AIA ORSO Fund Performance Review

Transcription

1 AIA ORSO Fund Performance Review AIA Retirement Fund Scheme January

2 AIA Retirement Fund Scheme Important Notes The AIA Capital Guaranteed Fund in this AIA Retirement Fund Scheme (the "Scheme") invests solely in an insurance policy issued by the AIA Company Limited (the "Insurer"). Your investments in the AIA Capital Guaranteed Fund, if any, are therefore subject to the credit risks of the Insurer as both insurer and guarantor. Your entitlement to the capital guarantee under the AIA Capital Guaranteed Fund for each calendar year will be subject to your continued investment in the AIA Capital Guaranteed Fund until the end of each calendar year (please refer to the section entitled "Switching Between Funds" of the Principal Brochure of the Scheme for details of how a year is to be defined). The AIA Guaranteed Fund in the Scheme is a capital guaranteed fund. The guarantor is AIA Pension and Trustee Co. Ltd. Your investments in the AIA Guaranteed Fund, if any, are subject to the credit risk of the guarantor. Your entitlement to the capital guarantee under the AIA Guaranteed Fund for each year will be subject to your continued investment in the AIA Guaranteed Fund until the end of each year (please refer to the section entitled Switching Between Funds of the Principal Brochure of the Scheme for details of how a year is to be defined). You should consider your own risk tolerance level and financial circumstances before making any fund choices. When, in your selection of fund choices, you are in doubt as to whether a certain fund choice is suitable for you (including whether it is consistent with your investment objectives), you should seek financial and/or professional advice and choose the fund choice(s) most suitable for you taking into account your circumstances. In the event that you do not make any fund choices, your contributions made and/or benefits transferred into the Scheme in respect of you will be invested in the default fund choice as agreed between your employer and the Trustees (and set out in the appropriate enrolment form(s)). The AIA Capital Stable Fund and AIA RCM Capital Stable Fund do not guarantee the repayment of capital under all circumstances. You should not base your fund choices on this document alone and should refer to the Principal Brochure of the Scheme. # The top ten holdings of an investment fund are calculated by AIA Pension and Trustee Co. Ltd., based on: i. the top fifteen holdings of each of its underlying fund(s) for the reporting month of January, February, June, July, August and December; and ii. the top ten holdings of each of its underlying fund(s) for the reporting month of March, April, May, September, October and November with reference to the NAV of the relevant holdings given to us by third-party sources, and are for reference only. The top ten holdings of an investment fund are shown at a different month (as specified in top ten holdings table) from the reporting month. Source: AIA Pension and Trustee Co. Ltd., unless specified otherwise. The AIA Retirement Fund Scheme is a pooled retirement scheme under the Occupational Retirement Schemes Ordinance. Investment involves risks and not all fund choices available under the Scheme would be suitable for everyone. Investment performance and returns may go down as well as up. Past performance is not indicative of future performance. Investors are subject to the credit risks (including default and downgrade risks) of the insurer in the case of a fund which invests in an insurance policy. For further details including the fees and charges, product features and risks involved, please refer to the Principal Brochure of the Scheme. Every effort is made by AIA Pension and Trustee Co. Ltd. or AIA Company (Trustee) Limited to ensure that all information contained in this publication is accurate at the date of publication. Issued by AIA Pension and Trustee Co. Ltd.

