Principal Sustainable Asian Allocation Fund - Income Plus (monthly) Class Units - Retirement (HKD) New
- The Principal Sustainable Asian Allocation Fund (“Sub-Fund”) will primarily (i.e. at least 70% of the Sub-Fund’s Net Asset Value) invest in a diversified range of assets and securities (including equities, equity related securities and debt securities) of companies and issuers in Asia Pacific (ex-Japan) which are considered to be outperforming their peers with respect to sustainability performance based on environmental, social and governance (“ESG”) factors (“ESG leaders”) as well as exchange traded funds (“ETF”) and collective investment schemes (“CIS”), which primarily invest in equity or debt securities and companies or issuers that maintain better ESG profiles than their corresponding traditional counterparts (collectively “ESG-focused ETF/CIS”), and provide capital growth and income over medium to long term.
- These investments may be denominated in various currencies. The Sub-Fund will not aim to focus its investments on any single country or market capitalisation. However, investments in any country, the Asia Pacific region or market capitalisation may be concentrated, depending on the Fund Manager’s Sub-Delegate’s assessment of the market conditions at different times.
- The Sub-Fund may invest up to 40% of its Net Asset Value in debt securities rated below investment grade (i.e. rated BB+ or below by Standard & Poor’s or comparable ratings by Moody’s Investors Services or Fitch Ratings) or in the case the credit rating is designated/assigned by a PRC (means the People’s Republic of China excluding Hong Kong, Macau and Taiwan for purpose of this material) credit rating agency, A+ and below, or unrated. For the purpose of the Sub-Fund, “unrated debt securities” is defined as debt securities which neither the debt securities nor their issuers have a credit rating. While these credit ratings provided by the relevant rating agencies serve as a point of reference, the Sub-Delegate of the Manager will conduct its own assessment on the credit quality based on various factors, such as leverage level, operating margin, return on capital, interest coverage, operating cash flows, industry outlook, competitive position in the market and corporate governance. The Sub-Fund may from time to time invest less than 30% of its Net Asset Value in RMB-denominated debt securities and equity securities issued in the PRC, including China A-shares via the Shanghai-Hong Kong Stock Connect and Shenzhen-Hong Kong Stock Connect or indirectly through all eligible instruments, the Qualified Foreign Investor (“QFI”) regime, the China interbank bond market direct access program and/or China Hong Kong Bond Connect, as well as urban investment bonds which are debt instruments issued by local government financing vehicles (“LGFVs”). These LGFVs are separate legal entities established by local governments and/or their affiliates to raise financing for public welfare investment or infrastructure projects.
- Various countries in Asia Pacific in which the Sub-Fund may invest, including but not limited to the following countries: China, Indonesia, Malaysia, Philippines and Thailand, are considered as emerging markets. As emerging markets tend to be more volatile than developed markets, any holdings in emerging markets are exposed to higher levels of market risk. Holdings in emerging markets are also exposed to special considerations not typically associated with investment in more developed markets, such as liquidity risks, currency risks/control, political and economic uncertainties, legal and taxation risks, settlement risks, custody risk and the likelihood of a high degree of volatility. The securities markets of some of the emerging countries in which the Sub-Fund’s assets may be invested are not yet fully developed which may, in some circumstances, lead to a potential lack of liquidity. Accounting, auditing and financial reporting standards in some of the emerging markets in which the Sub-Fund’s assets may be invested may be less vigorous than international standards. As a result, certain material disclosures may not be made by some companies. As a result, the Sub-Fund/investors may be adversely impacted.
- The use of ESG criteria may affect the Sub-Fund’s investment performance and, as such, the Sub-Fund may perform differently compared to similar funds that do not use such criteria. For instance, ESG criteria used in the Sub-Fund’s investment policy may result in the Sub-Fund forgoing opportunities to buy certain securities when it might otherwise be advantageous to do so, and/or selling securities due to such securities no longer meeting the Sub-Fund’s ESG criteria when it might be disadvantageous to do so. As such, the application of ESG criteria may restrict the ability of the Sub-Fund to acquire or dispose of its investments at a price and time that it wishes to do so, and may therefore result in a loss to the Sub-Fund.
