PRODUCED: JULY 2019

TradePlus S&P New China Tracker

Exchange-Traded Fund

www.tradeplus.com.my
 TradePlus S&P
New China Tracker
Opening doors to investment opportunities
within the New China economy

www.tradeplus.com.my
 TradePlus S&P New China Tracker (“Fund”) is an equity exchange-traded fund that is
designed to provide investors a convenient access to Chinese listed companies within
the consumption and service-oriented industries. The Fund closely tracks the performance
of the S&P New China Sectors Ex A-Shares Index; in which units are tradeable on Bursa
Malaysia Securities.

Key Highlights
1 An easy access to New China opportunities
Participate in the growth of New China sectors that have emerged from China’s transition to
become a consumption-focused economy. These sectors are starting to show dominance in
its contribution towards economic growth, and have gained notable traction.

Cumulative performance since January 2011*

140%
S&P New China Ex A-Shares Index: +59%
120%
MSCI China Index: +6%
100%
FTSE China 50 Index: -7%
80%
60%
40%
20%
0%
-20%
-40%
-60%
Jan 2011 Feb 2012 Apr 2013 Jun 2014 Jul 2015 Sep 2016 Oct 2017 Dec 2018

2 Gain exposure to familiar names and more – all in a single trade

One transaction is all it takes! The Fund facilitates an efficient way for you to access an extensive
portfolio of New China stocks, which are spread across varying sectors.

Top Ten (10) Constituents of the Fund’s Benchmark Index#:

No. Company Name Weightings (%)
1 AIA Group Ltd 10.61%
2 Tencent Holdings Ltd 10.35%
3 Alibaba Group Holding Ltd 9.47%
4 China Mobile Ltd 7.94%
5 Ping An Insurance (Group) Co of China Ltd 6.67%
6 Baidu Inc 6.58%
7 NetEase Inc 2.58%
8 JD.com Inc 2.56%
9 Galaxy Entertainment Group Ltd 2.38%
10 China Life Insurance Co Ltd 2.36%

3 Participate in your preferred currency

You may subscribe to the Fund in HKD via Participating Dealer(s), or trade in USD and MYR through
the Bursa stock exchange.

Source: *Returns are quoted in HKD, Bloomberg as at 31 December 2018. #S&P Dow Jones Indices as at 31 December 2018.
Fund Information

Trading on Bursa Securities

Trading Currency US Dollar (USD) Malaysian Ringgit (MYR)

Minimum Trading Units 100 100

Stock Code 0829EB 0829EA

Stock Short Name CHINAETF-USD CHINAETF-MYR

ISIN Code MYL0829EB009 MYL0829EA001

Investing through Participating Dealer(s)

Creation /
Hong Kong Dollar (HKD)
Redemption Currency
Methods for Creation / Creation of Units: Cash creation / In-Kind creation
Redemption of Units Redemption of Units: Cash redemption / In-Kind redemption
Minimum Creation /
500,000 units
Redemption Basket

Fund Facts
Listing Date 28 January 2019
Fund Launch Date 15 January 2019
Fund Category Equity exchange-traded fund
Fund Type Index tracking fund
Investment Objective The Fund aims to provide investment results that closely correspond
to the performance of the Benchmark.
Investment Strategy The Fund is a passively managed fund. The Manager intends to primarily
use a full replication strategy to track the performance of the Benchmark.
Investor Profile The Fund is suitable for investors who:
• seek exposure to Chinese listed companies in the consumption and
service-oriented industries; and
• have a high risk tolerance level.
Asset Allocation • A minimum of 70% of the Fund’s NAV is to be invested in Authorised
Securities;
• a maximum of 20% of the Fund’s NAV is to be invested in derivatives
and/or collective investment schemes; and
• the remaining balance of the Fund’s NAV is to be invested in money
market instruments and/or deposits.
Specific Risks • Equity Investment risk • Minimum redemption size
• Country risk • Tracking error risk
• Currency risk • Risks related to the benchmark
• Sector-related risks • Securities lending transaction risk
• Concentration risk
Base Currency HK Dollar (HKD)
Benchmark S&P New China Sectors Ex A-Shares Index
Financial Year End 31 December
Initial Approved
1,000,000,000 units
Fund Size
Income Distribution Subject to the availability of income, the Fund will distribute income on
an annual basis after the end of its first financial year.

