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CSI Alpha Fund Series CSI China-Hong Kong Leaders Fund CSI RMB Income Fund CSI RMB Short Maturity Bond Fund CSI RMB Money Market Fund CSI RMB China A-Shares Diversification Fund TRUST PROSPECTUS FUND SPECIFIC PROSPECTUS February 2015

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CSI Alpha Fund Series

CSI China-Hong Kong Leaders Fund

CSI RMB Income Fund

CSI RMB Short Maturity Bond Fund

CSI RMB Money Market Fund

CSI RMB China A-Shares Diversification Fund

TRUST PROSPECTUS

FUND SPECIFIC PROSPECTUS

February 2015

- i –

CONTENTS

Clause Page

A. TRUST PROSPECTUS .............................................................................................. 1

1. DIRECTORY OF PARTIES ............................................................................. 3

2. DEFINITIONS .................................................................................................. 4

3. INTRODUCTION ............................................................................................. 6

4. INVESTMENT OBJECTIVE AND POLICY ................................................... 6

5. INVESTMENT RESTRICTIONS ..................................................................... 6

6. BORROWING RESTRICTIONS ...................................................................... 8

7. RISK FACTORS ............................................................................................... 8

7.1 Principal Risk Factors ............................................................................ 8

7.2 Market Risk ........................................................................................... 9

7.3 Effect of Governmental Policy and Regulation ...................................... 9

7.4 Exchange Rates...................................................................................... 9

7.5 Interest Rates ......................................................................................... 9

7.6 Credit Rating Downgrading Risk ......................................................... 10

7.7 Valuation Risk ..................................................................................... 10

7.8 Investment in Equity Securities ............................................................ 10

7.9 Counterparty and Settlement Risk ........................................................ 10

7.10 Currency Risk ...................................................................................... 11

7.11 Transactions in Options, Futures, Warrants, Forwards or Swaps .......... 11

7.12 Emerging and Developing Markets ...................................................... 11

7.13 Operational Risk .................................................................................. 12

7.14 Concentration Risk/Single Country Investment Risk ............................ 12

7.15 Risk factors in relation to a Fund which invests in securities of issuers located in or associated with the PRC .................................................. 12

7.16 Credit Market Exposures...................................................................... 13

7.17 Borrowing Risk ................................................................................... 13

7.18 Risk of Termination ............................................................................. 14

7.19 Restricted Markets Risk ....................................................................... 14

7.20 The Renminbi Currency Risk ............................................................... 14

7.21 Hedging risk ........................................................................................ 14

7.22 Risks of investing in other funds .......................................................... 15

8. MANAGEMENT AND ADMINISTRATION ................................................ 15

8.1 Manager............................................................................................... 15

8.2 Trustee and Registrar ........................................................................... 18

9. ISSUE OF UNITS ........................................................................................... 18

9.1 Form of Units ...................................................................................... 18

10. SUBSCRIPTION FOR UNITS ........................................................................ 19

10.1 Issue Price ........................................................................................... 19

10.2 Minimum subscription and minimum holding ...................................... 19

10.3 Application procedure .......................................................................... 19

10.4 Payment procedure .............................................................................. 21

11. REDEMPTION OF UNITS ............................................................................. 22

11.1 Redemption of Units ............................................................................ 22

11.2 Redemption amount ............................................................................. 23

11.3 Redemption procedure ......................................................................... 23

11.4 Payment of redemption proceeds ......................................................... 24

- ii –

11.5 Restrictions on redemption................................................................... 25

12. CONVERSION OF UNITS ............................................................................. 25

13. TRANSFER OF UNITS .................................................................................. 26

14. CALCULATION OF NET ASSET VALUE ................................................... 26

14.1 Calculation of Net Asset Value ............................................................ 26

14.2 Publication of Net Asset Value ............................................................ 27

14.3 Suspension of dealing .......................................................................... 27

15. DISTRIBUTION POLICY .............................................................................. 28

16. CHARGES AND EXPENSES ........................................................................ 28

16.1 Management Fee .................................................................................. 29

16.2 Performance Fee .................................................................................. 29

16.3 Trustee Fee .......................................................................................... 29

16.4 Registrar's Fees .................................................................................... 29

16.5 Other Charges and Expenses ................................................................ 29

16.6 Fees payable by investors ..................................................................... 30

16.7 Cash Rebates and Soft Commissions .................................................... 30

17. TAXATION .................................................................................................... 30

17.1 Hong Kong .......................................................................................... 30

17.2 PRC Tax .............................................................................................. 31

17.3 US Tax Withholding and Reporting under the Foreign Account Tax Compliance Act (“FATCA”)................................................................ 35

17.4 General ................................................................................................ 37

18. GENERAL INFORMATION .......................................................................... 37

18.1 Accounts and Reports .......................................................................... 37

18.2 Trust Deed ........................................................................................... 37

18.3 Modification of Trust Deed .................................................................. 38

18.4 Meetings of Unitholders ....................................................................... 38

18.5 Compulsory Redemption or Transfer of Units ...................................... 39

18.6 Conflicts of Interest ............................................................................. 39

18.7 Material Contracts ............................................................................... 39

18.8 Documents available for inspection ...................................................... 40

18.9 Termination of the Trust and/or Funds ................................................. 40

18.10 Creation of Funds ................................................................................ 41

18.11 Anti-Money Laundering Regulations ................................................... 41

18.12 Auditors ............................................................................................... 41

19. GENERAL OVERVIEW OF RMB DEBT INSTRUMENTS MARKET IN THE PRC ................................................................................................................ 41

19.1 The types of debt instruments .............................................................. 42

19.2 The markets for debt instruments ......................................................... 45

19.3 Size and market structure ..................................................................... 46

19.4 Yield of major debt instruments ........................................................... 52

19.5 Regulatory bodies and credit rating agencies ........................................ 53

B. FUND SPECIFIC PROSPECTUS OF CSI CHINA-HONG KONG LEADERS FUND ......................................................................................................................... 55

20. CSI CHINA-HONG KONG LEADERS FUND .............................................. 55

21. DEFINITIONS ................................................................................................ 55

22. SUMMARY .................................................................................................... 57

23. INVESTMENT OBJECTIVE AND POLICY ................................................. 58

23.1 Currency Denomination ....................................................................... 58

23.2 Investment Objective ........................................................................... 58

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23.3 Investment Policy ................................................................................ 58

23.4 Securities Lending Arrangements ........................................................ 59

24. INVESTMENT RESTRICTIONS ................................................................... 59

25. BORROWING RESTRICTIONS .................................................................... 59

26. SUBSCRIPTION FOR UNITS ........................................................................ 60

26.1 Issue Price ........................................................................................... 60

26.2 Minimum subscription and minimum holding ...................................... 60

26.3 Application procedure .......................................................................... 60

27. REDEMPTION OF UNITS ............................................................................. 60

27.1 Redemption of Units ............................................................................ 60

27.2 Redemption procedure ......................................................................... 61

28. CALCULATION OF NET ASSET VALUE ................................................... 61

29. DISTRIBUTION POLICY .............................................................................. 61

30. CHARGES AND EXPENSES ........................................................................ 61

30.1 Subscription Charge and Redemption Charge ...................................... 61

30.2 Transfer Fee ......................................................................................... 62

30.3 Fiscal and Purchase Charges ................................................................ 62

30.4 Management Fee .................................................................................. 62

30.5 Trustee Fee .......................................................................................... 62

30.6 Registrar's Fees .................................................................................... 62

C. FUND SPECIFIC PROSPECTUS OF CSI RMB INCOME FUND ....................... 63

31. CSI RMB INCOME FUND ............................................................................. 63

32. DEFINITIONS ................................................................................................ 63

33. SUMMARY .................................................................................................... 66

34. INVESTMENT OBJECTIVE AND POLICY ................................................. 67

34.1 Currency Denomination ....................................................................... 67

34.2 Investment Objective ........................................................................... 67

34.3 Investment Policy ................................................................................ 68

34.4 Effect of RQFII Regulations on Redemptions ...................................... 71

34.5 RQFII Quota Limitation ....................................................................... 71

34.6 Potential Conflict of Interest ................................................................ 71

35. CUSTODY ...................................................................................................... 72

36. INVESTMENT RESTRICTIONS ................................................................... 73

37. BORROWING RESTRICTIONS .................................................................... 73

38. UNIT CLASSES ............................................................................................. 73

39. SUBSCRIPTION FOR UNITS ........................................................................ 74

39.1 Issue Price ........................................................................................... 74

39.2 Minimum subscription and minimum holding ...................................... 74

39.3 Application procedure .......................................................................... 74

40. REDEMPTION OF UNITS ............................................................................. 74

40.1 Redemption of Units ............................................................................ 74

40.2 Redemption procedure ......................................................................... 75

41. CALCULATION OF NET ASSET VALUE ................................................... 75

42. DISTRIBUTION POLICY .............................................................................. 75

43. CHARGES AND EXPENSES ........................................................................ 76

43.1 Subscription Charge and Redemption Charge ...................................... 76

43.2 Transfer Fee ......................................................................................... 76

43.3 Fiscal and Purchase Charges ................................................................ 76

43.4 Management Fee .................................................................................. 76

43.5 Trustee Fee .......................................................................................... 76

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43.6 Global Custodian Fee and PRC Sub-Custodian Fee.............................. 77

43.7 Establishment Expenses ....................................................................... 77

44. FUND SPECIFIC RISK FACTORS ................................................................ 77

44.1 Regulatory development and oversight ................................................ 78

44.2 RMB denominated bonds or other debt instruments ............................. 78

44.3 Specific risk in interbank market and exchange market ........................ 81

44.4 Cash custody risk ................................................................................. 81

44.5 RMB currency and conversion risk ...................................................... 82

44.6 Concentration risk/single country investment risk ................................ 82

44.7 PRC market risk................................................................................... 82

44.8 RQFII Regime Risks ............................................................................ 83

44.9 PRC tax considerations ........................................................................ 86

D. FUND SPECIFIC PROSPECTUS OF CSI RMB SHORT MATURITY BOND FUND ......................................................................................................................... 89

45. CSI RMB Short Maturity Bond Fund .............................................................. 89

46. DEFINITIONS ................................................................................................ 89

47. SUMMARY .................................................................................................... 92

48. INVESTMENT OBJECTIVE AND POLICY ................................................. 93

48.1 Currency Denomination ....................................................................... 93

48.2 Investment Objective ........................................................................... 93

48.3 Investment Policy ................................................................................ 93

48.4 Effect of RQFII Regulations on Redemptions ...................................... 95

48.5 RQFII Quota Limitation ....................................................................... 95

48.6 Potential Conflict of Interest ................................................................ 96

49. CUSTODY ...................................................................................................... 96

50. INVESTMENT RESTRICTIONS ................................................................... 97

51. BORROWING RESTRICTIONS .................................................................... 98

52. UNIT CLASSES ............................................................................................. 98

53. SUBSCRIPTION FOR UNITS ........................................................................ 98

53.1 Issue Price ........................................................................................... 98

53.2 Minimum subscription and minimum holding ...................................... 98

53.3 Application procedure .......................................................................... 98

54. REDEMPTION OF UNITS ............................................................................. 99

54.1 Redemption of Units ............................................................................ 99

54.2 Redemption procedure ......................................................................... 99

55. CALCULATION OF NET ASSET VALUE ................................................. 100

56. DISTRIBUTION POLICY ............................................................................ 100

57. CHARGES AND EXPENSES ...................................................................... 100

57.1 Subscription Charge and Redemption Charge .................................... 100

57.2 Transfer Fee ....................................................................................... 100

57.3 Fiscal and Purchase Charges .............................................................. 100

57.4 Management Fee ................................................................................ 101

57.5 Trustee Fee ........................................................................................ 101

57.6 Global Custodian Fee and PRC Sub-Custodian Fee............................ 101

57.7 Establishment Expenses ..................................................................... 101

58. FUND SPECIFIC RISK FACTORS .............................................................. 102

58.1 Regulatory development and oversight .............................................. 102

58.2 RMB denominated bonds or other debt instruments ........................... 102

58.3 Specific risk in interbank market and exchange market ...................... 105

58.4 Cash custody risk ............................................................................... 106

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58.5 RMB currency and conversion risk .................................................... 106

58.6 Concentration risk/single country investment risk .............................. 106

58.7 PRC market risk................................................................................. 107

58.8 RQFII Regime Risks .......................................................................... 107

58.9 Risks associated with investment in short-term debt instruments ........ 110

58.10 Risks associated with investment in PRC money market funds .......... 110

58.11 PRC tax considerations ...................................................................... 111

E. FUND SPECIFIC PROSPECTUS OF CSI RMB Money Market Fund .............. 113

59. CSI RMB Money Market Fund ..................................................................... 113

60. DEFINITIONS .............................................................................................. 113

61. SUMMARY .................................................................................................. 117

62. INVESTMENT OBJECTIVE AND POLICY ............................................... 120

62.1 Currency Denomination ..................................................................... 120

62.2 Investment Objective ......................................................................... 120

62.3 Investment Policy .............................................................................. 120

62.4 Effect of RQFII Regulations on Redemptions .................................... 123

62.5 RQFII Quota Limitation ..................................................................... 123

62.6 Potential Conflict of Interest .............................................................. 123

63. CUSTODY .................................................................................................... 124

64. INVESTMENT RESTRICTIONS ................................................................. 125

65. BORROWING RESTRICTIONS .................................................................. 126

66. UNIT CLASSES ........................................................................................... 126

67. SUBSCRIPTION FOR UNITS ...................................................................... 126

67.1 Issue Price ......................................................................................... 126

67.2 Minimum subscription and minimum holding .................................... 127

67.3 Application procedure ....................................................................... 127

68. REDEMPTION OF UNITS ........................................................................... 128

68.1 Redemption of Units .......................................................................... 128

68.2 Redemption procedure ....................................................................... 128

69. CALCULATION OF NET ASSET VALUE ................................................. 129

70. DISTRIBUTION POLICY ............................................................................ 129

71. CHARGES AND EXPENSES ...................................................................... 130

71.1 Subscription Charge and Redemption Charge .................................... 130

71.2 Transfer Fee ....................................................................................... 130

71.3 Fiscal and Purchase Charges .............................................................. 130

71.4 Management Fee ................................................................................ 130

71.5 Trustee Fee ........................................................................................ 130

71.6 Global Custodian Fee and PRC Sub-Custodian Fee............................ 131

71.7 Establishment Expenses ..................................................................... 131

72. FUND SPECIFIC RISK FACTORS .............................................................. 131

72.1 Regulatory development and oversight .............................................. 132

72.2 RMB denominated bonds or other debt instruments ........................... 132

72.3 Specific risk in interbank market and exchange market ...................... 134

72.4 Cash custody risk ............................................................................... 135

72.5 Hedging risk ...................................................................................... 135

72.6 RMB currency and conversion risk .................................................... 136

72.7 Onshore and offshore RMB markets risk ........................................... 137

72.8 Concentration risk/single country investment risk .............................. 137

72.9 PRC market risk................................................................................. 137

72.10 RQFII Regime Risks .......................................................................... 137

- vi –

72.11 Risks associated with investment in short-term debt instruments ........ 140

72.12 PRC tax considerations ...................................................................... 141

F. FUND SPECIFIC PROSPECTUS OF CSI RMB China A-Shares Diversification Fund ........................................................................................................................ 143

73. CSI RMB China A-Shares Diversification Fund ............................................ 143

74. DEFINITIONS .............................................................................................. 143

75. SUMMARY .................................................................................................. 146

76. INVESTMENT OBJECTIVE AND POLICY ............................................... 147

76.1 Currency Denomination ..................................................................... 147

76.2 Investment Objective ......................................................................... 148

76.3 Investment Policy .............................................................................. 148

76.4 Effect of RQFII Regulations on Redemptions .................................... 149

76.5 RQFII Quota Limitation ..................................................................... 149

76.6 Potential Conflict of Interest .............................................................. 149

77. CUSTODY .................................................................................................... 150

78. BORROWING RESTRICTIONS .................................................................. 151

79. UNIT CLASSES ........................................................................................... 151

80. SUBSCRIPTION FOR UNITS ...................................................................... 152

80.1 Issue Price ......................................................................................... 152

80.2 Minimum subscription and minimum holding .................................... 152

80.3 Application procedure ....................................................................... 152

81. REDEMPTION OF UNITS ........................................................................... 153

81.1 Redemption of Units .......................................................................... 153

81.2 Redemption procedure ....................................................................... 153

82. CALCULATION OF NET ASSET VALUE ................................................. 154

83. DISTRIBUTION POLICY ............................................................................ 154

84. CHARGES AND EXPENSES ...................................................................... 154

84.1 Subscription Charge and Redemption Charge .................................... 154

84.2 Transfer Fee ....................................................................................... 154

84.3 Fiscal and Purchase Charges .............................................................. 154

84.4 Management Fee ................................................................................ 154

84.5 Trustee Fee ........................................................................................ 155

84.6 Global Custodian Fee and PRC Sub-Custodian Fee............................ 155

84.7 Establishment Expenses ..................................................................... 155

85. FUND SPECIFIC RISK FACTORS .............................................................. 156

85.1 Regulatory development and oversight .............................................. 156

85.2 Cash custody risk ............................................................................... 156

85.3 RMB currency and conversion risk .................................................... 156

85.4 Onshore and offshore RMB markets risk ........................................... 157

85.5 Concentration risk/single country investment risk .............................. 157

85.6 PRC market risk................................................................................. 157

85.7 Specific risks relating to the China A-share market ............................ 157

85.8 RQFII Regime Risks .......................................................................... 158

85.9 Risks associated with investment in PRC money market funds .......... 161

85.10 PRC tax considerations ...................................................................... 161

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A. TRUST PROSPECTUS

This prospectus (the "Trust Prospectus") comprises information in relation to the CSI Alpha Fund Series (the "Trust"), an umbrella unit trust established under the laws of Hong Kong, by a trust deed dated 25 June 2009 between CITIC Securities International Investment

Management (HK) Limited 中信証券國際投資管理(香港)有限公司(the "Manager") as

manager and BOCI-Prudential Trustee Limited 中銀國際英國保誠信託有限公司 (the "Trustee") as trustee, supplemented by a supplemental trust deed dated 9 April 2010, further supplemented by a second supplemental trust deed dated 4 January 2012, a third supplemental trust deed dated 24 April 2014 and a fourth supplemental trust deed dated 19 December 2014.

The Manager accepts full responsibility for the accuracy of the information contained in this Trust Prospectus, each prospectus specific to a sub-fund of the Trust ("Fund Specific Prospectus", together the "Prospectus") and the Product Key Facts Statement of each sub-fund of the Trust, and confirms, having made all reasonable enquiries, that to the best of its knowledge and belief there are no other facts the omission of which would make any statement in the these documents misleading. However, neither the delivery of the Prospectus nor the offer or issue of units of the Trust shall under any circumstances constitute a representation that the information contained in the Prospectus is correct as of any time subsequent to its date of publication. The Prospectus may from time to time be updated.

Distribution of the Prospectus must be accompanied by a copy of the Product Key Facts Statement of each sub-fund of the Trust and the latest available annual report and accounts of the Trust (if any) and any subsequent interim report.

