HSBC GIF Chinese Equity Fund

Transcription

1 For Investment Professionals only Investment Case Investment Team The Fund Summary

2 The investment case 2

3 Investment case Why invest in the HSBC GIF Chinese Equity Strategy? Chinese economic growth at 7-8% or higher led by robust domestic consumption and investment Mid 2009, China shares valuation still attractive Private sector on the rise and higher spending power Disciplined and repeatable investment process, with the strong research culture, in-depth research to find the most attractive stock opportunities in the region HSBC has one of the largest and most experienced Chinese equity teams 3

4 The investment team 4

5 An experienced Chinese Equity Team 13 dedicated investment professionals Name Role Years Years with Experience HSBC/Halbis Richard Wong Investment Director China Alan Zhong Investment Manager China 5 4 Debbie Chan Investment Analyst China 5 2 Philip Mok Investment Director Hong Kong 20 6 Elina Fung Associate Director Hong Kong 8 2 Hugh Lee Senior Investment Analyst Banking 13 3 Mathew Lee Investment Analyst Property 9 3 Patrick Crivelli Investment Analyst Consumer 7 3 Florence Hsieh Head of Dealing Samuel Lai Senior Dealer 20 8 Andrew Lee Head of Portfolio Management Unit 14 4 Francis Chung Director, Asia Product Specialist 18 2 Sami Abouzahr Asia Product Specialist 5 5 5

6 The fund: HSBC GIF Chinese Equity Fund 6

7 Fund facts Recommended Investment Horizon: Investment Universe: Benchmark: Stock Weighting: Sector Diversification: 5 years Chinese equities with no capitalisation constraints. MSCI China A concentrated portfolio of our preferred stocks (40 to 60) No limitation on sector allocation 7

8 Investment Philosophy We believe that Chinese equity markets are inefficient and due to these inefficiencies may be volatile Inherent value will be recognised by the market, eliminating mis-pricing thus allowing us to deliver superior returns Our valuation driven approach focuses on companies growing shareholder value and the price one pays for this growth We believe companies with consistent above average growth produce superior stock market returns 8

9 Process Highlights Disciplined, valuation driven investment process Stock valuation and research generated by experienced team of fund managers and specialised analysts Quantitative and qualitative stock screening process Dedicated risk management team, bringing together a range of risk management tools into the investment process 9

10 Investment process Simple, Disciplined, Repeatable Screen the Universe Investable Universe Stock Research & Valuation Determine Stock Positions Model Portfolio Quantitative & qualitative screening Investable universe of 300 stocks 150 one-on-one company visits p.a. Research by Fund Managers and Analysts: Management quality Competitive advantage Earnings sustainability Position size relative to benchmark: Analyst Fair Value Target Strength of conviction Upside potential Contribution to risk stocks held Strong earnings at a reasonable price Client guideline compliance Multi-faceted risk analysis Valuation Analysts Fair Value 10

11 Portfolio Construction No formal limitation on sector allocation Stock positions will be reviewed with a view to sale when: The company is trading above the top of our analyst s assessment of its fair value range The outlook for the key drivers turns negative, a signpost that earnings will come under pressure A more attractive investment opportunity is identified There is a change to management strategy A major sale of assets or divisions has occurred There is an unexpected structural change to an industry in which the company is involved 11

12 Portfolio Composition (30 June 2009) Stock Weight China Construction Bank 8.71% China Mobile (HK) Ltd 8.42% Industrial & Commercial Bank of China 6.58% Petrochina (China) 6.57% Bank of China 5.02% China Life Insurance Co (2628) 4.74% CNOOC Ltd (883) (China) 4.06% China Shenhua Energy Co Ltd 3.56% China Resources Land Ltd 2.92% Tencent Holdings Lts 2.89% Sector Weight Financials 40.65% Oil & Gas 13.60% Basic Materials 12.14% Industrials 10.96% Telecommunications 10.48% Consumer Goods 5.11% Technology 3.67% Utilities 0.08% Cash 3.32% 12

13 Performances (30 June 2009) Performance in USD (% Change)* Rolling time period 30/06/ /06/ /06/ /06/ /06/ /06/ /06/ /06/ /06/ /06/2005 HSBC GIF Chinese Equity Rolling time period 1 month 3 months 6 months 1 year 3 years 5 years Fund Morningstar mean Benchmark Fund rank 52/79 47/78 59/74 49/71 33/45 18/32 59/74 33/65 32/49 15/43 Quartile rank * The above performance figures refer to the past and are not a reliable indicator of future returns. The value of investments and any income from them, can go down as well as up. The above performance figures are calculated in USD, and changes in the rate of currency exchange may affect the value of your investment. Source: Morningstar, bid to bid, gross income reinvested. Performance information is up to 30 June 2009, Morningstar run date 09 July Morningstar Sector used Offshore and International Funds, Eq China. Benchmark source: Datastream. From the inception of the fund to 31/12/97, the benchmark of the fund was the Peregrine Greater China Index. Between 01/01/98 and 31/05/05 the benchmark was CLSA China World. Please note quartile rank is a term widely used in financial services to denote performance of a fund within its sector. For example a ranking of 1 denotes a Fund in the top 25% of its peer group sector, with a ranking of 4 denoting a fund in the bottom 25% of it's peer group sector. Total return, sector median performance and ranks - Data Source - Copyright 2009 Morningstar, Inc. All Rights Reserved. 13