3 AIA Retirement Fund Scheme AIA Manager's Choice Fund To achieve long-term capital appreciation through a professionally managed portfolio, invested in two or more pooled investment funds. Net Asset Value Per Unit $ Fund Performance -7.35% -8.77% -2.58% 7.81% -0.96% -8.77% 2.74% 3.93% 12.09% -1.28% TENCENT HLDGS LTD 2.87% DAH SING BANK HKG 0.10% 01/12/ % HSBC HOLDINGS PLC ORD 2.01% AIA GROUP LTD 1.82% CHINA CONSTRUCTION BANK H SHS 1.66% CK HUTCHISON HOLDINGS LTD 1.28% PING AN INSURANCE GROUP CO-H 1.19% TOYOTA MOTOR CORP 1.17% CHINA MOBILE LTD 0.83% MITSUBISHI UFJ FINANCIAL GRO 0.79% (1) Europe Equities (4) United States Equities (5) Other Equities (6) Other Bonds (7) Cash and Others (5) 13.06% (4) 7.19% (6) 8.68% (3) 24.17% (7) 1.90% (1) 22.38% (2) 22.62% The global equity benchmark index fell sharply in January as signs of a further slowdown in China pushed down RMB and brought global risk appetite down with it. Oil prices also continued their sharp falls through much of the month as the supply glut showed no signs of abating. Recent volatility in the equity markets seems likely to remain in place for the foreseeable future. The fund's investments have been selected for their longer-term resilience and attractive risk reward characteristics, and so the team remains confident about the future. AIA American Equity Fund To achieve long-term capital growth by investing primarily in North American securities. Net Asset Value Per Unit US$ Fund Performance (NAV to NAV, in US Dollars ) -9.65% -4.20% 30.46% 52.59% 2.69% -4.20% 6.22% 28.20% 16.20% 0.66% ALPHABET 6.09% FACEBOOK 5.99% AMAZON.COM 5.13% GILEAD SCIENCES 4.61% REGENERON PHARMACEUTICALS 4.42% MASTERCARD 4.42% PRICELINE.COM 3.48% WELLS FARGO 3.48% CAPITAL ONE 3.37% STARBUCKS 3.32% (1) Consumer Discretionary (2) Energy (3) Financials (4) Health Care (5) Industrial (6) Information Technology (7) Materials (8) Utilities (9) Cash and Others (9) 3.16% (8) 2.80% (7) 3.20% (6) 24.07% (5) 5.60% (4) 15.19% (1) 19.99% (2) 4.90% (3) 21.09% Investor risk aversion was loud and clear in January, as small cap stocks measured by the Russell 2000 Index declined 8.8%, compared to large cap stocks as represented by the S&P 500, which lost 5.0%. The fund underperformed the benchmark for the month. Overweight positions in healthcare names Regeneron Pharmaceuticals and Gilead Sciences were the top detractors for the period. In contrast, strong stock selection in the Information Technology and Financials sectors helped the performance. Our overweight positions in Facebook (Information Technology) and Edison International (Utilities) were the largest contributors for the period.

4 AIA Retirement Fund Scheme AIA Asia ex Japan Equity Fund (previously known as AIA South East Asia Fund) To seek long-term capital appreciation by investing in the equity and equity-related securities of companies whose assets, products or operations are in the Asian Region. Net Asset Value Per Unit US$ Fund Performance (NAV to NAV, in US Dollars ) -7.34% % 2.24% -2.81% -4.35% % 14.03% 2.90% 13.05% % SAMSUNG ELECTRONICS CO LTD 5.31% TAIWAN SEMICONDUCTOR MANUFACTURING CO 4.45% TENCENT HLDGS LTD 3.73% CJ CGV CO LTD 2.75% CHINA CONSTRUCTION BANK H SHS 2.46% CHINA LESSO GROUP HOLDINGS 2.36% CHINA MOBILE LTD 2.12% LG CHEM LTD 2.12% AIA GROUP LTD 1.97% IND + COMM BK OF CHINA H 1.85% (8) 19.60% (1) China (2) Hong Kong (3) India (4) Indonesia (5) Malaysia (6) Philippines (7) Singapore (8) South Korea (9) Taiwan (10) Thailand (11) Cash and Others (10) 1.59% (9) 14.18% (7) 4.59% (11) 0.14% (6) 3.07% (1) 31.18% (3) 9.91% (4) 2.07% (5) 3.18% (2)10.49% The Federal Reserve increased its key rate by 25 bps in December, a first step in rate