The Trust and its sub-funds have been authorized by the Securities and Futures Commission of Hong Kong (the "SFC") pursuant to section 104 of the Securities and Futures Ordinance (the "SFO"). SFC authorization is not a recommendation or endorsement of the Trust and its sub-funds, nor does it guarantee the commercial merits of the Trust and its sub-funds or their performance. It does not mean the Trust or any of its sub-fund is suitable for all investors nor is it an endorsement of its suitability for any particular investor or class of investors.

No action has been taken to permit an offering of Units or the distribution of the Prospectus in any jurisdiction where action would be required for such purposes other than Hong Kong. The Prospectus has been written and authorized for distribution in Hong Kong only and may not be used for the purpose of an offer or solicitation in any jurisdiction or in any circumstances in which an offer or solicitation is not authorized.

In particular:

(a) the Units have not been and will not be registered under the United States Securities Act of 1933 (as amended) or where action would be required for such purposes and, may not be directly or indirectly offered or sold (i) in the United States of America, or any of its territories or possessions or areas subject to its jurisdiction; (ii) in an offering that would be considered to be an offering targeting residents of the United States pursuant to 12 U.S.C. 1851 and its implementing regulations; or (iii) or for the benefit of a “US Person” (as defined in Regulation S under the Securities Act of 1933); and

- 2 -

(b) the Trust has not been and will not be registered under the United States Investment Company Act of 1940 (as amended).

Potential applicants for Units should inform themselves as to (a) the possible tax consequences, (b) the legal requirements, and (c) any foreign exchange restrictions or exchange control requirements which they may encounter under the laws of the countries of their incorporation, citizenship, residence or domicile and which may be relevant to the subscription, holding or disposal of Units.

Enquiries and Complaints Handling

Investors may contact the Manager for any enquiries or complaints regarding the Trust or any sub-fund of the Trust. Such enquiries or complaints should be in writing and sent to the Manager at 26th Floor, CITIC Tower, 1 Tim Mei Avenue, Central, Hong Kong or via facsimile at (852) 2526 1989 or via email to [email protected]. Upon receipt of such enquiries or complaints, a preliminary response will be provided within 7 Business Days.

IMPORTANT - IF IN DOUBT OF THE CONTENTS OF THIS TRUST PROSPECTUS OR A FUND SPECIFIC PROSPECTUS, YOU SHOULD SEEK INDEPENDENT PROFESSIONAL FINANCIAL ADVICE.

Investors should note that the Net Asset Value per Unit is subject to market fluctuation and may go down as well as up.

Websites that are cited or referred to in the Prospectus and the Product Key Facts Statement of each sub-fund of the Trust have not been reviewed by the SFC.

- 3 -

1. DIRECTORY OF PARTIES

Manager CITIC SECURITIES INTERNATIONAL INVESTMENT MANAGEMENT (HK) LIMITED 26th Floor, CITIC Tower, 1 Tim Mei Avenue, Central, Hong Kong

Board of Directors of the Manager Mr. Ke YIN

Mr. Chi Leong Harry POON

Mr. Jianchiu HAN

Mr. Kwok Ming LEUNG

Mr. Yong WENG

Trustee and Registrar BOCI-PRUDENTIAL TRUSTEE LIMITED 12/F & 25/F Citicorp Centre 18 Whitfield Road Causeway Bay Hong Kong

Legal Advisers (in relation to CSI RMB Money Market Fund and CSI RMB China A-Shares Diversification Fund)

DEACONS

5/F, Alexandra House,

18 Chater Road,

Central,

Hong Kong

(in relation to all other sub-funds)

CLIFFORD CHANCE 27th Floor, Jardine House 1 Connaught Place, Central Hong Kong

Auditors ERNST & YOUNG 22/F CITIC Tower,

1 Tim Mei Avenue Central,

Hong Kong

- 4 -

2. DEFINITIONS

For the purposes of the Prospectus, unless the context otherwise requires (or a Fund Specific Prospectus otherwise defines) the following expressions have the following meanings:

"Business Day" any day other than Saturday or Sunday, on which banks are open for normal banking business in the location(s) applicable to a Fund as specified in the relevant Fund Specific Prospectus;

"CBRC" means the China Banking Regulatory Commission of the PRC;

"CSRC" means the China Securities Regulatory Commission of the PRC, the government agency responsible for matters relating to securities regulation;

"Dealing Day" the day on which the Manager is open to accept applications for subscription and redemption of Units as specified in the relevant Fund Specific Prospectus;

"Fund" a sub-fund of the Trust for which a separate Fund Specific Prospectus is issued by the Manager;

"Fund Specific Prospectus" means each document describing the features of a specific Fund including, among other things, the investment objective, the fees and charges and the investment restrictions;

"HK$" or "HK dollar" the lawful currency of Hong Kong;

"Hong Kong" the Hong Kong Special Administrative Region of the PRC;

"Manager" CITIC Securities International Investment Management (HK) Limited, acting through its Hong Kong office, as the manager of the Trust;

"MOF" means the Ministry of Finance of the PRC;

"NAV" or "Net Asset Value" net asset value of the Fund or per Unit of the Fund, as the context require;

"PBoC" means the People's Bank of China;

"PRC" or "China" the People's Republic of China and, except where the context requires and only for the purpose of the Prospectus, references in the Prospectus to China or the PRC do not include Hong Kong, Macau and Taiwan;

- 5 -

"Registrar" BOCI-Prudential Trustee Limited, in its capacity as registrar in respect of the Trust;

"RMB" or "Renminbi" the lawful currency of the PRC;

"SFC" the Securities and Futures Commission of Hong Kong;

"SFO" the Securities and Futures Ordinance, Laws of Hong Kong (Chapter 571);

"Trust Deed" the trust deed dated 25 June 2009 between the Manager and the Trustee establishing the Trust, supplemented by a supplemental trust deed dated 9 April 2010, further supplemented by a second supplemental trust deed dated 4 January 2012, a third supplemental trust deed dated 24 April 2014 and a fourth supplemental trust deed dated 19 December 2014, and as amended or supplemented from time to time;

"Trust" CSI Alpha Fund Series;

"Trustee" BOCI-Prudential Trustee Limited, in its capacity as the trustee of the Trust;

"Unit" a unit of the Fund;

"Unitholder" a registered holder for the time being of a Unit in the Fund;

"US$", “USD” or "US dollar" the lawful currency of the United States of America; and

"Valuation Point" the time at which the Net Asset Value of the Fund and Net Asset Value per Unit are calculated as specified for each Fund in the relevant Fund Specific Prospectus.

- 6 -

3. INTRODUCTION

The Trust is an open-ended umbrella unit trust established under Hong Kong law by a trust deed dated 25 June 2009 between the Manager and the Trustee, supplemented by a supplemental trust deed dated 9 April 2010, further supplemented by a second supplemental trust deed dated 4 January 2012, a third supplemental trust deed dated 24 April 2014 and a fourth supplemental trust deed dated 19 December 2014. In the case of inconsistency between the provisions of the Fund Specific Prospectus and this Trust Prospectus, the provisions of the Fund Specific Prospectus shall prevail.

4. INVESTMENT OBJECTIVE AND POLICY

The Trust offers CSI China-Hong Kong Leaders Fund, CSI RMB Income Fund, CSI RMB Short Maturity Bond Fund, CSI RMB Money Market Fund and CSI RMB China A-Shares Diversification Fund and is anticipated to offer a range of Funds, each with different investment objectives and policies as specified in the relevant Fund Specific Prospectus.

Any required changes to this Trust Prospectus and the Fund Specific Prospectus as a result of any changes to the investment policy may be subject to prior approval from the SFC. At least one month's prior notice of such changes (or such longer period as required by the SFC, not exceeding three months) will be given to the Unitholders concerned.

5. INVESTMENT RESTRICTIONS

The investment restrictions applicable to a Fund depend on the investment objectives and policies of the relevant Fund. These investment restrictions are contained in the Trust Deed and, subject to any exemptions or additional restrictions applicable to a particular Fund as described in the relevant Fund Specific Prospectus, are summarised below, which are applicable to the investments in relation to each Fund individually unless otherwise specified:

For Funds which are direct investment funds

(a) not more than 10% of the latest available total Net Asset Value of a Fund may consist of securities (other than government and other public securities) issued by a single issuer. "Government and other public securities" shall mean any investment issued by, or the payment of principal and interest on, which is guaranteed by the government of any member state of the Organisation for Economic Co-operation and Development ("OECD") or any fixed interest investment issued in any OECD country by a public or local authority or nationalised industry of any OECD country or anywhere in the world by any other body which is, in the opinion of the Trustee, of similar standing;

(b) the total collective investment of the Funds of the Trust (if any) may not hold more than 10% of any ordinary shares issued by any single issuer;

(c) not more than 15% of the latest available total Net Asset Value of a Fund may consist of securities neither listed, quoted nor dealt in on any stock exchange, over-the-counter market or other organized securities market that is open to the international public and on which the securities are regularly traded;

(d) not more than 10% of the latest available total Net Asset Value of a Fund may consist of units or shares in other collective investment schemes. No investment may be

- 7 -

made in a collective investment scheme whose investment objective is to invest primarily in investments prohibited by the SFC and in the case of an investment in a collective investment scheme whose investment objective is to invest primarily in any investment restricted by the SFC, such holdings may not be in contravention of the relevant limitation;

(e) the net aggregate value of contract prices of futures contracts entered into by a Fund, whether payable to or by the Fund (other than futures contracts entered into for hedging purposes) together with the aggregate value of holdings of physical commodities (including gold, silver, platinum or other bullion) and commodity based investments (other than securities issued by companies engaged in producing, processing or trading in commodities), may not exceed 20% of the latest available total Net Asset Value of the Fund;

(f) the value of warrants and options (other than warrants and options held for hedging purposes) in terms of the total amount of premium paid may not exceed 15% of the latest available total Net Asset Value of the relevant Fund; and

(g) up to 30% of the latest available total Net Asset Value of the relevant Fund may be invested in government and other public securities (as defined in (a) above) of the same issue, save that the relevant Fund may invest all of its assets in government and other public securities in at least six different issues.

In addition, the Manager may not on behalf of the relevant Fund:

(a) invest in a security of any class in any company or body if any director or officer of the Manager individually owns more than 0.5% of the total nominal amount of all the issued securities of that class, or, collectively the directors and officers of the Manager own more than 5% of those securities;

(b) invest in any type of real estate (including buildings) or interests in real estate (including options or rights but excluding shares in real estate companies and interests in real estate investment trusts that are listed on a stock exchange);

(c) make short sales if as a consequence the liability of the relevant Fund to deliver securities would exceed 10% of the latest available total Net Asset Value of the relevant Fund (and for this purpose securities sold short must be actively traded on a market where short selling is permitted);

(d) write uncovered options;

(e) write call options if the aggregate of the exercise prices of all such call options written on behalf of the relevant Fund would exceed 25% of the latest available total Net Asset Value of the relevant Fund;

(f) lend, assume, guarantee, endorse or otherwise become directly or contingently liable for or in connection with any obligation or indebtedness of any person without the prior written consent of the Trustee;

(g) enter into any obligation on behalf of the relevant Fund or acquire any asset for the account of the relevant Fund which involves the assumption of any liability by the

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Fund which is unlimited or any liability which exceeds the latest available total Net Asset Value of the relevant Fund; or

(h) invest in any security where a call is to be made for any sum unpaid on that security unless such call could be met in full out of cash or near cash held by the relevant Fund which has not been set aside for any other purposes.

If any of the investment and borrowing restrictions applicable to a Fund are breached, the Manager will as a matter of priority take all steps necessary within a reasonable period of time to remedy the situation, having due regard to the interest of Unitholders.

The Manager is not immediately required to sell applicable investments if any of the investment restrictions are exceeded as a result of changes in the value of a Fund's investments, reconstructions or amalgamations, payments out of the assets of a Fund or redemptions of Units. However, for so long as those limits are exceeded, the Manager will not acquire any further investments subject to the relevant restriction and will as a matter of priority take all steps necessary within a reasonable period of time to remedy the situation, having due regard to the interest of Unitholders.

The Manager may not obtain a rebate on any fees or charges levied by a collective investment scheme (or its management company) in which a Fund invested in. Where a Fund invests in units, shares or other interests in collective investment schemes managed by the Manager or its connected persons, all initial charges on such collective investment schemes must be waived.

6. BORROWING RESTRICTIONS

The purposes for which borrowings may be made and the restrictions on the level of borrowings which may be made for each Fund are set out in the relevant Fund Specific Prospectus. The assets of a Fund may be charged or pledged as security for any borrowings for the accounts of that Fund provided the assets so charged or pledged do not, at any time, exceed the level of the Fund's borrowings or indebtedness.

7. RISK FACTORS

7.1 Principal Risk Factors

Investors can lose money by investing in Units. Applicants should carefully consider the

risk factors described below together with all of the other information included in this

Trust Prospectus and refer to the relevant Fund Specific Prospectus of any particular

Fund for any additional risk factors before deciding whether to invest in Units.

The Net Asset Value per Unit may fall or rise. There can be no assurance that an investor

will achieve a return on his investment in the Units or a return on capital invested.

Each Fund is subject to the principal risks described below. Some or all of these risks may adversely affect a Fund's Net Asset Value, Unit price, yield, total return and/or its ability to meet its objective.

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7.2 Market Risk

The profitability of the investments of the Fund could be adversely affected by a worsening of general economic conditions globally or in certain individual markets. Factors such as interest rates, inflation, investor sentiment, the availability and cost of credit, the liquidity of the global financial markets and the level and volatility of securities prices could significantly affect the activity level of customers. For example: (a) an economic downturn or significantly higher interest rates could adversely affect the credit quality of the on-balance sheet and off-balance sheet assets; (b) a market downturn or worsening of the economy could cause the Trust and/or a Fund to incur mark to market losses in its trading portfolios.

7.3 Effect of Governmental Policy and Regulation

The investments of the Fund can be affected by the fiscal or other policies and other actions of various governmental and regulatory authorities. Areas where changes could have an impact include:

(a) the monetary, interest rate and other policies of central banks and regulatory authorities;

(b) general changes in government or regulatory policy that may significantly influence investor decisions in particular markets in which the Fund operates;

(c) general changes in the regulatory requirements, for example, prudential rules relating to the capital adequacy framework and rules designed to promote financial stability and increase depositor protection;

(d) changes in competition and pricing environments;

(e) further developments in the financial reporting environment; and

(f) expropriation, nationalisation, confiscation of assets and changes in legislation relating to foreign ownership.

7.4 Exchange Rates

The base currency of a Fund is not necessarily its investment currency. Investments are made in those currencies that, in the opinion of the Manager, best benefit the performance of the relevant Fund. Changes in foreign currency exchange rates will affect the value of Units held in a Fund. Unitholders investing in any Funds other than in HK dollars should be aware that exchange rate fluctuations could cause the value of their investment to diminish or increase.

7.5 Interest Rates

Impact of changes in macro-economic policies (i.e. monetary policy, fiscal policy) will have an influence over capital markets affecting the pricing of fixed income securities. The value of fixed income securities held by any Fund generally will vary inversely with changes in interest rates and such variation may affect Unit prices accordingly.

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7.6 Credit Rating Downgrading Risk

An issuer of fixed income securities may experience an adverse change in its financial condition which may in turn result in a decrease in the credit rating assigned by an internationally recognized statistical ratings organization to such issuer and fixed income securities issued by such issuer. Credit rating of fixed income securities reflects the issuer's ability to make timely payments of interest or principal - the lower the rating, the higher the risk of default. The adverse change in financial condition or decrease in credit rating of issuer may result in increased volatility in, and adverse impact on, the price of the relevant fixed income securities and negatively affect liquidity, making any such fixed-income security more difficult to sell.

7.7 Valuation Risk

Fixed income securities (including corporate bonds and commercial paper) are subject to the risk of mispricing or improper valuation, i.e. operational risk that the fixed income securities are not priced properly. Valuations are primarily based on the valuations from independent third party sources where the prices are available, accordingly valuations may sometimes involve uncertainty and judgemental determination and independent pricing information may not be available at all times. In the event of adverse market conditions where it is not possible to obtain any reference quotation from the market, the latest available quotations of the bond or commercial paper or the quotation of other bonds or commercial paper with very similar attributes may be used to estimate the fair market value. Such valuation methodology may not be equal to the actual liquidation price due to liquidity and size constraints. If valuation is proven to be incorrect, this will affect the Net Asset Value calculation of the Fund.

7.8 Investment in Equity Securities

The value of a Fund will be affected by changes in the stock markets and changes in the value of individual securities. At times, stock markets and individual securities can be volatile and prices can change substantially in short periods of time. The equity securities of small companies are more sensitive to these changes than those of larger companies. This risk will affect the value of a Fund, which will fluctuate as the value of the underlying equity securities fluctuates.

Moreover, the investment performance of equity securities depends upon a number of factors which are difficult to predict. Such factors include but are not limited to adverse economic and market conditions, changes in the general outlook for corporate earnings or risks associated with individual companies, which may adversely affect the Net Asset Value of a Fund.

7.9 Counterparty and Settlement Risk

A Fund will be exposed to counterparty risk on parties with whom they trade and when placing cash on deposit. A Fund will also be exposed to the risk of settlement default by a counterparty with which a Fund trades when buying and selling financial instruments (settlement risk). The risk of default of a counterparty is directly linked to the credit worthiness of the counterparty.

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7.10 Currency Risk

Assets of certain Funds may be denominated in currencies other than the Fund currency and the currency of some assets may not be freely convertible. Such kind of Funds may be adversely affected by changes in foreign exchange rates between the currencies in which the assets of the relevant Fund are held and the Fund currency in which the relevant Fund is denominated.

Further, in order to protect its present and further assets and liabilities against the fluctuation of currencies, a Fund may enter into transactions the object of which is the purchase or the sale of forward foreign exchange contracts, the purchase or the sale of call options or put options in respect of currencies, the purchase or the sale of currency forwards or the exchange of currencies on a mutual agreement basis provided that these transactions be made on a regulated market that operates regularly and is recognized and is open to the public. These non-hedging transactions constitute a higher risk than investments in transferable securities due to their greater volatility and less liquidity. These non-hedging transactions are used in a manner that does not interfere with the investment objectives and policies of a Fund.

7.11 Transactions in Options, Futures, Warrants, Forwards or Swaps

For the purposes of hedging, a Fund may seek to protect the returns from its underlying assets by using options, futures, warrants, forwards or swaps (including stock exchange futures). These transactions may be entered into with counterparties on an on- and off- exchange basis (over-the-counter) and may expose the Fund to counterparty risk mentioned above. The ability to use these techniques and instruments may be limited by market conditions and regulatory limits and there can be no assurance that the objective sought to be attained from the use of these techniques and instruments will be achieved. Participation in such techniques and instruments involves a high degree of risk due to the potential leverage effect. A relatively small market movement will have a proportionately larger impact which may work for or against the Fund. Also, there are transaction costs to which a Fund would not be subject if it did not use these techniques and instruments. There may be an imperfect correlation between instruments and the underlying investments or market sectors being hedged. Investments in instruments that are traded over the counter markets may involve additional liquidity risk as there is no existing market on which to close out open transactions. Therefore, such instruments may be difficult to value in the absence of a liquid market. There is the risk of default of the counterparty on the terms of these instruments and the risk of mispricing or improper valuation of these instruments. In addition, if the Manager's predictions of movements in the direction of the relevant securities, foreign currency and interest rate markets are inaccurate, the adverse consequences to a Fund may leave the Fund in a much worse position than if such techniques and instruments were not used.