Fees & Charges

Annual Management Fee 0.50% p.a. of the NAV of the Fund calculated and accrued daily
using the Fund’s Base Currency.
Annual Trustee Fee 0.04% p.a. of the NAV of the Fund calculated and accrued daily
using the Fund’s Base Currency.
Quarterly Licence Fee Minimum of USD10,000 p.a. or 0.05% of the average daily asset under
management, whichever is higher.
Understanding
Exchange-Traded Funds (“ETFs”)

What is an ETF?

A pooled investment
Much like unit trust funds, ETFs are also a form of collective investment.
The pooled investment collected from investors will be larger in amount;
thus providing easy access into the underlying referenced index – such
as a basket of stocks, bonds, or even commodities.

Commonly known as index trackers

The performance of an ETF is structured to track the performance of
its referenced index. Investment levels are kept high at all times to
replicate the performance of the index, irrespective of the outlook.

Governed by domestic regulators

Framework, and regulatory reporting requirements ensure that ETFs
are managed within its guided parameters. In Malaysia, any ETF will
need to be approved by the Securities Commission Malaysia and
Bursa Securities Malaysia prior to its listing.
Why invest in ETF?

Low Cost
ETFs are typically passive solutions; which allows it to be a cost-
effective investment option as compared to actively-managed funds.
Additionally, there is no sales charge.

Tradability
ETFs are listed on the stock exchange like a common stock. Hence it
can be bought or sold anytime throughout the regular trading hours.

Diversification
ETFs are fairly versatile, allowing investors to gain broad exposure into
various asset classes across global markets through a single transaction.
To complement one’s core portfolio, investors can select ETFs based on
preference of asset classes, themes, factors, and geographical reach.
 China:
Taking on New
Routes to Growth

T he meteoric rise of China as an economic powerhouse over the past half century is nothing
short of a remarkable story. Through the gradual liberalisation of its economy since the 1970s,
China has successfully steered itself from being one of the world’s poorest nations to its
second-largest economy today.

But with the apparent exhaustion of gains from urbanisation following decades of robust
development, there was a need for China to explore new and more sustainable forms of
growth in order to maintain its economic relevance for the coming generations. This eventually
sparked the emergence of the New China Economy.
The “New China” vision
Envisioning a future of quality growth as opposed to just quantity, the Chinese government
has committed itself, and continually pushed for structural reforms and policies to realise the
country’s latest economic transformation – into one that is powered by domestic consumption
and services.

Introduction of structural reforms for a more

2013
sustainable economy.

New China Economy:

till Gradually shaping a self-insulated economic
present model based on growth through consumption
and services; adding innovation to its
manufacturing prowess.

2011 China overtakes Japan to claim spot as

2nd largest economy in the world.

2001 China joins World Trade Organisation ("WTO").

1992 International Monetary Fund (“IMF”) ranks

China as 3rd largest economy in the world.

1978 Open Door Policy:

China opened its economy to foreign
investments, and encouraged development
1990 in market economy, as well as private sector.
Fuelling the New Transition
In the wake of the Chinese government’s bid to shape its New China Economy, an evident
change in China’s growth pattern began to transpire.

1 Expansion of services and consumption

The service and consumption industries have witnessed a sharp expansion in recent years, and
have rose to become amongst the top drivers of the country’s Gross Domestic Product (“GDP”).

China GDP Breakdown by Industries

uring 47 uring 40
act . act .
uf uf
n
n

3%

7%
Ma
Ma

2006 2016
er er
% %
S

vic vic
es 4 1.9 es 5 0.7

Contribution to China GDP Growth

65%

42% 43% 42%

15%

-7%
Consumption Investment Net Exports

2006 2016

Source: Bloomberg
 2 Rising income anchoring the shift in consumption pattern

Chinese household disposable income has increased from approximately 57% of its GDP in
2007 to roughly 62% of its GDP in 2016. This growth will likely remain well-supported moving
forward as the Chinese middle class is expected to grow to 303 million by 2020.

As wealth increases, consumption is likely to follow.

Furthermore, China possess one of the largest consumer markets in the world; only second to
the United States. From 2006 to 2016, the size of China’s consumption market jumped from
USD1.4 trillion to a staggering USD6 trillion; which makes up more than 10% of the global
consumption space.