- The use of ESG criteria may also result in the Sub-Fund being concentrated in companies with a focus on ESG criteria and its value may be more volatile than that of a fund having a more diverse portfolio of investments. The selection of securities may involve the subjective judgement of the Fund Manager’s Sub-Delegates. There is also a lack of standardized taxonomy of ESG criteria evaluation methodology and the way in which different funds apply such ESG criteria may vary. The Fund Manager and the Fund Manager’s Sub-Delegates’ ESG assessment takes into account ESG data and research from external data providers, which may be incomplete, inaccurate or unavailable. As a result, there is a risk associated with the assessment of a security or issuer based on such information or data.
- The Sub-Fund may also invest up to 10% of its net asset value in debt instruments with loss absorption features, which may include instruments classified as Additional Tier 1/Tier 2 capital instruments, contingent convertible bonds (“CoCos”), non-preferred senior bonds which may also be known as Tier 3 bonds and other instruments eligible to count as loss-absorbing capacity under the resolution regime for financial institution, in compliance with its investment policy and limits. These instruments may be subject to contingent write-down or contingent conversion to equity on the occurrence of trigger event(s).
- The Sub-Fund’s net derivative exposure may be up to 50% of the Sub-Fund’s net asset value.
- Investment involves risk. There is no assurance on investment returns and you may not get back the amount originally invested.
- The investment decision is yours but you should not invest in this Fund unless the intermediary who sells it to you has advised you that it is suitable for you and explained how it is consistent with your investment objectives.
- You should not rely solely on this marketing material when making your investment decision. You should read the Explanatory Memorandum and Product Key Facts of Principal Prosperity Series for further details (including investment policy, risk factors, fees and charges, and fund information).
- The dividend distributed by the Sub-Fund in respect of Income Class Units may be paid effectively out of the capital of the Sub-Fund (i.e. making the distribution from gross income while charging all or part of the relevant Sub-Fund’s fees and expenses to capital), resulting in an increase in distributable income for the payment of dividend by the Sub-Fund and may result in an immediate reduction of the net asset value per unit of the relevant class. Dividend for Income Plus Class Units may be paid out capital. Such payment of dividend out of capital or effectively out of capital amounts to a return or withdrawal of part of an investor’s original investment in the Income Class Units or the Income Plus Class Units or from any capital gains attributable to that original investment. Dividend is not guaranteed.
Performance During Fed Rate Hikes
As the economy rebounds from the COVID-19 shock, the possibilities of rate hikes by the Federal Reserve increase after the tapering of bond purchases. With relatively solid fundamentals, Asian equites and bonds could sustain their uptrend over a short-to-medium term.
Robust Economic Growth Potential
The Asian economy has taken up a growing share of the world economy. Measured by purchasing power parity, the region's economy is expected to account for 47.9 percent of the world's total in 2021, up from 45.3 percent registered in 2017, according to IMF.
Attractive Relative Valuation
A growing number of Asian listed companies with diverse sectors offer a potential for a rich ground of potential alpha opportunities while their stock valuations are cheaper compared to other markets. With solid fundamentals, Asian bonds looked attractive over US bonds in relative value terms.
Historically Compelling Return With Less Volatility Relative To Global Equities
Competitive Yields Relative To Developed Markets
In the past 10 years, dividends in Asia Pacific ex-Japan markets are one of the key contributors to total return. Interest rates in developed markets were slashed to extremely low levels. Asian markets have yield advantages compared to other parts of the world.
Source: Please refer to the Sales Flyer under the Download section.
Investing in Best-In-Class Companies
All securities invested by the fund (including ETF and CIS) are screened with the aim of identifying ESG leaders. ESG scorings on potential companies/issuers are assigned using a proprietary ESG methodology. The fund’s goal is to achieve a better ESG rating than the traditional index.
Source: Please refer to the Sales Flyer under the Download section.
Valuation Date (DD/MM/YYYY)
^ The unit price of the fund is calculated on net asset value.