normalization. Asian equities were flat in December, but started sliding after the new year. This was worsened when China introduced a stock circuit breaker rule from the first day of the year (but later suspended it), and also when RMB began to fall in the foreign exchange markets. Uncertainties around the Chinese economy will remain a drag on the market in the near term. However, any signs from the Federal Reserve to refrain from further rate hikes or additional quantitative easing programs would be positive for the market. The team expects equity market volatility to continue, but it should decrease as macro data stabilizes on recent macro data. AIA European Equity Fund 1 1 To achieve capital growth by investing in a collective investment scheme authorized by the Securities and Futures Commission which is mainly invested in equity securities quoted on European stock exchanges. Net Asset Value Per Unit HK$ Fund Performance (NAV to NAV, in HK Dollars ) -6.03% -8.28% 4.19% 5.11% -2.33% -8.28% -2.03% 15.94% 16.72% % SAP SE 5.31% PRUDENTIAL PLC 4.81% SANOFI 4.31% BRITISH AMERICAN TOBACCO PLC 3.51% PUBLICIS GROUPE SA 3.41% ROCHE HOLDING LTD 3.41% SCHNEIDER ELEC SA 3.31% SMITH & NEPHEW PLC 3.31% ROYAL DUTCH SHELL PLC 3.20% BAYER AG 3.10% (8) 37.77% (1) Denmark (2) France (3) Germany (4) Netherlands (5) Norway (6) Spain (7) Switzerland (8) United Kingdom (9) Cash and Others (9) 0.73% (7) 9.22% (1) 1.40% (6) 1.80% (2) 24.04% (3) 14.62% (4) 5.31% (5) 5.11% European equities fell sharply in January due to renewed concerns over Chinese growth and its negative impact on the global economy. Falling oil prices, driven partly by an expected increase in supply following the lifting of international sanctions on Iran, also added to the bearish sentiment. Energy stocks have been weighed down by falling oil prices. Most sectors ended in negative territory, with Financials registering the steepest decline. In a risk-off environment, large-cap companies outperformed their smaller peers, while growth stocks outperformed value stocks. 1 The underlying fund is denominated in Euro. HKD/EUR exchange rate risk will be borne by the investor.

5 AIA Retirement Fund Scheme AIA Greater China Equity Fund To provide long term capital appreciation by investing in the equity securities of companies with exposure to the economies of countries within the Greater China Region i.e. China, Hong Kong and Taiwan, through an underlying fund. Net Asset Value Per Unit $ 9.29 Fund Performance (NAV to NAV, in HK Dollars ) % % % % % % 6.39% 4.52% 13.57% % TENCENT HLDGS LTD 0.10% TAIWAN SEMICONDUCTOR MANUFACTURING CO 0.07% CK HUTCHISON HOLDINGS LTD 0.06% AIA GROUP LTD 0.06% CHINA OVERSEAS LAND & INVEST 0.05% CSPC PHARMACEUTICAL GROUP LTD 0.04% ANTA SPORTS PRODUCTS LTD 0.04% ZTE CORP-H 0.03% CHINA MOBILE LTD 0.03% HON HAI PRECISION INDUSTRY 0.03% (1) China (2) Hong Kong (3) Taiwan (4) Cash and Others (3) 22.82% (2) 20.64% (4) 3.38% (1) 53.16% The Hong Kong equity market witnessed a tough start to the year. Investor confidence in China's onshore A-shares and local policies remained weak, with circuit breakers proving to be the latest misstep. The Taiwan market outperformed its regional peers, despite weakening local currency versus the USD. Most macro indicators continue to point to further weakness in the Industrial and Manufacturing segments, although Consumption and Services remain relatively robust. The fund should stay relatively defensive, while gradually increasing exposure in Energy names. AIA Hong Kong Equity Fund To provide capital growth primarily through investment in equity securities of Hong Kong SAR companies through an underlying fund. Net Asset Value Per Unit HK$ (NAV to NAV, in