The Taikang Kaitai Hong Kong Dollar Money Market Fund’s objective is to achieve a return in Hong Kong Dollars in line with prevailing money market rates in Hong Kong.

• Strategy


• The Sub-Fund seeks to achieve its investment objective by investing primarily (i.e. not less than 70% of its Net Asset Value) in HKD denominated and settled short-term deposits and high quality money market instruments issued by governments, quasi-governments, international organisations and financial institutions. High quality money market instruments include but are not limited to government bills, short term notes, bankers’ acceptance, commercial papers, certificates of deposits, commercial bills and debt securities. Debt securities invested by the Sub-Fund (up to 20% of the Net Asset Value) include but are not limited to government bonds, fixed and floating rate bonds. Non-HKD denominated investments may account for up to 30% of the Sub-Fund’s Net Asset Value.


• There is no specific geographical allocation of the country of issue of the Sub-Fund’s investments, except that the Sub-Fund may not invest more than 30% of its Net Asset Value in emerging markets (including the onshore China markets). Countries or regions in which the Sub-Fund may invest in include but are not limited to Hong Kong, Singapore, the European Union, the United States and China (onshore and offshore markets).


• The Sub-Fund may invest in onshore and offshore RMB denominated money market instruments or debt securities. The total exposure to onshore RMB denominated money market instruments and debt securities may be up to 20% of the Sub-Fund’s Net Asset Value (accessed via the mutual bond market access between Hong Kong and Mainland China (“Bond Connect”)). The total exposure to offshore RMB denominated money market instruments and debt securities (“Dim Sum” bonds) will be less than 10% of the Sub-Fund’s Net Asset Value. The total exposure to onshore and offshore RMB denominated assets may be up to 30% of the Sub-Fund’s Net Asset Value.


• The Manager will assess the credit quality and the liquidity profile of instruments that may be acquired on behalf of the Sub-Fund to determine whether a money market instrument is of high quality. The Sub-Fund will only invest in instruments which 1) have, or the issuers of which have, an investment grade rating, i.e. at least BBB-/Baa3 (rated by an internationally recognised credit agency such as Moody's, Standard & Poor's or Fitch) or AA+ (rated by a Mainland Chinese domestic credit rating agency) or 2) in terms of short-term debt security, has an investment grade short-term credit rating of A-3 or higher by Standard & Poor’s or F3 or higher by Fitch or P-3 or higher by Moody’s or equivalent rating as rated by one of the international credit rating agencies. While these credit ratings provided by the relevant rating agencies serve as a point of reference, the Manager will conduct its own assessment on the credit quality based on various factors. The assessment by the Manager involves both quantitative and qualitative analyses of an issuer’s credit fundamentals. Quantitative financial factors that are assessed may include, the issuer’s leverage, operating margin, return on capital, interest coverage and operating cash flows. Qualitative factors that will be assessed may include, industry outlook, the firm’s competitive position, corporate governance, and other non-financial factors. The Manager will assess the liquidity profile of instruments based on various factors, included but not limited to time to cash, liquidation horizon, price volatility, external liquidity classification, daily trading volume, yield volatility and bid-ask spread of such instruments. Only instruments with sufficient liquidity will be included in the portfolio of the Sub-Fund.


• The aggregate value of the Sub-Fund’s holding of instruments and deposits issued by a single entity will not exceed 10% of the total Net Asset Value of the Sub-Fund except: (i) where the entity is a substantial financial institution (as defined in the SFC’s Code on Unit Trusts and Mutual Funds (the “Code”)) and the total amount does not exceed 10% of the entity’s share capital and non-distributable capital reserves, the limit may be increased to 25%; or (ii) in the case of Government and other public securities (as defined in the Code), up to 30% may be invested in the same issue; or (iii) in respect of any deposit of less than USD1,000,000 or its equivalent in HKD, where the Sub-Fund cannot otherwise diversify as a result of its size.


