value of the Listed Class of Shares over the same period. It may be different upon actual operation of the Fund and may vary from year to year. As the Fund adopts a single management fee structure, the estimated ongoing charges of the Fund will be equal to the amount of the single management fee, which is capped at 0.68% of the average Net Asset Value of the Listed Class of Shares of the Fund. Any ongoing expenses exceeding 0.68% of the average Net Asset Value of the Listed Class of Shares of the Fund will be borne by the Manager and will not be charged to the Fund. For the avoidance of doubt, the single management fee does not include the fees relating to the FDIs , including swaps, entered into by the Fund. Please refer to the Key Facts Statement and the Prospectus for further details.

Disclaimer

This document contains the opinions of Mirae Asset Global Investments (Hong Kong) Limited (“MAGIHK”) and is intended for your use only.

It is not a solicitation, offer or recommendation to buy or sell any security or other financial instrument and shall not constitute any form of regulated financial advice, legal, tax or other regulated service. Information contained herein has been obtained from sources believed to be reliable, but is not guaranteed. MAGIHK makes no representation as to their accuracy or completeness and therefore do not accept any liability for a loss arising from the use of this document.

Investment involves risk. Forecasts, past information and estimates have certain inherent limitations. Statements concerning financial market trends or portfolio strategies are based on current market conditions, which will fluctuate. There is no guarantee that these opinions are suitable for all investors and each investor should evaluate their ability to invest for the long term, especially during periods of downturn in the market. Outlook and strategies are subject to change without notice.

Past performance information presented is not indicative of future performance. Before making any investment decision, investors should read the fund’s offering document for further details including the risk factors. Investors should ensure they fully understand the risks associated with the applicable investment and should also consider their own investment objective and risk tolerance level. Investors are advised to seek independent professional advice if in doubt.

Issuer: Mirae Asset Global Investments (Hong Kong) Limited (Licensed by the Securities and Futures Commission for Types 1, 4 and 9 regulated activities under the Securities and Futures Ordinance). This document has not been reviewed by the Securities and Futures Commission or the applicable regulator in the jurisdiction which this article is posted and no part of this publication may be reproduced in any form, or referred to in any other publication, without express written permission of MAGIHK.

Authors: Zijun Liu and Jeff Huang(Licensed by the Securities and Futures Commission for Types 1 and 4 regulated activities under the Securities and Futures Ordinance). The authors and their associate(s) do not hold the securities/funds mentioned in the article.