HK Dollars ) % % -8.79% -1.86% -4.66% % 14.07% -3.24% 24.37% % AIA GROUP LTD 9.70% HSBC HOLDINGS PLC 6.72% TENCENT HOLDINGS LTD 5.52% CK HUTCHISON HOLDINGS LTD 4.83% CHEUNG KONG PROPERTY HOLDINGS LTD 4.45% CHINA MOBILE LTD 3.70% TECHTRONIC INDUSTRIES CO 3.49% CHINA PACIFIC INSURANCE GROUP CO LTD 3.48% HONGKONG LAND HOLDINGS LTD 2.94% BAIDU INC/CHINA 2.83% (1) Consumer Goods (2) Consumer Services (3) Financials (4) Health Care (5) Industrials (6) Oil and Gas (7) Technology (8) Telecommunications (9) Others (10) Cash and Others (7) 8.01% (6) 1.51% (5) 13.51% (4) 2.00% (8) 7.25% (9) 1.43% (10) 0.78% (1) 11.50% (3) 42.07% (2) 11.94% Chinese and Hong Kong equities had a turbulent start to 2016 as markets posted negative returns, with losses sparked by renewed market turmoil in China and a plunging oil price. Chinese equities, via its domestic stock markets, led the losses as the A-share markets were forced to close early twice within a week after a new circuit-breaking mechanism was implemented. However, the Chinese authorities later reversed course, with the decision taken to extend the share-sale ban and suspend the short-lived circuit breaking mechanism. In Hong Kong, stocks also saw declines as market fears in China spilled over into the local stock market, with China-based companies' shares seeing a particularly heavy sell-off.

6 AIA Retirement Fund Scheme AIA Capital Guaranteed Fund 2 2 To achieve a stable, consistent, predicable rate of return and the guarantee of capital, by investing primarily in fixed income instruments or in any product which, in the opinion of AIA Company Limited, provides economically equivalent returns, and investments in equity will not exceed 15% of total assets. Fund Performance % 2.57% 8.26% 15.55% 2.60% 2.57% 2.51% 2.96% 3.46% 3.17% FUBON BK 0.00% 12/04/ % BANK OF SCOTLAND LLOYDS 0.00% 17/08/ % GEN ELEC CAP CRP GE 4.433% 08/05/ % KOREA NATL OIL 3.40% 15/02/ % MTR CORP (C.I.) MTRC 5.80% 13/08/ % CITIGROUP GLOBAL C 4.90% 18/03/ % KOREA DEV BANK KDB 5.00% 20/11/ % WHARF FIN (BVI) WHARF 4.73% 25/01/ % WESTPAC BANKING WSTP 5.165% 10/10/ % CHINA DEVELOP BK SDBC 2.70% 25/01/ % (1) HKD Bonds (2) USD Bonds (3) Mutual Funds (4) Cash and Others (4) 5.63% (3) 0.12% (2) 9.70% (1) 84.55% 2 AIA Company Limited (the "Insurer"), is the insurer of the underlying insurance policy, guarantees the investment yield of AIA Capital Guaranteed Fund declared for each calendar year will not be negative. The Insurer, at its sole discretion, has the right to retain any investment income of AIA Capital Guaranteed Fund that is in excess of the required amount to be set aside to meet the guaranteed benefits under AIA Capital Guaranteed Fund. Such a guarantee will not apply if a member leaves AIA Capital Guaranteed Fund in the middle of the year. Scheme participants are advised to refer to the Principal Brochure and Fund Fact Sheets of the Scheme for more information. The Insurer reserves the right to discontinue the guarantee or revise the guarantee upon the giving of 6 months notice (or such shorter period in compliance with relevant regulatory requirements). 3 A monthly yield will be declared at the sole discretion of AIA Pension and Trustee Co. Ltd. and AIA Company (Trustee) Limited. Sharp movements in the RMB caused market volatility, resulting in a global market risk-off. The fear of accelerating capital outflow from China spilled over to HKD assets, causing HIBORs to shoot up with a bear flattening bias and the HKD was tested at the weaker side of the peg. 3-month HIBORs jumped 30 bps month-on-month to 0.7% in January. Given the concern about capital outflow from China, the team believes HKD assets will likely come under pressure in