HSBC ETFsplc Interim Report and Unaudited Financial Statements For the Financial Period from 1 January 2019 to 30 June 2019
HSBC ETFs plcInterim Report and Unaudited Financial Statements
For the Financial Period from 1 January 2019 to 30 June 2019
HSBC ETFs PLC >1<
Contents
Management and Administration .......................................................................................... 6
General Information ...................................................................................................................... 8
Investment Manager’s Report ................................................................................................21
HSBC FTSE 100 UCITS ETF
Schedules of Investments .................................................................................................................33
Statement of Financial Position .........................................................................................................39
Statement of Comprehensive Income ...............................................................................................40
Statement of Changes in Net Assets Attributable to
Holders of Redeemable Participating Shares ...................................................................................41
HSBC EURO STOXX 50 UCITS ETF
Schedules of Investments .................................................................................................................42
Statement of Financial Position .........................................................................................................47
Statement of Comprehensive Income ...............................................................................................48
Statement of Changes in Net Assets Attributable to
Holders of Redeemable Participating Shares ...................................................................................49
HSBC MSCI JAPAN UCITS ETF
Schedules of Investments .................................................................................................................50
Statement of Financial Position .........................................................................................................61
Statement of Comprehensive Income ...............................................................................................62
Statement of Changes in Net Assets Attributable to
Holders of Redeemable Participating Shares ...................................................................................63
HSBC FTSE 250 UCITS ETF
Schedules of Investments .................................................................................................................64
Statement of Financial Position .........................................................................................................75
Statement of Comprehensive Income ...............................................................................................76
Statement of Changes in Net Assets Attributable to
Holders of Redeemable Participating Shares ...................................................................................77
HSBC S&P 500 UCITS ETF
Schedules of Investments .................................................................................................................78
Statement of Financial Position ........................................................................................................95
Statement of Comprehensive Income ...............................................................................................96
Statement of Changes in Net Assets Attributable to
Holders of Redeemable Participating Shares ...................................................................................97
HSBC MSCI EUROPE UCITS ETF
Schedules of Investments .................................................................................................................98
Statement of Financial Position ......................................................................................................119
Statement of Comprehensive Income .............................................................................................120
Statement of Changes in Net Assets Attributable to
Holders of Redeemable Participating Shares .................................................................................121
HSBC MSCI USA UCITS ETF
Statement of Investments ................................................................................................................122
Statement of Financial Position ......................................................................................................142
Statement of Comprehensive Income .............................................................................................143
Statement of Changes in Net Assets Attributable to
Holders of Redeemable Participating Shares .................................................................................144
HSBC ETFs PLC >2<
Contents (continued)
HSBC MSCI BRAZIL UCITS ETF
Schedules of Investments ...............................................................................................................145
Statement of Financial Position ......................................................................................................148
Statement of Comprehensive Income .............................................................................................149
Statement of Changes in Net Assets Attributable to
Holders of Redeemable Participating Shares .................................................................................150
HSBC MSCI PACIFIC ex JAPAN UCITS ETF
Schedules of Investments ...............................................................................................................151
Statement of Financial Position ......................................................................................................156
Statement of Comprehensive Income .............................................................................................159
Statement of Changes in Net Assets Attributable to
Holders of Redeemable Participating Shares .................................................................................160
HSBC MSCI EM FAR EAST UCITS ETF
Schedules of Investments ...............................................................................................................161
Statement of Financial Position ......................................................................................................180
Statement of Comprehensive Income .............................................................................................181
Statement of Changes in Net Assets Attributable to
Holders of Redeemable Participating Shares .................................................................................182
HSBC MSCI TURKEY UCITS ETF
Schedules of Investments ...............................................................................................................183
Statement of Financial Position ......................................................................................................186
Statement of Comprehensive Income .............................................................................................187
Statement of Changes in Net Assets Attributable to
Holders of Redeemable Participating Shares .................................................................................188
HSBC MSCI WORLD UCITS ETF
Schedules of Investments ...............................................................................................................189
Statement of Financial Position ......................................................................................................235
Statement of Comprehensive Income .............................................................................................236
Statement of Changes in Net Assets Attributable to
Holders of Redeemable Participating Shares .................................................................................237
HSBC MSCI CHINA UCITS ETF
Schedules of Investments ...............................................................................................................238
Statement of Financial Position .......................................................................................................252
Statement of Comprehensive Income .............................................................................................253
Statement of Changes in Net Assets Attributable to
Holders of Redeemable Participating Shares .................................................................................254
HSBC MSCI SOUTH AFRICA CAPPED UCITS ETF
Schedules of Investments ...............................................................................................................255
Statement of Financial Position .......................................................................................................258
Statement of Comprehensive Income .............................................................................................259
Statement of Changes in Net Assets Attributable to
Holders of Redeemable Participating Shares .................................................................................260
HSBC MSCI CANADA UCITS ETF
Schedules of Investments ...............................................................................................................261
Statement of Financial Position .......................................................................................................266
Statement of Comprehensive Income .............................................................................................267
Statement of Changes in Net Assets Attributable toHolders of Redeemable Participating Shares 267
HSBC ETFs PLC >3<
Contents (continued)
HSBC MSCI MEXICO CAPPED UCITS ETF
Schedules of Investments ...............................................................................................................269
Statement of Financial Position ......................................................................................................272
Statement of Comprehensive Income .............................................................................................273
Statement of Changes in Net Assets Attributable to
Holders of Redeemable Participating Shares .................................................................................274
HSBC MSCI EM LATIN AMERICA UCITS ETF
Schedules of Investments ...............................................................................................................275
Statement of Financial Position .......................................................................................................282
Statement of Comprehensive Income .............................................................................................283
Statement of Changes in Net Assets Attributable to
Holders of Redeemable Participating Shares .................................................................................284
HSBC MSCI INDONESIA UCITS ETF
Schedules of Investments ...............................................................................................................285
Statement of Financial Position .......................................................................................................288
Statement of Comprehensive Income .............................................................................................289
Statement of Changes in Net Assets Attributable to
Holders of Redeemable Participating Shares .................................................................................290
HSBC MSCI MALAYSIA UCITS ETF
Schedules of Investments ...............................................................................................................291
Statement of Financial Position ......................................................................................................295
Statement of Comprehensive Income .............................................................................................296
Statement of Changes in Net Assets Attributable to
Holders of Redeemable Participating Shares .................................................................................297
HSBC MSCI TAIWAN CAPPED UCITS ETF
Schedules of Investments ...............................................................................................................298
Statement of Financial Position .......................................................................................................303
Statement of Comprehensive Income .............................................................................................304
Statement of Changes in Net Assets Attributable to
Holders of Redeemable Participating Shares .................................................................................305
HSBC MSCI KOREA UCITS ETF
Schedules of Investments ...............................................................................................................306
Statement of Financial Position ......................................................................................................311
Statement of Comprehensive Income .............................................................................................312
Statement of Changes in Net Assets Attributable to
Holders of Redeemable Participating Shares .................................................................................313
HSBC FTSE EPRA/NAREIT DEVELOPED UCITS ETF
Schedules of Investments ...............................................................................................................314
Statement of Financial Position ......................................................................................................327
Statement of Comprehensive Income .............................................................................................328
Statement of Changes in Net Assets Attributable to
Holders of Redeemable Participating Shares .................................................................................329
HSBC MSCI RUSSIA CAPPED UCITS ETF
Schedules of Investments ...............................................................................................................330
Statement of Financial Position ......................................................................................................331
Statement of Comprehensive Income .............................................................................................332
Statement of Changes in Net Assets Attributable to
Holders of Redeemable Participating Shares .................................................................................335
HSBC ETFs PLC >4<
Contents (continued)
HSBC MSCI EMERGING MARKETS UCITS ETF
Schedules of Investments ...............................................................................................................336
Statement of Financial Position ......................................................................................................370
Statement of Comprehensive Income .............................................................................................371
Statement of Changes in Net Assets Attributable to