14 Statistics (30 June 2009) Fund size (in millions USD): 3, Portfolio Turnover*: 0.52 Volatility**: Tracking error**: 4.06 Information Ratio**: * Source : HSBC, calculation uses the lesser of sales and purchases over the past year ** Source : HSBC, based on monthly returns over the past three years where available 14

15 Fund description and Manager profile HSB1005a Richard Wong Investment Director, Equities, Halbis Capital Management (HK) Ltd. Richard Wong has been working in the industry since Prior to joining Halbis in 1997, Richard was employed by Nikko Capital Management (HK) as Senior Portfolio Manager. Richard holds an MBS in Finance from New York University. The fund offers investors access to the worlds fastest growing economy through a well-diversified portfolio of Chinese shares The portfolio - which currently ranks among the largest Chinese equity funds globally - is predominantly invested in large companies, although stock selection is conducted across a range of market capitalisations It is managed by a very experienced and team who seek to deliver performance through a sophisticated valuation-driven approach, coupled with disciplined risk management This presentation should be viewed in conjunction with the relevant simplified prospectus and full prospectus for a full list of risk warnings prior to making an investment in a fund. 15

16 Fund Details Legal form Base currency Sub-fund of Luxembourg UCITS HSBC Global Investment Funds US$ Launch date 25 June 1992 ISIN code Management fees Performance fees Subscription fees Benchmark LU % tax included NONE 5.54% maximum, tax included MSCI China Redemption fees Dealing Valuation Settlement Management company Investment advisor Custodian Launch price (in USD) NONE Daily before 10:00 (CET) Daily Trade day + 4 business days HSBC Investment Funds (Luxembourg) SA Halbis Capital Management (Hong Kong) Limited RBC Dexia Investor Services Bank S.A

17 Summary 17

18 Summary A recognised leader in the management of Asian financial assets 37 investment professionals based in Hong Kong and Singapore Opportunity to invest in the fastest growing economy through diversified portfolio Approximately US$3.9bn in funds under management of Chinese Equities (as at end of December 2008) 18

19 What kind of investor should consider the HSBC GIF Chinese Equity Fund? Experienced investors with a long term investment horizon Investors seeking lower-beta and relatively uncorrelated investments in more nascent areas of growth Investors comfortable with Exposure to emerging markets and smaller capitalisation companies that can increase the volatility of returns and may restrict liquidity 19

20 Important information This presentation is intended for investment professionals only and not for distribution to Retail Clients. The contents of this presentation are confidential and may not be reproduced or further distributed to any person or entity, whether in whole or in part, for any purpose. The material contained in this presentation is for information only and does not constitute investment advice or a recommendation to any reader of this material to buy or sell investments. The HSBC Global Investment Fund ( GIF ) range is a Luxembourg domiciled SICAV and is regulated by the CSSF. The funds mentioned in this document may not be registered for sale or available in all jurisdictions. For available funds please contact your local HSBC office. HSBC Global Investment Funds range cannot be sold by anyone in any jurisdiction in which such offer or solicitation is not lawful or in which the person making such an offer or solicitation is not qualified to do so or to anyone to whom it is unlawful to make such offer or solicitation. All applications are made on the basis of the current HSBC Global Investment Funds Prospectus, simplified prospectus and most recent annual and semi-annual reports. These can be obtained on request and free of charge from HSBC Global Asset Management (UK) Limited or the local distributors. The value of investments may go down as well as up and you may not get back the full amount you invested. Where overseas investments are held the rate of exchange may cause the value of investments to go down as well as up. Markets in some countries can be described as emerging markets. Some of these may involve a higher risk than where an investment is within a more established market. Where a sub-fund invests predominately in one geographical area, any decline in economic conditions may affect prices and the value of underlying investments. The securities representing interests in the HSBC Global Investment Funds range have not been and will not be registered under the US Securities Act of 1933 and will not be offered for sale or sold in the United States of America, its territories or possessions and all areas subject to its jurisdiction, or United States person, except in a transaction which does not violate the Securities Law of the United States of America. This document is issued by HSBC Global Asset Management (UK) Limited, 8 Canada Square, Canary Wharf, London, E14 5HQ, UK. Authorised and regulated by the Financial Services Authority and registered as number Copyright. HSBC Global Asset Management All Rights Reserved. This product is marketed in a sub-distributing capacity on a principal to principal basis by the HSBC Global Asset Management MENA, a unit that is part of HSBC Bank Middle East Limited, PO Box 66, Dubai, UAE, which is incorporated and regulated by the Jersey Financial Services Commission. Services are subject to the Bank s terms and conditions. HSBC Bank Middle East Limited is a member of the HSBC Group. The information provided has not been prepared taking into account the particular investment objectives, financial situation and needs of any particular investor. As a result, investors using this information should assess whether it is appropriate in the light of their own individual circumstances before acting on it. The information in this document is derived from sources believed to be reliable, but which have not been independently verified. However, HSBC Bank Middle East Limited makes no guarantee of its accuracy and completeness and is not responsible for errors of transmission of factual or analytical data, nor shall HSBC Bank Middle East Limited be liable for damages arising out of any person s reliance upon this information. All charts and graphs are from publicly available sources or proprietary data. The opinions in this document constitute the present judgment of the issuer, which is subject to change without notice. This document is neither an offer to sell, purchase or subscribe for any investment nor a solicitation of such an offer. This document is intended for the use of institutional and professional customers and is not intended for the use of private customers. This document is intended to be distributed in its entirety. No consideration has been given to the particular investment objectives, financial situation or particular needs of any recipient. Any transaction will be subject to HSBC Bank s Terms of Business /ME/