the near term. This, along with a rising rate risk in the US, made the team believe HKD rates will underperform US rates. AIA Guaranteed Fund 4 4 To develop a secured source of high recurring income over the long run and the guarantee of capital by investing in prudent, balanced fixed interest instruments and equities with low to medium inherent risk. (1) HKD Bonds (2) USD Bonds (3) Mutual Funds (4) Cash and Others Fund Performance % 2.58% 8.30% 16.14% 2.60% 2.58% 2.51% 3.00% 3.56% 3.56% (4) 5.63% (3) 0.12% (2) 9.70% (1) 84.55% FUBON BK 0.00% 12/04/ % BANK OF SCOTLAND LLOYDS 0.00% 17/08/ % GEN ELEC CAP CRP GE 4.433% 08/05/ % KOREA NATL OIL 3.40% 15/02/ % MTR CORP (C.I.) MTRC 5.80% 13/08/ % CITIGROUP GLOBAL C 4.90% 18/03/ % KOREA DEV BANK KDB 5.00% 20/11/ % WHARF FIN (BVI) WHARF 4.73% 25/01/ % WESTPAC BANKING WSTP 5.165% 10/10/ % CHINA DEVELOP BK SDBC 2.70% 25/01/ % 4 With effect from 1 April 2010, AIA Guaranteed Fund (the "Fund") provides for an annual capital guarantee at the end of each relevant year on any amount invested in the Fund (after any deduction for payment of the Trustee Fee of 1% p.a. (deducted monthly)). If a member or an external retirement scheme investor (as the case may be) switches out his/her investment from the Fund before the end of the relevant year for any reason, the guarantee of capital mentioned above will not apply and the member or external retirement scheme investor would be entitled to his/her contribution and the monthly yield that has been declared and credited to his/her account on or before the date of switching. In addition, a member or an external retirement scheme investor who switches out his/her investment from the Fund before the end of the relevant year may not receive the whole amount of his/her contribution if the monthly yield declared is negative. The guarantor is AIA Pension and Trustee Co. Ltd. ("AIA") while AIA Company Limited agrees and undertakes to satisfy the capital guarantee under the Fund if AIA is unable to satisfy the capital guarantee for any reason. 5 A monthly yield will be declared at the sole discretion of AIA Pension and Trustee Co. Ltd. and AIA Company (Trustee) Limited.

7 AIA Growth Fund To maximize its long-term capital appreciation in US dollar terms through investing in an internationally diversified portfolio of securities mainly in equities with balance in bonds and cash. Net Asset Value Per Unit US$ 3.41 Fund Performance (NAV to NAV, in US Dollars ) -8.58% % 0.89% 5.57% -2.10% % 3.80% 8.88% 14.97% -8.98% TENCENT HLDGS LTD 3.45% HSBC HOLDINGS PLC ORD 2.33% CITIBANK, HONG KONG 0.12% 01/12/ % AIA GROUP LTD 2.20% CHINA CONSTRUCTION BANK H SHS 1.95% CK HUTCHISON HOLDINGS LTD 1.55% PING AN INSURANCE GROUP CO-H 1.40% CHINA MOBILE LTD 1.03% CHINA OVERSEAS LAND & INVEST 0.87% CSPC PHARMACEUTICAL GROUP LTD 0.77% (1) Europe Equities (4) United States Equities (5) Other Equities (6) Other Bonds (7) Cash and Others (7) 3.95% (6) 3.29% (1) 22.01% (5) 13.56% (4) 11.16% (2) 27.37% (3) 18.66% The global equity benchmark index fell sharply in January as signs of a further slowdown in China pushed down RMB and brought global risk appetite down with it. Oil prices also continued their sharp falls through much of the month as the supply glut showed no signs of abating. Recent volatility in the equity markets seems likely to remain in place for the foreseeable future. The fund's investments have been selected for their longer-term resilience and attractive risk reward characteristics, and so the team remains confident about the future. AIA Balanced Fund To maximize its long-term capital appreciation in US dollar terms with moderate risk parameters through investing in a balanced portfolio