Holders of Redeemable Participating Shares .................................................................................372
HSBC MSCI AC FAR EAST ex JAPAN UCITS ETF
Schedules of Investments ...............................................................................................................373
Statement of Financial Position ......................................................................................................394
Statement of Comprehensive Income .............................................................................................395
Statement of Changes in Net Assets Attributable to
Holders of Redeemable Participating Shares .................................................................................396
HSBC ECONOMIC SCALE WORLDWIDE EQUITY UCITS ETF
Schedules of Investments ...............................................................................................................397
Statement of Financial Position .......................................................................................................479
Statement of Comprehensive Income .............................................................................................480
Statement of Changes in Net Assets Attributable to
Holders of Redeemable Participating Shares .................................................................................481
HSBC MULTI FACTOR WORLDWIDE EQUITY UCITS ETF
Schedules of Investments ...............................................................................................................482
Statement of Financial Position .......................................................................................................505
Statement of Comprehensive Income .............................................................................................506
Statement of Changes in Net Assets Attributable to
Holders of Redeemable Participating Shares .................................................................................507
HSBC MSCI China A Inclusion UCITS ETF
Schedules of Investments ...............................................................................................................508
Statement of Financial Position .......................................................................................................517
Statement of Comprehensive Income .............................................................................................518
Statement of Changes in Net Assets Attributable to
Holders of Redeemable Participating Shares .................................................................................519
HSBC MSCI SAUDI ARABIA 20/35 CAPPED UCITS ETF
Schedules of Investments ...............................................................................................................520
Statement of Financial Position .......................................................................................................523
Statement of Comprehensive Income .............................................................................................524
Statement of Changes in Net Assets Attributable to
Holders of Redeemable Participating Shares .................................................................................525
HSBC ETFs PLC
Statement of Financial Position ......................................................................................................526
Statement of Comprehensive Income .............................................................................................527
Cash Flow Statement ......................................................................................................................528
Notes to the Financial Statements .........................................................................................................529
HSBC ETFs PLC >5<
Contents (continued)
Schedules of Changes in Investments HSBC FTSE 100 UCITS ETF ................................................................................................................576
HSBC EURO STOXX 50 UCITS ETF ....................................................................................................577
HSBC MSCI JAPAN UCITS ETF ...........................................................................................................578
HSBC FTSE 250 UCITS ETF ................................................................................................................579
HSBC S&P 500 UCITS ETF ..................................................................................................................580
HSBC MSCI EUROPE UCITS ETF .......................................................................................................581
HSBC MSCI USA UCITS ETF ...............................................................................................................582
HSBC MSCI BRAZIL UCITS ETF ..........................................................................................................583
HSBC MSCI PACIFIC ex JAPAN UCITS ETF .......................................................................................584
HSBC MSCI EM FAR EAST UCITS ETF ..............................................................................................585
HSBC MSCI TURKEY UCITS ETF ........................................................................................................586
HSBC MSCI WORLD UCITS ETF .........................................................................................................587
HSBC MSCI CHINA UCITS ETF ..........................................................................................................588
HSBC MSCI SOUTH AFRICA CAPPED UCITS ETF ............................................................................589
HSBC MSCI CANADA UCITS ETF ......................................................................................................590
HSBC MSCI MEXICO CAPPED UCITS ETF .......................................................................................591
HSBC MSCI EM LATIN AMERICA UCITS ETF ...................................................................................592
HSBC MSCI INDONESIA UCITS ETF ...................................................................................................593
HSBC MSCI MALAYSIA UCITS ETF ...................................................................................................594
HSBC MSCI TAIWAN CAPPED UCITS ETF .........................................................................................595
HSBC MSCI KOREA UCITS ETF ..........................................................................................................596
HSBC FTSE EPRA/NAREIT DEVELOPED UCITS ETF ......................................................................597
HSBC MSCI RUSSIA CAPPED UCITS ETF ........................................................................................598
HSBC MSCI EMERGING MARKETS UCITS ETF ...............................................................................599
HSBC MSCI AC FAR EAST ex JAPAN UCITS ETF ............................................................................600
HSBC ECONOMIC SCALE WORLDWIDE EQUITY UCITS ETF .........................................................601
HSBC MULTI FACTOR WORLDWIDE EQUITY UCITS ETF ...............................................................602
HSBC MSCI CHINA A INCLUSION UCITS ETF ...................................................................................603
HSBC MSCI SAUDI ARABIA 20/35 CAPPED UCITS ETF ...................................................................604
HSBC ETFs PLC >6<
Management and Administration
Directors Paying Agent – Switzerland
Eimear Cowhey* (Irish) (Chairperson) HSBC Private Bank (Suisse) SA
Carmen Gonzalez-Calatayud** (Spanish) Quai des Bergues 9 - 17
Guillaume Rabault** (French) P.O. Box 2888
Feargal Dempsey* (Irish) CH-1211 Geneva 1
Vikramaaditya** (Indian) Switzerland
* Independent Non-Executive Directors and Secretary
members of the Audit Committee. Goodbody Secretarial Limited
** Non-Executive Director 25/28 North Wall Quay
IFSC
Depositary^ Dublin 1
HSBC France, Dublin Branch Ireland
1 Grand Canal Square
Grand Canal Harbour Registered Office
Dublin 2 (Registration number: 467896)
Ireland 25/28 North Wall Quay
IFSC
Registrar (Secondary Market) Dublin 1
Computershare Investor Services (Ireland) Limited Ireland
Heron House
Corrig Road Administrator
Sandyford Industrial Estate HSBC Securities Services (Ireland) DAC
Dublin 18 1 Grand Canal Square
Ireland Grand Canal Harbour
Dublin 2
Legal Advisers (As to Irish Law) Ireland
Arthur Cox
10 Earlsfort Terrace Independent Auditor
Dublin 2 KPMG
Ireland 1 Harbourmaster Place
IFSC
Investment Manager and UK Representative Dublin 1
HSBC Global Asset Management (UK) Limited Ireland
8 Canada Square
London E14 5HQ Registrar and Transfer Agent
United Kingdom (Primary Market)
HSBC Securities Services (Ireland) DAC
Swiss Representative 1 Grand Canal Square
HSBC Global Asset Management Grand Canal Harbour
(Switzerland) AG Dublin 2
Gartenstrasse 26 Ireland
CH-8002 Zurich
Switzerland Listing Sponsor
J&E Davy
Management Company and Global Distributor (effective 1 April 2019)
Davy House 49 Dawson Street
HSBC Investment Funds Luxembourg S.A. Dublin 2
16 Boulevard d’Avranches Ireland
L-1160 Luxembourg
Grand Duchy of Luxembourg
^ With effect from 1 April, 2019 HSBC Institutional Trust Services (Ireland) DAC merged with and into HSBC France and its business now operates from the Dublin Branch of HSBC France.
HSBC ETFs PLC >7<
Management and Administration (continued)
Paying Agent – Sweden Jane Street Financial
Skandinaviska Enskilda Banken AB 20 Fenchurch Street
through its entity Custody Services SEB Merchant Banking Custody Services
London EC3M 3BY United Kingdom
Global Funds
RB6 Morgan Stanley
Rissneleden 110 25 Cabot Square
SE-10640 Stockholm Canary Wharf
Sweden London E14 4QA
United Kingdom
Paying Agent – France
CACEIS Bank Optiver VOF
1/3 Place Valhubert Strawinskylaan 3095
75013 Paris 2nd Floor
France Amsterdam 1077 ZX
Netherlands
Paying Agent – Austria
Erste Bank der Oesterreichischen Sparkassen AG RBC Capital Markets
Graben 21, 1010 Wien 1 Queenhithe
Österreich Thames Court
London EC4V 3DQ
Authorised Participants United Kingdom
Bank of America Merrill Lynch
2 King Edward Street Societe Generale SA
London EC1A 1HQ 29 Boulevard Haussmann
United Kingdom 75009 Paris
France
Bluefin Europe LLP
110 Bishopsgate Susquehanna Europe
London, EC2N 4AY International Centre
United Kindom Memorial Road
IFSC
Commerzbank Dublin 1
30 Gresham Street
London EC2V 3PG Virtu Financial
United Kingdom Whitaker Square
Sir John Rogerson’s Quay
Flow Traders B.V. Grand Canal Dock
Jacob Bontiusplaats 9 Dublin 2
1018 LL Amsterdam Ireland
Netherlands
Goldenberg Hehmeyer
32 Floor
25 Canada Square
London E14 5LQ
United Kingdom
HSBC Global Markets
8 Canada Square
London E14 5HQ
United Kingdom
IMC Trading B.V.
Strawinskylaan 377
Amsterdam 1077 XX
Netherland
HSBC ETFs PLC >8<
General Information
HSBC ETFs PLC (the “Company”) is an open-ended investment company with variable capital which was incorporated in Ireland on 27 February 2009 with registration number 467896 and authorised by the Central Bank of Ireland (the “Central Bank”) as an Undertaking for Collective Investment in Transferable Securities (“UCITS”) pursuant to the European Communities (Undertakings for Collective Investment in Transferable Securities) Regulations, 2011 as amended (the “UCITS Regulations 2011”) and the Central Bank (Supervision and Enforcement) Act 2013 (Section 48 (1)) (Undertakings for Collective Investment In Transferable Securities) Regulations 2019 (the “Central Bank UCITS Regulations”), (together “the UCITS Regulations”). The objective of the Company is the collective investment in transferable securities and other liquid financial assets of capital raised from the public, operating on the principle of risk spreading in accordance with the UCITS Regulations. The Company is structured as an umbrella fund with segregated liability between sub-funds and comprises separate sub-funds (each a “Sub-Fund” and together the “Sub-Funds”), in that the Directors may from time to time, with the prior approval of the Central Bank, issue different series of shares representing separate portfolios of assets. The assets of each Sub-Fund will be invested in accordance with the investment objective and policies applicable to such Sub-Fund as disclosed in the prospectus of the Company (the “Prospectus”) and the relevant Sub-Fund supplement (the “Supplement”). The Company currently consists of 29 Sub-Funds in operation as at 30 June 2019 (31 December 2018: 28). Each of the Sub-Funds, through the listing of their shares on one or more stock exchanges, is an exchange traded fund (“ETF”).
HSBC ETFs PLC >9<
General Information (continued)
Stock Exchange Listing All of the sub-funds have a primary listing on the London Stock Exchange and a secondary listing as detailed below: Sub-Funds Secondary Listing
HSBC FTSE 100 UCITS ETF
NYSE Euronext – Paris, Xetra Germany
and SIX Swiss
HSBC EURO STOXX 50 UCITS ETF
NYSE Euronext - Paris, Xetra Germany, SIX Swiss
and Borsa Italiana
HSBC MSCI JAPAN UCITS ETF
NYSE Euronext - Paris, Xetra Germany, SIX Swiss
and Borsa Italiana
HSBC FTSE 250 UCITS ETF NYSE Euronext - Paris
HSBC S&P 500 UCITS ETF
NYSE Euronext - Paris, Xetra Germany, SIX Swiss
and Borsa Italiana
HSBC MSCI EUROPE UCITS ETF
NYSE Euronext - Paris, Xetra Germany, SIX Swiss
and Borsa Italiana
HSBC MSCI USA UCITS ETF
NYSE Euronext – Paris,
Xetra Germany and SIX Swiss
HSBC MSCI BRAZIL UCITS ETF
NYSE Euronext – Paris,
Xetra Germany and SIX Swiss
HSBC MSCI PACIFIC ex JAPAN UCITS ETF
NYSE Euronext - Paris, Xetra Germany, SIX Swiss
and Borsa Italiana
HSBC MSCI EM FAR EAST UCITS ETF
NYSE Euronext - Paris, Xetra Germany, SIX Swiss
and Borsa Italiana
HSBC MSCI TURKEY UCITS ETF
NYSE Euronext – Paris, SIX Swiss and Xetra
Germany
HSBC MSCI WORLD UCITS ETF
NYSE Euronext - Paris, Xetra Germany, SIX Swiss
and Borsa Italiana
HSBC MSCI CHINA UCITS ETF
NYSE Euronext - Paris, Xetra Germany, SIX Swiss
and Borsa Italiana
HSBC MSCI SOUTH AFRICA CAPPED UCITS ETF
NYSE Euronext - Paris, Xetra Germany, SIX Swiss
and Borsa Italiana
HSBC MSCI CANADA UCITS ETF
NYSE Euronext – Paris, SIX Swiss and Xetra
Germany
HSBC MSCI MEXICO CAPPED UCITS ETF SIX Swiss and Xetra Germany
HSBC MSCI EM LATIN AMERICA UCITS ETF
NYSE Euronext - Paris, Xetra Germany, SIX Swiss
and Borsa Italiana
HSBC MSCI INDONESIA UCITS ETF SIX Swiss, Xetra Germany and Borsa Italiana
HSBC MSCI MALAYSIA UCITS ETF SIX Swiss, Xetra Germany and Borsa Italiana
HSBC MSCI TAIWAN CAPPED UCITS ETF* SIX Swiss, Xetra Germany and Borsa Italiana
HSBC MSCI KOREA UCITS ETF SIX Swiss, Xetra Germany and Borsa Italiana
HSBC FTSE EPRA/NAREIT DEVELOPED UCITS ETF SIX Swiss, Xetra Germany and Borsa Italiana
HSBC MSCI RUSSIA CAPPED UCITS ETF SIX Swiss, Xetra Germany and Borsa Italiana
HSBC MSCI EMERGING MARKETS
UCITS ETF SIX Swiss, Xetra Germany and Borsa Italiana
HSBC MSCI AC FAR EAST ex JAPAN UCITS ETF SIX Swiss and Xetra Germany and Borsa Italiana
HSBC ECONOMIC SCALE WORLDWIDE
EQUITY UCITS ETF Xetra Germany and Borsa Italiana
HSBC MULTI FACTOR WORLDWIDE EQUITY
UCITS ETF SIX Swiss, Xetra Germany and Borsa Italiana
HSBC MSCI CHINA A INCLUSION UCITS ETF** SIX Swiss, Xetra Germany and Borsa Italiana
HSBC MSCI SAUDI ARABIA 20/35 CAPPED
UCITS ETF*** SIX Swiss
*Formerly known as HSBC MSCI TAIWAN UCITS ETF.
