PRODUCT KEY FACTS GF CHINA GROWTH FUND December 2014 This statement provides you with key information about GF China Growth Fund (the Fund ). This statement is a part of the offering document and must be read in conjunction with the Explanatory Memorandum of the Fund. You should not invest in this product based on this statement alone. Quick facts Manager: GF Asset Management (Hong Kong) Limited Custodian: HSBC Institutional Trust Services (Asia) Limited Ongoing charges over a year # : Class A (USD): 1.99% Class B (HKD): 1.99% # Each of the ongoing charges figure is based on expenses for the year ended 31 December 2013. This figure may vary from year to year. Dealing frequency: Daily* Base currency: US dollars Dividend policy: No dividends or distributions will be made by the Fund. Financial year end of this Fund: 31 December Min. investment: Class A (USD) Shares US$1,000 Class B (HKD) Shares HK$ equivalent to US$1,000 Min. redemption: Nil * Generally, Dealing Day is a day (other than a Saturday and a Sunday) on which banks in Hong Kong are open for normal banking business. Please refer to the Explanatory Memorandum for the full definition of Dealing Day. What is this product? The Fund is an open-ended investment company incorporated under the laws of the Cayman Islands with limited liability and registered as a regulated mutual fund. Objective and Investment Strategy Objective The investment objective of the Fund is to achieve medium to long-term capital appreciation and steady return through investing primarily (i.e. at least 70% of its non-cash assets) in securities of companies in the Greater China region and companies deriving significant income in the Greater China region, which are listed, quoted or traded on major stock exchanges worldwide including but not limited to the PRC, Hong Kong, Taiwan, Singapore, the United States, the United Kingdom, Australia and New Zealand. For the purpose of this document, the Greater China region includes the PRC, Hong Kong, Macau Special Administrative Region and Taiwan. 1
Strategy The Fund will seek to achieve its investment objective by taking predominantly long positions in the Greater China-related securities. The Manager intends to focus on two types of companies, namely (i) companies with sustainable long-term earnings growth potential and (ii) companies in sectors which the Manager believes are undervalued. The Manager may also invest in any other companies which it considers appropriate from time to time. In the process of identifying and determining companies with sustainable long-term earnings growth potential, the Manager may consider - (i) companies that demonstrate quality products/services with good demand in market; and/or (ii) companies that are having dominant or growing market share in their sectors. When investing companies in sectors which the Manager believes are undervalued, the Fund may invest in (i) companies in sectors which are considered by the Manager undervalued as compared to the market and/or (ii) companies which are considered by the Manager undervalued as compared to other companies in the same sector. Currently, the Manager does not intend the Fund to focus on any particular sector. The Fund may hold up to 100% of its net asset value in cash or cash equivalents on a temporary basis under limited circumstances, such as in times of a prolonged bearish market or extremely unfavourable economic conditions. The Fund may not invest more than 10% of its net asset value in aggregate directly or indirectly in PRC A Shares and PRC B Shares. If there is any change in this investment policy in future, prior notice of not less than one month will be given to Shareholders and this document will be updated accordingly. For the avoidance of doubt, the Fund does not currently intend to invest directly or indirectly in PRC A Shares and PRC B Shares. Currently, the Fund may invest in debt securities but not more than 10% of its net asset value will be invested in debt securities. The Fund may invest in derivatives for hedging purposes only. What are the key risks? Investment involves risks. Please refer to the Explanatory Memorandum for details including the risk factors. 1. Investment risk The Fund is an investment fund. There is no guarantee of the repayment of principal. The instruments invested by the Fund may fall in value and therefore your investment in the Fund may suffer losses. 2. Economic, Political and other Risks in PRC Investing in the PRC as an emerging market economy carries a greater degree of risk. The value of the Fund s assets invested in the PRC may be adversely affected by uncertainties such as political developments, changes in government policies, taxation, currency repatriation restrictions and restrictions on foreign investment. The RMB currently is controlled by the State Administration of Foreign Exchange ( SAFE ) in the PRC. Such control of currency conversion and movements in the RMB exchange rates may adversely affect the operations and financial results of companies in the PRC or companies deriving significant income from the PRC. If the Fund invests a significant portion of its net asset value in such companies which happen to be adversely 2
