HONG KONG--(BUSINESS WIRE)--On March 11th 2020, one of the Big Three credit rating agencies, Fitch Ratings (“Fitch”), has assigned a first-time Fund Credit Quality Rating of 'AAAf', the highest rating within the rating agency, to CSOP US Dollar Money Market ETF (stock code: 9096.HK), which is managed by CSOP Asset Management Limited (“CSOP”). It is also the first Hong Kong listed ETF that has received the rating from Fitch in HK. As the first USD Money Market ETF in Hong Kong investing in USD denominated deposits and deposit certificates issued by high rating financial institutions, 9096.HK was listed on May 8th 2019, and has already achieved total return of 2.08% with USD 104.5 million under management as of Jan 31st 2020. With listed share class and unlisted share class, 9096.HK provides investors with a flexible and efficient cash management tool to sail through the turbulent market.
The AAAf assigned by Fitch indicates the underlying assets of 9096.HK have high credit quality, low interest rate-risk and low quality spread—9096.HK predominately invests in time deposits. About 90% of the counterparties were rated in the ‘A’ category at end of February 2020. The fund's exposure to interest-rate and spread risk is low given its short maturity profile.
On the other hand, Fitch regards the investment manager - CSOP as suitably qualified, competent and capable of managing the fund consistently with the rating, with sufficient operational resources and expertise.
9096.HK, one of the CSOP money market ETFs has several features as the pioneer cash management tool in HK market.
1. Investment Safety: With the only “AAAf” rating ETF in HK, 9096.HK demonstrates its high-quality underlying assets, robust liquidity management by fund manager and sophisticated trading support.
2. Underlying assets simplicity, no single-day loss: 9096.HK predominately invests in time deposits, with no bond investment to ensure stable positive gain. Since the launch on May 8th 2019, it has never recorded a single-day loss1. Under the global bond market current tough conditions, this strategy might provide higher level of investment safety to investors.
3. Liquidity: 9096.HK is able to provide overnight liquidity equivalent to above 10% of its assets under management, one-week liquidity to above 50% of its assets under management2, highly beyond Securities and Futures Commission (SFC)’s requirements of 7.5% and 15% respectively. The sizeable liquidity demands from investors can be therefore well supported.
4. Outperformance to benchmark: 9096.HK could offer investors higher return than its underlying index (FTSE 3-Month US Dollar Eurodeposit Index)—since inception of May 8th 2019 to Jan 31th 2020, the total return of 9096.HK was 2.08%, significantly beating the underlying index performance of 1.03%3.
Ms. Melody He, Head of Business Development of CSOP commented, “We are glad to see Fitch assigned 9096.HK with ‘AAAf’ rating. The rating not only proves our strong fund management ability, but also provides an insightful investment reference to investors.” Besides 9096.HK, CSOP provides investors with diversified cash management tools denominated in HKD and RMB - CSOP HKD Money ETF (3035.HK) and CSOP RMB Money Market ETF (3122.HK).
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For further details, including the risk factors, please refer to the respective offering documents.
About CSOP Asset Management Limited
CSOP Asset Management Limited (“CSOP”) was founded in 2008 as the first offshore asset manager set up by a regulated asset management company in China. With a dedicated focus on China investing, CSOP manages public and private funds, as well as providing investment advisory services to Asian and global investors. In addition, CSOP is best known as an ETF leader in Asia. As of 31 Dec 2019, CSOP had US$ 6.3 billion in assets under management.
This material has not been reviewed by the Securities and Futures Commission.
Issuer: CSOP Asset Management Limited
IMPORTANT: Investment involves risks. Investment value may rise or fall. Past performance information presented is not indicative of future performance. Investors should refer to the Prospectus and the Product Key Facts Statement for further details, including product features and risk factors. Investors should not base on this material alone to make investment decisions.
- CSOP US Dollar Money Market ETF (the “Sub-Fund”) invests in US Dollar-denominated and settled short-term deposits and money market instruments, and the Manager adopts a passive tracking strategy to provide investment results that, before deduction of fees and expenses, closely correspond to the performance of the FTSE 3-Month US Dollar Eurodeposit Index (the “Benchmark”).
- The Sub-Fund does not guarantee principal and the Manager has no obligation to redeem the Units at the offer value. The Sub-Fund does not have a constant Net Asset Value. The Sub-Fund is not subject to the supervision of the Hong Kong Monetary Authority. It is not principal protected and is not protected by the deposit protection scheme.
- Investors should be aware that investment in the Sub-Fund is subject to normal market fluctuations and other risks inherent in the underlying assets into which the Sub-Fund may invest. There can be no assurance that any appreciation in value of investments will occur. There is no guarantee of repayment of principal.
- The factors influencing interest rates include, amongst other things, monetary policy, fiscal policy and inflation. If the Benchmark becomes negative, the Sub-Fund will suffer a loss. Moreover, if the Benchmark is at a low level, the Sub-Fund may also produce a negative return over a given period of time, as ongoing charges of the Sub-Fund may be higher than the interests received by the Sub-Fund. Therefore, the Sub-Fund may suffer a loss even when the Benchmark is positive.
- As the Sub-Fund invests in short-term debt instruments with short maturities, the turnover rates of the Sub-Fund’s investments may be relatively high and the transaction costs incurred as a result of the purchase or sale of short-term debt instruments may also increase which in turn may have a negative impact on the Net Asset Value of the Sub-Fund.
Please note that the above listed investment risks are not exhaustive and investors should read the Prospectus in detail before making any investment decision.
Index Provider Disclaimer:
The CSOP US Dollar Money Market ETF (the “Fund”) has been developed solely by CSOP Asset Management Limited. The Fund is not in any way connected to or sponsored, endorsed, sold or promoted by the London Stock Exchange Group plc and its group undertakings (collectively, the “LSE Group”). FTSE Russell is a trading name of certain of the LSE Group companies.
All rights in the FTSE 3-Month US Dollar Eurodeposit Index (the “Index”) vest in the relevant LSE Group company which owns the Index. FTSE®” is a trademark of the relevant LSE Group company and is used by any other LSE Group company under license. “TMX®” is a trade mark of TSX, Inc. and used by the LSE Group under license.
The Index is calculated by or on behalf of FTSE Fixed Income, LLC or its affiliate, agent or partner. The LSE Group does not accept any liability whatsoever to any person arising out of (a) the use of, reliance on or any error in the Index or (b) investment in or operation of the Fund. The LSE Group makes no claim, prediction, warranty or representation either as to the results to be obtained from the Fund or the suitability of the Index for the purpose to which it is being put by CSOP Asset Management Limited.
1 Bloomberg Data, January 25th 2019-March 12th 2020
2 Fitch Ratings: Fitch Assigns CSOP US Dollar Money Market ETF First-Time
3 Bloomberg Data, 2020 March 5th