7.12 Emerging and Developing Markets

Investors should note that Funds which invest in securities of issuers located in emerging and less developed markets could involve special considerations and risks. The special risks are those such as currency fluctuations, political risks, the risks of investing in countries with smaller capital markets, price volatility and restrictions on foreign investment. Companies of the relevant markets may have standards of financial reporting, accounting and information disclosure which are not comparable to those of developed markets. Information and accounts may thus not be publicly available nor be in accordance with international standards.

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Procedures currently in place for custody, settlement, clearing and registration of securities transactions in emerging markets may be less developed than those in place in other more developed markets and thus can increase settlement risk or result in delay in realising securities and adversely affect prices. The issuers and stock exchanges and other market participants may be subject to a level of regulation which may be less than that of developed markets. Less efficient banking and telecommunications systems can give rise to delayed payments and in extreme cases could lead to dispute over the title of securities. Investments may be affected by changes in law and government policy and requirements imposed by stock exchanges such as price constraint and market suspension as well as political changes which may affect the stability of governments and markets and/or result in restrictions on foreign investment or the repatriation of monies.

7.13 Operational Risk

The Fund's operations are carried out by the service providers described herein. In the event of a bankruptcy or insolvency of a service provider, investors could experience delays (for example, delays in the processing of subscriptions, conversions and redemption of Units) or other disruptions.

7.14 Concentration Risk/Single Country Investment Risk

A Fund that invests in a single region or country may likely be more volatile and subject to higher concentration risk than a broad-based fund, such as a global equity fund, as it is more susceptible to fluctuations in value resulting from adverse conditions in the region or country in which it invests.

7.15 Risk factors in relation to a Fund which invests in securities of issuers located in or associated with the PRC

A Fund may be subject to the economic, political and social development and risks in the PRC. In recent years the Chinese government has implemented economic reform measures which emphasise decentralisation and the utilisation of market forces in the development of the Chinese economy. Although many of such reforms have resulted in significant economic growth and social progress, some of them are unprecedented or experimental and are subject to adjustment and modification. Other political, economic and social factors existing in mainland China can also lead to further adjustment to the reform measures. It is uncertain whether or not such reforms will be positive to the stock markets as well as the performance of a Fund.

The Chinese markets are still in the early stages of their development, have less volume, are less liquid and experience greater volatility than more developed markets and are not highly regulated. The decrease in market liquidity for the securities in which the Fund invests may impair its ability to execute transactions. In such circumstances, some of such Fund's securities may become illiquid which would impact its ability to acquire or dispose of such securities at their intrinsic value. The securities markets in the PRC are emerging markets that are undergoing rapid growth and changes. This may lead to trading volatilities, difficulties in settlement and recording of transactions and in interpreting and applying the relevant regulations. In addition, there is a low level of regulation and enforcement activity in these securities markets. Settlement of transactions may be subject to delay and administrative uncertainties. Further, regulations continue to develop and may change without notice which may further delay redemptions or restrict liquidity. There may not be

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regulation and monitoring of the Chinese securities markets and activities of investors, brokers and other participants equivalent to that in certain more developed markets.

Companies in mainland China are required to follow the Chinese accounting standards and practice which, to a certain extent, follow international accounting standards. The financial statements prepared by accountants following the Chinese accounting standards and practice may differ from (or less stringent than) those prepared in accordance with international accounting standards.

The Shanghai Stock Exchange and Shenzhen Stock Exchange may have lower trading volumes than most OECD exchanges and the market capitalisations of listed companies are small compared to those on more developed exchanges in developed markets. The listed equity securities of many companies in the PRC are accordingly materially less liquid, subject to greater dealing spreads and experience materially greater volatility than those of OECD countries. The PRC government has been developing a comprehensive system of commercial laws and considerable progress has been made in the promulgation of laws and regulations dealing with economic matters such as corporate organization and governance, foreign investment, commerce, taxation and trade. Because these laws, regulations and legal requirements are relatively recent, their interpretation and enforcement involve uncertainties. In addition, the PRC laws for investor protection are still in developing stage and may be less sophisticated than those in developed countries.

7.16 Credit Market Exposures

Future earnings of or return derived from an investment of the Fund could be affected by depressed asset valuations resulting from a deterioration in market conditions. Financial markets are sometimes subject to stress conditions where steep falls in asset values can occur, as demonstrated by recent events affecting asset-backed collateralized debt obligations and the US sub-prime residential mortgage market. Severe market events are difficult to predict. As market conditions change, the fair value of any credit market exposures could fall further and result in additional losses or impairment charges, which could have a material adverse effect on the earnings or return of a Fund's investment. Such losses or impairment charges could derive from: a decline in the value of exposures; a decline in the ability of counterparties, including monoline insurers, to meet their obligations as they fall due; or the ineffectiveness of hedging and other risk management strategies in circumstances of severe stress. Any value ultimately realised by the Fund on sale of an asset will depend on the prices achievable in the market following the decision to sell which may be higher or lower than the asset's current estimated value. If there is a shortfall between the proceeds obtained on disposal and the carrying value of the asset on the balance sheet there would be an adverse effect on the earnings or return of the Fund.

7.17 Borrowing Risk

Market conditions have substantially reduced the availability of credit, which may have a material adverse effect on the Trust or the Fund's ability to achieve its investment objective with respect to any particular investment and/or the Fund's entire portfolio, which could have a material adverse effect on the Trust or the Fund's overall return objectives.

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7.18 Risk of Termination

The Trust and/or Funds may be terminated in certain circumstances which are summarised under the section "Termination of the Trust and/or Funds". In the event of the termination of a Fund, such Fund would have to distribute to the Unitholders their pro rata interest in the assets of the Fund. It is possible that at the time of such sale or distribution, certain investments held by the relevant Fund will be worth less than the initial cost of acquiring such investments, resulting in a loss to the Unitholders. Moreover, any organisational expenses (such as establishment costs) with regard to the Trust or the relevant Fund that had not yet been fully amortised would be debited against the Fund's assets at that time.

7.19 Restricted Markets Risk

A Fund may invest in securities in jurisdictions (such as the PRC) which impose limitations or restrictions on foreign ownership or holdings. In such circumstances, the Fund may be required to make investments in the relevant markets directly or indirectly. In either case, legal and regulatory restrictions or limitations may have adverse effect on the liquidity and performance of such investments due to factors such as limitations on fund repatriation, dealing restrictions, adverse tax treatments, higher commission costs, regulatory reporting requirements and reliance on services of local custodians and service providers.

7.20 The Renminbi Currency Risk

Starting from 2005, the exchange rate of the Renminbi is no longer pegged to the US dollar. The Renminbi has now moved to a managed floating exchange rate based on market supply and demand with reference to a basket of foreign currencies. The daily trading price of the Renminbi against other major currencies in the inter-bank foreign exchange market would be allowed to float within a narrow band around the central parity published by the People's Bank of China. As the exchange rates are based primarily on market forces, the exchange rates for Renminbi against other currencies, including US dollars and Hong Kong dollars, are susceptible to movements based on external factors. It should be noted that the Renminbi is currently not a freely convertible currency as it is subject to foreign exchange control policies of the Chinese government. The possibility that the appreciation of Renminbi will be accelerated cannot be excluded. On the other hand, there can be no assurance that the Renminbi will not be subject to devaluation. Any devaluation of the Renminbi could adversely affect the value of investors' investments in the relevant Fund. Investors whose base currency is not the Renminbi may be adversely affected by changes in the exchange rates of the Renminbi. Further, the PRC government's imposition of restrictions on the repatriation of Renminbi out of China may limit the depth of the Renminbi market in Hong Kong and reduce the liquidity of the relevant Fund. The Chinese government's policies on exchange control and repatriation restrictions are subject to change, and the Fund's or the investors' position may be adversely affected.

7.21 Hedging risk

A Fund may engage in derivative transactions as part of its strategy for hedging purposes. Hedging strategies may also be performed in relation to specific Unit classes. These strategies include the use of financial derivative instruments for hedging against fluctuations in the relative values of the Fund's portfolio positions as a result of changes in exchange rates, interest rates, prices of underlying funds and levels of other interest rates and prices of other securities. These instruments are volatile and may be subject to various types of risk,

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including but not limited to market risk, liquidity risk, credit risk, counterparty risk, legal risk and operations risk.

There can be no guarantee that there will be a correlation between price movements in the instrument used and the underlying investments of the Fund that are being hedged through the use of the instrument. Moreover, there may be an imperfect correlation between derivative instruments used as hedging tools and the investments to be hedged, causing the use of a particular technique not to achieve its intended objectives. The degree of imperfection of correlation depends upon circumstances such as variations in speculative market demand, and differences between financial instruments being hedged and instruments underlying the standard contracts available for trading in such respects as interest rate levels, maturities and creditworthiness of issuers. An imperfect hedge may result in a loss of capital to the Fund. A decision as to whether, when and how to hedge involves exercise of skill and judgement, and even a well conceived hedge may be unsuccessful to some degree because of market behaviour or unexpected interest rate trends.

In addition, the use of derivatives can involve significant economic leverage and may, in some cases, involve significant risks of loss. The low initial margin deposits normally required to establish a position in such instruments permits leverage. As a result, a relatively small movement in the price of the underlying contract may result in a profit or a loss that is high in proportion to the amount of assets actually placed as initial margin.

Also, the ability to use these strategies may be limited by market conditions and regulatory limits and there can be no guarantee that any of these strategies will meet their expected target.

7.22 Risks of investing in other funds

The Fund may invest in other funds. In addition to the fees and charges charged by the Fund, investors should note that there are fees involved when investing in these underlying funds. Investment decisions of these underlying funds will be made independently of the Fund Manager. There is no assurance that the investment objective and strategy of these underlying funds will be achieved despite the selection and monitoring process undertaken by the Manager. If the Fund invest in other funds managed by the Manager or its connected persons, all initial charges on the underlying fund must be waived, and the Manager must not obtain rebate of any fees or charges levied by the underlying fund. If any conflict of interest may still arise out of such investments, the Manager will use its best endeavours to resolve it fairly.

8. MANAGEMENT AND ADMINISTRATION

8.1 Manager

CITIC Securities International Investment Management (HK) Limited is the Manager of the Trust. It was incorporated in Hong Kong on 1 March 2007 and has its principal office in Hong Kong. The Manager is wholly owned by CITIC Securities International Fund Management Limited. The Manager is licensed with the SFC to carry on Type 1 (dealing in securities), Type 4 (advising on securities) and Type 9 (asset management) regulated activity under the SFO. The Manager was appointed the manager of the Trust pursuant to the Trust Deed.

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The appointment of the Manager may be terminated in the circumstances set out in the Trust Deed.

The directors of the Manager are:

YIN Ke

Mr. Yin Ke (殷可) was appointed as a director of the Manager in May 2007. Mr. Yin is

currently the chief executive officer, executive director and vice chairman of CITIC Securities International Company Limited, a wholly-owned subsidiary of CITIC Securities Company Limited ("CITIC Securities"), a leading investment bank based in China and listed on the Shanghai Stock Exchange (600030.SS).

Mr. Yin is also the Vice Chairman, executive director and a member of the executive committee of CITIC Securities. He also serves as a non-executive director of CITIC Pacific Limited, a company listed on the Main Board of the Stock Exchange (267.HK), and Hui Xian Asset Management Limited. Mr. Yin previously worked as the assistant to the chief executive officer of the Shenzhen Stock Exchange from 1991 to 1992, responsible for assisting the chief executive officer for the development and day-to-day operation of the Shenzhen Stock Exchange; deputy general manager and executive director of Jun'an Securities Co., Ltd. from 1992 to 1998, executive director and responsible person of Jun'an Securities Co., Ltd. from 1998 to 1999, responsible for the investment banking, brokerage and overseas businesses and the overall management of the company; deputy chairman of the merger committee of Guotai Jun'an Securities Co., Ltd. from 1998 to 1999, responsible for coordinating the merger between Jun'an Securities Co., Ltd. and Guotai Securities Co., Ltd.; director of Guotai Jun'an Securities Co., Ltd. from 1999 to 2000, responsible for the strategic development of the company; president and executive director of China United Securities Co., Ltd. from 2000 to 2002, responsible for the overall management and business of the company; director and deputy general manager of CITIC Capital Holdings Limited from 2002 to 2007, responsible for the investment banking and private equity investment businesses of the company; non-executive director of CITIC Capital Holdings Limited from 2007 to 2009; director of ACT 360 Solutions Limited from 2000 to 2009, responsible for the business strategy of the company; independent director of CCB Principal Asset Management Co., Ltd. from 2005 to 2009; and director of Zhongxing Shenyang Commercial Building Group Co., Ltd. from 2006 to 2010; non-executive director of CITIC Dameng Holdings Limited from 2010 to 2011; and non-executive director of Dah Chong Hong Holdings Limited from 2010 to 2012. He obtained a master’s degree in economics in 1991 from Zhejiang University.

Mr. Yin is currently a responsible officer of (i) CITIC Securities Brokerage (HK) Limited, a licensed corporation under the SFO to engage in Type 1 (dealing in securities) and Type 4 (advising on securities) regulated activities; (ii) CITIC Securities Corporate Finance (HK) Limited, a licensed corporation under the SFO to engage in Type 1 (dealing in securities), Type 4 (advising on securities) and Type 6 (advising on corporate finance) regulated activities; and (iii) CITIC Securities Futures (HK) Limited, a licensed corporation under the SFO to engage in Type 2 (dealing in futures contracts) regulated activity.

POON Chi Leong Harry

Mr. POON Chi Leong Harry (潘志良), was appointed as a director of the Manager in

February 2008.

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Mr. Poon received a degree of master of business administration from the University of Hong Kong in 2006. He is registered as a Certified Public Accountant (Practising) in the Hong Kong Institute of Certified Public Accountants.

From October 2004 to May 2006, Mr. Poon was employed as director, brokerage finance & operation in the brokerage-finance department of CITIC Capital Market Holdings Limited and was responsible for overseeing the operations, settlement, finance, accounting and regulatory reporting in areas of brokerage finance and operations. In May 2006, Mr. Poon's employment with CITIC Capital Market Holdings Limited was transferred to CITIC Securities International Company Limited as a result of group restructuring. He currently serves as the Executive Director, Chief Financial Officer of CITIC Securities International Company Limited and is responsible for the financial control function.

HAN Jianchiu

Mr. HAN Jianchiu (韓劍秋) joined CITIC Securities International Company Limited as

Managing Director, Head of Capital Management since October 2011. He attained Bachelor Degree from University of Science and Technology (PRC), Master from University of Alberta (Canada) and PhD in Engineering from Massachusetts Institute of Technology (USA). He has gained over 15 years of experience in the investment management and trading areas. Having served at Chase Manhattan Bank (now JP Morgan Chase) (USA), AIG Financial Products (USA & HK), Canadian Imperial Bank of Commerce (Singapore), Simplex Capital Asia Ltd (USA), BOC International (HK), his last position held was Managing Director, Head of Fixed Income Department at China International Capital Corporation (HK).

LEUNG Kwok Ming

Mr. LEUNG Kwok Ming (梁國明) was appointed as a director of the Manager in October

2014. He is Chief Operating Officer at CITIC Securities International Company Limited. In his role, he has management oversight of strategic and growing developments of all middle and back office functions. Mr. Leung has over 20 years of experience with asset management in the areas of risk management, investment analytics, operations and information technology. He was the Regional Head - Asia of Investment Risk and Analytical Services at Northern Trust. Prior to that, He was an Associate Director, Investment Performance Analytics with AIG Investment Corporation (Asia) Ltd. He also had several years’ experience with HSBC Asset Management, Bank of Bermuda and Wardley Investment Services (HK) Ltd.

Mr. Leung is now sitting the Global Investment Performance Standards (GIPS) Committee of The Hong Kong Society of Financial Analyst. He was an advisor and question writer to CFA Institute serving on the CIPM Examination Review Panel. He has spoken at several conferences on Investment Risk and Performance in the region. A graduate from Simon Fraser University in Canada, Mr. Leung is a Chartered Financial Analyst and he is also a CIPM certificant.

WENG Yong

Dr. Weng Yong (翁湧) was appointed as a director of the Manager in February 2015. He

joined CITIC Securities in 2011. He is now a managing director and the Head of Alternative Investments of CITIC Securities International Company Limited. Prior to that, Dr. Weng was

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a managing director and the head of quantitative equities in UBS Global Asset Management, and prior to that, a director and the head of quantitative equities in Credit Suisse Asset Management. Dr. Weng started his career in the field of investment management in Bank of America Capital Management as a research analyst and portfolio manager in 2001. Dr. Weng obtained his PhD degree in Economics from Boston University and Master’s and Bachelor’s degrees in Engineering from Tsinghua University in Beijing.

8.2 Trustee and Registrar

BOCI-Prudential Trustee Limited, a company incorporated with limited liability in Hong Kong, has been appointed as trustee and registrar to the Trust.

Under the Trust Deed, the Trustee is responsible for the safe-keeping of the assets and administration of the Trust.

BOCI-Prudential Trustee Limited is incorporated with limited liability in Hong Kong on 19 October 1999 and is registered as a trust company under Section 77 of Trustee Ordinance and is an Approved Trustee under the Mandatory Provident Fund Schemes Ordinance. Being registered as the Approved Trustee, it is subject to statutory regulation of the Mandatory Provident Fund Schemes Authority.

The Trustee is a joint venture founded by BOC Group Trustee Company Limited and Prudential Corporation Holdings Limited ("PCHL"). BOC Group Trustee Company Limited is owned by BOC International Holdings Limited and Bank of China (Hong Kong) Limited, which are subsidiaries of Bank of China Limited. The business activities of Bank of China Limited are principally corporate banking, retail banking, investment banking, insurance and other financial services. PCHL is wholly owned by Prudential plc which provides a broad range of financial and insurance services as well as engages in fund management business.

The Trustee and Registrar will not participate in transactions and activities, or make any payments denominated in US dollars, which, if carried out by a US person, would be subject to sanctions by The Office of Foreign Assets Control ("OFAC") of the US Department of the Treasury. The Trustee has adopted a policy of compliance with the sanctions issued by OFAC.

BOCI-Prudential Trustee Limited is not involved directly or indirectly with the business affairs, organisation, sponsorship or management of the Trust. In addition, BOCI-Prudential Trustee Limited is not responsible for the preparation of this Trust Prospectus and the Fund Specific Prospectus and therefore accept no responsibility for any information contained in this Trust Prospectus and the Fund Specific Prospectus.

9. ISSUE OF UNITS

9.1 Form of Units

Units will be in registered form. Unit certificates will not be issued. A contract note will be issued upon issue of Units as a result of an investor's application and will be forwarded by ordinary post (at the risk of the investor) to the investor's address of record.

