HFT (HK) CHINA RMB FIXED INCOME FUND

Transcription

1 HFT (HK) CHINA INVESTMENT SERIES HFT (HK) CHINA FIXED INCOME FUND INTERIM REPORT (UNAUDITED) FOR THE PERIOD FROM 1 MARCH 2012 (DATE OF INCEPTION) TO 30 JUNE 2012

2 MANAGER HFT Investment Management (HK) Limited ( HFT HK ) HFT HK is the Hong Kongbased subsidiary and international arm of HFT Investment Management Co., Ltd. HFT HK offers a wide range of China and Greater China investment strategies. HFT Investment Management Co., Ltd. advises on (traditional) QFII products since Total QFII assets: circa USD 2.9 bln (as of June 2012) HFT Investment Management Co., Ltd. ( HFT ) Shanghaibased HFT is M2+(chn) Fitch rated since HFT is a fully licensed asset management company in mainland China; a jointventure between Haitong Securities and BNP Paribas Investment Partners. Its domestic activities span mutual funds, investment advisory and enterprise annuities & segregated accounts. Its investment team covers equity, fixed income and money market instruments. HFT s Fixed Income capabilities include domestic mutual funds, Enterprise annuities & mandates and QFII products. Bond management at HFT started in 2003 and has expanded steadily over the years to reach 37.5 bln as of June FUND INFORMATION Manager: HFT Investment Management (HK) Limited Trustee: BOCIPrudential Trustee Limited Custodian: Bank of China (Hong Kong) Limited Dealing frequency: Daily Base currency: Financial year end: 31 December

3 CONTENTS Page Administration 1 Report of Manager 2 Statement of Financial Position (Unaudited) 3 Statement of Comprehensive Income (Unaudited) 4 Statement of Changes in Equity (Unaudited) 5 Net Assets Attributable to Unitholders and Units in Issue (Unaudited) 5 Performance Table (Unaudited) 6 Statement of Movements in Portfolio Holdings (Unaudited) 6 Investment Portfolio (Unaudited) 7

4 ADMINISTRATION Manager HFT Investment Management (HK) Limited 30/F, Three Exchange Square 8 Connaught Place Central, Hong Kong Directors of the Manager Mr. TIAN Ren Can Mr. VERVOORN Jelle Mr. ZHANG Wenwei Mr. YAN Xiaoqing Mr. TAO Wangxiong Ms. YAO Lulu Mr. LO Nim Chi (resigned on 31 July 2012) Trustee and Registrar BOCIPrudential Trustee Limited 12/F & 25/F, Citicorp Centre 18 Whitfield Road Causeway Bay Hong Kong Custodian Bank of China (Hong Kong) Limited 14/F., Bank of China Tower 1 Garden Road Hong Kong RQFII Custodian Bank of China Limited No. 1, Fuxingmen Nei Dajie Beijing China Solicitors to the Manager Deacons 5/F, Alexandra House 18 Chater Road Central, Hong Kong Auditor KPMG 8th Floor, Prince s Building 10 Chater Road Central, Hong Kong 1