• The Sub-Fund will not invest in convertible bonds. It will not invest in instruments with loss-absorption features (i.e. instruments that may be subject to contingent write-down or contingent conversion to ordinary shares on the occurrence of trigger event(s)).


• The Sub-Fund will maintain a portfolio with weighted average maturity not exceeding 60 days and a weighted average life not exceeding 120 days and must not purchase an instrument with a remaining maturity of more than 397 days, or two years in the case of Government and other public securities.


• The Sub-Fund may borrow up to 10% of its total Net Asset Value but only on a temporary basis for the purpose of meeting redemption requests or defraying operating expenses.


• For the avoidance of doubt, the Sub-Fund will not (i) invest in any securities or other financial products or instruments that are neither listed, quoted nor dealt in on a stock exchange, over-the-counter market or other organised securities market which is open to the international public and on which such securities are regularly traded or (ii) make any short sales.




• Financial Derivative Instruments (“FDI”)


• The Sub-Fund may invest in FDI for hedging purposes only but not for investment purposes. Any material currency risk from non-HKD denominated investments will be appropriately hedged into HKD.


• The Sub-Fund’s net derivative exposure may be up to 50% of the Sub-Fund’s Net Asset Value.


• Sale and Repurchase Transactions


• The Sub-Fund may enter into sale and repurchase transactions only on a temporary basis mainly for the purpose of meeting redemption requests. The maximum proportion and expected proportion of the Net Asset Value of the Sub-Fund that can be subject to sale and repurchase transactions, when aggregated with the Sub-Fund’s borrowing, are 10% and 10% respectively.


• The Sub-Fund will not enter into securities lending and reverse repurchase transactions in respect of the Sub-Fund.


• It is the intention of the Manager to sell the securities for cash equal to the market value of the securities provided in a sale and repurchase transaction, where cash obtained will not be re-invested. The Sub-fund will not receive any non-cash collateral.




• Investment Allocation
• The Sub-Fund’s indicative asset allocation is presented in the table below:





Investments

Percentage of allocation (% of Net Asset Value)

HKD denominated securities
HKD denominated and settled short-term deposits and high quality money market instruments	70 - 100
Non-HKD denominated securities
Non-HKD denominated and settled short-term deposits and high quality money market instruments	0 - 30




Fund Profile

Asset Class	Fixed Income	Domicile	Hong Kong
Base Currency	HKD

Dealing Information

Dealing Frequency	Daily
Dealing Currency	HKD
Subscription Fee	Class B, Class A, Class I and Class M: up to 5%
Redemption Fee	Class B, Class A, Class I and Class M: NIL
Switching Charge	Class B, Class A, Class I and Class M: up to 1%
Management Fee	Class B: 0.65% p.a. Class A: 0.40% p.a. Class I: 0.05% p.a. Class M: 0.00% p.a.
Minimum Initial Subscription	Class B – HKD1 Class A –HKD100 Class I –HKD1 Class M –HKD10,000
Minimum Subsequent Subscription	Class B – HKD1 Class A –HKD100 Class I –HKD1 Class M –HKD10,000
Minimum Holding (Units with aggregate minimum value of:)	Class B – HKD1 Class A –HKD100 Class I –HKD1 Class M –HKD10,000
Minimum Redemption Amount (Units with aggregate minimum value of:)	Class B – HKD1 Class A –HKD100 Class I –HKD1 Class M –HKD10,000
Launch Price	Class B, Class A, Class I and Class M: HKD10
Distribution Frequency	Semi-annually (June and December, if any), subject to the Manager’s discretion
Trustee, Administrator and Registrar	BOCI-Prudential Trustee Limited
Custodian	Bank of China (Hong Kong) Limited
ISIN Code	HK0000772993 (Class B – HKD) HK0000773033 (Class A – HKD) HK0000773058 (Class I – HKD) HK0000773017 (Class M – HKD)
Bloomberg Ticker	TADMMBH HK (Class B – HKD) TADMMAH HK (Class A – HKD) TADMMIH HK (Class I – HKD) TADMMHK HK (Class M – HKD)