** The sub-fund was listed on London Stock Exchange on 27 July 2018.
*** The sub-fund was listed on London Stock Exchange on 1 May 2019.
HSBC ETFs PLC >10<
General Information (continued)
Total Expense Ratio The Total Expense Ratio (“TER”) for each Sub-Fund for the financial period from 1 January 2019 to 30 June 2019 is as follows:
Sub-Funds Financial Period ended
30 June 2019 Financial Year ended 31
December 2018
HSBC FTSE 100 UCITS ETF 0.07% 0.07%
HSBC EURO STOXX 50 UCITS ETF 0.05% 0.05%
HSBC MSCI JAPAN UCITS ETF 0.19% 0.19%
HSBC FTSE 250 UCITS ETF 0.35% 0.35%
HSBC S&P 500 UCITS ETF 0.09% 0.09%
HSBC MSCI EUROPE UCITS ETF 0.20% 0.20%
HSBC MSCI USA UCITS ETF 0.30% 0.30%
HSBC MSCI BRAZIL UCITS ETF 0.60% 0.60%
HSBC MSCI PACIFIC ex JAPAN UCITS ETF 0.40% 0.40%
HSBC MSCI EM FAR EAST UCITS ETF 0.60% 0.60%
HSBC MSCI TURKEY UCITS ETF 0.60% 0.60%
HSBC MSCI WORLD UCITS ETF 0.15% 0.15%
HSBC MSCI CHINA UCITS ETF 0.60% 0.60%
HSBC MSCI SOUTH AFRICA CAPPED UCITS ETF 0.60% 0.60%
HSBC MSCI CANADA UCITS ETF 0.35% 0.35%
HSBC MSCI MEXICO CAPPED UCITS ETF 0.60% 0.60%
HSBC MSCI EM LATIN AMERICA UCITS ETF 0.60% 0.60%
HSBC MSCI INDONESIA UCITS ETF 0.60% 0.60%
HSBC MSCI MALAYSIA UCITS ETF 0.60% 0.60%
HSBC MSCI TAIWAN CAPPED UCITS ETF* 0.60% 0.60%
HSBC MSCI KOREA UCITS ETF 0.60% 0.60%
HSBC FTSE EPRA/NAREIT DEVELOPED UCITS ETF 0.40% 0.40%
HSBC MSCI RUSSIA CAPPED UCITS ETF 0.60% 0.60%
HSBC MSCI EMERGING MARKETS UCITS ETF 0.40% 0.40%
HSBC MSCI AC FAR EAST ex JAPAN UCITS ETF 0.45% 0.45%
HSBC ECONOMIC SCALE WORLDWIDE EQUITY UCITS ETF 0.25% 0.25%
HSBC MULTI FACTOR WORLDWIDE EQUITY UCITS ETF 0.25% 0.25%
HSBC MSCI CHINA A INCLUSION UCITS ETF**^ 0.30% 0.60%
HSBC MSCI SAUDI ARABIA 20/35 CAPPED UCITS ETF*** 0.50% -
* Formerly known as HSBC MSCI TAIWAN UCITS ETF.
** The sub-fund was listed on London Stock Exchange on 27 July 2018 and the TER for the financial period ended 31 December 2018 is presented for the period of operations of the Sub-fund.
*** The sub-fund was listed on London Stock Exchange on 1 May 2019 and the TER for the financial period ended 30 June 2019 is presented for the period of operations of the Sub-fund.
^ Effective from 1 April 2019, the TER of the Sub-Fund was reduced from 0.60% to 0.30%.
HSBC ETFs PLC >11<
General Information (continued)
Portfolio Turnover Rate* The Portfolio Turnover Rate (“PTR”)* for each Sub-Fund for the financial period from 1 January 2019 to 30 June 2019 is as follows:
Sub-Funds Financial Period ended
30 June 2019 Financial Year ended 31
December 2018
HSBC FTSE 100 UCITS ETF 4.84% 16.45%
HSBC EURO STOXX 50 UCITS ETF 3.19% 19.69%
HSBC MSCI JAPAN UCITS ETF 4.10% 7.61%
HSBC FTSE 250 UCITS ETF 13.41% 40.24%
HSBC S&P 500 UCITS ETF 2.08% 8.98%
HSBC MSCI EUROPE UCITS ETF 3.21% 9.91%
HSBC MSCI USA UCITS ETF 3.05% 5.13%
HSBC MSCI BRAZIL UCITS ETF 10.33% 10.89%
HSBC MSCI PACIFIC ex JAPAN UCITS ETF 4.98% 9.46%
HSBC MSCI EM FAR EAST UCITS ETF 7.67% 15.13%
HSBC MSCI TURKEY UCITS ETF 10.27% 37.43%
HSBC MSCI WORLD UCITS ETF 1.99% 10.23%
HSBC MSCI CHINA UCITS ETF 12.32% 24.66%
HSBC MSCI SOUTH AFRICA CAPPED UCITS ETF 4.77% 19.06%
HSBC MSCI CANADA UCITS ETF 5.15% 9.30%
HSBC MSCI MEXICO CAPPED UCITS ETF 1.47% 6.38%
HSBC MSCI EM LATIN AMERICA UCITS ETF 10.06% 7.69%
HSBC MSCI INDONESIA UCITS ETF 3.86% 14.57%
HSBC MSCI MALAYSIA UCITS ETF 6.78% 16.89%
HSBC MSCI TAIWAN CAPPED UCITS ETF** 5.48% 8.63%
HSBC MSCI KOREA UCITS ETF 2.23% 8.41%
HSBC FTSE EPRA/NAREIT DEVELOPED UCITS ETF 4.81% 19.02%
HSBC MSCI RUSSIA CAPPED UCITS ETF 8.25% 9.82%
HSBC MSCI EMERGING MARKETS UCITS ETF 7.72% 7.33%
HSBC MSCI AC FAR EAST ex JAPAN UCITS ETF 5.04% 11.60%
HSBC ECONOMIC SCALE WORLDWIDE EQUITY UCITS ETF 35.97% 34.87%
HSBC MULTI FACTOR WORLDWIDE EQUITY UCITS ETF 83.03% 154.66%
HSBC MSCI CHINA A INCLUSION UCITS ETF*** 23.77% 12.71%
HSBC MSCI SAUDI ARABIA 20/35 CAPPED UCITS ETF^ 9.09% N/A
* PTR calculation includes equalisation.
** Formerly known as HSBC MSCI TAIWAN UCITS ETF.
*** The sub-fund was listed on 27 July 2018. Accordingly, the PTR for the financial year ended 31 December 2018 was calculated from 27 July 2018 to 31 December 2018.
^ The sub-fund was listed on 1 May 2019. Accordingly, the PTR is calculated from 1 May 2019 to 30 June 2019.
HSBC ETFs PLC >12<
General Information (continued)
Sub-Fund Performance Data The percentage total return of one share of each Sub-Fund, as calculated in accordance with the Swiss Funds Association guidelines is as follows:
Sub-Funds Benchmark
Financial Period ended
30 June 2019
Fund Benchmark
Financial Year ended
31 December 2018
Fund Benchmark
HSBC FTSE 100 UCITS ETF FTSE 100® Index 13.06% 13.14% (8.76%) (8.73%) HSBC EURO STOXX 50 UCITS ETF EURO STOXX 50® Index 19.49% 18.91% (11.89%) (12.46%) HSBC MSCI JAPAN UCITS ETF MSCI Japan Index 8.33% 8.44% (13.45%) (13.44%) HSBC FTSE 250 UCITS ETF FTSE 250® Index 12.71% 12.97% (13.37%) (13.25%) HSBC S&P 500 UCITS ETF S&P 500® Index 18.27% 18.18% (4.52%) (4.94%) HSBC MSCI EUROPE UCITS ETF MSCI Europe Index 16.96% 16.73% (10.60%) (10.94%) HSBC MSCI USA UCITS ETF MSCI USA Index 18.44% 18.44% (4.66%) (5.04%) HSBC MSCI BRAZIL UCITS ETF MSCI Brazil Index 14.79% 15.63% (1.08%) (0.65%) HSBC MSCI PACIFIC ex JAPAN UCITS ETF MSCI Pacific ex Japan Index 17.78% 18.03% (10.25%) (10.30%) HSBC MSCI EM FAR EAST UCITS ETF MSCI EM Far East Index 10.02% 10.43% (16.50%) (16.84%) HSBC MSCI TURKEY UCITS ETF MSCI Turkey Index (0.72%) (0.42%) (41.21%) (41.40%) HSBC MSCI WORLD UCITS ETF MSCI World Index 17.09% 16.98% (8.20%) (8.71%) HSBC MSCI CHINA UCITS ETF MSCI China Index 12.61% 12.97% (18.76%) (18.88%) HSBC MSCI SOUTH AFRICA CAPPED UCITS ETF
MSCI South Africa Capped Index 11.14% 11.31% (24.52%) (24.76%)
HSBC MSCI CANADA UCITS ETF MSCI Canada Index 20.83% 21.01% (17.19%) (17.20%) HSBC MSCI MEXICO CAPPED UCITS ETF MSCI Mexico Capped Index 6.50% 6.69%
(15.41%) (15.53%)
HSBC MSCI EM LATIN AMERICA UCITS ETF
MSCI EM Latin America Index 11.96% 12.50%
(6.29%) (6.14%)
HSBC MSCI INDONESIA UCITS ETF MSCI Indonesia Index 8.53% 8.90%
(10.36%) (10.33%)
HSBC MSCI MALAYSIA UCITS ETF MSCI Malaysia Index 1.20% 1.49% (6.04%) (6.03%) HSBC MSCI TAIWAN CAPPED UCITS ETF* MSCI Taiwan Capped Index 9.58% 9.92% (8.91%) (8.93%) HSBC MSCI KOREA UCITS ETF MSCI Korea Index 3.52% 3.90% (20.90%) (20.94%) HSBC FTSE EPRA/NAREIT DEVELOPED UCITS ETF
FTSE EPRA/NAREIT Developed Index 14.52% 14.51%
(4.95%) (5.63%)
HSBC MSCI RUSSIA CAPPED UCITS ETF MSCI Russia Capped Index 31.77% 31.96%
(0.88%) (1.06%)
HSBC MSCI EMERGING MARKETS UCITS ETF
MSCI Emerging Markets Index 10.63% 10.94%
(14.74%) (14.85%)
HSBC MSCI AC FAR EAST ex JAPAN UCITS ETF
MSCI AC Far East ex Japan Index 11.39% 11.57%
(15.11%) (15.53%)
HSBC ECONOMIC SCALE WORLDWIDE EQUITY UCITS ETF MSCI AC World Net 13.45% 17.00%
(11.26%) (10.01%)
HSBC MULTI FACTOR WORLDWIDE EQUITY UCITS ETF MSCI AC World Net 13.32% 16.23%
(9.76%) (9.42%)
HSBC MSCI CHINA A INCLUSION UCITS ETF **
MSCI China A Inclusion Index 26.94% 27.23%
N/A
N/A
HSBC MSCI SAUDI ARABIA 20/35 CAPPED UCITS ETF***
MSCI Saudi Arabia 20/35 Capped Index N/A N/A N/A N/A
* Formerly known as HSBC MSCI TAIWAN UCITS ETF.