5 REPORT OF MANAGER Macro and Market Review In March, the February CPI declined to 3.2% yoy from 4.5% in January. There was expectation that the inflation may ease further and the economic growth may continue to slow down modestly. The worse than expected economic figures triggered risk of selling off in Ashares market and the investors were rushing to bond market pushing the yield curve down a bit. The first quarter GDP released at the beginning of April grew at 8.1% yoy, which was lower than forecast of 8.4%. It busted the prospect for the policy maker to ease monetary policy. The CGB yield curve bullish steepened by 510 basis points and the credit bond prices rallied during the month. Particularly, the newly issued medium rated bonds performed the best. In May, the CPI came out in line with consensus. However, other economic readings including PPI, industrial production, new loans and retail sales growth were worse than expectation. PBOC announced to cut RRR by 50bps after these macro data release. The CGB yield curve bullish steepened further by 5060 bps for short to medium tenors. In addition, the high grade bonds were performing well and the credit spreads to CGBs were tightened. However, the spreads between AAA and AA rated bonds remained stable. On June 7, the PBOC announced rate cuts for the first time since Benchmark deposit rates and loan rates were cut by 25bps. More importantly, banks can offer a 20% discount to the key lending rates, up from a previous 10%. Also the lenders will, for the first time, be able to offer savers deposit rates that are up to 10% higher than the benchmark rates. This move was seen as a milestone in the road of rate liberalization in China. The market continued to rally modestly due to the rate cut. However, the economic data for May appeared to be mixed and liquidity was tight in late June. The bond yields rebounded and exceeded the pre rate cut levels. Performance Review As of June 29, 12, both retail and institutional classes of the Fund delivered positive return since inception. The retail class fluctuated in narrow range since its launch on March 1, It rallied significantly in May due to the RRR cut and steadily climbed up to reach its highest at the end of June, The majority of the Fund holdings were short to medium tenor notes, which enjoyed some capital gain from the bullish steepening of the yield curve. It parked almost half of its fund in CGB and policy banks for liquidity management. For credit exposure, the Fund mainly invested in high grade credit bonds to keep the volatility at relatively low level. Outlook Going into the second half of 2012, the front end yields are expected to stay range bound at current level after the rally in May and June. The next catalyst will be the further monetary policy easing. For the long end yields, the economic growth expectation will play an important role. The CPI and GDP data releases will be the market focus. The development of European sovereign debt crisis will also play a role guiding the market sentiment. HFT Investment Management (HK) Limited 30 June

6 STATEMENT OF FINANCIAL POSITION (Unaudited) As at 30 June 2012 Assets Financial assets at fair value through profit or loss Cash and cash equivalents Interest receivable on bank deposits and bonds Dividend receivable on unit trust Prepaid expenses and other receivables Subscription proceeds receivable Total assets 91,171,519 9,039, , , ,065,349 Liabilities Financial liabilities at fair value through profit or loss Amounts due to brokers Redemption proceeds payable Amounts payable on redemption of units Management fee payable Trustee fee payable Dividend payable to unitholders Withholding tax payable Accrued expenses and other payable Total liabilities 3, ,731 20, ,190 69, ,551 Equity Share capital Retained earnings 100,785, ,781 Total Equity 101,585,798 Total Liabilities and Equity 102,065,349 Number of Units in Issue (Class A) 155, Number of Units in Issue (Class I) 857, Net Asset Value per Unit (Class A) Net Asset Value per Unit (Class I)

7 STATEMENT OF COMPREHENSIVE INCOME (Unaudited) For the Period from 1 March 2012 (DATE OF INCEPTION) to 30 June 2012 Income Dividends Interest revenue on financial assets at fair value through profit or loss Interest revenue on bank deposits Net gain on financial assets at fair value through profit or loss 537, , ,913 1,430,252 Expenses Management fee Trustee fee (274,731) (76,129) Legal and professional fee License fee Custodian fee (21,249) Auditors remuneration (55,506) Preliminary expenses (55,243) Publishing expenses (4,260) Brokerage fee and other transaction costs (21,837) Withholding tax (117,549) Other expenses (2,669) Net foreign exchange losses (298) (629,471) Profit and Total Comprehensive Income for the period 800,781 4

8 STATEMENT OF CHANGES IN EQUITY (Unaudited) For the Period from 1 March 2012 (DATE OF INCEPTION) to 30 June 2012 At 1 March 2012 (Date of Inception) Subscription of units Redemption of units Switching out from Class A to Class I Switching in to Class I to Class A Share Capital Retained Earnings Total 100,834, ,834,297 (49,280) (49,280) (71,200,265) (71,200,265) 71,200,265 71,200,265 Dividend Distribution Total comprehensive income for the period 800, , ,785, , ,585,798 As at 30 June 2012 NET ASSETS ATTRIBUTABLE TO UNITHOLDERS AND UNITS IN ISSUE (Unaudited) For the Period from 1 March 2012 (DATE OF INCEPTION) to 30 June 2012 Class A Units outstanding at inception Units issued Units redeemed Number of Units 860, (10,344.82) Units switching out from Class A to Class I (695,038.06) Units outstanding at 30 June , Class I Units outstanding at inception Units issued Units redeemed Units switching in from Class A to Class I Units outstanding at 30 June , , ,