Fractions of not less than one-thousandth of a Unit will be issued. Application moneys representing smaller fractions of a Unit (i.e. less than one thousandth of a Unit) will be retained by the relevant Fund.

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Upon issue, and subject to the provisions of this Trust Prospectus, the Fund Specific Prospectus and the Trust Deed, Units of a Fund are entitled to participate equally in the profits of the relevant Fund.

Units do not carry any preferential or pre-emptive rights. At any meeting of Unitholders, every Unitholder who (being an individual) is present in person or (being a partnership or corporation) is present by an authorized representative or by proxy shall have one vote in respect of each whole Unit it holds. Unitholders are not entitled to any vote in respect of fractions of Units but are entitled to participate in the liquidation proceeds.

Upon the death of a Unitholder, the Registrar reserves the right to require the provision of appropriate legal documentation in order to verify the rights of all and any successors in title to Units.

10. SUBSCRIPTION FOR UNITS

10.1 Issue Price

Units of a Fund will initially be offered to applicants on the terms described in the relevant Fund Specific Prospectus. Units of a Fund will be distributed by distributors authorized by the Manager.

Thereafter, each Unit will be available for issue on each Dealing Day at the Net Asset Value per Unit (for further details, see "Calculation of Net Asset Value" in section 14 below of this Trust Prospectus) calculated as at the Valuation Point subject to a subscription charge as set out in the relevant Fund Specific Prospectus and any fiscal and purchase charges.

Fiscal and purchase charges may be imposed by the Manager in its discretion to compensate the Fund for any dilution in a Fund's Net Asset Value as a result of a large volume of applications from investors, or a large application request by an investor, on any Dealing Day. The Manager will only charge fiscal and purchase charges if, in its opinion, the existing Unitholders might otherwise be materially adversely affected. In such circumstances, the fiscal and purchase charges applicable shall be no more than 2% of the Issue Price of each Unit issued, taking into account the level of fees and expenses paid or payable by the Fund (such as brokerage fees, tax payable, government charges, transaction costs, bid/offer spread and clearing charges) in connection with the large volume of applications from investors, or a large application request by an investor. A Fund shall be entitled to retain the benefit of any rounding adjustment arising on calculation of subscription.

10.2 Minimum subscription and minimum holding

Applicants should refer to the Fund Specific Prospectus for the minimum subscription amount that must be subscribed for the Units and the minimum holding of Units of the relevant Fund.

The Manager may, at its absolute discretion, waive or modify these minimum limits.

10.3 Application procedure

When an investor submits the application form via his/her authorized distributor, that investor should confirm the relevant cut-off time with the authorized distributor. This cut-off time

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will be earlier than the application deadline of the Trustee as specified in the relevant Fund Specific Prospectus.

Application for Units is made by completing an application form available from the Manager and returning it to the Trustee (via the Manager or authorized distributor) in the manner described on the application form. The signed originals of any application form sent by facsimile or other electronic means must be mailed or sent to the Trustee (from the Manager or authorized distributor) by hand, together with the supporting documentation described on the application form, except where the requirement for the original is waived by the Manager and the Trustee.

Where subscription of Units is through an authorized distributor, Units may be registered in the name of a nominee company of the authorized distributor through whom the applicant subscribes for Units. As a result of this arrangement, the applicant will be dependent on the person in whose name applicant's Units are registered to take action on his/her behalf.

Any applications for subscriptions of Units during the initial offer must be received by the Trustee (via the Manager or authorized distributor) by the application deadline as specified in the relevant Fund Specific Prospectus.

Thereafter, applications for Units in the Fund received by the Trustee (from the Manager or authorized distributor) before the application deadline on any Dealing Day will usually be effected at the Net Asset Value per Unit of the relevant Fund (for further details, see "Calculation of Net Asset Value" in section 14 below of this Trust Prospectus) calculated as at the relevant Valuation Point plus the subscription charge and each amount, if any, per Unit as the Manager may determine represents fiscal and purchase charges. A correctly completed application for Units received by the Trustee (from the Manager or authorized distributor) after the application deadline on any Dealing Day, or on any day that is not a Dealing Day, will usually be processed on the next Dealing Day.

Notwithstanding the immediately preceding paragraph, the Manager may, at its absolute discretion, and upon consultation with the Trustee, accept applications for Units after the application deadline on any Dealing Day. Such applications for Units may be processed on the same Dealing Day if the Manager agrees in consultation with the Trustee.

Investors should confirm the relevant cut-off time with their authorised distributor if they choose to submit the application form through such a distributor. Application moneys are invested net of any bank charges.

The Manager and the Trustee shall not be responsible or liable to any applicant, Unitholder or any relevant parties for any loss resulting from the non-receipt of any application form or applications received after the application deadline on any Dealing Day, by whichever method it is sent (including non-receipt of application forms by facsimile or other electronic means).

The Manager, and the Trustee in consultation with the Manager, reserves the right to reject, in whole or in part, any application without giving any reason. In the event that an application is rejected, application monies will be returned without interest by cheque through the post at the risk of the person(s) entitled to payment. In addition, the Manager may, at any time and from time to time and in its absolute discretion, without liability and without notice, discontinue the subscription of Units.

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No later than the end of the second following Business Day after being registered as the holder in respect of any Units applied for, the Registrar shall send written confirmation to the applicant (or the first named in the case of joint applicants) of its or their entry on the register of Unitholders.

The Trust is not registered under the United States Securities Act of 1933, as amended, nor has the Trust been registered under the United States Investment Company Act of 1940, as amended. Units may not be offered or sold, directly or indirectly, (i) in the United States of America or its territories or possessions or areas subject to its jurisdiction; (ii) in an offering would be considered to be an offering targeting residents of the United States pursuant to 12 U.S.C. 1851 and its implementing regulations; or (iii) to or for the benefit of a “US Person” (as defined in Regulation S under the Securities Act of 1933). Accordingly, the Trust may require any subscriber to provide it with any information that it may consider necessary a US Person.

Subject to the matters referred to in this section (and the section entitled "Anti-Money Laundering Regulations" in section 18.11 below of this Trust Prospectus), applications for Units will normally be processed immediately upon receipt by the Trustee, or its agents.

10.4 Payment procedure

Applicants should refer to the Fund Specific Prospectus for the base currency of each Fund and details of the currency in which payments can be made.

For Funds that provide for payments to be made in HK dollars, such payments can be made for Units by telegraphic transfer or by cheque. Payment by HK dollar cheque, or bank draft in other freely convertible currencies, may be accepted at the discretion of the Manager. Payment by cheque is likely to cause delay in receipt of cleared funds and Units generally will not be issued until the cheque is cleared. Any costs of transfer of application moneys to a Fund will be payable by the applicant. For Funds that provide for payments to be made in HK dollars, if the Manager has agreed to accept payment in a currency other than Hong Kong dollars, such payment will be converted into Hong Kong dollars and only the proceeds of such conversion (after deducting expenses relating to such conversion and bank charges) will be applied towards payment of the subscription money. No post-dated cheques will be accepted.

The Trustee will not process applications if subscription moneys are remitted from an account not in the applicant's name or from an account in a country which is not a member of the Financial Action Task Force on Money Laundering ("FATF country") unless the Manager has obtained sufficient evidence to satisfy itself of the provenance and legitimacy of such subscription moneys and instructs the Trustee accordingly. This means that if subscription moneys do not come from an account in the applicant's name in a FATF country, the application is likely to be delayed and the Trustee is likely to require in those circumstances further verification of the applicant's identity and source of funds.

Applications will generally be accepted on a Dealing Day only if application moneys have been received on or prior to such Dealing Day in relation to which Units are to be issued. Notwithstanding the above, a Fund may rely upon application orders received and may issue Units to investors according to such orders and invest the expected application amounts. If payment of funds is not cleared within three (3) Business Days following the relevant Dealing Day (or such other date as the Manager shall determine and notify the relevant

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applicant), the Manager reserves the right to cancel the transaction. In such circumstances, the Manager or the Trustee may charge a cancellation fee to represent administrative costs incurred in processing an application and may require the defaulting applicant to pay compensation for any loss directly or indirectly resulting from the failure by the applicant to make good settlement by the settlement date. Such charge may include, but is not limited to, the difference between the prices at issue and at cancellation of the Units concerned.

If payment is made by telegraphic transfer, in order to avoid possible delays a copy of the remittance instruction should be enclosed with the application and the relevant remitting bank should be instructed to advise the owner of the account into which the funds are being remitted and the full name of the investor on whose behalf the payment is made should be indicated. The Trustee and the Manager reserve the right to delay the acceptance of any such application pending receipt of such information. Third party payment of application monies is not allowed.

Investors should carefully note the payment instructions set out on the application form.

Where payments are made by telegraphic transfer, neither the Trustee nor the Manager shall be responsible for reconciling remittances where problems occur in the transmission, or as a result of inadequate or incorrect details on the transfer instructions. Bank charges in connection with a telegraphic transfer may be deducted from the proceeds of the transfer by the remitting bank, correspondents, agents or sub-agents, and the receiving bank may also deduct bank charges from the remittance. The amount invested will therefore be the net amount of money actually received into the Trust's account, following the deduction of all relevant charges.

No money should be paid to any intermediary in Hong Kong who is not licensed or registered or permitted pursuant to a relevant exemption to carry on Type 1 (dealing in securities) regulated activity under Part V of the SFO.

Where a Fund is denominated in HK dollars and amounts are received in any currency other than HK dollars, they will be converted into HK dollars and the proceeds of conversion (after deducting the costs of conversion and other reasonable costs and expenses) will be applied in the subscription of Units. Conversion of currencies may involve some delay, and will be made at the then prevailing market rate obtained by the Trustee. Any residual cash caused by conversion of currencies will be retained for the benefit of the relevant Fund.

As the RMB is not a freely convertible currency, where a Fund is denominated in RMB, all payments must be made in RMB.

Applicants should refer to the Fund Specific Prospectus for further details.

11. REDEMPTION OF UNITS

11.1 Redemption of Units

A Unitholder may redeem all or some of its Units in whole on any Dealing Day, subject to the minimum redemption amount as set out in the Fund Specific Prospectus or the amount imposed by his/her authorized distributor. Partial redemptions may be made, as long as the minimum holding as set out in the Fund Specific Prospectus remains in the Unitholder's account after the redemption is completed. If, after redemption, a Unitholder would be left

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with a balance of Units having a value of less than the minimum holding, the Manager may decide that this request be treated as a request for redemption for the full balance of the Unitholder's holding of Units. A Unitholder wishing to redeem its Units should complete a redemption form and return it to the Trustee (via the Manager or authorized distributor) in the manner described on the redemption form. The signed originals of any redemption form sent by facsimile or other electronic means must be mailed or sent to the Trustee (via the Manager or authorized distributor) by hand, except where the requirement for the original is waived by the Manager and the Trustee.

11.2 Redemption amount

Units redeemed on a Dealing Day will be redeemed at the redemption price based on the Net Asset Value per Unit applicable to that Dealing Day less the redemption charge and each amount, if any, per Unit as the Manager may determine represents fiscal and purchase charges. Fiscal and purchase charges may be imposed by the Manager in its discretion to compensate the Fund for any dilution in the Fund's Net Asset Value as a result of a large volume of redemptions by Unitholders, or a large redemption request from any Unitholder, on any Dealing Day. The Manager will only charge fiscal and purchase charges if, in its opinion, the continuing Unitholders might otherwise be materially adversely affected. In such circumstances, the fiscal and purchase charges applicable shall be no more than 2% of the redemption amount, taking into account the level of fees and expenses paid or payable by the Fund (such as brokerage fees, tax payable, government charges, transaction costs, bid/offer spread and clearing charges) in connection with the large volume of redemptions from investors, or a large application request by any Unitholder. A Fund shall be entitled to retain the benefit of any rounding adjustments arising from the calculation of redemption prices.

On the Dealing Day on which the redemption is effected, the corresponding Units will be cancelled in the Trust's Unit register. Any taxes, commissions and other fees incurred in the respective countries in which Units are redeemed and, where so specified in the relevant Fund Specific Prospectus, a redemption charge will be charged out of the redemption proceeds payable. The redemption charge will be for the account of the Manager.

11.3 Redemption procedure

When an investor submits the redemption request via his/her authorized distributor, that investor should confirm the relevant cut-off time with the authorized distributor. This cut-off time will be earlier than the redemption deadline of the Trustee as specified in the relevant Fund Specific Prospectus.

A redemption request must be given by completing a redemption form available from the Manager and returning it to the Trustee (via the Manager or authorized distributor) by mail or by hand or other electronic means specifying the number of Units to be redeemed, the name of the registered Unitholder(s) and payment instructions for the redemption proceeds. Failure to provide any of the required information may result in delay of such application for redemption whilst verification is being sought from the Unitholder.

A redemption request given by facsimile or other electronic means may be accepted by prior arrangement with the Manager and on the terms and conditions required by the Manager and the Trustee. Where facsimile or electronic redemption requests are accepted, Unitholders will be required to indemnify the Manager and Trustee against any loss, cost, proceeding, action, claim or other liability of any nature whatsoever arising directly or indirectly as a

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result of reliance upon such instructions. The Manager and Trustee may rely conclusively upon, and shall incur no liability, in respect of any action taken as a consequence of such instructions believed in good faith to be signed by properly authorized persons.

Subject to the provisions under "Suspension of dealing" in section 14.3 below this Trust prospectus, applications for redemption will be considered as binding and irrevocable by the Manager and the Trustee.

Neither the Trustee nor the Manager shall be responsible or liable to a Unitholder or any relevant parties for any loss resulting from non-receipt of any redemption request or a redemption request received after the redemption deadline on any Dealing Day, by whichever method it is sent (including non-receipt of facsimile redemption forms or via electronic means).

Redemption requests for Units in a Fund received by the Trustee (from the Manager or authorized distributor) prior to redemption deadline as specified on the relevant Fund Specific Prospectus on a Dealing Day will be processed using the Net Asset Value per Unit (for further details, see "Calculation of Net Asset Value" in section 14 below of this Trust Prospectus) calculated as at the Valuation Point in respect of that Dealing Day less the redemption charge and each amount, if any, per Unit as the Manager may determine represents fiscal and purchase charges. Redemption requests received by the Trustee (from the Manager or authorized distributor) after the redemption deadline on a Dealing Day, or on a day which is not a Dealing Day, will be processed on the next Dealing Day.

Notwithstanding the immediately preceding paragraph, the Manager, may at its absolute discretion, and upon consultation with the Trustee, accept redemption requests after the redemption deadline on any Dealing Day. Such redemption requests may be processed on the same Dealing Day if the Manager agrees in consultation with the Trustee.

Investors should confirm the relevant cut-off time with the authorised distributors if they choose to submit the redemption request through such a distributor.

11.4 Payment of redemption proceeds

Redemption proceeds will not be paid to any redeeming Unitholder until:

(a) a valid redemption request (including the original written redemption request duly signed by the Unitholder unless the requirement of the original is waived by the Manager and the Trustee) has been received by the Trustee; and

(b) the signature of the Unitholder (or each joint Unitholder) has been verified to the satisfaction of the Trustee.

Third party payment is not allowed.

Where no account details have been provided or in the absence of instructions to the contrary, redemption proceeds will be paid in the base currency of the Fund by cheque. Payment will normally be made within seven Business Days after the Dealing Day on which Units were redeemed or, if later, after the day original redemption documentation is received (except where the requirement for the original is waived by the Manager and the Trustee), and in any event within four weeks of that Dealing Day. Payments made by cheque will be sent at the redeeming Unitholder's risk. Bank charges (if any) incurred in making payment will be borne

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by the redeeming Unitholder and accordingly will be deducted from the redemption proceeds. If a Unitholder requests payment in any freely convertible currency acceptable to the Manager other than HK dollars, the conversion will be made at the then prevailing market rate obtained by the Trustee and any conversion costs will be borne by the Unitholder. Any request to redeem Units may not be executed until any previous transaction involving the Units to be redeemed has been completed and full settlement in respect of such Units completed.

11.5 Restrictions on redemption

The Manager may suspend the redemption of Units or delay the payment of redemption proceeds during any periods in which the determination of the Net Asset Value per Unit is suspended (for further details see "Suspension of dealing" in section 14.3 below of this Trust Prospectus).

With a view to protecting the interests of Unitholders, the Manager is entitled to limit the aggregate number of Units relating to any Fund redeemed on any Dealing Day to 10% of the total value of Units in issue of that Fund. In this event, the limitation will apply pro rata so that all Unitholders wishing to redeem Units on that Dealing Day will redeem the same proportion by value of those Units, and Units not redeemed (but which would otherwise have been redeemed) will be carried forward for redemption, subject to the same limitation, on the next Dealing Day. If requests for redemption are so carried forward, the Trustee will inform the Unitholders concerned.

12. CONVERSION OF UNITS

Unitholders may apply to convert Units of (i) one Fund (the "original fund") for Units of another Fund that has the same base currency (the "new fund"), or (ii) one Unit class for another Unit Class of the same Fund, subject to Units of the new fund/Unit class being in issue and being offered for sale, subject to the creation, issue or sale thereof not being suspended and subject to the right of Unitholders of the original fund/Unit class not being suspended, provided that no such conversion shall be effected if it would result in the Unitholder being a Unitholder of the new fund/Unit class or Units of the original fund/Unit class less in number than the minimum investment limits for a relevant Fund (see "Subscription for Units" in section 10 above of the Trust Prospectus), by giving notice to the Trustee (via the Manager or authorized distributor) before cut-off time of the relevant Fund on any Dealing Day.

The general provisions applying to redemption of Units will apply equally to conversion. The rate at which the original fund/Unit class will be converted on any common Dealing Day (which is both a Dealing Day in relation to Units of the original fund/Unit class and a Dealing Day in relation to Units of the new fund/Unit class) will be determined by reference to the prevailing Unit prices applicable to redemptions and subscriptions for Units of the relevant Funds/Unit class (see "Subscription for Units" and "Redemption of Units" in sections 10 and 11 above of the Trust Prospectus) on that relevant common Dealing Day on which the conversion is to be effected.

There is no conversion fee payable on a conversion exchange of Units. No conversion can take place where Units in the original fund/class and the new fund/class are in different currencies.

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13. TRANSFER OF UNITS

Subject as provided below, Units may be transferred by an instrument in writing in common form signed by (or, in the case of a body corporate, signed on behalf of or sealed by) the transferor and the transferee and duly stamped with adequate stamp duty before the form is passed to the Registrar. The transferor will be deemed to remain the holder of the Units transferred until the name of the transferee is entered in the register of Unitholders in respect of such Units.

Each instrument of transfer must relate to a single class of Units only. No Units may be transferred if, as a result, either the transferor or the transferee would hold Units having a value less than the minimum holding amount (if any) of the relevant class as set out in the relevant Fund Specific Prospectus.