affected by exchange controls contemplated herein, this may result in an unfavourable impact on the net asset value of the Fund. 3. Currency Risk A portion of the Fund s investments will be denominated in RMB or other foreign currencies, and the Fund s income from such investments will be received or realized in such currencies. Adverse changes in the value of the RMB or any other currency in which the Fund s investments are denominated against the US dollar will result in corresponding adverse changes in the US dollar value of the Fund s assets denominated in such currencies and the Fund s net asset value. 4. Concentration Risk The Fund invests substantially in the Greater China-related securities and is subject to concentration risk. Investors should be aware that the Fund is likely to be more volatile than a broadbased fund, such as a global or regional equity fund, as the Fund is more susceptible to fluctuations in value resulting from adverse conditions in the PRC. 5. Liquidity Risk The market for some securities in which the Fund may invest may be relatively illiquid. The market for relatively illiquid securities tends to be more volatile than the market for more liquid securities. Investment of the Fund s assets in relatively illiquid securities may restrict the ability of the Fund to dispose of its investments at a price and time that it wishes to do so, which in turn may adversely affect the performance of the Fund and have a negative impact on the net asset value of the Fund. How has the Fund performed? 30% 26.4% 20% 18.0% 18.8% 10% 0% 2009-10% 2010 2011 2012 2013-20% -20.8% -30% Past performance information is not indicative of future performance. Investors may not get back the full amount invested. The computation basis of the performance is based on the calendar year end, NAV-to- NAV, with dividend reinvested. These figures show by how much the share class increased or decreased in value during the calendar year being shown. Performance data has been calculated in USD including ongoing charges and excluding subscription fee and redemption fee you might have to pay. Where no past performance is shown there was insufficient data available in that year to provide performance. Fund launch date: 2009 Class A launch date: 2009 The Manager views Class A, being the share class offered in Hong Kong with the longest history of performance, as the most appropriate representative share class. 3
Is there any guarantee? This Fund does not have any guarantees. You may not get back the full amount of money you invest. What are the fees and charges? Charges which may be payable by you You may have to pay the following fees when dealing in the Participating Shares of the Fund. Fee What you pay Subscription fee (initial charge) (% of total subscription amount received) Redemption fee (redemption charge) Switching charge (% of the total monetary value being converted out of the Initial Class) up to 5% Not applicable up to 1% Ongoing fees payable by the Fund The following expenses will be paid out of the Fund. They affect you because they reduce the return you get on your investments. Fee Annual rate (as a % of the Fund s net asset value) Management fee All Classes: Up to 5% Current rate* - Class A (USD) Shares: 1.50% Class B (HKD) Shares: 1.50% Custodian fee & Administrator fee All Classes: Up to 0.5% Current rate* - All Classes: up to 0.14%, subject to a monthly minimum of US$5,500 * You should note that the current rate of fee may be increased, up to a specified permitted maximum, by giving shareholders not less than one month s prior notice. For details please refer to the section headed Charges and Expenses in the Explanatory Memorandum. Other fees You may have to pay other fees and charges when dealing in the Participating Shares of the Fund. The Fund will also bear the costs which are directly attributable to it, as set out in the Explanatory Memorandum. 4
Additional Information You generally buy and redeem Participating Shares at the Fund s next-determined net asset value (NAV) after the Manager or the Authorised Distributor(s) receive your request in good order on or before 4:00 p.m. (Hong Kong time) being the dealing cut-off time. The Authorised Distributor(s) may impose different dealing deadlines for receiving requests from investors. Investors may obtain the past performance information of other share classes offered to Hong Kong investors from the website of the Manager at http://www.gfgroup.com.hk/**. The net asset value of the Fund is calculated and the price of Participating Shares published on each Dealing Day. They are available online at http://www.gfgroup.com.hk/**. Please note that the website has not been reviewed by the SFC. Important If you are in doubt, you should seek professional advice. The SFC takes no responsibility for the contents of this statement and makes no representation as to its accuracy or completeness. ** This website has not been reviewed by the SFC. 5