9 PERFORMANCE TABLE (Unaudited) For the Period from 1 March 2012 (DATE OF INCEPTION) to 30 June 2012 SubFund As at 30 June 2012 Net asset value of the Fund 101,585,798 Highest issue price per unit Financial period ended as at 30 June 2012 Net asset value per unit Class A Class I Lowest redemption price per unit Class A Class I Class A Class I STATEMENT OF MOVEMENTS IN PORTFOLIO HOLDINGS (Unaudited) For the Period from 1 March 2012 (DATE OF INCEPTION) to 30 June 2012 Listed/Quoted investments 30 June 2012 % 1 March 2012 (Date of Inception) % Fixed Interest Securities China Listed debt securities Unlisted/Quoted debt securities Total Listed & Quoted Investment Other net assets Net assets at 30 June

10 INVESTMENT PORTFOLIO (UNAUDITED) As at 30 June 2012 Fixed Interest Securities Nominal Value Market Value % of Net Asset China Listed debt securities CHINA GOVT BOND 3.02% A 17SEP ,240 14,376, CHINA GOVT BOND 2.6% S/A 20SEP ,020 2,737, COSCO SHIPPING CO LTD 0.8% A 28JAN ,590 5,286, HUAXIN CEMENT CO LTD 5.35% A 17MAY ,000 3,034, BAOSHAN IRON & STEEL CO LTD 0.8% A 20JUN ,000 5,643, SHANGHAI INTL PORT GROUP CO LTD 4.69% A 30MAR ,120 6,500, SINOCHEM INTL CORP 4.99% A 05MAR ,000 5,100, CHINA PETROLEUM & CHEMICAL CORP 0.8% A 20FEB ,400 6,893, GD POWER DEVELOPMENT CO LTD 1% A 07MAY ,000 6,123, YAHGEE MODULAR HOUSE CO LTD 6.5% A 10APR ,000 5,190, ,884, Total Listed/quoted Investments Unlisted/Quoted debt securities AGRICULTURAL DEVELOPMENT BANK OF CHINA 3.45% A 06APR ,000 10,046, EXPORTIMPORT BANK OF CHINA 3.83% A 01MAR ,000 10,129, CHINA GOVT BOND 2.91% A 26APR ,000 10,111, Total Unlisted/Quoted debt securities 30,287, TOTAL INVESTMENTS 91,171, OTHER NET ASSETS 10,414, ,585, NET ASSETS AS AT 30 JUNE 2012 TOTAL INVESTMENTS, AT COST 90,533,558 7

11 DISCLAIMER ( the Fund ), a SubFund Management (HK) Limited publication and any recommendation of the, has been authorized by contained herein speak only as of the date hereof and are subject the SFC; however, such authorization is not an official to change without notice. HFT Investment Management (HK) recommendation or endorsement of the Fund nor does it guarantee Limited has no obligation to update or amend any information the commercial merits of the Fund or its performance. It does not contained here in. mean the Fund is suitable for all investors nor is it an endorsement of its suitability for any particular investor or class of investors. This This publication is being furnished to you for informational material has not been reviewed by the SFC. purposes only and on the condition that it will not form a primary basis for any investment decision. Investors must make their own This publication does not constitute an offer or solicitation of any determination of the appropriateness of an investment in any transaction in any securities referred to here in. The content of this securities referred to herein based on the legal, tax and accounting publication does not constitute investment advice to any person. considerations applicable to such investors and their own Any recommendation contained herein may not be suitable for all investment strategy. By virtue of this publication, neither HFT investors. Although the information contained herein has been Investment Management Co., Ltd or HFT Investment Management obtained from sources believed to be reliable, its accuracy and (HK) Limited, nor any of their employees shall be responsible for completeness cannot be guaranteed. This HFT Investment any investment decision.

12 HFT Investment Management (HK) Limited Suite 3003, 30/F, Three Exchange Square, 8 Connaught Place, Central, Hong Kong T: F: E: info.hk@hftfund.com Visit our website