14. CALCULATION OF NET ASSET VALUE

14.1 Calculation of Net Asset Value

The Manager and the Trustee have agreed that the Net Asset Value per Unit will be determined by the Trustee as at the Valuation Point in accordance with the terms of the Trust Deed. The Trust Deed provides (inter alia) that:

(a) the Net Asset Value per Unit shall be determined in respect of any relevant Dealing Day by (i) calculating as at the relevant Valuation Point therefor the Net Asset Value of the Fund; (ii) dividing the resulting amounts by the number of Units then outstanding; and (iii) rounding to the nearest two decimal places, unless determined otherwise by the Manager, with the relevant Fund retaining the benefit of any such rounding;

(b) except in the case of any interest in a collective investment scheme to which paragraph (c) applies and subject as provided in paragraph (f) below, all calculations based on the value of investments quoted, listed, traded or dealt in on any securities market shall be made by reference to the last traded price available (or if none is available the previous traded price quoted) on the principal stock exchange for such investments as at the last close of business in the relevant market unless determined otherwise by the Manager. In determining such prices the Trustee, Manager or their respective agents shall be entitled to use and rely on electronic price feeds from such source or sources as they may from time to time determine;

(c) subject as provided in paragraph (f) below, the value of each interest in any collective investment scheme shall be the last published net asset value per unit or share in such collective investment scheme (where available) or (if the same is not available) the last published bid prices for such unit or share. If such net asset value, bid prices or price quotations are not available, the value of the relevant investment shall be determined from time to time in such manner as the Manager shall determine;

(d) the value of any investment which is not listed or ordinarily dealt in on a market shall be the initial value thereof which is equal to the amount expended out of the relevant Fund in the acquisition of such investment (including in each case the amount of fiscal and purchase charges) provided that the Manager may with the consent of the

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Trustee and shall at the request of the Trustee cause a revaluation to be made by a professional person approved by the Trustee as qualified to value such investment;

(e) cash, deposits and similar investments shall be valued at their face value (together with accrued interest) unless, in the opinion of the Manager, any adjustment should be made to reflect the value thereof;

(f) notwithstanding the foregoing, the Manager may with the consent of the Trustee adjust the value of any investment or permit some other method of valuation to be used if, having regard to relevant circumstances, the Manager considers that such adjustment or use of such other method is required or desirable to reflect the fair value of the investment; and

(g) the value of any investment (whether of a security or cash) otherwise than in the currency of a Fund shall be converted into the currency of the relevant Fund at the rate (whether official or otherwise) obtained by the Trustee in the circumstances having regard to any premium or discount which may be relevant and to the costs of exchange.

Potential investors should note that under International Financial Reporting Standards ("IFRS"), the value of investments which has a bid price and an ask price, such as investments quoted, listed, traded or dealt in on any stock exchange, commodities exchange, futures exchange or over-the counter market, the price within the bid-ask spread that is most representative of fair value in the circumstance shall be used to measure its fair value. The Trust has chosen to value such investments by reference to its last traded price. The Manager believes that such investment calculated using last traded price is expected to fall within the bid-ask spread. If the difference in valuation of investments using last traded price and bid/ask price are material to the audit of the Funds’ financial statements, the Manager may be required to make adjustments in the annual financial statements of the Funds in order to comply with IFRS and if relevant will include a reconciliation note in the annual financial statements of the Funds to reconcile amounts shown in the annual financial statements to those arrived at by applying the appropriate values required under IFRS.

14.2 Publication of Net Asset Value

Subject as otherwise provided in the relevant Fund Specific Prospectus, the Net Asset Value per Unit of each Fund will be published daily in the Standard and the Hong Kong Economic Times.

14.3 Suspension of dealing

The Manager may at any time with the approval of the Trustee temporarily suspend the right of the Unitholders to require the redemption of Units under this paragraph and may accordingly temporarily delay the payment of any moneys in respect of any such realisation so suspended during any of the following periods:

(a) any period when any market on which a substantial part of the investments or other property for the time being comprised in the Fund is quoted, listed or dealt in is closed otherwise than for ordinary holidays;

(b) any period when dealings on any such market are restricted or suspended;

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(c) during the existence of any state of affairs as a result of which disposal of some or all investments or other property for the time being comprised in the Fund cannot, in the opinion of the Manager, be effected normally or without seriously prejudicing the interests of Unitholders;

(d) during any breakdown in the means of communications normally employed in determining the Net Asset Value or redemption price or when for any other reason the value of any investment or other property for the time being comprised in the Fund or redemption price cannot be promptly and fairly ascertained;

(e) any period when the realisation of investments or other property for the time being comprised in the Fund or the transfer of funds involved in such realisation cannot, in the opinion of the Manager, be effected at normal prices or normal rates of exchange; or

(f) any period when the payment or receipt of the proceeds of the realisation of any of the investments or other property comprised in the Fund is the subject of delay.

Whenever the Manager declares a suspension, as soon as practicable after any declaration and at least once a month during the period of the suspension, it shall publish a notice in The Standard and the Hong Kong Economic Times and/or cause a notice to be given to Unitholders and to all those (whether Unitholders or not) whose applications to redeem Units are affected by the suspension, stating that the suspension declaration has been made.

Application for Units made or pending during a suspension period may be withdrawn by notice in writing received by the Trustee prior to the end of the suspension period. Applications not withdrawn will be processed on the first Dealing Day following the end of the suspension period, on the basis of the Net Asset Value per Unit determined as at the Valuation Point in respect of such Dealing Day.

Any Unitholder or potential Unitholder may at any time after such a suspension has been declared and before termination of such suspension withdraw any application for the redemption of Units of the relevant Fund (but only if the realisation of those Units has not been effected on a Dealing Day prior to that suspension) or any application for the issue of Units or any conversion notice in respect of the conversion of Units of that Fund or of Units of another Fund into Units of that Fund by notice in writing to the Manager or, if the Manager and the Trustee have so agreed, the Trustee.

No Units will be issued or redeemed by the Trust during any period in which the determination of the Net Asset Value per Unit is suspended.

No Units may be issued or redeemed during a period of suspension of dealing.

15. DISTRIBUTION POLICY

The distribution policy of each of the Funds will be set out in the relevant Fund Specific Prospectus.

16. CHARGES AND EXPENSES

Unitholders will be given at least one month's prior written notice (or such period as agreed with the SFC) should there be any increase in charges and expenses stated herein.

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16.1 Management Fee

The Manager is entitled to receive a management fee from the Trust in relation to a Fund at a rate as set out in the Fund Specific Prospectus.

The management fee is payable monthly in arrears.

The Manager may increase the rate of management fee payable in respect of the Fund (up to a maximum rate of 2.5% per annum) on giving not less than one month's prior notice to Unitholders.

16.2 Performance Fee

The Manager may be entitled to receive a performance fee from the Trust in relation to a Fund at a rate as set out in the Fund Specific Prospectus.

16.3 Trustee Fee

The current fees payable to the Trustee in relation to a Fund are set out in the relevant Fund Specific Prospectus.

16.4 Registrar's Fees

The current fees payable to the Registrar in relation to a Fund are set out in the relevant Fund Specific Prospectus.

16.5 Other Charges and Expenses

Each Fund will bear the costs set out in the Trust Deed which are directly attributable to it. Where those costs are not directly attributable to a Fund each Fund will bear the costs in proportion to its respective Net Asset Value or in any manner the Manager considers fair. These include, but are not limited to, all stamp and other duties, taxes, governmental charges, bank charges, brokerage, exchange costs and commissions, transfer fees and expenses, registration fees and expenses, valuation fees and expenses; the fees and expenses of sub-custodians, the fees and expenses of the auditors and legal advisers; the expenses of or incidental to the preparation of amendments to the constitutive documents of the Trust and the expenses of holding meetings of Unitholders and of giving notices to Unitholders; the costs and expenses of obtaining and maintaining any regulatory approval or authorisation of the Trust or in complying with any undertaking given, or agreement entered into in connection with any rules governing such approval or authorisation; and any costs incurred in publishing the redemption prices of Units, all costs of preparing, printing and distributing all statements, all costs of preparing accounts and reports, the expenses of preparing and printing any prospectus, and any other operating and out of pocket expenses.

Save as those costs and expenses referred to above no promotional and advertising expenses may be charged to the Trust's assets. No commission will be payable to sales agents out of the Trust's assets.

The Trustee is entitled to receive from the Trust once-off establishment fee of up to HK$10,000 for the establishment of each sub-fund of the Trust.

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The preliminary establishment expenses of the Trust have been fully amortised. In the event that further Funds are established, the Manager may reallocate the preliminary establishment expenses of the Trust to such additional sub-funds, as it deems appropriate. The preliminary establishment expenses of the additional sub-funds shall also be borne by the relevant sub-funds and shall be amortised over such period as the Manager may determine.

The Manager may share any fees it receives with distributors or agents procuring subscriptions to Units. The Manager and its associates may, with the consent of the Trustee, deal with any investment fund, both as principal and agent, and, subject as provided below, may retain any benefit which they receive as a result.

16.6 Fees payable by investors

Subject as otherwise provided in the Fund Specific Prospectus, investors may be subject to subscription charge and redemption charge based on the issue price and redemption price of each Unit, respectively. In the event that a Unitholder wishes to make a transfer, it may be subject to a transfer fee based on the redemption price of each Unit.

16.7 Cash Rebates and Soft Commissions

Neither the Manager nor any of its connected persons may retain cash or other rebates from a broker or dealer in consideration of directing transactions to them.

The Manager and any of its connected persons may effect transactions by or through the agency of another person with whom the Manager or any of its connected persons have an arrangement under which that party will from time to time provide to or procure for the Manager or any of its connected persons, goods, services or other benefits: for example, research and advisory services, computer hardware associated with specialised software or research services and performance measures etc., the nature of which is such that their provision can reasonably be expected to benefit the Trust as a whole and may contribute to an improvement in the Trust's performance and that of the Manager or any of its connected persons in providing services to the Trust and for which no direct payment is made but in consideration of which the Manager or any of its connected persons will direct transactions to that party. Such transactions would only be executed on a basis which is consistent with best-execution standards and where the brokerage rates are not in excess of customary institutional full service brokerage rates. Those goods and services do not include travel accommodation, entertainment, general administrative goods and services, general office equipment or premises, membership fees, employee salaries or direct money payments. Details of soft commission arrangements will be disclosed in the Trust's accounts.

17. TAXATION

The following statements regarding taxation are by way of a general guide to potential

investors in respect of the Trust regarding the law and practice in force in Hong Kong and

the PRC at the date of this Trust Prospectus.

17.1 Hong Kong

For so long as the Trust maintains its authorisation with the SFC under the SFO, the Trust will be a specified investment scheme under section 26A(1A) of the Inland Revenue

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Ordinance. Any sums received or accrued to a specified investment scheme (whether they are sourced from Hong Kong or not) will not be subject to Hong Kong profits tax.

Unitholders resident in Hong Kong will not be subject to any Hong Kong tax on distributions from any of the sub-funds or on capital gains realised on the disposal or redemption of any Units unless the acquisition and realisation of Units is or forms part of a trade, profession or business carried on in Hong Kong. Hong Kong stamp duty will not be payable on the issue or redemption of Units.

The above information relating to taxation is based on the enacted laws and current practice of Hong Kong. It is not comprehensive and is subject to change. Prospective investors should consult their own professional advisers as to the implications of buying, holding or disposing of Units and to the provision of the laws of the jurisdiction in which they are subject to tax.

17.2 PRC Tax

By investing in securities issued by PRC tax resident enterprises, irrespective of whether such securities are issued or distributed onshore (“onshore PRC securities”) or offshore (“offshore PRC securities”, and together with onshore PRC securities, (the “PRC Securities”), a Fund may be subject to PRC taxes. PRC taxation for a Fund will vary depending on the investment strategy of the Fund. With regard to each Fund which has potential PRC tax exposure through investment in PRC Securities, please refer to the section headed "PRC Tax considerations" in the relevant Fund Specific Prospectus for the tax provisioning policy of the Manager.

The tax laws and regulations of the PRC may change any time, and they may be changed with retrospective effect. The interpretation and applicability of the PRC tax laws and regulations by tax authorities are not as consistent and transparent as those of more developed nations, and may vary from location to location. Moreover, there is no assurance that tax incentives currently offered to foreign companies, if any, will not be abolished and the existing tax laws and regulations will not be revised or amended in the future. The value of the relevant Funds’ investments in the PRC and the amount of their income and gains could be adversely affected by an increase in tax rates or change in the taxation basis.

Corporate Income Tax

If the Trust or a Fund is considered as a tax resident enterprise of the PRC, it will be subject to PRC Corporate Income Tax (“CIT”) at 25% on its worldwide taxable income. If the Trust or a Fund is considered as a non-tax resident enterprise with an establishment or place of business (“PE”) in the PRC, the profits and gains attributable to that PE would be subject to CIT at 25%. If the Trust or a Fund is a non-PRC resident and has no PE in the PRC, or in the case of having PE in the PRC, but the profits are not substantially related to the PE, by investing in PRC Securities, a Fund may generally be subject to withholding income tax (“WIT”) imposed in the PRC, unless exempt or reduced under specific tax circulars or relevant tax treaties.

The Manager intends to manage and operate the Trust and the Funds in such a manner that the Trust and the Funds should not be treated as tax resident enterprises of the PRC and has no PE in the PRC for CIT purposes, although this cannot be guaranteed.

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Dividend income and interest income –

Unless a specific exemption or reduction is available under current PRC tax laws and regulations or specific tax circulars or relevant tax treaties, non-tax resident enterprises without PE in the PRC are subject to WIT, generally at a rate of 10%, to the extent it directly derives the PRC sourced passive income. PRC sourced passive income (such as dividend income or interest income) may arise from investments in the PRC Securities. The entity distributing such dividend income or interest income is required to withhold such tax. Accordingly, the Trust or a Fund may be subject to WIT and/or other PRC taxes on any cash dividends, distributions and interest it receives from its investment in PRC Securities. Under the PRC CIT Law, interests derived from government bonds are exempt from PRC WIT.

Investment in onshore PRC securities via RMB qualified foreign institutional investor (“RQFII”):

Where the Trust or a Fund invests in onshore PRC securities via a RQFII, the PRC tax may be imposed on such Fund under the name of the relevant RQFII. However, under the terms of the arrangement between the relevant RQFII and the Trust, the relevant RQFII will pass on any tax liability to the Trust for the account of the relevant Fund. As such, the relevant Fund is the ultimate party which bears the risks relating to any PRC taxes which are so levied by the relevant PRC tax authorities. Under current PRC tax laws and regulations, a relevant RQFII is subject to a WIT of 10% on cash dividends, distributions and interest from the PRC Securities unless exempt or reduced under current PRC tax laws and regulations or relevant tax treaties.

However, if the RQFII or foreign corporate is a tax resident of a tax treaty country, it may apply for the reduced PRC WIT rate under the relevant tax treaty. Under the Arrangement

between the Mainland of China and the Hong Kong Special Administrative Region for the

Avoidance of Double Taxation and Prevention of Fiscal Evasion with respect to Taxes on

Income (“China-HK Arrangements”), the tax charged on interests received by the non-resident holders of debt instruments (including enterprises and individuals) will be 7% of the gross amount of the interest, if Hong Kong tax residents are the beneficial owners under the China-HK Arrangements.

As a Fund may seek to achieve its investment objective by investing through the RQFII quota of CITIC Securities International Company Limited (which is a Hong Kong tax resident) and the Trust is also a unit trust set up in Hong Kong, the interest derived from such investment may be subject to the reduced tax rate of 7% under the China-HK Arrangements. In order to qualify for this preferential rate, approval of the PRC tax authority is required. The Manager will further assess and seek to apply for approval from the PRC tax authorities in relation to the relevant Funds, although this cannot be guaranteed. If the required approval is not obtained, the general rate of 10% will be applicable to the relevant Funds on interest.

Also, pursuant to the China-HK Arrangements, the tax charged on dividends received by the non-tax resident holders of shares issued by Chinese resident companies will be 5% of the gross amount of the dividends, if Hong Kong tax residents are the beneficial owners and directly hold at least 25% of the equity of the company paying the dividends. Due to applicable investment restrictions, a Fund will not hold more than 10% of any ordinary shares issued by any single issuer. In this connection, dividends derived from China A-shares invested through RQFII will not be able to benefit from the reduced tax rate of 5% and the general tax rate of 10% will be applicable to the Fund.

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Investment in China A-shares via the Shanghai-Hong Kong Stock Connect (“Stock Connect”):

Caishui (2014) No.81 (“Circular 81”) states that dividends received by foreign investors (including the relevant Funds) from investments in China A-shares via the Stock Connect is subject to 10% WIT which will be withheld by the PRC companies distributing the dividends, unless exempt or reduced under current PRC tax laws and regulations or relevant tax treaties.

Capital gains –

Investment in onshore PRC securities via RQFII:

Circular Caishui (2014) No.79 (“Circular 79”) states that RQFII without a PE in the PRC or RQFII with a PE in the PRC but the income so derived in the PRC is not effectively connected with its PE is temporarily exempt from PRC WIT on capital gains derived from investments in China A-shares effective from 17 November 2014. Circular 79 also states that RQFII is subject to PRC WIT on capital gains from investments in China A-shares before 17 November 2014. Specific rules governing taxes on capital gains derived by RQFII from the investment in PRC Securities other than China A-shares have yet to be announced. In the absence of such specific rules, the PRC CIT treatment should be governed by the general tax provisions of the PRC CIT Law. For an enterprise that is not a tax resident enterprise and has no PE in the PRC, a 10% PRC WIT shall apply to capital gains derived from the investment in PRC Securities other than China A-shares, unless exempt or reduced under current PRC tax laws and regulations or relevant tax treaties.

Notwithstanding the Circular 79 announcement, the Manager, having regard to the independent professional tax advice on the application of the China-HK Arrangements, considers that in assessing WIT on capital gains derived by RQFII prior to 17 November 2014 from investments in China A-shares, potential treaty relief under the China-HK Arrangements should still be taken into account.

Under the China-HK Arrangements, capital gains derived by Hong Kong tax residents from alienation of shares issued by PRC companies may only be taxed in the PRC if the recipient, at any time within 12 months preceding such alienation, had a participation of at least 25% in that PRC company or if the PRC company is a land rich company (i.e. PRC companies in which more than 50% of their assets are comprised, directly or indirectly, of immovable property situated in the PRC). Where a Fund invests in China A-shares through RQFII quota that is made available to the Fund, due to the applicable investment restrictions, the Fund may not hold more than 10% of any ordinary shares issued by any single issuer. In such a case, if a Fund is considered as a Hong Kong tax resident, the capital gains derived before 17 November 2014 from alienation of the shares of non-land rich China A-shares companies may not be subject to PRC WIT, subject to the approval of the relevant PRC tax authorities. Also, under the China-HK Arrangements, capital gains derived by a Hong Kong tax resident from investments in PRC fixed income instruments as well as exchange traded funds should not be subject to PRC WIT upon approval by the PRC tax authorities.

Pursuant to the relevant PRC tax regulations, approval by the relevant PRC tax authorities should be obtained before a Hong Kong resident can enjoy relief under the China-HK Arrangements, and a Hong Kong Tax Resident Certificate (“HKTRC”) issued by the Inland Revenue Department of Hong Kong (the “IRD”) may be required to be submitted to the relevant PRC tax authorities for this purpose. No HKTRC has been obtained from the IRD in

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respect of the relevant Funds at the date of this Prospectus. If the PRC tax authorities enforce the collection of PRC WIT on capital gains and require the relevant Funds to provide a HKTRC in order to obtain the PRC WIT exemption, the Manager will apply for a HKTRC on behalf of the relevant Funds on annual basis, which is subject to the assessment of the IRD. The Manager will consider independent professional tax advice relating to the relevant Funds’ eligibility to obtain a HKTRC and to benefit from the China-HK Arrangements in determining its tax provisioning policy for the relevant Funds.