** The sub-fund was listed on 27 July 2018.
*** The sub-fund was listed 1 May 2019.
HSBC ETFs PLC >13<
General Information (continued)
Sub-Fund Performance Data (continued) Past performance is not an indication of current or future performance and the performance data does not take account of commissions and costs incurred on the creation and redemption of shares. The Prospectus, Sub-Fund Supplements, key investor information documents in respect of the Sub-Funds, Articles of Association of the Company, annual and semi-annual reports of the Company, as well as a list of the purchases and sales on the account of the Sub-Funds can be obtained free of charge by Swiss investors from the representative of the Company in Switzerland, HSBC Global Asset Management (Switzerland) AG, Gartenstrasse 26, P.O Box, CH-8002 Zurich, Switzerland. Plan d'Epargne en Actions (“PEA”) Eligibility For the purpose of eligibility requirements of Article L-221-31 of the French Monetary and Financial Code, the relevant Sub-Funds must at all times during the financial period ended 30 June 2019 and 31 December 2018 be invested in more than 75% of PEA eligible assets. PEA eligible assets are defined as equity or equity equivalent securities, which have their registered office in a country which is a member of the EU or the European Economic Area. As at 30 June 2019, the following Sub-Funds satisfy the criteria for PEA Eligibility: % PEA Eligible Assets Sub-Funds 30 June 2019 31 December 2018 HSBC FTSE 100 UCITS ETF 95.73% 91.15% HSBC EURO STOXX 50 UCITS ETF 99.41% 99.43% HSBC FTSE 250 UCITS ETF 89.37% 88.74% HSBC MSCI EUROPE UCITS ETF 82.23% 82.73% All share classes issued by the Sub-Funds in operation at 30 June 2019 have UK Reporting Fund status, either from 1 January 2010 or the launch of the relevant share class concerned. As and when new Sub-Funds are launched, UK Reporting Fund applications will be made to HM Revenue & Customs accordingly.
Details of the distributing share classes that have UK Reporting Fund status can be found on the HM Revenue & Customs’ (“HMRC”) website at www.hmrc.gov.uk. At the da te of these financial statements the precise location of this HMRC report is: https://www.gov.uk/government/publications/offshore-funds-list-of-reporting-funds The Company made available to shareholders the reportable income information for the financial period ended 30 June 2019 that they require for their UK tax returns at www.etf.hsbc.com by 30 June 2019. If investors do not have access to the internet they can apply in writing for a copy of this information to HSBC ETFs PLC, 25/28 North Wall Quay, IFSC, Dublin 1, Ireland.
https://www.gov.uk/government/publications/offshore-funds-list-of-reporting-fundshttp://www.etf.hsbc.com/
HSBC ETFs PLC >14<
General Information (continued)
Supplemental information 1. Exchange Rates
The following average exchange rates were used to translate income and expenses into the presentation currency (USD) at 30 June 2019 and 30 June 2018.
30 June 2019 30 June 2018 Euro 0.88460 0.82892 Pound Sterling 0.77068 0.72896 The following Exchange rates were used to translate assets and liabilities into the functional currency (EUR) at 30 June 2019 and 31 December 2018.
30 June 2019 31 December 2018 Danish Krone 7.46370 7.46242 Norwegian Kroner 9.70947 9.89871 Pound Sterling 0.89479 0.89757 Swedish Krona 10.56602 10.13499 Swiss Franc 1.11033 1.12692 United States Dollar 1.13880 1.14315 The following Exchange rates were used to translate assets and liabilities into the functional currency (GBP) at 30 June 2019 and 31 December 2018.
30 June 2019 31 December 2018 Euro 1.11758 1.11411 United States Dollar 1.27270 1.27360 Chinese Yuan Renminbi 8.74727 8.75008 Japanese Yen 137.12072 139.73300
The following exchange rates were used to translate assets and liabilities into the functional currency (USD) at 30 June 2019 and 31 December 2018.
30 June 2019 31 December 2018 Australian Dollar 1.42501 1.42046 Brazilian Real 3.83265 3.87575 Canadian Dollar 1.30675 1.36580 Chilean Peso 678.95000 694.00000 Chinese Yuan Renminbi 6.87300 6.87035 Colombian Peso 3,207.00000 3,247.50000 Czech Koruna 22.34285 22.51410 Danish Krone 6.55400 6.52795 Egyptian Pound 16.69500 17.92000 Euro 0.87812 0.87478 Hong Kong Dollar 7.81250 7.82935 Hungarian Forint 283.43435 280.62810 Indonesian Rupiah 14,127.50000 14,380.00000 Israeli New Shekel 3.56655 3.73675 Japanese Yen 107.74000 109.71500 Korean Won 1,154.65000 1,115.80000 Malaysian Ringgit 4.13250 4.13250 Mexican Peso 19.21165 19.69375 New Zealand Dollar 1.48887 1.49131 Norwegian Kroner 8.52605 8.65915 Pakistani Rupee 159.75000 138.80000 Peruvian Nuevo Sol 3.28795 3.37850
HSBC ETFs PLC >15<
General Information (continued)
Supplemental information (continued) 1. Exchange Rates (continued) 30 June 2019 31 December 2018 Philippine Peso 51.23500 52.58500 Polish Zloty 3.72920 3.75675 Pound Sterling 0.78573 0.78518 Qatari Riyal 3.64125 3.64125 Russian Rouble 63.07500 69.37250 Singapore Dollar 1.35295 1.36300 South African Rand 14.10125 14.38500 Swedish Krona 9.27820 8.86585 Swiss Franc 0.97500 0.98580 Taiwan Dollar 31.05950 30.73700 Thai Baht 30.66750 32.56000 Turkish Lira 5.78400 5.31990 UAE Dirham 3.67315 3.67315 Saudi Riyal 3.75025 - 2. Comparative net asset value Funds NAV
Per Share 30 June 2019
Total NAV
30 June 2019
HSBC FTSE 100 UCITS ETF GBP 74.87 198,400,449 HSBC EURO STOXX 50 UCITS ETF EUR 36.89 140,551,985
HSBC MSCI JAPAN UCITS ETF USD 31.73 169,797,760
HSBC FTSE 250 UCITS ETF GBP 18.69 38,878,447
HSBC S&P 500 UCITS ETF USD 29.68 2,972,603,463
HSBC MSCI EUROPE UCITS ETF EUR 13.43 127,557,815 HSBC MSCI USA UCITS ETF USD 28.26 39,564,705 HSBC MSCI EM FAR EAST UCITS ETF USD 45.00 19,348,915
HSBC MSCI BRAZIL UCITS ETF USD 22.09 37,700,446
HSBC MSCI PACIFIC ex JAPAN UCITS ETF USD 14.37 33,200,918
HSBC MSCI TURKEY UCITS ETF USD 2.31 9,240,267
HSBC MSCI WORLD UCITS ETF USD 21.82 945,894,866 HSBC MSCI CHINA UCITS ETF USD 7.96 396,083,461 HSBC MSCI SOUTH AFRICA CAPPED UCITS ETF USD 49.04 3,677,726
HSBC MSCI CANADA UCITS ETF USD 17.50 28,872,090
HSBC MSCI MEXICO CAPPED UCITS ETF USD 32.65 7,346,077
HSBC MSCI EM LATIN AMERICA UCITS ETF USD 28.48 17,090,406 HSBC MSCI INDONESIA UCITS ETF USD 87.12 47,915,167 HSBC MSCI MALAYSIA UCITS ETF USD 35.38 4,616,810
HSBC MSCI TAIWAN CAPPED UCITS ETF* USD 36.35 14,538,650
HSBC MSCI KOREA UCITS ETF USD 45.47 9,547,932
HSBC FTSE EPRA/NAREIT DEVELOPED UCITS ETF USD 24.54 147,226,598
HSBC MSCI RUSSIA CAPPED UCITS ETF USD 12.54 71,173,278 HSBC MSCI EMERGING MARKETS UCITS ETF USD 10.74 248,202,384 HSBC MSCI AC FAR EAST ex JAPAN UCITS ETF USD 45.42 320,212,044 HSBC ECONOMIC SCALE WORLDWIDE EQUITY
USD 17.13 426,779,142 UCITS ETF HSBC MULTI FACTOR WORLDWIDE EQUITY
USD 19.17 361,116,442 UCITS ETF HSBC MSCI CHINA A INCLUSION UCITS ETF** USD 9.58 175,116,442 HSBC MSCI SAUDI ARABIA 20/35 CAPPED UCITS ETF*** USD 17.24 15,513,309
* Formerly known as HSBC MSCI TAIWAN UCITS ETF.
