Investment Approach

The Fund aims to achieve a return on your investment, through a combination of capital growth and income on the Fund’s assets, which reflects the return of the Bloomberg Barclays China Treasury + Policy Bank Index, the Fund’s benchmark index (Index). The Fund is passively managed and aims to invest so far as possible and practicable in the fixed income (FI) securities (such as bonds) that make up the Index or provide a similar return to the securities of the Index. The FI securities, will at the time of inclusion in the Index, comply with the requirements of the Index and will have no minimum credit rating, provided they are not in default. The Index measures the performance of CNY denominated bonds issued by the Ministry of Finance of the People’s Republic of China (PRC), and debt issued by Chinese policy banks (PRC government agencies which are not guaranteed by the government), that are listed on the China Interbank Bond Market (CIBM). They have a par value of at least CNY5 billion and a remaining maturity of at least 1 year at the time of inclusion in the Index. The Index does not impose any minimum credit rating requirements. The Fund intends to replicate the Index by holding the bond issues of all issuers which make up the Index, in a similar proportion to the weightings of the issuers in the Index.