Hang Seng’s Diverse Fund Investments

What role do investors play in sustainability?

The threat of climate change is looming large as one of the biggest global challenges. To tackle the issue head on, carbon neutrality and emissions reduction have been included in the long-term development goals of governments and corporates around the world in a bid to achieve a rapid transition into a low-carbon future.

As investors, we may consider investing in companies with low carbon exposure to make a positive impact on climate change.

Investment opportunities from low carbon transition

China is the second largest economy¹ as well as the second largest equity market² in the world. Currently, more and more mainland enterprises have committed to the net zero pledge as a way to meet the national goals of peaking carbon
emissions by 2030 and realizing net zero by 2060. Their process of transition is expected to unleash enormous potential opportunities for investing in the low carbon theme.

Meanwhile, as a result of global policy support driving towards the movement, there is a growing universe of low carbon related corporates, along with the emergence of the relevant market sectors and indexes. Fund related to the low carbon theme have also made their debuts in markets around the world.

To ride on this policy trend, investors may subscribe for related funds to invest for sustainability, while capturing the potential return from the relevant trends.

Invest in a specific sector with
index funds

Apart from the advantage of risk diversification, fund investing also empowers investors with access to global investment opportunities. At Hang Seng, we have a broad spectrum of fund choices for selection,

Covering the above-mentioned funds related to the sustainability theme
The widest range of index fund choices³
Plus other fund categories

By simply investing in funds tracking the benchmark index for your target market, you can stay close to the performance reflected by such index, and also diversify the concentration risks from investing in single securities.

Diversify the risk of investing in single entities

Avoid the risks associated with active stock picking

Want to know more about funds related to sustainability?

Want to know more about the key features of index funds?

Want to look up our list of index funds?

Hong Kong Trade Development Council, 18 January 2023
World Federation of Exchanges, Hang Seng Investment Management, 30 December 2022
According to the study on the number of index funds in "Index Funds (Ch 8.6)" under "Product" at "Unit Trusts & Mutual Funds" under the category of "Unlisted Products" on Securities and Futures Commission website, through Hang Seng Bank on 31 March 2023

Important Risk Warning
Risk Disclosure of Investment Funds:

Investors should note that all investments involve risks (including the possibility of loss of the capital invested), prices or value of investment fund units may go up as well as down and past performance information presented is not indicative of future performance. Investors should read carefully and understand the relevant offering documents of the investment funds (including the fund details and full text of the risk factors stated therein) and the Notice to Customers for Fund Investing before making any investment decision. Investment funds are investment products and some may involve derivatives. Investors should carefully consider their own circumstances whether an investment is suitable for them in view of their own investment objectives, investment experience, preferred investment tenor, financial situation, risk tolerance abilities, tax implications and other needs, etc., and should understand the nature, terms and risks of the investment products. Investors should obtain independent professional advice if they have concerns about their investment.

The risks for funds which are index funds include but not limited to:

Tracking error risk: There can be no assurance that the performance of the relevant fund will be identical to the performance of the relevant index. Factors such as the fees and expenses borne by the relevant fund, the time differences associated with portfolio re-balancing, the prices at which the constituent stocks of the relevant index are acquired or disposed by the relevant fund, the market condition at the relevant time of acquisition or disposal, the index-tracking strategies or financial derivative instruments used will affect the performance of such fund relative to the relevant index.
Passive investment risk: Fund manager does not have any discretion to select stocks individually or to take defensive positions in declining markets or changes in the composition of the index. Hence, any fall in the relevant index will result in corresponding fall in the value of the relevant fund. The composition of the relevant index may change and stocks currently comprising the relevant index may subsequently be delisted. Other stocks may also be added subsequently to become constituent stocks of the relevant index.
Concentration risk: The relevant fund may beconcentrated in a single or particular sector(s)or single country/ region. The performance of the relevant fund could depend substantially on the performance of the relevant single or particular sector(s)/market(s) and the relevant fund is likely to be more volatile than a broadbased fund as it is more susceptible to adverse conditions in the relevant single or particular sector(s) / market (s). In seeking to reflect the weightings of constituent stocks of the relevant index, investments of the relevant fund may be concentrated in a single constituent stock or several constituent stocks. The performance of the relevant index and the fund may be significantly affected by the price fluctuation of one or several of the constituent stocks of the relevant index.