** The sub-fund was launched and listed on the London Stock Exchange on 27 July 2018.
*** The sub-fund was launched and listed on the London Stock Exchange on 1 May 2019.
HSBC ETFs PLC >16<
General Information (continued)
Supplemental information (continued) 2. Comparative net asset value (continued) Funds NAV
Per Share 31 December 2018
Total NAV
31 December 2018 HSBC FTSE 100 UCITS ETF GBP 67.52 173,873,426 HSBC EURO STOXX 50 UCITS ETF EUR 31.20 115,762,040 HSBC MSCI JAPAN UCITS ETF USD 29.74 218,661,384 HSBC FTSE 250 UCITS ETF GBP 16.73 34,808,387 HSBC S&P 500 UCITS ETF USD 25.31 2,489,530,817 HSBC MSCI EUROPE UCITS ETF EUR 11.61 133,572,169 HSBC MSCI USA UCITS ETF USD 24.04 27,644,577 HSBC MSCI EM FAR EAST UCITS ETF USD 41.50 28,223,264 HSBC MSCI BRAZIL UCITS ETF USD 19.44 33,184,237 HSBC MSCI PACIFIC ex JAPAN UCITS ETF USD 12.42 32,425,463 HSBC MSCI TURKEY UCITS ETF USD 2.33 10,029,689 HSBC MSCI WORLD UCITS ETF USD 18.81 646,234,146 HSBC MSCI CHINA UCITS ETF USD 7.13 338,655,797 HSBC MSCI SOUTH AFRICA CAPPED UCITS ETF USD 44.54 3,340,293 HSBC MSCI CANADA UCITS ETF USD 14.64 26,343,005 HSBC MSCI MEXICO CAPPED UCITS ETF USD 30.95 8,511,935 HSBC MSCI EM LATIN AMERICA UCITS ETF USD 25.70 15,417,519 HSBC MSCI INDONESIA UCITS ETF USD 81.30 58,738,035 HSBC MSCI MALAYSIA UCITS ETF USD 35.45 4,625,864 HSBC MSCI TAIWAN UCITS ETF USD 33.84 6,767,793 HSBC MSCI KOREA UCITS ETF USD 43.96 6,154,627 HSBC FTSE EPRA/NAREIT DEVELOPED UCITS ETF USD 21.74 147,855,806 HSBC MSCI RUSSIA CAPPED UCITS ETF USD 9.88 62,020,061 HSBC MSCI EMERGING MARKETS UCITS ETF USD 9.79 232,133,870 HSBC MSCI AC FAR EAST ex JAPAN UCITS ETF USD 40.97 317,500,429 HSBC ECONOMIC SCALE WORLDWIDE EQUITY UCITS ETF USD 15.31 381,457,060 HSBC MULTI FACTOR WORLDWIDE EQUITY UCITS ETF USD 17.05 269,965,090 HSBC MSCI CHINA A INCLUSION UCITS ETF* USD 7.57 7,951,898 *The sub-fund was launched and listed on the London Stock Exchange on 27 July 2018.
HSBC ETFs PLC >17<
General Information (continued)
Supplemental information (continued) 2. Comparative net asset value (continued) Funds NAV
Per Share 30 June 2018
Total NAV
30 June 2018 HSBC FTSE 100 UCITS ETF GBP 76.98 162,421,003 HSBC EURO STOXX 50 UCITS ETF EUR 35.98 126,289,381 HSBC MSCI JAPAN UCITS ETF USD 33.79 234,854,804 HSBC FTSE 250 UCITS ETF GBP 20.04 41,679,742 HSBC S&P 500 UCITS ETF USD 27.38 3,049,015,329 HSBC MSCI EUROPE UCITS ETF EUR 13.22 158,674,869 HSBC MSCI USA UCITS ETF USD 26.10 62,647,811 HSBC MSCI EM FAR EAST UCITS ETF USD 16.49 28,140,562 HSBC MSCI BRAZIL UCITS ETF USD 13.85 36,157,024 HSBC MSCI PACIFIC ex JAPAN UCITS ETF USD 47.55 37,086,531 HSBC MSCI TURKEY UCITS ETF USD 2.93 5,563,626 HSBC MSCI WORLD UCITS ETF USD 20.87 566,734,644 HSBC MSCI CHINA UCITS ETF USD 8.70 367,692,189 HSBC MSCI SOUTH AFRICA CAPPED UCITS ETF* USD 50.67 3,800,469 HSBC MSCI CANADA UCITS ETF USD 17.33 33,791,525 HSBC MSCI MEXICO CAPPED UCITS ETF USD 35.99 10,796,182 HSBC MSCI EM LATIN AMERICA UCITS ETF USD 24.82 14,890,688 HSBC MSCI INDONESIA UCITS ETF USD 74.15 45,228,777 HSBC MSCI MALAYSIA UCITS ETF USD 36.86 4,809,838 HSBC MSCI TAIWAN UCITS ETF USD 37.14 11,143,087 HSBC MSCI KOREA UCITS ETF USD 50.62 10,629,552 HSBC FTSE EPRA/NAREIT DEVELOPED UCITS ETF
USD 23.49 138,579,603
HSBC MSCI RUSSIA CAPPED UCITS ETF USD 10.35 179,010,993 HSBC MSCI EMERGING MARKETS UCITS ETF USD 10.88 264,465,424 HSBC MSCI AC FAR EAST ex JAPAN UCITS ETF USD 46.05 287,798,451 HSBC ECONOMIC SCALE WORLDWIDE EQUITY UCITS ETF USD 16.88 420,279,255 HSBC MULTI FACTOR WORLDWIDE EQUITY UCITS ETF USD 19.11 249,201,811
* Formerly known as HSBC MSCI SOUTH AFRICA UCITS ETF.
3. Soft Commission Neither the Company nor the Investment Manager has entered into any soft commission arrangements with respect to the Company for the period end (31 December 2018: Nil). 4. Securities Lending There were no securities lending transactions during the period (31 December 2018: Nil).
5. Directed Brokerage Services There were no brokerage fees accrued or paid to the Authorised Participants during the financial period ended 30 June 2019 (31 December 2018: Nil).
HSBC ETFs PLC >18<
General Information (continued)
Supplemental information (continued) 6. Significant events during the financial period
The following Sub-Funds were listed on Borsa Italiana stock exchange on 16 January 2019: MSCI EUROPE UCITS ETF MSCI PACIFIC ex JAPAN UCITS ETF MSCI EM FAR EAST UCITS ETF MSCI CHINA UCITS ETF MSCI SOUTH AFRICA UCITS ETF MSCI EM LATIN AMERICA UCITS ETF MSCI INDONESIA UCITS ETF MSCI TAIWAN UCITS ETF MSCI MALAYSIA UCITS ETF MSCI KOREA UCITS ETF FTSE EPRA/NAREIT DEVELOPED UCITS ETF MSCI RUSSIA CAPPED UCITS ETF MSCI AC FAR EAST ex JAPAN UCITS ETF HSBC MULTI-FACTOR WORLDWIDE EQUITY UCITS ETF HSBC MSCI CHINA A INCLUSION UCITS ETF
HSBC MSCI SAUDI ARABIA 20/35 CAPPED UCITS ETF was authorised by the Central Bank as a Sub-Fund of the Company on 15 January 2019. Accordingly, the Sub-Fund was launched and listed on the London Stock Exchange on 1 May 2019. The Sub-Fund was listed on SIX Swiss on 17 June 2019. The Company had been a self-managed UCITS investment company since its establishment on 27 February 2009. A determination was made by the Directors to appoint HSBC Investment Funds Luxembourg S.A. (the “Management Company”) as Management Company and Global Distributor of the Company in order to rationalise and enhance the governance of the Company. Accordingly, the Management Company was appointed as the Management Company of the Company on 1 April 2019. From this date onwards, it is the responsibility of the Management Company to pay the TER of the Company. If the Sub-Funds’ expenses exceed the TER, in relation to operating the funds, the Management Company will cover any shortfall from its own assets.
The Management Company has been established under the laws of the Grand Duchy of Luxembourg in the form of a “Société Anonyme” and has its registered office at 16, boulevard d’Avranches, L-1160 Luxembourg, Grand Duchy of Luxembourg. As at the appointment of the Management Company in this capacity, the Company ceased to be a self-managed UCITS investment company.
The Depositary merged with and into HSBC France on 1 April 2019 and its business operates from the Dublin Branch of HSBC France. An updated prospectus was issued on 1 April 2019 to reflect the below changes: - Additional risk factor disclosure in relation to cross-class liability risk.
- Changes to the composition of the Board of the Company.
- Information on Liquidity Risk Management policy.
- Updates to the section entitled “European Benchmark Regulations”.
- Updates to the list of Recognised Markets at Schedule I.
- New share classes for a number of Sub-Funds of the Company.
HSBC ETFs PLC >19<
General Information (continued)
Supplemental information (continued)
6. Significant events during the financial period (continued)
The Supplements for HSBC FTSE 100 UCITS ETF, HSBC MSCI Russia UCITS ETF, HSBC S&P 500 UCITS ETF, HSBC MSCI USA UCITS ETF and HSBC Multifactor Worldwide UCITS ETF were updated on 17 May 2019 to extend the dealing deadline for placing subscription and redemption requests for each of these Sub-Funds. Shareholders of these Sub-Funds were notified in advance of this change in dealing times. At an Extraordinary General Meeting of the Company held on the 24 May 2019, shareholders voted upon and passed a resolution to change the investment objective of the HSBC MSCI Taiwan UCITS ETF to replicate the performance of the MSCI Taiwan Capped Index previously the MSCI Taiwan index, effective 6 June 2019 (the “Effective Date”) As of the Effective Date, the name of the HSBC MSCI Taiwan UCITS ETF was changed to HSBC MSCI Taiwan Capped UCITS ETF to better reflect the change of the investment objective of the Sub-Fund. There were no other significant events which occurred during the period.
HSBC ETFs PLC >20<
General Information (continued)
Supplemental information (continued) Disclosure of Remuneration Policy in the General Information The Management Company has implemented a remuneration policy pursuant to Directive 2014/91/EU of the European Parliament and of the Council of 23 July 2014 amending Directive 2009/65/EC on the coordination of laws, regulations and administrative provisions relating to undertakings for collective investment in transferable securities (UCITS) as regards to depositary functions, remuneration policies and sanctions (the “UCITS V Directive”), which was transposed into Luxembourg law on 1 June 2016 by way of the Luxembourg law of 10 May 2016. The remuneration policy, which has been approved by the Management Company’s board of directors, includes measures to avoid conflicts of interest and seeks to promote sound and effective risk management and that neither encourage risk taking which is inconsistent with the risk profile and instrument of incorporation of the Company nor impair compliance with the Management Company’s duty to act in the best interest of the Company. The remuneration policy, which describes how remuneration and benefits are determined, is available at www.global.assetmanagement.hsbc.com/about-us/governance-structure, or on request from the Management Company. The annual review of the remuneration policy, including a review of the existing remuneration structure as well as implementation of the regulatory requirements and compliance with them, was completed during the year and no irregularities were identified. Furthermore, there were no material changes made to the remuneration policy in the past financial year.