of equities and fixed income securities. Net Asset Value Per Unit US$ (1) Europe Equities (4) United States Equities (5) Other Equities (6) Hong Kong Dollar Bonds (7) Other Bonds (8) Cash and Others Fund Performance (NAV to NAV, in US Dollars ) (8) 2.56% (1) 12.42% (2) 14.44% -4.72% -6.87% 0.22% 5.93% -1.76% (7) 41.20% (3) 12.35% -6.87% 3.15% 4.31% 8.29% -2.39% (6) 0.53% (5) 9.09% (4) 7.41% DAH SING BANK HKG 0.12% 01/12/ % TENCENT HLDGS LTD 2.03% HSBC HOLDINGS PLC ORD 1.29% AIA GROUP LTD 1.28% CHINA CONSTRUCTION BANK H SHS 1.14% CK HUTCHISON HOLDINGS LTD 0.90% PING AN INSURANCE GROUP CO-H 0.82% US TREASURY 4.50% 15/02/ % JPMIF - GLOBAL HIGH YIELD BOND FUND 0.62% CHINA MOBILE LTD 0.60%

8 AIA Retirement Fund Scheme AIA Capital Stable Fund To minimize its short-term capital risk in US dollar terms and to enhance returns over the long term through limited exposure to global equities. Net Asset Value Per Unit -2.58% -4.83% -0.86% 5.06% -1.66% -4.83% 2.24% 1.89% 5.11% 0.82% US$ Fund Performance (NAV to NAV, in US Dollars ) DAH SING BANK HKG 0.12% 01/12/ % TENCENT HLDGS LTD 1.24% US TREASURY 4.50% 15/02/ % JPMIF - GLOBAL HIGH YIELD BOND FUND 1.07% EUROPEAN INV BK 2.15% 18/01/ % US TREASURY 4.625% 15/11/ % US TREASURY 3.50% 15/02/ % US TREASURY N/B T 1.25% 31/10/ % US TREASURY 1.00% 31/08/ % HSBC HOLDINGS PLC ORD 0.83% (1) Europe Equities (4) United States Equities (5) Other Equities (6) Hong Kong Dollar Bonds (7) Other Bonds (8) Cash and Others (2) 8.78% (1) 8.53% (8) 2.13% (3) 8.48% (4) 2.88% (5) 4.66% (6) 5.13% (7) 59.41% The global equity benchmark index fell sharply in January as signs of a further slowdown in China pushed down RMB and brought global risk appetite down with it. Oil prices also continued their sharp falls through much of the month as the supply glut showed no signs of abating. Recent volatility in the equity markets seems likely to remain in place for the foreseeable future. The fund's investments have been selected for their longer-term resilience and attractive risk reward characteristics, and so the team remains confident about the future. AIA RCM Growth Fund To maximize long term overall returns by investing primarily in global equities through the underlying fund. Net Asset Value Per Unit HK$ Fund Performance (NAV to NAV, in HK Dollars ) -7.92% % -3.83% -0.45% -4.61% % 1.38% 7.58% 14.23% -9.38% INDUSTRIAL AND COMMERCIAL BANK OF CHINA H SHS 4.25% CK HUTCHISON HOLDINGS LTD 3.80% BANK OF CHINA LTD H SHS 3.28% CHINA MOBILE LTD 3.26% TENCENT HOLDINGS LTD 3.00% PING AN INSURANCE (GROUP) CO OF CHINA LTD H SHS 2.80% CHINA CONSTRUCTION BANK H SHS 2.68% ROCHE HOLDINGS-GENUSSCHEIN 2.57% SONY CORP 2.37% VISA INC CL A 2.36% (1) Europe Equities (3) Japan Equities (4) North American Equities (5) Other Equities (6) Other Bonds (7) Cash and Others (7) 10.66% (1) 15.34% (6) 1.54% (5) 8.20% (2) 33.39% (4) 21.03% (3) 9.84% US equities retreated sharply during January amid concerns over the strength of both the US and the global economy. European equities fell over January, with Greece, Italy and Germany among the countries with the weakest returns. By contrast, although the UK also showed decline, it tended to hold up better than other developed European markets. Asian equities suffered sharp declines over January. All developed markets in the region fell, with only the smaller economies of Thailand and Indonesia managing to record slight positive returns (in local currency terms).the newly implemented circuit breakers were triggered twice in the first week of January as the market fall reached 7% on two separate days. The Chinese authorities subsequently announced that the use of circuit breakers was to be suspended with immediate effect.