In light of the uncertainty on the income tax treatment on capital gains and in order to meet any potential tax liability for capital gains, the Manager reserves the right to provide for PRC WIT on such gains or income and withhold the tax for the account of the relevant Funds and will notify the Unitholders should the Manager decide to exercise such right. The Manager's current policy on tax provisions is set out in the section headed "PRC Tax considerations" of the Fund Specific Prospectus. Where any provision is made, the amount of actual provision will be disclosed in the financial statements of the relevant Funds.

It should also be noted that there is a possibility of the PRC tax rules being changed and taxes being applied retrospectively. Even if tax provisions (if any) are made, the amount of such provisions may not be sufficient to meet the actual tax liabilities. With the uncertainties under the applicable PRC tax laws and the possibility of such laws being changed and taxes being applied retrospectively, any provision for taxation made by the Manager may be excessive or inadequate to meet actual PRC tax liabilities on gains derived from sale of PRC Securities. Consequently, investors may be advantaged or disadvantaged depending upon the final outcome of how such gains will be taxed, the level of provision and when they subscribed and/or redeemed their Units in/from the relevant Funds. In case of any shortfall between the provisions and actual tax liabilities, which will be debited from the relevant Funds’ assets, the relevant Funds’ net asset values will be adversely affected. On the other hand, if the actual applicable tax rate levied is lower than that provided for by the Manager so that there is an excess in the tax provision amount, investors who have redeemed their Units will be disadvantaged as they would have borne the loss from the Manager's overprovision. In this case, the then existing and new Unitholders may benefit if the difference between the tax provisions and the actual taxation liabilities under that lower tax rate can be returned to the account of the relevant Funds as assets thereof. Notwithstanding the above provisions, Unitholders who have already redeemed their Units in the relevant Funds will not be entitled or have any right to claim any part of such overprovision.

Investment in China A-shares via the Stock Connect:

Under Circular 81, CIT is temporarily exempted on capital gains derived by foreign investors (including the relevant Funds) from investments in China A-shares via the Stock Connect.

Business Tax ("BT") and other surtaxes:

In the absence of specific exemptions, taxpayers are subject to BT at the rate of 5% in respect of gains derived from the disposal of marketable securities in China, such as China A-shares. Caishui (2005) No. 155 (“Circular 155”) states that gains derived by qualified foreign institutional investors (“QFII”) from the trading of Chinese securities are exempt from BT. The new PRC Provisional Regulations of Business Tax ("BT Regulations") which came into effect on 1 January 2009 did not change this exemption treatment at the date of the Prospectus. It is uncertain whether Circular 155, which provides for the exemption from BT on gains derived by QFII from trading of PRC debt and equity securities, would equally

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apply to securities trading gains derived through RQFII. For China A-shares traded via the Stock Connect, Circular 81 states that gains derived by foreign investors trading through such platform are temporarily exempt from BT.

The new BT Regulations does not specifically exempt BT on interest earned by non-financial institutions. It is not entirely clear whether BT will apply to interest on government and corporate bonds but in practice, some local tax authorities have not imposed BT on interest derived from bonds.

Dividends or profit distributions on equity investment derived from China are not included in the taxable scope of BT.

In addition, Urban Maintenance and Construction Tax (currently at the rate ranging from 1% to 7%), EducationSurcharge (currently at the rate of 3%) and Local Education Surcharge (currently at the rate of 2%) are imposed based on the BT liabilities.

Stamp Duty

Stamp duty is levied on certain taxable documents executed or used in China, such as documentation effecting the transfer of equity interests in Chinese companies, the purchase and sale of China A-shares, the purchase and sale of goods, contract documents issued for process contracting, construction contracting, property leasing, and other documents listed in the Stamp Duty Regulations.

Stamp duty is levied on the execution or receipt in China of certain documents, including contracts for the sale of China A- and B-shares traded on the PRC stock exchanges or via the Stock Connect, at the rate of 0.1%. In the case of contracts for sale of China A- and B-shares, such stamp duty is currently imposed on the seller but not on the purchaser.

It is unclear whether PRC stamp duty that is imposed on the transfer of shares of PRC companies under the Stamp Duty Regulations would similarly apply to the acquisition and disposal of China H-shares by non-PRC investors outside the PRC. That said, PRC stamp duty is generally not imposed for trading of China H-shares in practice.

No PRC Stamp Duty is expected to be imposed on non-tax resident holders of government and corporate bonds, either upon issuance or upon a subsequent transfer of such bonds.

17.3 US Tax Withholding and Reporting under the Foreign Account Tax Compliance Act (“FATCA”)

The US Hiring Incentives to Restore Employment Act was signed into law in March 2010. It includes provisions generally known as FATCA. The intention of FATCA is that, as a safeguard against tax evasion, the details of US investors holding assets outside the US will be reported to the US Internal Revenue Service (“IRS”) by non-US financial institutions. To discourage non-US financial institutions from staying outside this regime, all US securities held by a financial institution (for the Funds, principally equity and debt securities issued by US corporations and institutions including the US government) that does not comply with FATCA will be subject to a US tax withholding of 30% on gross sales proceeds as well as income. This regime will become effective in phases between 1 July 2014 and 1 January 2017.

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The Trust and each of the Funds have registered with the IRS as a participating Foreign Financial Institution (“FFI”) and is FATCA-compliant, and an officer of the Manager is acting as the responsible officer for the Funds. As participating FFI under FATCA, the Funds agree to certain US tax reporting obligations with respect to the holdings of and payments to certain investors in the Funds, and possible withholding requirements on payments made to certain investors. Though the Funds will attempt to satisfy any obligations imposed on the Funds to avoid the imposition of the FATCA withholding tax, given the complexity of the FATCA requirements, no assurance can be given that the Funds will be able to satisfy all these obligations. If a Fund is unable to comply with FATCA, certain US sourced payments made to the Fund may be subject to a 30% FATCA withholding tax, resulting in a decrease in the net asset value of the relevant Fund and therefore incurring material loss to Unitholders.

In order to comply with FATCA, Unitholders and prospective investors may be required to provide mandatory documentary evidence of their tax residence to the Manager, the Trustee and/or the relevant authorized distributors. The US has developed two models to simplify the implementation of FATCA. Hong Kong and the US have already signed an intergovernmental agreement (“IGA”) on 13 November 2014 to operate under Model II which establishes a framework of enabling relevant financial institutions in Hong Kong to seek consent for disclosure from US investors, and to report relevant tax information of such investors to the IRS. This model of IGA will be supplemented by the operation of a tax information exchange agreement. Thus, the application of the withholding rules and the information that may be required to be reported and disclosed are subject to change.

Unitholders and authorized distributors acting for the Unitholders should note that it is the existing policy of the Trust that US Persons may not invest in the Funds, and that Unitholders who become US persons are subject to compulsory redemption of their holdings (for further details, see "Compulsory Redemption or Transfer of Units" in section 18.5 below of this Trust Prospectus). Please also note that the Manager and the Trustee have the right to withhold, set-off or deduct any reasonable amounts (including any tax obligation) from the redemption proceeds payable to the relevant Unitholders, provided that such withholding, set-off or deduction is permitted by applicable laws and regulations (including FATCA), and the Manager and the Trustee are acting on good faith and on reasonable grounds.

In addition, under FATCA, the definition of a US reportable account may include a wider range of investors than the current US Person definition in this Trust Prospectus. The Manager and the Trustee may therefore resolve, subject to further clarity on the implementation and impact of FATCA, that it is the interests of the Trust to widen the class of investors prohibited from investing in the Funds and to make proposals regarding the Units holdings by the existing Unitholders or their further investment in the Units of the Funds in view of the wider FATCA definition.

Any discussion of US federal income tax considerations set forth in this Trust Prospectus was written in connection with the promotion and marketing of the Units of the Funds. Such discussion is not intended or written to be tax advice to any person and is not intended or written to be used, and cannot be used, by any person for the purpose of avoiding any US federal tax penalties that may be imposed on such person. Prospective investors and Unitholders of the Funds should consult their own tax advisors regarding the possible implications of FATCA on their investment in the Funds.

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17.4 General

Investors should consult their professional advisers on the consequences to them of acquiring, holding, redeeming, transferring or selling Units under the relevant laws of the jurisdictions to which they are subject, including the tax consequences and any exchange control requirements. These consequences, including the availability of, and the value of, tax relief to investors will vary with the law and practice of the investors' country of citizenship, residence, domicile or incorporation and their personal circumstances.

18. GENERAL INFORMATION

18.1 Accounts and Reports

The financial year end of the Trust and each Fund is 31 December in each year. Audited accounts will be available within four months of the end of each financial year.

The Manager also sends half yearly unaudited interim reports to Unitholders. These interim reports (made up to the last Dealing Day in June) will be available within two months of the end of the period which they cover.

Once annual and interim reports are issued, Unitholders will be notified of where such reports, in printed and electronic forms, can be obtained. Such notices will be sent to Unitholders on or before the issue date of the relevant reports. Once issued, the annual and interim reports will be available in softcopy from the website http://www.citics.com.hk/CSIInvestmentManagementFund.aspx and in hardcopy for inspection at the Manager’s office free of charge during normal working hours.

At least one month’s prior notice will be provided to Unitholders if there will be any change to the mode of distribution of annual and interim reports described above.

The accounts will be prepared in accordance with International Financial Reporting Standards and published in English only.

18.2 Trust Deed

The Trust was established under Hong Kong law by a trust deed made between the Manager and the Trustee. All Unitholders are entitled to the benefit of, are bound by and are deemed to have notice of the provisions of the Trust Deed.

The Trust Deed contains the duties and responsibilities of the Trustee and the Manager. The Trust Deed requires that (subject as provided in the Trust Deed) the Trustee and the Manager exercise their respective powers and authorities in the exclusive interests of the Unitholders.

The Trust Deed also contains provisions for, in the absence of fraud, negligence or wilful default by the Trustee or Manager (as the case may be), the indemnification of the Trustee and the Manager and their relief from liability in certain circumstances. Unitholders and intending applicants are advised to consult the terms of the Trust Deed.

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18.3 Modification of Trust Deed

The Trustee and the Manager may agree to modify the Trust Deed by supplemental deed provided that in the opinion of the Trustee such modification:

(a) is not materially prejudicial to the interests of Unitholders, does not operate to release to any material extent the Trustee, the Manager or any other person from any responsibility to the Unitholders and (with the exception of the cost of preparing and executing the relevant supplemental deed) does not increase the costs and charges payable out of the assets of the Trust; or

(b) is necessary in order to comply with any fiscal, statutory or official requirement; or

(c) is made to correct a manifest or technical error. In all other cases modifications require the sanction of an extraordinary resolution of the Unitholders affected.

Any modifications to the Trust Deed, unless they are sanctioned by an extraordinary resolution of the Unitholders affected or in the opinion of the Trustee are not of material significance or are made to correct a manifest error or the SFC agrees that no notice is required, will be notified to the Unitholders as soon as practicable after they are made. The Trustee shall give such period of notice as required by the SFC to the Unitholders before any modifications to the Trust Deed are to take effect.

18.4 Meetings of Unitholders

The Trust Deed provides for meetings of Unitholders to be convened by the Trustee or the Manager upon at least 21 days' notice. Notices of meetings of Unitholders will be posted to Unitholders.

Proxies may be appointed. The quorum at Unitholders' meetings is Unitholders present in person or by proxy holding not less than 10% (or, in relation to a resolution proposed as an extraordinary resolution, 25%) of Units in issue. If a quorum is not present, the meeting will be adjourned for not less than 15 days. Separate notice of any adjourned meeting will be given, and at an adjourned meeting, Unitholders, whatever their number or the number of Units held by them, will form a quorum. An ordinary resolution may be passed by a simple majority of the votes of those present and entitled to vote in person or by proxy at a duly convened meeting.

An extraordinary resolution is required under the Trust Deed for certain purposes and is a resolution proposed as such and passed by a majority of 75% of the total number of votes cast.

The Trust Deed provides that at any meeting of Unitholders, every Unitholder who (being an individual) is present in person or (being a partnership or corporation) is present by an authorized representative or by proxy shall have one vote. On a poll every Unitholder who is present or by representative or by proxy will have one vote for every whole Unit of which he is the holder.

For so long as the Fund is authorized by the SFC pursuant to the SFO, any resolution put to the vote of any meeting shall be decided on a poll only.

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18.5 Compulsory Redemption or Transfer of Units

The Manager or the Trustee may require a Unitholder to transfer his Units or, failing a transfer, may redeem his Units in accordance with the Trust Deed if it comes to the notice of the Manager or the Trustee that the Unitholder holds his Units

(a) as a US Person;

(b) in breach of the law or requirements of any country, any governmental authority or any stock exchange on which Units are listed; or

(c) in circumstances (whether directly or indirectly affecting the Unitholder and whether taken alone or in conjunction with any other persons, connected or not, or any other circumstances appearing to the Manager or Trustee to be relevant) which, in the opinion of the Manager or the Trustee, may result in the Trust incurring any liability to taxation or suffering any other pecuniary disadvantage which the Trust may not otherwise have incurred or suffered.

18.6 Conflicts of Interest

The Manager and the Trustee may from time to time act as trustee, administrator, registrar, manager, custodian, investment manager or investment adviser or otherwise as may be required from time to time in relation to, or be otherwise involved in or with, other funds and clients which have similar investment objectives to those of the Trust or any Fund. It is, therefore, possible that any of them may, in the course of business, have potential conflicts of interest with the Trust or any Fund. Each will, at all times, have regard in such event to its obligations to the Trust and to Unitholders and will endeavour to ensure that such conflicts are resolved fairly. In any event, the Manager shall ensure that all investment opportunities will be fairly allocated.

The Manager has an established policy in relation to the identification and monitoring of potential conflicts of interest scenarios. There is functional separation of different areas of operations to control the flow of information that may be confidential and/or price sensitive. Computer and information system with appropriate access controls have been put in place by the Manager. Key duties and functions are segregated among different departments. The Manager has adopted trading policies which are designed to ensure the fair allocation of investment opportunities among funds, investment vehicles or accounts that the Manager manages or advises. A designated risk management and portfolio control team and compliance team of the Manager will monitor the implementation of such trading policies and dealing procedures with overall monitoring by the senior management of the Manager.

The Trustee will keep and maintain proper books of accounts, records and documents for each fund or scheme under their trusteeship and segregate the assets of different funds or schemes. The Trustee will keep data and information in relation to the portfolio of each fund/scheme confidential.

18.7 Material Contracts

The following contract (not being contract in the ordinary course of business) has been entered into in relation to the Trust and are, or may be, material:

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• the Trust Deed dated as of 25 June 2009, a supplemental trust deed dated 9 April 2010, a second supplemental trust deed dated 4 January 2012, a third supplemental trust deed dated 24 April 2014 and a fourth supplemental trust deed dated 19 December 2014 between the Trustee and the Manager pursuant to which the Manager was appointed, subject to the overall supervision of the Trustee, to manage the Trust's affairs;

• any agreements between the Manager and third parties referred to in the Fund Specific Prospectus.

18.8 Documents available for inspection

For as long as each sub-fund remains authorized by the SFC, copies of the agreements referred to under "Material Contracts" above are available for inspection free of charge at any time during normal business hours on any day (excluding Saturday, Sunday and public holidays) at the offices of the Manager at 26th Floor, CITIC Tower, 1 Tim Mei Avenue, Central, Hong Kong and copies thereof may be obtained from the Manager at that address on payment of a reasonable fee.

18.9 Termination of the Trust and/or Funds

The Trust (or a Fund) may be terminated by the Trustee, with the approval of the Manager (except in the case of the liquidation of, or analogous proceedings in respect of, the Manager or the Manager's failure to appoint a new trustee in place of the Trustee following the receipt of a written notice of retirement from the Trustee) in the following circumstances:

(a) it becomes illegal or in the opinion of the Manager impossible or impracticable to continue the Trust (or a Fund);

(b) the Trust (or a Fund) becomes liable to taxation (whether in Hong Kong or elsewhere) in respect of income or capital gains at a rate considered by the Manager to be excessive in relation to the rate which would be borne by investors by investing directly in relevant portfolio securities;

(c) the Trust (or a Fund) ceases to be authorized by the SFC pursuant to the SFO;

(d) the Manager goes into liquidation (other than voluntary liquidation for the purpose of reconstruction or amalgamation upon terms previously approved in writing by the Trustee) or analogous proceedings where, after the expiration of a period of three months, the Trustee has not appointed a new manager;

(e) if the Net Asset Value of the Trust or a Fund is less than HK$100 million; or

(f) if the Manager shall fail to appoint a new trustee in place of the Trustee within such time as the Trustee considers to be reasonable after the date of the Trustee's written notice to retire in accordance with the Trust Deed.

Unitholders may at any time terminate the Trust by extraordinary resolution with effect from the date such extraordinary resolution is passed or such later date (if any) as such extraordinary resolution may provide.

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At least three months' prior notice of the termination of the Trust (or a Fund) will be given to Unitholders (unless the Trust or a Fund is terminated by reason of illegality, in which case no prior notice need to be given to Unitholders but Unitholders will be notified as soon as reasonably practicable).

18.10 Creation of Funds

The Manager can, at its discretion, decide to create further Funds with different investment objectives and in such cases, this Trust Prospectus will be updated accordingly. The Trustee shall maintain for each Fund a separate pool of assets.

18.11 Anti-Money Laundering Regulations

As part of the responsibility of the Trustee and the Manager for the prevention of money laundering, the Trustee may require a detailed verification of an investor's identity and the source of the payment of application moneys. Depending on the circumstances of each application, a detailed verification may not be required where:

(a) the applicant makes the payment from an account held in the applicant's name at a recognized financial institution; or

(b) the application is made through a recognized intermediary.

These exceptions will only apply if the financial institution or intermediary referred to above is within a country recognized as having sufficient anti-money laundering regulations.

The Trustee and the Manager reserve the right to request any information that they consider necessary to verify the identity of an applicant and the source of the payment. In the event of delay or failure by the applicant to produce any information required for verification purposes, the Trustee and/or the Manager may refuse to accept the application and the related application moneys.

18.12 Auditors

Ernst & Young, Hong Kong has been appointed as the auditors for the Trust and each Fund. The Manager may replace the auditors without prior notice to the Unitholders.

The engagement letter entered into between the Trust and Ernst & Young contains provisions limiting the liability of Ernst & Young arising out of or in connection with the engagement to an amount equal to one time the fees paid except to the extent that such liability arises as a result of wilful default or fraud on the part of Ernst & Young. Other release and indemnity provisions are also contained in the engagement letter relating to consequential loss, third party claims and fraudulent acts or omissions, misrepresentations or wilful default on the part of the Trust, its Manager, its Trustee, employees or agents.