Neither the Management Company nor the Company pay any remuneration to the identified staff of any
delegate.
HSBC ETFs PLC >21<
Investment Manager’s Report
Market Commentary 2019
Asset class performance has been very robust year-to-date, with both equities and fixed income asset classes delivering strong, positive returns, precisely because fears of a continuing sluggish global economy did not materialise. Indeed, the reverse has been true. The macroeconomic backdrop has been better than expected, relative to consensus forecasts, with the evidence now suggesting that what happened last year, especially in Q4, was a ‘cyclical slowdown’, from which activity is now slowly recovering.
More importantly though, investor confidence was boosted by the US Federal Reserve’s ‘pivot’ at the start of the year to a more accommodative stance. Markets are now expecting rate cuts, not rate hikes. Moreover, the Fed was not the only central bank to ‘pivot’ and, as result, we’re now back to a world of policy accommodation.
HSBC ETFs PLC >22<
Investment Manager’s Report (continued)
HSBC ETF Performance to 30 June 2019
ETFS
Performance 1 Jan- 30 June
2019 Fund Performance
(Gross)
Performance 1 Jan- 30 June
2019 Fund Benchmark
Performance
Performance 1 Jan- 30 June
2019 Sub-Fund vs Benchmark
Sub-Fund vs
Benchmark (Since
inception)
Performance 1 Jan- 30
June 2019 Tracking
Error (Gross
Developed Countries
HSBC FTSE 100 UCITS ETF 13.06% 13.14% (0.08%) (0.86%) 0.05%
HSBC EURO STOXX 50 UCITS ETF 19.49% 18.91% 0.58% 11.05% 0.13%
HSBC MSCI JAPAN UCITS ETF 8.33% 8.44% (0.11%) (0.05%) 0.08%
HSBC FTSE 250 UCITS ETF 12.71% 12.97% (0.26%) (2.82%) 0.08%
HSBC S&P 500 UCITS ETF 18.27% 18.18% 0.09% 8.61% 0.07%
HSBC MSCI EUROPE UCITS ETF 16.96% 16.73% 0.23% 6.16% 0.09%
HSBC MSCI USA UCITS ETF 18.44% 18.44% (0.00%) 9.01% 0.07%
HSBC MSCI PACIFIC EX JAPAN UCITS
ETF 17.78% 18.03% (0.26%) 0.08% 0.07%
HSBC MSCI WORLD UCITS ETF 17.09% 16.98% 0.11% 3.54% 0.33%
HSBC MSCI CANADA UCITS ETF 20.83% 21.01% (0.17%) 0.69% 0.06%
HSBC FTSE EPRA/NAREIT
DEVELOPED UCITS ETF 14.52% 14.51% 0.01% 5.16% 0.14%
Emerging Countries
HSBC MSCI BRAZIL UCITS ETF 14.79% 15.63% (0.84%) (1.58%) 0.14%
HSBC MSCI EM FAR EAST UCITS ETF 10.02% 10.43% (0.41%) 1.62% 0.40%
HSBC MSCI TURKEY UCITS ETF (0.72%) (0.42%) (0.30%) 0.19% 0.15%
HSBC MSCI CHINA UCITS ETF 12.61% 12.97% (0.35%) 0.93% 0.59%
HSBC MSCI SOUTH AFRICA CAPPED
UCITS ETF 11.14% 11.31% (0.17%) 1.82% 0.14%
HSBC MSCI MEXICO CAPPED
UCITS ETF 6.50% 6.69% (0.19%) 0.75% 0.08%
HSBC MSCI EM LATIN AMERICA
UCITS ETF 11.96% 12.50% (0.54%) (0.38%) 0.19%
HSBC MSCI INDONESIA UCITS ETF 8.53% 8.90% (0.36%) 0.06% 0.06%
HSBC MSCI MALAYSIA UCITS ETF 1.20% 1.49% (0.29%) 0.09% 0.08%
HSBC MSCI TAIWAN CAPPED UCITS ETF* 9.58% 9.92% (0.34%) (0.28%) 0.07%
HSBC MSCI KOREA UCITS ETF 3.52% 3.90% (0.37%) (0.85%) 0.45%
HSBC MSCI RUSSIA CAPPED
UCITS ETF 31.77% 31.96% (0.19%) 0.07% 0.23%
HSBC MSCI EMERGING MARKETS
UCITS ETF 10.63% 10.94% (0.31%) 1.86% 0.56%
HSBC MSCI AC FAR EAST EX JAPAN
UCITS ETF 11.39% 11.57% (0.17%) 0.50% 0.35%
HSBC MSCI CHINA A INCLUSION
UCITS ETF** 26.94% 27.23% (0.29%) N/A N/A
HSBC MSCI SAUDI ARABIA 20/35
CAPPED UCITS ETF*** N/A N/A N/A N/A N/A
Developed and Emerging Countries
HSBC ECONOMIC SCALE WORLDWIDE
EQUITY UCITS ETF 13.45% 17.00% (3.55%) (7.40%) 3.58%
HSBC MULTIFACTOR WORLDWIDE
EQUITY UCITS ETF 13.32% 16.23% (2.91%) (4.59%) 0.94%
* Formerly known as HSBC MSCI TAIWAN UCITS ETF.
** The sub-fund was listed on 27 July 2018.
*** The sub-fund was listed on 1 May 2019.
HSBC ETFs PLC >23<
Investment Manager’s Report (continued)
HSBC ETF Performance (continued) to 30 June 2019
ETFS
NAV (30/06/2019) FUND CCY
NAV (31/12/2018) FUND CCY NAV Variation
HSBC FTSE 100 UCITS ETF GBP 198,400,449 GBP 173,873,426 24,527,023
HSBC EURO STOXX 50 UCITS ETF EUR 140,551,985 EUR 115,762,040 24,789,945
HSBC MSCI JAPAN UCITS ETF USD 169,797,760 USD 218,661,384 (48,863,624)
HSBC FTSE 250 UCITS ETF GBP 38,878,447 GBP 34,808,387 4,070,060
HSBC S&P 500 UCITS ETF USD 2,972,603,463 USD 2,489,530,817 483,072,646
HSBC MSCI EUROPE UCITS ETF EUR 127,557,815 EUR 133,572,169 (6,014,354)
HSBC MSCI USA UCITS ETF USD 39,564,705 USD 27,644,577 11,920,128
HSBC MSCI BRAZIL UCITS ETF USD 37,700,446 USD 33,184,237 4,516,209
HSBC MSCI PACIFIC ex JAPAN UCITS ETF USD 33,200,918 USD 32,425,463 775,455
HSBC MSCI EM FAR EAST UCITS ETF USD 19,348,915 USD 28,223,264 (8,874,349)
HSBC MSCI TURKEY UCITS ETF USD 9,240,267 USD 10,029,689 (789,422)
HSBC MSCI WORLD UCITS ETF USD 945,894,866 USD 646,234,146 299,660,720
HSBC MSCI CHINA UCITS ETF USD 396,083,461 USD 338,655,797 57,427,664
HSBC MSCI SOUTH AFRICA CAPPED UCITS ETF USD 3,677,726 USD 3,340,293 337,433
HSBC MSCI CANADA UCITS ETF USD 28,872,090 USD 26,343,005 2,529,085
HSBC MSCI MEXICO CAPPED UCITS ETF USD 7,346,077 USD 8,511,935 (1,165,858)
HSBC MSCI EM LATIN AMERICA UCITS ETF USD 17,090,406 USD 15,417,519 1,672,887
HSBC MSCI INDONESIA UCITS ETF USD 47,915,167 USD 58,738,035 (10,822,868)
HSBC MSCI MALAYSIA UCITS ETF USD 4,616,810 USD 4,625,864 (9,054)
HSBC MSCI TAIWAN CAPPED UCITS ETF* USD 14,538,650 USD 6,767,793 7,770,857
HSBC MSCI KOREA UCITS ETF USD 9,547,932 USD 6,154,627 3,393,305
HSBC FTSE EPRA/NAREIT DEVELOPED UCITS ETF USD 147,226,598 USD 147,855,806 (629,208)
HSBC MSCI RUSSIA CAPPED UCITS ETF USD 71,173,278 USD 62,020,061 9,153,217
HSBC MSCI EMERGING MARKETS UCITS ETF USD 248,202,384 USD 232,133,870 16,068,514
HSBC MSCI AC FAR EAST ex JAPAN UCITS ETF USD 320,212,044 USD 317,500,429 2,711,615
HSBC ECONOMIC SCALE WORLDWIDE EQUITY
USD 426,779,142 USD 381,457,060 45,322,082 UCITS ETF
HSBC MULTI FACTOR WORLDWIDE EQUITY
UCITS ETF USD 361,116,442 USD 269,965,090 91,151,352
HSBC MSCI CHINA A INCLUSION UCITS ETF** USD 175,718,071 USD 7,951,898 167,766,173
HSBC MSCI SAUDI ARABIA 20/35 CAPPED
UCITS ETF*** USD 15,513,309 - 15,513,309
* Formerly known as HSBC MSCI TAIWAN UCITS ETF.
** The sub-fund was listed on 27 July 2018.
***The sub-fund was listed on 1 May 2019.
HSBC ETFs PLC >24<
Investment Manager’s Report (continued)
HSBC ETF Performance To 30 June 2019
YTD
ISIN Code
Performance Attribution
Net Gross
(explanation where gross tracking difference
is greater than 0.03)
HSBC FTSE 100 UCITS ETF
FTSE 100
Differential (Tracking Difference)
13.06
13.14
(0.08)
13.10
13.14
(0.04)
IE00B42TW061
Predominant driver of underperformance is stamp duty on UK
purchases.
HSBC Euro Stoxx 50 UCITS ETF
DJ Euro Stoxx 50
Differential (Tracking Difference)
19.49
18.91
0.58
19.52
18.91
0.61
IE00B4K6B022
Performance explained by favourable withholding tax rates
applicable to the fund as compared to the benchmark.
HSBC MSCI Japan UCITS ETF
MSCI Japan
Differential (Tracking Difference)
8.33
8.44
(0.11)
8.43
8.44
(0.01)
IE00B5VX7566
Within tolerance band.
HSBC FTSE 250 UCITS ETF
FTSE 250
Differential (Tracking Difference)
12.71
12.97
(0.26)
12.90
12.97
(0.07)
IE00B64PTF05
Predominant driver of underperformance is stamp duty on UK
purchases.