218 303
million
million
Middle Class
Population
expected
2015
to grow to
2020F

Boast a consumption
market worth
USD 6 TRILLION

Source: CEIC, Haver, UBS estimates

 3 Boom of the E-commerce industry

Internet penetration rate in China has vastly increased over the years – from 42% in 2012 to
56% in 2017, while 98% of the total internet users are using mobile internet.

Increasing internet adoption sparked a boom in China’s online retail sales, which grew by
USD528 billion over the span from 2012 to 2017. It has outgrown the United States with a solid
32% compounded annual growth rate (“CAGR”).

As of 2017, China’s online retail sales market is larger than that of the United States.

Online Retail Sales (USD billion) Online Retail Sales: Total Value (%)
706
14%
13%
32%
CAGR 453
15%
CAGR
231 8%
178 6%

China US China US
2012 2017 2012 2017

Source: CNNIC, iResearch, Citi Research, US Commerce Department

4 Artificial Intelligence (“AI”) capabilities

The integration and application of AI technology across

industries is also becoming a pivotal part of China’s economic
transformation.

China is currently ranked number 2 in terms of AI, behind the

United States. Nevertheless, it has grown tremendously in
recent years and is the leading holder of the most AI patents
in the world as of 2018.

China aims to become a global leader in the field by 2030.

Source: South China Morning Post

An Emerging Theme for
Investment Opportunities
While the dramatic, double digit growth pace as seen in the China of old is no longer – growth
prospects for the future remains promising. To name a few, sectors including consumer staples,
insurance, healthcare, and e-commerce are among the beneficiaries of the New China transformation.

Naturally, ongoing regulatory and policy implementations by the Chinese government – such
as supply-side reforms and efforts to reduce reliance on a debt-fuelled economy – may pose
a slight dampening effect on growth for the near term. However, it is important to note that
this shift in economic priorities would serve as the necessary groundwork in ensuring China’s
steady progress towards a healthier and more sustainable growth model.

China’s economic prowess is undeniable, and its influence over the global marketplace will
only continue to grow from here. Treading ahead, innovation will remain at the heart of
China’s expansion blueprint, as they continue to employ measures and resources to enhance
its AI capabilities, as well as its service and consumption industries. Coupling this with the
nation’s sheer population and rising purchasing power, the New China Economy presents
itself as a potential bright spot for long term growth and an emerging investment theme that
is worth considering.

Disclaimer
This content has been prepared by Affin Hwang Asset Management Berhad (hereinafter referred to as “Affin Hwang AM”)
specific for its use, a specific target audience, and for discussion purposes only. All information contained within this
presentation belongs to Affin Hwang AM and may not be copied, distributed or otherwise disseminated in whole or in part
without written consent of Affin Hwang AM. The information contained in this presentation may include, but is not limited to
opinions, analysis, forecasts, projections and expectations (collectively referred to as “Opinions”). Such information has been
obtained from various sources including those in the public domain, are merely expressions of belief. Although this
presentation has been prepared on the basis of information and/or Opinions that are believed to be correct at the time the
presentation was prepared, Affin Hwang AM makes no expressed or implied warranty as to the accuracy and completeness of
any such information and/or Opinions. As with any forms of financial products, the financial product mentioned herein (if any)
carries with it various risks. Although attempts have been made to disclose all possible risks involved, the financial product
may still be subject to inherent risk that may arise beyond our reasonable contemplation. The financial product may be wholly
unsuited for you, if you are adverse to the risk arising out of and/ or in connection with the financial product. Affin Hwang AM
is not acting as an advisor or agent to any person to whom this presentation is directed. Such persons must make their own
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 Warning Statement
A Prospectus is available for the TradePlus S&P New China Tracker, and investors have the right to request a
copy of it. Investors are advised to read and understand the contents of the Prospectus dated 15 January 2019
and Supplementary Prospectus dated 2 July 2019 before investing. The Prospectus and Supplementary
Prospectus have been registered with the Securities Commission Malaysia, who takes no responsibility for its
contents. A copy of the Prospectus and Supplementary Prospectus can be obtained at Affin Hwang Asset
Management Berhad’s sales offices. As with any forms of financial products, the financial product mentioned
herein carries with it various risks. Investors are advised to consider the general and specific risks involved as
stipulated in its Prospectus and Supplementary Prospectus before investing. There are also fees and charges
involved when investing in the fund, and investors are advised to consider the fees and charges carefully before
investing. The price of units and distribution payable, if any, may go down as well as up and past performance of
the fund should not be taken as indicative of its future performance.