19. GENERAL OVERVIEW OF RMB DEBT INSTRUMENTS MARKET IN THE PRC

CSI RMB Income Fund, CSI RMB Short Maturity Bond Fund and CSI RMB Money Market Fund primarily invest in RMB debt instruments in the PRC. This section provides a general overview of the PRC RMB debt market for investors’ reference.

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19.1 The types of debt instruments

In general, in the PRC, there are three categories of fixed income instruments or products denominated and settled in RMB ("RMB Debt Instruments"). They are interest rate products, credit products, and equity-linked fixed income products. The interest rate products ("IR Products") include central government bonds ("CGBs"), policy bank bonds, and central bank notes ("CBNs"). The credit products ("Credit Products") include financial bonds and non-financial bonds. The former consists of subordinate bonds, and latter mainly includes short-term commercial paper ("CP"), mid-term notes ("MTNs"), National Development and Reform Commission ("NDRC") corporate bonds, CSRC corporate bonds, and bonds with attached warrants ("DCBs"). The small and medium enterprise collective notes and asset-back securities can also be classified as non-financial bonds. The equity-linked fixed income products are commonly referred to as convertible bonds, and their market size is relatively negligible.

Figure 1: The PRC's fixed income markets consist predominately of IR Products and Credit Products

Source: China Central Depository & Clearing Co., Ltd. (CCDC). Dec 2013

The following contains a brief description of each debt instruments:

Government bonds

Government bonds are issued by the MOF to finance public expenditure. The issuer is the central government or the local government, which has the highest credit quality domestically. Hence, government bonds are generally regarded as less risky than other types of bond. With high liquidity and large amount of issuance, the secondary market for government bonds is fairly well-developed. Moreover, interest earned on government bonds is tax-exempted.

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Policy bank bonds

Policy bank bonds are another popular type of interest rate product in mainland China. The main issuers are policy banks under the supervision of PBoC. There are three policy banks in mainland China: China Development Bank mainly functions as an alternative financing source for national infrastructure and pillar industries critical to national economic growth; the Export-Import Bank of China specializes in international trade finance (exports and imports), foreign construction contracts and investments; and the Agriculture Development Bank of China specializes in financing agriculture and rural economic development in mainland China.

Central bank notes/bills

A central bank note or bill is a short-term debt certificate issued by PBoC to commercial banks, which is traded only in the interbank market. The bills issued are monetary policy tools to regulate the monetary base and to reduce the amount of excess funding at commercial banks. Central bank bonds are typically short-term in nature, most are from 3 months to 3 years. A majority amount of central bank bonds have maturities of less than 1 year and are issued for the purpose of open market operations. They have the same credit quality as treasury bonds, except that the treasury bonds enjoy tax exemptions.

Financial bonds

Bank subordinate bonds

Under the supervision of CSRC and PBoC, commercial banks were allowed to issue subordinate bonds to improve their capital adequacy with effect from 2004. The amount of subordinated bonds each bank can issue is capped at no more than 50% of its core capital with maturity typically 10 or 15 years.

Other financial bonds and notes/bills

In accordance with the rules and regulations issued by the CSRC in 2003, securities firms can raise capital by issuing bonds via public offerings or private placements, which opened up alternative finance channels for securities companies. In 2004, upon the approval of CSRC, securities firms were allowed to issue short-term financing bills in the interbank market, which satisfied securities companies' short-term financing needs and provided money market investors with alternative investment opportunities.

Non-financial corporate bonds

There are six categories of non-financial corporate bonds: listed company corporate bonds, enterprise bonds, short-term financing bills, medium-term notes, SME collective notes and convertible bonds.

Listed company corporate bonds

Listed company corporate bonds were introduced in October 2007 and are regulated by CSRC. Unlike other non-financial bonds, PBoC will not conduct any further examinations after CSRC's approval. Although the rules for issuance are less strict than other bonds, only corporate issuers that have sound credit ratings, and average annual distributable profits in the recent three accounting years equal to at least one year's interest that the company would pay

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on the proposed bond issue, would be approved by the CSRC for issuing listed company corporate bonds. In addition, the value of outstanding bonds after a proposed issuance may not exceed 40% of the company's net assets at the end of the latest accounting year.

Enterprise bonds

Enterprise bonds are different from listed company corporate bonds and are jointly regulated by PBoC, NDRC and CSRC. The issuers are generally state-owned corporations, state holding corporations and central government subsidiaries. Before 2006, all issuers were central enterprises, i.e. mega-sized state-owned enterprises directly under the control of the central government and hence they were also regarded as less risky bonds. After 2006, the number of newly issued local enterprise bonds has outstripped that of central enterprise bonds. Between 2009 to 2013, the number of local enterprise bonds issued grew significantly, most of which is known as "urban investment bonds". On concern over the excessive growth of this category of debts, CSRC has tightened the rules of on new issuance of urban investment bonds in June 2013.

Short-term commercial paper

Short-term commercial paper, regulated by PBoC, has less than 1 year maturity and has been issued in the interbank market since May 2005. Issuers are generally non-financial corporations with very good credit ratings. Since issuers are usually large corporations with good standing, no bank guarantee is required. Given the flexibility to raise funds at rates lower than those offered on bank lending, major Chinese companies make active use of short-term financing bills, and many foreign companies also express a strong desire to use this financing tool recently.

Medium-term notes

Similar to commercial paper, medium-term notes (or MTN) issuers are usually large listed corporations, or enterprises focused on coal production, power generation, oil refining or transportation services. These companies/corporations and enterprises are required to be legally registered non-financial institutions which are corporate members of the National Association of Financial Market Institutional Investors ("NAFMII"). Because they are usually in good standing, no bank guarantee is required. The commercial paper and MTN markets have been the fastest growing segments in the past several years. Although the MTNs were initially authorized by PBoC, after October 2008 the MTNs were authorized by the NAFMII, a self-regulatory and authorized registration entity of the debt-financing instruments.

Small and medium sized enterprise (SME) collective notes

SME collective notes were launched in 2009 and provided a tool to help solve the SME financing problems after the 2008 financial crisis in the US. The advantage of this scheme is that individual borrowers pay less when borrowing via the collective notes, because the bond yield reflects the high credit quality of the guarantor. Each SME is individually responsible for a portion of the issue. It is supervised by NAFMII. Unlike commercial paper and MTN issuance, a bank guarantee is required, which is not necessarily easy to obtain. SME collectives may secure their bond guarantees via an entirely commercial arrangement. The biggest institution providing the arrangement and guarantee is China Bond Insurance Co. Ltd.

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(CBI), a newly established (September 2009) credit enhancement provider, founded by six state-owned enterprises and NAFMII.

Convertible bonds

Convertible bonds in mainland China are issued and traded on exchanges regulated by the CSRC. The initial maturity is usually around 5 years. The size of this product is in the development stage and is relatively small to the mainland China bond market. Mutual funds, insurance companies, QFIIs and securities companies are more active participants in this segment.

Asset backed securities/mortgage backed securities ("MBS")

The securitized market started in December 2005 and is regulated by CBRC and PBoC. China's CITIC Trust was the first MBS underwriter/issuer for China Construction Bank. The development of this market has been slow because the CBRC and PBoC are concerned about the potential negative impact of asset securitization after the 2008 US financial crisis. This type of security has low liquidity and is relatively insignificant to the bond market.

19.2 The markets for debt instruments

The fixed income markets in the PRC are segmented into interbank market and exchange market in Shanghai and Shenzhen stock exchanges. The interbank market is predominant, into which approximately 98% of the bonds or debt instruments are taken custody as at September 2013. Currently cross-market custody transfer only applies to treasury bonds and NDRC corporate bonds, while the other types of bonds are not transferrable between these two markets. Very few fixed income products such as CSRC corporate bonds, DCBs and convertible bonds are taken custody in the listed bond market.

Figure 2: Interbank market dominates the fixed income markets in the PRC

Source: China Central Depository & Clearing Co., Ltd. (CCDC). Dec 2013

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19.3 Size and market structure

Market size

The size of outstanding fixed income instruments is around RMB25 trillion as of the end of 2013, accounting for approximately over 44.0% of GDP of the PRC.

Figure 3: Fixed income markets size as % of GDP

Source: China Central Depository & Clearing Co., Ltd. (CCDC). Dec 2013

The IR Products account for approximately 72% of the total amount of outstanding fixed income instruments. In that space, CBNs, CGBs and policy bank bonds account for approximately 3%, 49% and 48% respectively.

Figure 4: Market structure of IR Products of the PRC

Source: China Central Depository & Clearing Co., Ltd. (CCDC). Dec 2013

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In relation to Credit Products, Financial Bonds, MTNs, corporate bonds and enterprise bonds are the main types of Credit Products and account for approximately 84% of the total outstanding amount of the credit market in the PRC.

Figure 5: Market structure of Credit Products of the PRC

Source: Wind Financial Terminal. Dec 2013

Trading volume

The estimated trading volume in 2013 is around RMB 37 trillion. The following chart shows the trading volume of different fixed income products.

Figure 6: Trading volume of mainland China's fixed income market

Source: China Central Depository & Clearing Co., Ltd. (CCDC). Dec 2013

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Main players

The commercial banks are the main investors in fixed income markets of the PRC. Insurance companies and mutual funds are also the important players, but with smaller roles.

Figure 7: Major market players in terms of the holding % of all outstanding securities

Source: China Central Depository & Clearing Co., Ltd. (CCDC). Dec 2013

Trading platform

Interbank market transaction of fixed income products is over-the-counter, facilitated by market makers. Traditionally, the listed bond market is driven by continuously auction system. In order to enhance the transaction efficiency of fixed-income securities and improve market liquidity of the listed bond market, the Shanghai Stock Exchange launched the Integrated Electronic Platform for Fixed-income Securities in 2008. The following tables show the size of the bond market (by market type) in the PRC and the relevant regulators for each major type of products being traded:

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Table 1: Size of mainland China Bond Market (by market type) in 2013

In 100 Million RMB

End of 2013

Regulators

New

Issuance Total Inter-bank Exchanges OTC Other

Total

56,453.94 259,113.26 242,868.27 8,855.82

4,892.32

2,496.85

Government Bonds PBoC, MOF, CSRC

19,044.01 91,780.65 84,304.50 2,411.07

4,890.67

174.41

Central Bank Bonds PBoC

5,362.00 5,521.72 5,521.72 -

- -

Policy Bank Bonds PBoC, CBRC

19,960.30 88,719.58 86,849.58 -

-

1,870.00

Government

Supporting

Institution Bonds PBoC, MOF, CSRC

1,500.00 9,800.00 9,718.94 14.57

0.98

65.51

Commercial Bank

Bonds PBoC, CBRC

1,117.00 12,938.00 12,938.00 -

- -

Non-bank Financial

Institution Bonds PBoC, CBRC

189.00 362.00 362.00 -

- -

Corporate Bonds

NDRC, PBoC,

CSRC

4,752.30 23,358.65 16,542.26 6,430.18

0.67

385.54

Asset-backed

Securities/Mortgage-

backed Securities PBoC, CBRC,

109.06 171.39 169.99 -

-

1.40

Middle Term Notes PBoC, NAFMII

4,400.10 26,323.40 26,323.40 -

- -

SME Collective Notes PBoC, NAFMII

5.17 91.57 91.57 -

- -

Foreign Bonds

PBoC, MOF,

NDRC, CSRC

- 31.30 31.30 -

- -

Source: China Central Depository & Clearing Co., Ltd. (CCDC). Dec 2013

Key information with respect to each major market is summarized in the following table:

Table 2: Key information on major bond market in mainland China

Interbank Exchange

Key market participants

Institution investors, banks and financial institutions

Non-bank Institutions, individuals

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Counter parties

Institution investors, banks and financial institutions

China Securities Depository and Clearing Corporation Limited will act as the central counterparty for bond transactions on the PRC Stock Exchanges

Trading platform Trading center, OTC

Shanghai Stock Exchange (SHSE) Shenzhen Stock Exchange (SZSE)

Market share (% of total issuance in all markets)

Spot bonds (98%) Repos (71%)

Spot bonds (2%) Repo (29%)

Trading volume of different products (%in each market)

Spot bonds (20%) Repos (80%)

Spot bonds (2%) Repo (98%)

Trading/pricing mechanism

Quote negotiating Auto matching

Settlement Same date or next date settlement (T+0,T+1)

Same date settlement (T+0)

Regulators PBoC CSRC

Central clearing / Depository trust

China Central Depository & Clearing Co., Ltd. (CCDC)

China Securities Depository and Clearing Corporation Limited (CSDCC)

Liquidity high high

Minimum issuance requirements

No regulatory minimum credit rating requirements

For bonds listed and traded only through the comprehensive electronic platform of the PRC Stock Exchanges:

1. Minimum 1 year maturity 2. Minimum issuance size RMB 50 million

Additional requirements for bonds listed and traded also on other platform(s) of the PRC Stock Exchanges:

1. "AA" rating by the PRC Rating Agencies

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2. Before listing of the bonds:

a) for SZSE, the asset to liability ratio of the issuer at the end of the latest period shall be not higher than 70%, and the weighted average asset to liability ratio of all issuers shall be not higher than 70% if the bonds are issued by aggregate means; and

b) for SHSE, the latest closing net assets of the issuer shall not be less than RMB 1.5 billion

3. For SZSE, the annual average distributable profit realized by the issuer in the last 3 accounting years shall be not less than 150% of the bond's annual coupon payment, and the average distributable profit realized by all issuers in the last 3 accounting years shall be not less than 150% of the annual coupon payment of the bonds if the bonds are issued by aggregate means

4. For SHSE, the average distributable profit realized by the issuer in the last 3 accounting years before listing of the bonds shall be not less than 150% of the annual coupon payment of the bonds

Source: Corporate Bond Listing Rules of the Shenzhen Stock Exchange (rules 2.1 – 2.3) and Corporate Bond Listing Rules of the Shanghai Stock Exchange (rules 2.1-2.2)

Associated Risk Counterparty settlement risk

Credit risk on CSDCC acting as central counterparty for all bond transactions; Relatively lower liquidity than interbank market

Sources: www.china bond.com, Wind, CITIC Securities, Sep 2013

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19.4 Yield of major debt instruments

0 - 1 Year Maturity Yield

Fixed rate treasury bond 2.04% - 3.38%

Central bank bill/note 2.23% - 3.63%

Fixed rate policy bank bond 2.52% - 4.28%

Enterprise bond (AAA) 3.04% - 4.70%

Enterprise bond (AA+) 3.44% - 5.16%

Enterprise bond (AA) 3.58% - 5.36%

1 - 3 Year Maturity Yield

Fixed rate treasury bond 3.38% - 3.78%

Central bank bill/note 3.63% - 4.03%

Fixed rate policy bank bond 4.28% - 4.58%

Enterprise bond (AAA) 4.70% - 5.00%

Enterprise bond (AA+) 5.16% - 5.65%

Enterprise bond (AA) 5.36% - 6.08%

3 - 20 Year Maturity Yield

Fixed rate treasury bond 3.78% - 4.44%

Fixed rate policy bank bond 4.58% - 5.42%

Enterprise bond (AAA) 5.00% - 5.97%

Enterprise bond (AA+) 5.65% - 6.88%

Enterprise bond (AA) 6.08% - 7.47%

Source: China Central Depository & Clearing Co., Ltd. (CCDC). Jun 2014

The yield of major PRC debt instruments with less than one year maturity, one to three year maturity, and three to twenty year maturity was in the range of 2.04% to 5.36%, 3.38% to 6.08%, and 3.78% to 7.47%, respectively, as at 30 June 2014. (Source: www.chinabond.com.cn).

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Investors should note that the above is not an indication of the expected return of any Fund. There is no assurance that a Fund's return will be correlated with the expected yield of its underlying investments.

19.5 Regulatory bodies and credit rating agencies

Regulatory bodies in mainland China

CPs and MTNs are regulated by the National Association of Financial Market Institutional Investors ("NAFMII"). The NDRC corporate bonds are under the supervision of NDRC, and the CSRC corporate bonds and DCBs are regulated by CSRC.

Credit rating agencies

Currently, there are five major qualified rating agencies in the PRC: China Cheng Xin International Credit Rating ("CCXI"), China Lianhe Credit Rating ("CLCR"), Dagong Global Credit Rating ("DGCR"), Shanghai Brilliance Credit Rating & Investors Services ("SBCS"), and Pengyuan Credit Rating ("PCR").

Rating agencies are not regulated in the PRC at the moment. The regulatory bodies of each type of credit bond will authorize the rating agencies to give rating to the bonds. Different regulatory bodies in the PRC have different requirements for the qualification of rating agencies in its domain. For instance, CSRC does not allow joint ventures to become the rating agencies for the CSRC corporate bonds and DCBs. Therefore, CCXI and CLCR, two companies having stake investments from Moody's and Fitch respectively, have established subsidiaries to qualify as a rating agency to satisfy the regulatory requirement. The following table shows the regulatory supervision of the 5 rating agencies and their subsidiaries in the related markets:

Table 3: Rating agencies and regulatory supervision

CPs and MTNs (NAFMII) NDRC corp (NDRC) CSRC corp and DCBs (CSRC)

CCXI CCXI CCXR (CCXI's subsidiary)

SBCS SBCS SBCS

PCR PCR

DGCR DGCR DGCR

CLCR CLCR Tianjin CLCR (CLCR's subsidiary)

In terms of methodology adopted by the rating agencies in the PRC, the methodology used by some rating agencies in the PRC is similar to that used by international rating agencies. Nevertheless, the credit appraisal system in the PRC is at an early stage of development. There is no standard credit rating methodology used in investment appraisal and as such, the same rating scale may have different meaning with different agencies. The assigned ratings may not reflect the actual financial strength of the appraised asset.

According to a research report issued by Shanghai Brilliance Credit Ratings and Investors Services, around 91% of the bond issuers in the PRC are rated between AAA to AA-, and approximately 9% are rated as AA or below during the first half of 2013. However, the rating system in the PRC is different from western countries; there is no clear line between investment grade and non-investment grade. Like their global peers, the rating agencies in

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the PRC are facing the principal agency problem. There is the potential conflict of interest issue where the rating agencies are rating issuers and at the same time receive remuneration from such issuers.

Investors can go to the website of each rating agency (see below) to obtain rating information on an issuer, but most of the rating information is only available to paid investors:

http://www.ccxi.com.cn/199/301/ShortDownList.html

http://www.shxsj.com/

http://www.dagongcredit.com/dagongweb/index.php

http://www.pyrating.cn/

http://www.shxsj.com/en/

http://www.lianheratings.com.cn/

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B. FUND SPECIFIC PROSPECTUS OF CSI CHINA-HONG KONG LEADERS FUND

This Fund Specific Prospectus comprises information in relation to the CSI China-Hong Kong Leaders Fund (the "Fund"), a sub-fund of the Trust. Units in the Fund are now being offered for subscription on the terms set out in the Trust Prospectus and the Trust Deed. It is envisaged that further sub-funds of the Trust may be created in the future. The Trust is managed by CITIC Securities International Investment Management (HK) Limited.

