Objectives and Approach

The sub-fund aims to provide long term capital growth by investing in a portfolio of Hong Kong SAR equities, while promoting ESG characteristics within the meaning of Article 8 of SFDR. The sub-fund invests in normal market conditions a minimum of 90% of its net assets in equities and equity equivalent securities of companies which are domiciled in, based in, carry out the larger part of their business activities, or are listed on a Regulated Market, in Hong Kong SAR. The sub-fund may also invest in eligible closed-ended Real Estate Investment Trusts (“REITs”). The sub-fund includes the identification and analysis of a company’s ESG credentials (“ESG Credentials”) as an integral part of the investment decision making process, to help assess risks and potential returns. ESG Credentials may include, but are not limited to: environmental and social factors, including but not limited to physical risks of climate change and human capital management, that may have a material impact on a security issuer’s financial performance and valuation. corporate governance practices that protect minority investor interests and promote long-term sustainable value creation. ESG Credentials are proprietary to HSBC, subject to ongoing research and may change over time as new criteria are identified. Notwithstanding the Excluded Activities as detailed below, the inclusion of a company in the sub-fund’s investment universe is at the discretion of the Investment Adviser. Issuers with improving ESG Credentials may be included when their credentials are still limited. Companies and/or issuers considered for inclusion within the sub-fund’s portfolio will be subject to Excluded Activities in accordance with HSBC Asset Management’s Responsible Investment Policies, which may change from time to time. More information is provided in section 1.5. “Integration of sustainability risks into investment decisions and SFDR principles” subsection HSBC Asset Management Responsible Investment Policies. ESG Credentials, Excluded Activities and the need for enhanced due diligence may be identified and analysed by using, but not exclusively, HSBC’s Proprietary ESG Materiality Framework and ratings, fundamental qualitative research and corporate engagement. When assessing issuers’ ESG score and/or rating or their involvement in Excluded Activities, the Investment Adviser may rely on expertise, research and information provided by financial and non-financial data providers. Investments in Chinese equities include, but are not limited to, China A-shares and China B-shares (and such other securities as may be available) listed on stock exchanges in the People's Republic of China (“PRC”). The sub-fund may directly invest in China A-shares through the Shanghai-Hong Kong Stock Connect and/or the Shenzhen-Hong Kong Stock Connect, subject to applicable quota limitations. Furthermore, the sub-fund may gain exposure to China A-shares indirectly through China A-shares Access Products (“CAAP”) such as, but not limited to, participation notes linked to China A-shares. The sub-fund may invest up to 20% of its net assets in China A-shares through the Shanghai-Hong Kong Stock Connect and/or the Shenzhen-Hong Kong Stock Connect and up to 10% of its net assets in CAAPs. The sub-fund's maximum exposure to China A-shares (through the Shanghai-Hong Kong Stock Connect, the Shenzhen-Hong Kong Stock Connect or CAAP) and China B-shares is 20% of its net assets. The sub-fund will not invest more than 10% of its net assets in CAAPs issued by any single issuer of CAAPs. The sub-fund normally invests across a range of market capitalisations without any capitalisation restriction. The sub-fund may invest up to 10% of its net assets in units or shares of UCITS and/or other Eligible UCIs (including other subfunds of HSBC Global Investment Funds). The sub-fund may also invest in bank deposits, money market instruments or money market funds for treasury purposes. The sub-fund will not invest more than 10% of its net assets in REITs. The sub-fund may use financial derivative instruments for hedging and cash flow management (for example, Equitisation). However, the sub-fund will not use financial derivative instruments extensively for investment purposes. The financial derivative instruments the sub-fund is permitted to use include, but are not limited to, futures and foreign exchange forwards (including non-deliverable forwards). Financial derivative instruments may also be embedded in other instruments in which the sub-fund may invest. Financial derivative instruments may also be used for efficient portfolio management purposes. The sub-fund can enter into Securities Lending transactions for up to 29% of its net assets, however, it is expected that this will not exceed 25%. 210 RESTRICTED The sub-fund is actively managed and does not track a benchmark. The sub-fund has an internal or external target to outperform the reference benchmark, FTSE MPF Hong Kong. The Investment Adviser will use its discretion to invest in securities not included in the reference benchmark based on active investment management strategies and specific investment opportunities. It is foreseen that a significant percentage of the subfund's investments will be components of the reference benchmark. However, their weightings may deviate materially from those of the reference benchmark. Any deviations with respect to the benchmark are monitored within a comprehensive risk framework, which includes monitoring at security & sector level. The deviation of the sub-fund’s performance relative to the benchmark is also monitored, but not constrained, to a defined range. The investment management process will result in periods when the sub-fund’s performance may be close to that of the reference benchmark, as well as periods when it is not. The reference benchmark has a high level of concentration. This means that a small number of securities make up a significant proportion of the benchmark.