BU China Gateway Fund ("CGF")

Dynamic allocation in Chinese equities and bonds to capture the potential growth of the new economy

Flexible allocation aiming to foster long term return

Ranked high in its own category in terms of year-to-date and past 2 years' performance 1 #

3 major investment themes for equities

Domestic consumption, new energy application, positions in cyclical stocks

Aims to provide monthly dividends

Dividends are not guaranteed, and distributions may be paid out of income and/or capital+
Annualized dividend yield as of June 2 #
USD 5.5%
HKD 5.5%
RMB hedged 7.8%

China couldn't be a missing piece of your investment portfolio

Economic growth being robust for the second half of the year

  • The economy is recovering in a stable and healthy pace. GDP recorded 7.9% growth in Q2 while 12.7% for the first half of the year3 .
  • Shipping and infrastructure will be the key drivers of growth for the second half of the year.

  • Rate cut by PBOC injects liquidity into the market

  • People's Bank of China (PBOC) announced to lower the required reserve ratio in July posing positive impact to the financial market.

  • Focuses on 3 investment themes for equities

    Domestic consumption

  • The expansion of middle to high income groups in China drives the demand for mid to high-end services such as health care, cosmetic surgery, beauty products and services and white wine etc.

  • "China chic" is getting popular among youngsters and mass public in China. Its rising quality and innovativeness boosts the marketability of the national brands. Local sportswear, dairy products and beer are the key beneficiaries.

  • China Chic is getting popular among youngsters
      Source:  www.xinhuanet.com, 10 May 2021.

    The application of new energy

  • The production volume of electric vehicles in the first half of this year has recorded a 3 times YOY growth (see the chart below). More local brands are entering the market with new technologies introduced. The industry is under a high growth cycle and faces less policy risk. We are optimistic on the future growth of the industry.

  • The production volume of electric wehicles in China
      Source: https://nance.sina.com.cn, 14 June 2021.

    Positions in cyclical stocks

  • Cyclical stocks e.g. shipping, oil and commodities etc. are favoured in a gradual recovery of China and other economies in the world. Our investment team will consider to increase its holdings on attractive valuations.
  • cyclical stocks

    Fund Features

    The fund has been performing well since its launch in 2018 and its return is leading other funds in the same category1,4,#

    Timely adjusts equity and bond mix

  • The equity to bond ratio of the Fund in general: Equity:70%; Bond:30%
  • To capture the market upside in equities as well as the fixed income opportunities.

  • Invests broadly across Chinese stocks to seek alpha

  • Dynamically allocates in China A-shares, Hong Kong equities, ADR, China bond market to capture the potential growth in individual markets.

  • Investors can enjoy investment return with dividend payment

  • Through the active trades conducted by our investment professionals with the expertise in China equity and bond markets, additional return and dividend payment capacity can be achieved.
  • The Fund offers dividend yields at 5.5% (A USD distributing) and 7.8% (A RMB Hedged distributing) 2,# 
  • Dynamic allocation between China equity and bond markets to capture investment opportunities and mitigate market volatilities