The investment objective of the Fund is to provide capital growth and income over medium to long term, through primarily investing in a diversified range of assets and securities (including equities, debt securities, etc.) of companies and issuers in Asia Pacific (ex-Japan) which are considered to be outperforming their peers with respect to sustainability performance based on environmental, social and governance ("ESG") factors (“ESG leaders”) as well as exchanged trade funds ('ETF") and collective investment schemes ("CIS") which primarily invest in equity or debt securities and companies or issuers that maintain better ESG profiles than their corresponding traditional counterparts (collectively “ESG-focused ETF/CIS”).
The Fund aims to maintain a minimum of 70% of its net asset value invested in (i) equity and equity related securities and/or (ii) debt securities issued by ESG leaders as well as ESG-focused ETF/CIS. The Fund adopts a dynamic asset allocation strategy, and may invest up to 85% of its latest net asset value in equities and/or debt securities. The aggregate investments in ETF and CIS (including ESG-focused ETF/CIS) will be less than 30% of the net asset value. The Fund Manager adopts a best-in-class strategy under which the Fund Manager will screen all securities investable by the Fund (including ETF and CIS) with the aim of identifying ESG leaders and ESG-focused ETF/CIS. For details please refer to Explanatory Memorandum.
Principal Prosperity Series
Principal Sustainable Asian Allocation Fund - Income Plus (monthly) Class Units - Retirement (HKD)
HKD201.26 million As of 30/06/2022
3 years annualized volatility1
Launch Date (DD/MM/YYYY)
Ongoing charges over a year2
1. The 3 Years Annualized Volatility shows the risk of a fund and is calculated as an annualized standard deviation based on the monthly rates of return of the fund over the past three years. However, it is not required to indicate the 3 Years Annualized Volatility if the period between the reporting date of the website and the inception date for the fund is less than 3 years.
2. As the unit class has not been launched for one year, the figure is an estimate only and represents the sum of the estimated ongoing expenses chargeable to the respective class of the Fund over a 12-month period expressed as a percentage of the estimated average net asset value of the respective class of the Fund over the same period. The actual figure may be different upon actual operation of the Fund and the figure may vary from year to year.
Cumulative Return ¹ (%)
|As of (DD/MM/YYYY)||1 Month||3 Months||Year To Date||1 Year||3 Years||5 Years||Since Launch|
Calendar Year Return ¹ (%)
As of (DD/MM/YYYY)
Year To Date
|As of (DD/MM/YYYY)||Year To Date||2021||2020||2019||2018||2017|
|Dividend Period End Date||Dividend per unit||Dividend paid out of net distributable income for the period||Dividend effectively paid out of capital|
Dividend, if declared, will be paid on a monthly basis. If the dividend is below US$100, it will be reinvested.
There is no guarantee that dividends will be paid or that there will be a target level of dividend payments for the Income Class Units. It is intended, although not guaranteed, that Income Plus Class Units will distribute a set level of net income, i.e. a target income, determined by the Manager on a regular basis. The level and frequency of the dividends paid by the Sub-Fund does not necessarily indicate the total return and income of the Sub-Fund. Dividend payments are subject to the Fund Manager’s discretion.
Net distributable income = "Gross income (other than any realised gain on sale of investments, unrealised gain on investments and foreign exchange gain)" less "total expenses incurred by fund"
Warning: Please note that a positive distribution yield does not imply a positive return. Investors should not make any investment decision solely based on information contained in the table above. You should read the relevant offering document (including the key facts statement) of the fund for further details including the risk factors.
Explanatory Memorandum - Principal Prosperity Series
Product Key Facts - Principal Sustainable Asian Allocation Fund
Fund Fact Sheets - Principal Sustainable Asian Allocation Fund
Notice to Unitholder of Principal Prosperity Series (7 February 2022)
Notice to Unitholder of Principal Prosperity Series (8 December 2021)
Responsible Investment Policy
Additional Information for Principal Sustainable Asian Allocation Fund
Sales Flyer - Principal Sustainable Asian Allocation Fund
Dividend Records - Principal Sustainable Asian Allocation Fund
Mutual Funds Product Range Brochure