9 AIA Retirement Fund Scheme AIA RCM Stable Growth Fund To achieve a stable overall return over the long term by investing in a diversified portfolio of global equities and fixed-interest securities through the underlying fund. Net Asset Value Per Unit HK$ Fund Performance (NAV to NAV, in HK Dollars ) -3.74% -6.85% -4.36% 1.11% -3.61% -6.85% -0.16% 2.83% 8.50% -2.56% OVERSEA CHINESE BANKING CORP LTD 0.04% 01/12/ % INDUSTRIAL AND COMMERCIAL BANK OF CHINA H SHS 2.45% CK HUTCHISON HOLDINGS LTD 2.06% BANK OF CHINA LTD H SHS 1.88% CHINA MOBILE LTD 1.79% TENCENT HOLDINGS LTD 1.65% PING AN INSURANCE (GROUP) CO OF CHINA LTD H SHS 1.55% CHINA CONSTRUCTION BANK H SHS 1.51% ROCHE HOLDINGS-GENUSSCHEIN 1.36% VISA INC CL A 1.31% (1) Europe Equities (4) North American Equities (5) Other Equities (6) Hong Kong Dollar Bonds (7) Other Bonds (8) Cash and Others (1) 7.52% (8) 10.00% (2) 18.16% (3) 5.42% (7) 41.44% (4) 10.84% (5) 3.91% (6) 2.71% US equities retreated sharply during January amid concerns over the strength of both the US and the global economy. European equities fell over January, with Greece, Italy and Germany among the countries with the weakest returns. By contrast, although the UK also showed decline, it tended to hold up better than other developed European markets. Asian equities suffered sharp declines over January. All developed markets in the region fell, with only the smaller economies of Thailand and Indonesia managing to record slight positive returns (in local currency terms).the newly implemented circuit breakers were triggered twice in the first week of January as the market fall reached 7% on two separate days. The Chinese authorities subsequently announced that the use of circuit breakers was to be suspended with immediate effect. AIA RCM Capital Stable Fund To provide investors with capital preservation combined with steady capital appreciation over the long term by investing in a diversified portfolio of global equities and fixedinterest securities through the underlying fund. Net Asset Value Per Unit HK$ Fund Performance (NAV to NAV, in HK Dollars ) -1.86% -4.68% -3.89% 1.31% -3.19% (1) Europe Equities (4) North American Equities (5) Other Equities (6) Hong Kong Dollar Bonds (7) Other Bonds (8) Cash and Others (8) 8.73% (1) 4.65% (2) 11.13% (3) 3.31% (4) 6.52% (5) 2.41% -4.68% -0.08% 0.91% 5.41% 0.00% OVERSEA CHINESE BANKING CORP LTD 0.04% 01/12/ % BUNDESREPUB. DEUTSCHLAND SER98 (BR) 4.75% 04/07/ % INDUSTRIAL AND COMMERCIAL BANK OF CHINA H SHS 1.57% JAPAN (GOVT OF) (20 YEAR ISSUE) SER % 20/03/ % JAPAN (GOVT OF) (2 YEAR ISSUE) SER % 15/12/ % CK HUTCHISON HOLDINGS LTD 1.24% BANK OF CHINA LTD H 1.20% BUONI POLIENNALI DEL TES 5.00% 01/08/ % CHINA MOBILE LTD 1.17% UK (GILTS) 5.00% 07/03/ % (7) 58.84% (6) 4.41%

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