HSBC S&P 500 UCITS ETF
S&P 500
Differential (Tracking Difference)
18.27
18.18
0.09
18.32
18.18
0.14
IE00B5KQNG97
Performance explained by favourable withholding tax rates
applicable to the fund as compared to the benchmark.
HSBC MSCI EUROPE UCITS ETF
MSCI Europe
Differential (Tracking Difference)
16.96
16.73
0.23
17.08
16.73
0.34
IE00B5BD5K76
Performance explained by favourable withholding tax rates
applicable to the fund as compared to the benchmark.
HSBC MSCI USA UCITS ETF
MSCI USA
Differential (Tracking Difference)
18.44
18.44
0.00
18.61
18.44
0.17
IE00B5WFQ436
Performance explained by favourable withholding tax rates
applicable to the fund as compared to the benchmark.
HSBC MSCI BRAZIL UCITS ETF
MSCI BRAZIL
Differential (Tracking Difference)
14.79
15.63
(0.84)
15.13
15.63
(0.50)
IE00B5W34K94
Performance driven by CGT.
HSBC ETFs PLC >25<
Investment Manager’s Report (continued)
HSBC ETF Performance To 30 June 2019
YTD
ISIN Code
Performance Attribution
Net Gross
(explanation where gross tracking difference
is greater than 0.03)
HSBC MSCI PACIFIC EX JAPAN UCITS ETF
MSCI PACIFIC
Differential (Tracking Difference)
17.78
18.03
(0.26)
18.01
18.03
(0.02) IE00B5SG8Z57
HSBC MSCI EM FAR EAST UCITS ETF
MSCI EM FAR EAST
Differential (Tracking Difference)
10.02
10.43
(0.41)
10.34
10.43
(0.09) IE00B5LP3W10
Performance explained by fund optimization and imperfectly
tracking future.
HSBC MSCI TURKEY UCITS ETF
MSCI TURKEY
Differential (Tracking Difference)
(0.72)
(0.42)
(0.30)
(0.43)
(0.42)
(0.01) IE00B5BRQB73
HSBC MSCI WORLD UCITS ETF
MSCI WORLD
Differential (Tracking Difference)
17.09
16.98
0.11
17.18
16.98
0.20 IE00B4X9L533
Mainly driven by WHT.
HSBC MSCI CHINA UCITS ETF
MSCI CHINA
Differential (Tracking Difference)
12.61
12.97
(0.35)
12.94
12.97
(0.02) IE00B44T3H88
HSBC MSCI SOUTH AFRICA CAPPED UCITS ETF
MSCI SOUTH AFRICA
Differential (Tracking Difference)
11.14
11.31
(0.17)
11.47
11.31
0.16 IE00B57S5Q22
Outperformance can be explained by the fund benefiting from
wins on WHT (10%) vs the index (20%).
HSBC MSCI CANADA UCITS ETF
MSCI CANADA
Differential (Tracking Difference)
20.83
21.01
(0.17)
21.04
21.01
0.04 IE00B51B7Z02
Performance mainly explained by the cash pull.
HSBC MSCI MEXICO CAPPED UCITS ETF
MSCI MEXICO
Differential (Tracking Difference)
6.50
6.69
(0.19)
6.81
6.69
0.12 IE00B3QMYK80
Performance explained by a combination of wins on WHT and
imperfectly tracking future.
HSBC ETFs PLC >26<
Investment Manager’s Report (continued)
HSBC ETF Performance To 30 June 2019
YTD
ISIN Code
Performance Attribution
Net Gross
(explanation where gross tracking difference
is greater than 0.03)
HSBC MSCI EM LATIN AMERICA UCITS ETF
MSCI EM LATIN AMERICA
Differential (Tracking Difference)
11.96
12.50
(0.50)
12.29
12.50
(0.20)
IE00B4TS3815
Primary drivers for underperformance are capital gains tax
and detrimental withholding tax rate versus index assumption.
HSBC MSCI INDONESIA UCITS ETF
MSCI INDONESIA
Differential (Tracking Difference)
8.53
8.90
(0.36)
8.86
8.90
(0.04)
IE00B46G8275
Performance explained by imperfectly tracking future.
HSBC MSCI MALAYSIA UCITS ETF
MSCI MALAYSIA
Differential (Tracking Difference)
1.20
1.49
(0.29)
1.50
1.49
0.01
IE00B3X3R831
HSBC MSCI TAIWAN CAPPED UCITS ETF*
MSCI TAIWAN
Differential (Tracking Difference)
9.58
9.92
(0.34)
9.90
9.92
(0.02)
IE00B3S1J086
HSBC MSCI KOREA UCITS ETF
MSCI KOREA
Differential (Tracking Difference)
3.52
3.90
(0.37)
3.83
3.90
(0.07)
IE00B3Z0X395
Underperformance is explained by timing differences on
Korean dividends between the index and the Fund.
HSBC FTSE EPRA NAREIT DEVELOPED UCITS ETF
FTSE EPRA NAREIT DEVELOPED
Differential (Tracking Difference)
14.52
14.51
0.01
14.75
14.51
0.23
IE00B5L01S80
Performance explained by wins on WHT as well as a
backdated WHT payment from 2018.
HSBC MSCI RUSSIA CAPPED UCITS ETF
MSCI RUSSIA CAPPED
Differential (Tracking Difference)
31.77
31.96
(0.19)
32.16
31.96
0.20
IE00BGHHCV04
Performance explained by a combination of wins on WHT and
imperfectly tracking future.
* Formerly known as HSBC MSCI TAIWAN UCITS ETF.
HSBC ETFs PLC >27<
Investment Manager’s Report (continued)
HSBC ETF Performance To 30 June 2019
YTD
ISIN Code
Performance Attribution
Net Gross
(explanation where gross tracking difference
is greater than 0.03)
HSBC MSCI EMERGING MARKETS UCITS ETF
MSCI EMERGING MARKETS
Differential (Tracking Difference)
10.63
10.94
(0.31)
10.85
10.94
(0.09)
IE00B5SSQT16
Performance explained by fund optimization and imperfectly
tracking future.
HSBC MSCI AC FAR EAST EX JAPAN UCITS ETF
MSCI AC FAR EAST EX JAPAN
Differential (Tracking Difference)
11.39
11.57
(0.17)
11.64
11.57
0.08
IE00BBQ2W338
Performance explained by fund optimization and imperfectly
tracking future.
HSBC ECONOMIC SCALE WORLDWIDE EQUITY
UCITS ETF
MSCI AC WORLD
Differential (Tracking Difference)
13.45
17.00
(3.55)
13.59
17.00
(3.41)
IE00BKZG9Y92
Fund follows a fundamentally weighted investment strategy.
Performance deviation explained by this.
HSBC MULTI FACTOR WORLDWIDE EQUITY
UCITS ETF
MSCI AC WORLD
Differential (Tracking Difference)
13.32
16.23
(2.91)
13.45
16.23
(2.77)
IE00BKZGB098
Fund follows a multi-factor investment strategy. Performance
deviation explained by this.
HSBC MSCI CHINA A INCLUSION UCITS ETF*
MSCI CHINA A INCLUSION
Differential (Tracking Difference)
26.94
27.23
(0.29)
27.18
27.23
(0.05)
IE00BF4NQ904
The Fund was too small in January and February to hold any
future contract which resulted in a cash drag. Since then
performance has been affected by an imperfectly tracking
future contract.
HSBC MSCI SAUDI ARABIA 20/35 CAPPED
UCITS ETF**
MSCI SAUDI ARABIA 20/35
Differential (Tracking Difference)
N/A N/A IE00BGHHCV04
*The sub-fund was listed on 27 July 2018.
**The sub-fund was listed on 1 May 2019.
HSBC ETFs PLC >28<
Investment Manager’s Report (continued)
Tracking Error
Realised tracking error is annualised standard deviation of the difference in monthly returns between a Sub-Fund and its benchmark index. Tracking error shows the consistency of returns relative to the benchmark index over a defined financial period of time.
Anticipated tracking error is based on the expected volatility of differences between the returns of a Sub-Fund and the returns of its benchmark index.
For physically replicating Sub-Funds, the investment management approach is to buy a portfolio of securities that as far as practicable consist of the securities that make up the benchmark index, in similar proportion to the weights presented in the benchmark index.
For non-replicating Sub-Funds, the investment management approach aims to match the main risk characteristics of the benchmark index by investing in a portfolio that is primarily made up of securities that represent the benchmark index. The aim is to generate a return which is as close as practicable to the total return of the index net of transaction costs and gross of fees and other costs.
Cash management, efficient portfolio management techniques, transaction costs from rebalancing and currency hedging can have an impact on tracking error as well as the return differential between a Sub-Fund and its benchmark index. Importantly, these impacts can be either positive or negative depending on the underlying circumstances.
In addition to the above, the Sub-Funds may also have a tracking error due to withholding tax suffered by the Sub-Funds on any income received from its investments. The level and quantum of tracking error arising due to withholding taxes depends on various factors such as any reclaims filed on behalf of the Sub-Funds with various tax authorities, any benefits obtained by the Sub-Funds under a tax treaty.
The table on page 29-32 below compares the anticipated tracking error of the Sub-Funds against the actual realised tracking error of the Sub-Funds as at 30 June 2019. An explanation of the difference is provided. The realised tracking error is annualised and calculated using data from the preceding 36 month observation period. Where a Sub-Fund has not been trading for 36 months, the annualised tracking error since inception has been presented.
HSBC ETFs PLC >29<
Investment Manager’s Report (continued)
HSBC ETF Performance To 30 June 2019
1 Year Tracking Error (“TE”)
ISIN Code Explanation of Divergence*
(only significant divergence is explained) Anticipated
Tracking Error
Realised
Tracking Error
HSBC FTSE 100 UCITS ETF
FTSE 100
Differential
0.100 0.057 IE00B42TW061
HSBC Euro Stoxx 50 UCITS ETF
DJ Euro Stoxx 50
Differential
0.200 0.136 IE00B4K6B022
HSBC MSCI Japan UCITS ETF
MSCI Japan
Differential
0.100 0.039 IE00B5VX7566
HSBC FTSE 250 UCITS ETF
FTSE 250
Differential
0.100 0.056 IE00B64PTF05
HSBC S&P 500 UCITS ETF
S&P 500
Differential 0.100 0.138 IE00B5KQNG97
The slighly elevated TE is due to S302 tax which bounced back in
August for a merger between AT&T and Time Warner corporate
action event, resulting in approximately 3bps. We are also seeing on
a daily basis more noise from the banned weapons and the munitions
optimisation impact which pushed TE level up.