Licensing Disclosure Statement and Conditions

The "S&P New China Ex A-Shares Index" is a product of S&P Dow Jones Indices LLC, a division of S&P Global, or
its affiliates (“SPDJI”) and has been licensed for use by Affin Hwang Asset Management Bhd. Standard & Poor’s®
and S&P® are registered trademarks of Standard & Poor’s Financial Services LLC, a division of S&P Global (“S&P”);
Dow Jones® is a registered trademark of Dow Jones Trademark Holdings LLC (“Dow Jones”). It is not possible to
invest directly in an index. TradePlus S&P New China Tracker are not sponsored, endorsed, sold or promoted by
SPDJI, Dow Jones, S&P, any of their respective affiliates (collectively, “S&P Dow Jones Indices”). Neither S&P Dow
Jones Indices make any representation or warranty, express or implied, to the owners of the TradePlus S&P New
China Tracker or any member of the public regarding the advisability of investing in securities generally or in
TradePlus S&P New China Tracker particularly or the ability of the S&P New China Ex A-Shares Index to track
general market performance. Past performance of an index is not an indication or guarantee of future results.
S&P Dow Jones Indices’ only relationship to Affin Hwang Asset Management Bhd with respect to the S&P New
China Ex A-Shares Index is the licensing of the Index and certain trademarks, service marks and/or trade names
of S&P Dow Jones Indices and/or its licensors. The S&P New China Ex A-Shares Index is determined, composed
and calculated by S&P Dow Jones Indices without regard to Affin Hwang Asset Management Bhd or the
TradePlus S&P New China Tracker. S&P Dow Jones Indices have no obligation to take the needs of Affin Hwang
Asset Management Bhd or the owners of TradePlus S&P New China Tracker into consideration in determining,
composing or calculating the S&P New China Ex A-Shares Index. Neither S&P Dow Jones Indices are responsible
for and have not participated in the determination of the prices, and amount of TradePlus S&P New China
Tracker or the timing of the issuance or sale of TradePlus S&P New China Tracker or in the determination or
calculation of the equation by which TradePlus S&P New China Tracker is to be converted into cash, surrendered
or redeemed, as the case may be. S&P Dow Jones Indices have no obligation or liability in connection with the
administration, marketing or trading of TradePlus S&P New China Tracker. There is no assurance that investment
products based on the S&P New China Ex A-Shares Index will accurately track index performance or provide
positive investment returns. S&P Dow Jones Indices LLC is not an investment or tax advisor. A tax advisor should
be consulted to evaluate the impact of any tax-exempt securities on portfolios and the tax consequences of
making any particular investment decision. Inclusion of a security within an index is not a recommendation by
S&P Dow Jones Indices to buy, sell, or hold such security, nor is it considered to be investment advice.

NEITHER S&P DOW JONES INDICES NOR THIRD PARTY LICENSOR GUARANTEES THE ADEQUACY, ACCURACY,
TIMELINESS AND/OR THE COMPLETENESS OF THE S&P NEW CHINA EX A-SHARES INDEX OR ANY DATA RELATED
THERETO OR ANY COMMUNICATION, INCLUDING BUT NOT LIMITED TO, ORAL OR WRITTEN COMMUNICATION
(INCLUDING ELECTRONIC COMMUNICATIONS) WITH RESPECT THERETO. S&P DOW JONES INDICES SHALL NOT
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JONES INDICES MAKES NO EXPRESS OR IMPLIED WARRANTIES, AND EXPRESSLY DISCLAIMS ALL WARRANTIES,
OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE OR USE OR AS TO RESULTS TO BE OBTAINED
BY AFFIN HWANG ASSET MANAGEMENT BHD, OWNERS OF THE TRADEPLUS S&P NEW CHINA TRACKER, OR ANY
OTHER PERSON OR ENTITY FROM THE USE OF THE S&P NEW CHINA EX A-SHARES INDEX OR WITH RESPECT TO
ANY DATA RELATED THERETO. WITHOUT LIMITING ANY OF THE FOREGOING, IN NO EVENT WHATSOEVER SHALL
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Affin Hwang Asset Management Bhd (429786-T)

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