HSBC MSCI EUROPE UCITS ETF
MSCI Europe
Differential
0.100 0.078 IE00B5BD5K76
HSBC MSCI USA UCITS ETF
MSCI USA
Differential 0.100 0.138 IE00B5WFQ436
The slighly elevated TE is due to S302 tax which bounced back in
August for a merger between AT&T and Time Warner corporate
action event, resulting in approximately 3bps. We are also seeing on
a daily basis more noise from the banned weapons and the munitions
optimisation impact which pushed TE level up.
HSBC ETFs PLC >30<
Investment Manager’s Report (continued)
HSBC ETF Performance To 30 June 2019
1 Year Tracking Error (“TE”)
ISIN Code Explanation of Divergence*
(only significant divergence is explained) Anticipated
Tracking Error
Realised
Tracking Error
HSBC MSCI BRAZIL UCITS ETF
MSCI BRAZIL
Differential
0.200 0.205 IE00B5W34K94
HSBC MSCI PACIFIC EX JAPAN UCITS ETF
MSCI PACIFIC
Differential
0.100 0.067 IE00B5SG8Z57
HSBC MSCI EM FAR EAST UCITS ETF
MSCI EM FAR EAST
Differential
0.400 0.336 IE00B5LP3W10
HSBC MSCI TURKEY UCITS ETF
MSCI TURKEY
Differential 0.200 0.263 IE00B5BRQB73
The slightly elevated TE is due to high credit interest rates in Turkey
(~20%) resulting in large interest payments to the Fund. The Fund
also disinvests for dividend distribution on the close of ex date - 1
whereas the performance methodology uses the close of ex date.
HSBC MSCI WORLD UCITS ETF
MSCI WORLD
Differential
0.400 0.223 IE00B4X9L533
HSBC MSCI CHINA UCITS ETF
MSCI CHINA
Differential
0.400 0.225 IE00B44T3H88
HSBC MSCI SOUTH AFRICA CAPPED UCITS ETF
MSCI SOUTH AFRICA
Differential
0.400 0.095 IE00B57S5Q22
HSBC MSCI CANADA UCITS ETF
MSCI CANADA
Differential
0.100 0.047 IE00B51B7Z02
HSBC ETFs PLC >31<
Investment Manager’s Report (continued)
HSBC ETF Performance To 30 June 2019
1 Year Tracking Error (“TE”)
ISIN Code Explanation of Divergence*
(only significant divergence is explained) Anticipated
Tracking Error
Realised
Tracking Error
HSBC MSCI MEXICO CAPPED UCITS ETF
MSCI MEXICO
Differential
0.100 0.085 IE00B3QMYK80
HSBC MSCI EM LATIN AMERICA UCITS ETF
MSCI EM LATIN AMERICA
Differential
0.200 0.181 IE00B4TS3815
HSBC MSCI INDONESIA UCITS ETF
MSCI INDONESIA
Differential
0.200 0.078 IE00B46G8275
HSBC MSCI MALAYSIA UCITS ETF
MSCI MALAYSIA
Differential
0.200 0.059 IE00B3X3R831
HSBC MSCI TAIWAN CAPPED UCITS ETF*
MSCI TAIWAN
Differential
0.100 0.070 IE00B3S1J086
HSBC MSCI KOREA UCITS ETF
MSCI KOREA
Differential
0.400 0.168 IE00B3Z0X395
HSBC FTSE EPRA NAREIT DEVELOPED UCITS ETF
FTSE EPRA NAREIT DEVELOPED
Differential
0.200 0.245 IE00B5L01S80
The TE is elevated on this Fund due to an index event error on the
merger of Brookfield Property (fund constituent) whereby the Fund
chose to sell out of the position ahead of the index event so as to
not incur the WHT of 30% and as such be in line with the index. The
index subsequently decided to apply a tax resulting in the Fund
outperforming the index by approximately 20bps. There was also
an adjustment to the index causing further volatility.
* Formerly known as HSBC MSCI TAIWAN UCITS ETF.
HSBC ETFs PLC >32<
Investment Manager’s Report (continued)
HSBC ETF Performance To 30 June 2019
1 Year Tracking Error (“TE”)
ISIN Code Explanation of Divergence*
(only significant divergence is explained) Anticipated
Tracking Error
Realised Tracking
Error
HSBC MSCI RUSSIA CAPPED UCITS ETF
MSCI RUSSIA CAPPED
Differential
0.200 0.151 IE00B5LJZQ16
HSBC MSCI EMERGING MARKETS UCITS ETF
MSCI EMERGING MARKETS
Differential
0.400 0.258 IE00B5SSQT16
HSBC MSCI AC FAR EAST EX JAPAN UCITS ETF
MSCI AC FAR EAST EX JAPAN
Differential
0.400 0.267 IE00BBQ2W338
HSBC ECONOMIC SCALE WORLDWIDE EQUITY UCITS ETF
MSCI AC WORLD**
Differential
N/A N/A IE00BKZG9Y92
HSBC MULTI FACTOR WORLDWIDE EQUITY UCITS ETF
MSCI AC WORLD**
Differential
N/A N/A IE00BKZGB098
HSBC MSCI CHINA A INCLUSION UCITS ETF^
MSCI CHINA A INCLUSION
Differential
0.500 N/A IE00BF4NQ904
HSBC MSCI SAUDI ARABIA 20/35 CAPPED
UCITS ETF^^
MSCI SAUDI ARABIA 20/35
Differential
0.400 N/A IE00BGHHCV04
* Tracking error below anticipated level.
** Fund converted to active economic scale strategy. Fund no longer tracks the benchmark passively and performance deviation is explained by this.
^ The sub-fund was listed on 27 July 2018.
^^ The sub-fund was listed on 1 May 2019.
HSBC ETFs PLC >33<
Schedules of Investments
HSBC FTSE 100 UCITS ETF As at 30 June 2019
Transferable securities admitted to official stock exchange listing
Holdings Financial assets at fair value through profit or loss Fair Value
GBP % of Net
Asset Value
Equities
Bermuda
Financial (31 December 2018: 0.26%)
29,184 Hiscox Ltd 493,793 0.25
493,793 0.25
Germany
Consumer Services (31 December 2018: 0.28%)
45,620 TUI AG 352,369 0.18
352,369 0.18
Ireland
Consumer Services (31 December 2018: 0.89%)
8,029 Paddy Power 475,959 0.24
128,080 WPP 1,268,248 0.64
1,744,207 0.88
Industrial (31 December 2018: 2.62%)
84,703 CRH 2,170,091 1.09
10,304 DCC 723,341 0.36
95,077 Experian 2,266,636 1.14
24,906 Smurfit Kappa 593,261 0.30
5,753,329 2.89
Isle Of Man
Consumer Services (31 December 2018: 0.22%)
Netherlands
Oil & Gas (31 December 2018: 11.14%)
851,283 Royal Dutch Shell 21,932,637 11.05
21,932,637 11.05
Switzerland
Basic Materials (31 December 2018: 1.92%)
1,169,019 Glencore International 3,195,513 1.61
3,195,513 1.61
Consumer Goods (31 December 2018: 0.28%)
20,348 Coca Cola Hellenic Bottling Company 604,743 0.30
604,743 0.30
Industrial (31 December 2018: Nil)
24,316 Ferguson PLC 1,361,696 0.69
1,361,696 0.69
HSBC ETFs PLC >34<
Schedules of Investments (continued)
HSBC FTSE 100 UCITS ETF (continued) As at 30 June 2019
Transferable securities admitted to official stock exchange listing
Holdings Financial assets at fair value through profit or loss Fair Value
GBP % of Net
Asset Value
Equities (continued)
United Kingdom
Basic Materials (31 December 2018: 6.81%)
103,450 Anglo American 2,321,935 1.17
35,754 Antofagasta 332,369 0.17
217,863 BHP Group Plc 4,389,939 2.21
13,010 Croda International 666,112 0.34
57,271 Evraz Group 380,967 0.19
19,092 Fresnillo 166,139 0.08
19,898 Johnson Matthey 662,404 0.33
38,394 Mondi 687,253 0.35
115,211 Rio Tinto 5,622,873 2.84
15,229,991 7.68
Consumer Goods (31 December 2018: 15.23%)
36,422 Associated British Foods 897,074 0.45
105,620 Barratt Developments 604,780 0.30
12,546 Berkeley Group Holdings 468,091 0.24
239,148 British American Tobacco Malaysia 6,574,178 3.31
42,745 Burberry Group 795,912 0.40
244,737 Diageo 8,281,900 4.17
99,805 Imperial Tobacco Group 1,843,199 0.93
33,204 Persimmon 663,084 0.33
65,891 Reckitt Benckiser Group 4,094,467 2.06
341,037 Taylor Wimpey 537,986 0.28
114,132 Unilever 5,586,191 2.83
30,346,862 15.30
Consumer Services (31 December 2018: 9.07%)
16,795 Carnival ord 584,298 0.29
166,020 Compass Group 3,132,797 1.58
130,585 Informa 1,090,385 0.55
19,058 Intercontinental Hotels 985,680 0.50
166,192 International Consolidated Airlines Group 792,570 0.40
390,331 ITV 421,557 0.21
170,168 J Sainsbury 333,444 0.17
37,774 JD Sports 221,507 0.11
221,186 Kingfisher 475,329 0.24
204,347 Marks & Spencer Group 430,559 0.22
13,690 Next 756,509 0.38
47,403 Ocado Group 553,193 0.28
HSBC ETFs PLC >35<
Schedules of Investments (continued)
HSBC FTSE 100 UCITS ETF (continued) As at 30 June 2019
Transferable securities admitted to official stock exchange listing
Holdings Financial assets at fair value through profit or loss Fair Value
GBP % of Net
Asset Value
Equities (continued)
United Kingdom (continued)
Consumer Services (31 December 2018: 9.07%) (continued)
81,667 Pearson 669,179 0.34
196,934 Reed Elsevier 3,760,455 1.90
1,013,526 TESCO 2,297,663 1.16
18,196 Whitbread 842,293 0.42
231,188 WM Morrison Supermarkets 465,613 0.23
17,813,031 8.98
Financial (31 December 2018: 20.82%)
99,775 3i Group 1,110,995 0.56
21,548 Admiral Group 475,780 0.24
409,149 Aviva 1,704,106 0.86
1,800,821 Barclays 2,697,630 1.36
98,618 British Land 530,959 0.27
144,186 Direct Line Insurance Group 478,409 0.24
28,274 Hargreaves Lansdown 542,578 0.27