20. CSI CHINA-HONG KONG LEADERS FUND

This document relates to the CSI China-Hong Kong Leaders Fund, a sub-fund established under the Trust and authorized by the SFC pursuant to section 104 of the SFO. SFC authorization is not a recommendation or endorsement of the Fund, nor does it guarantee the commercial merits of the Fund or its performance. It does not mean the Fund is suitable for all investors nor is it an endorsement of its suitability for any particular investor or class of investors. This Fund Specific Prospectus should be read in conjunction with the Trust Prospectus and the Product Key Facts Statement relating to the Fund. In case of discrepancies between Part A (the Trust Prospectus) and Part B (this Fund Specific Prospectus) of this document in relation to the CSI China-Hong Kong Leaders Fund, this Part B shall prevail.

21. DEFINITIONS

Defined terms used in this Fund Specific Prospectus which are not defined below bear the same meanings as in the Trust Prospectus.

"Business Day" any day other than Saturday or Sunday, on which banks in Hong Kong are open for normal banking business, but excluding any day on which a tropical cyclone warning signal 8 or higher or a black rain storm warning signal or any warning or signal considered by the Manager to be similar in effect is in force in Hong Kong after 9:00 a.m. (Hong Kong time) and before 5:00 p.m. (Hong Kong time) on that day unless the Manager and the Trustee otherwise agree;

"Dealing Day" daily on each Business Day;

"Fund" the CSI China-Hong Kong Leaders Fund, being a sub-fund of the Trust offered pursuant to this Fund Specific Prospectus;

"Issue Price" the Net Asset Value per Unit calculated as at the Valuation Point on the Dealing Day relating to the application for the issue of Units;

"Redemption Charge" a charge payable by the Unitholder and calculated as a percentage of the Redemption Price of each Unit which is being redeemed by that Unitholder;

- 56 -

"Redemption Price" the Net Asset Value per Unit calculated as at the Valuation Point on the Dealing Day relating to the application for redemption of Units;

"Subscription Charge" a charge payable by the Unitholder and calculated as a percentage of the Issue Price (as the case may be) of each Unit which is issued to that Unitholder;

"Trust Prospectus" the prospectus in Part A of this document relating to CSI Alpha Fund Series, as amended or supplemented from time to time;

"Valuation Point" means the close of business in the last relevant market to close on each relevant Dealing Day or such other time or times as the Manager may from time to time determine.

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22. SUMMARY

Set out below is a summary of the Fund. The summary information is derived from, and should be read in conjunction with, the full text of this Fund Specific Prospectus. Your attention is drawn to the section entitled "Risk Factors" in the Trust Prospectus. Key information in respect of the Fund is as follows:

Issue Price means the Net Asset Value per Unit calculated as at the Valuation Point, and subject to a Subscription Charge and any fiscal and purchase charges

Dealing Day daily on each Business Day

Initial Minimum Subscription Amount

HK$10,000

Subsequent Minimum Subscription Size

1 Unit

Minimum Holding HK$10,000

Manager CITIC Securities International Investment Management (HK) Limited

Trustee and Registrar BOCI-Prudential Trustee Limited

Fees payable by Unitholders

Subscription Charge Up to 5% of the Issue Price of each Unit

Transfer Fee Up to 3% of the Redemption Price of each Unit may be charged to the transferor by the Registrar on behalf of the Trustee for the registration of each transfer

Redemption Fee Up to 5% of the Redemption Price of each Unit

Fiscal and Purchase Charges Up to 2% of the Issue Price of each Unit (in case of subscription) or up to 2% of the Redemption Price of each Unit (in case of redemption) chargeable only to compensate the Fund for any dilution in the Fund's Net Asset Value as a result of a large volume of applications/redemptions by Unitholders, or a large application/redemption request from any Unitholder, on any Dealing Day and in the Manager's opinion the continuing Unitholders might otherwise be materially adversely affected.

Fees payable by the Fund

Management Fee Up to 2% per annum of the Net Asset Value of the Fund

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Performance Fee Nil

Trustee Fee Up to 0.5% per annum of the Net Asset Value of the Fund

Trustee Set-Up Fee The Trustee is entitled to receive from the Trust once-off establishment fee of up to HK$50,000 for the establishment of each Fund of the Trust.

Trustee Out-of-Pocket Expense Fee

The Trustee is entitled to receive reimbursement for out of pocket expenses such as postage and stationery.

Registrar's Fee The Trustee is entitled to receive up to 0.05% per annum of the Net Asset Value of the Fund for receiving and processing subscriptions and redemptions and preparation of monthly statements to investors.

23. INVESTMENT OBJECTIVE AND POLICY

23.1 Currency Denomination

Units in the Fund are denominated in HK dollars.

23.2 Investment Objective

The investment objective of the Fund is to achieve long-term appreciation of the Unit price through capital growth and income appreciation by investing in a diversified portfolio of at least twenty three blue chip equities, and to a limited extent, ADRs and GDRs, that are listed primarily on Hong Kong stock exchange and/or any international securities exchange and/or other organized securities markets that are open to the international public and on which such securities are regularly traded ("Recognized Stock Exchanges"), subject to the investment restrictions applicable to the Fund, as set out in the Trust Prospectus.

23.3 Investment Policy

The Fund will invest in equities, and to a limited extent, ADRs and GDRs, that are listed in Hong Kong and/or on the Recognized Stock Exchanges.

The Fund will invest at least 70% of its Net Asset Value, in listed equities with large capitalisation issued by companies established in Hong Kong or by companies whose shares are listed in Hong Kong (including but not limited to H-shares and shares of red-chip companies) which derive a predominant portion of their income, revenue, assets or economic activity from the PRC and Hong Kong. Large capitalisation equities are those with a minimum market capitalisation of at least HK$8 billion at the time of investment.

The Fund does not intend to enter into any financial derivative instruments, repo or other similar over-the-counter transactions for investment purposes.

For the purpose of hedging, the Fund may use financial derivative instruments such as options, futures or warrants which are economically appropriate to the reduction of relevant risks or costs subject to any such transactions complying with the overall investment

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restrictions of the Fund. The Fund may enter into futures, options and warrants contracts relating to financial instruments, provided that these transactions are conducted on a regulated market that operates regularly and is recognized and is open to the public. The Fund may also enter into forward purchase settlement transactions for the purposes of hedging with broker-dealers who make markets in these transactions and who are first class financial institutions that specialise in these types of transactions and are participants in the over-the-counter markets.

Investors should refer to section 7 of the Trust Prospectus for the specific risk considerations applicable to the use of options, futures or warrants.

The Fund does not intend to invest in physical commodities and/or commodity based investments (other than securities issued by companies engaged in producing, processing or trading in commodities).

23.4 Securities Lending Arrangements

The Manager may, with the consent of the Trustee, enter into securities lending transactions on behalf of the Fund provided that the following requirements are complied with:

(a) As part of its lending transactions, the Manager must in principle receive on behalf of the Fund collateral, the value of which at the conclusion of the contract shall be at least equal to the global aggregate valuation of the securities lent.

(b) The collateral must be in the form of government bonds, highly rated AA corporate bonds (or above), bonds, cash and cash instruments.

(c) The minimum financial standing of counterparties must be A-1+ (Standard and Poor's) or P1/Prime-1 rated (Moody's).

(d) Securities lending transactions may not exceed 30% of their global valuation of the securities portfolio of the Fund.

(e) All income arising from the securities lending transactions will be retained for the benefit of the Fund.

24. INVESTMENT RESTRICTIONS

The Fund is subject to the investment restrictions described in the "Investment Restrictions" section in the Trust Prospectus.

25. BORROWING RESTRICTIONS

The maximum borrowings of the Fund may not exceed 25% of its total Net Asset Value. For the purposes of this restriction, back-to-back loans do not count as borrowing.

Borrowing may only be effected on a temporary basis for the purpose of meeting redemption requests or defraying fees, costs, charges, expenses and disbursements of the Fund or the Trust in accordance with the provisions of the Trust Deed.

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26. SUBSCRIPTION FOR UNITS

26.1 Issue Price

Each Unit will be offered at the Issue Price, being the Net Asset Value per Unit calculated as at the Valuation Point, and again subject to a Subscription Charge and any fiscal and purchase charges.

Units were initially issued to the public in July 2009 at the initial issue price of HK$10 per Unit subject to the Subscription Charge.

26.2 Minimum subscription and minimum holding

The initial minimum subscription amount that must be subscribed for the Units is HK$10,000 with a subsequent minimum subscription of one Unit. The minimum holding of Units is HK$10,000. The Manager may, at its discretion, waive or modify these minimum limits.

26.3 Application procedure

When an investor submits the application form via his/her authorized distributor, that investor should confirm the relevant cut-off time with the authorized distributor. This cut-off time will be earlier than the application deadline of the Trustee listed below.

Applications for Units in the Fund received by the Trustee (from the Manager or authorized distributor) prior to 5:00 p.m. (Hong Kong time) on any Dealing Day will be effected at the Issue Price plus the Subscription Charge and each amount, if any, per Unit as the Manager may determine represents fiscal and purchase charges. An application for Units received by the Trustee (from the Manager or authorized distributor) after the application deadline on any Dealing Day, or on any day that is not a Dealing Day, will usually be processed on the next Dealing Day.

Notwithstanding the immediately preceding paragraph, the Manager, may at its absolute discretion and upon consultation with the Trustee, accept applications for Units after 5:00 p.m. (Hong Kong time) on any Dealing Day. Such applications for Units may be processed on the same Dealing Day if the Manager agrees in consultation with the Trustee.

Investors should confirm the relevant cut-off time with the authorised distributors if they choose to submit the application form through such a distributor.

27. REDEMPTION OF UNITS

27.1 Redemption of Units

A Unitholder may redeem all or some of its Units in whole on any Dealing Day. A Unitholder wishing to redeem its Units should confirm the minimum redemption size with his/her authorized distributor. Partial redemptions may be made, as long as the minimum holding of HK$10,000 remains in the Unitholder's account after the redemption is completed. If, after redemption, a Unitholder would be left with a balance of Units having a value of less than the minimum holding, the Manager may decide that this request be treated as a request for redemption for the full balance of the Unitholder's holding of Units. A Unitholder wishing to redeem its Units should complete a redemption form and return it as instructed on

- 61 -

the redemption form. Redemption forms can be obtained from the Manager or authorized distributor.

27.2 Redemption procedure

When an investor submits the redemption request via his/her authorized distributor, that investor should confirm the relevant cut-off time with the authorized distributor. This cut-off time will be earlier than the redemption deadline of the Trustee listed below.

Redemption requests for Units in the Fund received by the Trustee (from the Manager or authorized distributor) prior to 5:00 p.m. (Hong Kong time) on a Dealing Day will be effected at the Redemption Price less the Redemption Charge and each amount, if any, per Unit as the Manager may determine represents fiscal and purchase charges. Redemption requests received by the Trustee (from the Manager or authorized distributor) after 5:00 p.m. (Hong Kong time) on a Dealing Day, or on a day which is not a Dealing Day, will be processed on the next Dealing Day.

Notwithstanding the immediately preceding paragraph, the Manager, may at its absolute discretion and upon consultation with the Trustee, accept redemption requests for Units after 5:00 p.m. (Hong Kong time) on any Dealing Day. Such redemption requests may be processed on the same Dealing Day if the Manager agrees in consultation with the Trustee.

Investors should confirm the relevant cut-off time with the authorised distributors if they choose to submit the redemption request through such a distributor.

If the Manager or the Trustee is required by the laws of any relevant jurisdiction to withhold any redemption moneys payable to the holder of a Unit the amount of such amount shall be deducted from the redemption moneys otherwise payable to such person.

28. CALCULATION OF NET ASSET VALUE

The Net Asset Value per Unit will be determined by the Trustee as at the Valuation Point in accordance with the terms of the Trust Deed. The details of the valuation rules are described in the Trust Prospectus under "Calculation of Net Asset Value".

29. DISTRIBUTION POLICY

The Manager does not presently intend to make cash distributions in respect of the Fund. Income earned by the Fund will be reinvested in the Fund and reflected in the value of its Units.

30. CHARGES AND EXPENSES

Fees payable by Unitholders:

30.1 Subscription Charge and Redemption Charge

The Manager is entitled to receive a Subscription Charge of up to 5% of the Issue Price of each Unit and a Redemption Charge of up to 5% of the Redemption Price of each Unit.

The Manager may pay the whole or a part of the proceeds from the Subscription Charge and/or redemption charge to any intermediary.

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30.2 Transfer Fee

Should a Unitholder wish to transfer one or more Units a fee of up to 3% of the Redemption Price of each Unit may be charged to the transferor by the Registrar on behalf of the Trustee for the registration of each transfer.

30.3 Fiscal and Purchase Charges

Up to 2% of the Issue Price of each Unit (in case of subscription) or up to 2% of the Redemption Price of each Unit (in case of redemption) may be chargeable only to compensate the Fund for any dilution in the Fund's Net Asset Value as a result of a large volume of applications/redemptions by Unitholders, or a large application/redemption request from any Unitholder, on any Dealing Day and in the Manager's opinion the continuing Unitholders might otherwise be materially adversely affected. Please refer to sections 10.1 and 11.2 of the Trust Prospectus for further details.

Fees payable by the Fund:

30.4 Management Fee

The Manager is entitled to receive, on an annual basis, a management fee from the Trust, at a rate of up to 2% per annum with respect to the Units of the Net Asset Value of the Fund calculated and accrued as at each Dealing Day. The management fee is payable monthly in arrears.

30.5 Trustee Fee

The Trustee will receive up to 0.5% per annum of the Net Asset Value of this Fund (the "Trustee Fee"). The Trustee Fee is calculated and accrued as at each Dealing Day and is payable monthly in arrears. The Trustee Fee includes the fees payable for the services rendered in its capacity as trustee of the Trust and custodian of the assets of the Fund.

The Trustee is also entitled to receive from the Trust (a) once-off set up fee of up to HK$50,000 for the establishment of each sub-fund of the Trust; (b) reimbursement for relevant out-of-pocket expenses and disbursements incurred for the Fund; and (c) various transaction fees to cover settlement of transactions, the receipt of dividends from Fund assets and other fees and charges as agreed with the Manager from time to time.

30.6 Registrar's Fees

The Trustee is entitled to receive up to 0.05% per annum administrative fee of the Net Asset Value of the Fund ("Registrar's Fee") for receiving and processing applications and redemptions, conversions of Units and preparation of monthly statements for Unit Holders. Should the number of Unit Holders become greater than 30, the Trustee is entitled to HK$20 per monthly statement for each additional Unit Holder.

The total of the Trustee Fee, valuation fee and Registrar's Fee payable to BOCI-Prudential Trustee Limited in its capacity as the Trustee and Registrar of the Fund is subject to a minimum monthly fee of up to HK$30,000 for the Fund.

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C. FUND SPECIFIC PROSPECTUS OF CSI RMB INCOME FUND

This Fund Specific Prospectus comprises information in relation to the CSI RMB Income Fund (the "Fund"), a sub-fund of the Trust. Units in the Fund are now being offered for subscription on the terms set out in the Trust Prospectus and the Trust Deed. It is envisaged that further sub-funds of the Trust may be created in the future. The Trust is managed by CITIC Securities International Investment Management (HK) Limited.

31. CSI RMB INCOME FUND

This document relates to the CSI RMB Income Fund, a sub-fund established under the Trust and authorized by the SFC pursuant to section 104 of the SFO. SFC authorization is not a recommendation or endorsement of the Fund, nor does it guarantee the commercial merits of the Fund or its performance. It does not mean the Fund is suitable for all investors nor is it an endorsement of its suitability for any particular investor or class of investors. This Fund Specific Prospectus should be read in conjunction with the Trust Prospectus and the Product Key Facts Statement relating to the Fund. In case of discrepancies between Part A (the Trust Prospectus) and Part C (this Fund Specific Prospectus) of this document in relation to the CSI RMB Income Fund, this Part C shall prevail.

32. DEFINITIONS

Defined terms used in this Fund Specific Prospectus which are not defined below bear the same meanings as in the Trust Prospectus.

"Business Day" any day other than Saturday or Sunday, on which banks in Hong Kong and the PRC are open for normal banking business, but excluding any day on which a tropical cyclone warning signal 8 or higher or a black rain storm warning signal or any warning or signal considered by the Manager to be similar in effect is in force in Hong Kong after 9:00 a.m. (Hong Kong time) and before 5:00 p.m. (Hong Kong time) on that day unless the Manager and the Trustee otherwise agree;

"China A-shares" means securities of companies incorporated in China and listed on a PRC Stock Exchange, traded in RMB and available for investment by domestic investors, qualified foreign institutional investors and RQFIIs;

"Credit Products" has the meaning as defined at page 42;

"CSDCC" means the China Securities Depository & Clearing Corporation Limited;

"Dealing Day" each Business Day and such other day(s) as the Manager may from time to time determine;

"Fund" the CSI RMB Income Fund, being a sub-fund of the Trust offered pursuant to this Fund Specific Prospectus;

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"IR Products" has the meaning as defined at page 42;

"Issue Price" the Net Asset Value per Unit calculated as at the Valuation Point on the Dealing Day relating to the application for the issue of Units;

"mainland China" or "PRC" means the People's Republic of China (excluding, for the purposes of the Trust Prospectus and this Fund Specific Prospectus, the Hong Kong Special Administrative Region, Macao Special Administrative Region and Taiwan);

"PRC Rating Agencies" means (i) China Cheng Xin International Credit Rating, (ii) China Lianhe Credit Rating, (iii) Dagong Global Credit Rating, (iv) Shanghai Brilliance Credit Rating and Investors Services, and (v) Pengyuan Credit Rating;

"PRC Stock Exchanges" means the Shanghai Stock Exchange, the Shenzhen Stock Exchange and any other stock exchange that opens in the PRC;

"QFII Quota" means a PRC foreign exchange investment quota granted to a qualified foreign institutional investor pursuant to the QFII Regulations;

"QFII Regulations" means the regulations and rules, as amended from time to time, governing the establishment and operation of qualified foreign institutional investors and QFII Quotas;

"Redemption Charge" a charge payable by the Unitholder and calculated as a percentage of the Redemption Price of each Unit which is being redeemed by that Unitholder;

"Redemption Price" the Net Asset Value per Unit calculated as at the Valuation Point on the Dealing Day relating to the application for redemption of Units;

"RMB" means Renminbi, the lawful currency of the PRC;

"RMB Debt Instruments" has the meaning as defined at page 42;

"RQFII" means a RMB qualified foreign institutional investor under the RQFII Regulations;

"RQFII Permitted Securities"

means securities and investments permitted to be held or made by RQFIIs under RQFII Regulations, which currently include the following RMB denominated financial instruments:

(a) China A-shares;

(b) fixed income securities traded on the PRC Stock

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Exchanges or the interbank market in the PRC;

(c) PRC securities investment funds approved by the CSRC; and

(d) other financial instruments from time to time approved by CSRC or the People's Bank of China;

"RQFII Quota" means a RMB investment quota granted to a RQFII pursuant to the RQFII Regulations;

"RQFII Regulations" means the regulations and rules, as amended from time to time, governing the establishment and operation of RQFIIs and RQFII Quotas;

"SAFE" means the PRC State Administration of Foreign Exchange, the government agency responsible for matters relating to foreign exchange administration;

"Subscription Charge" a charge payable by the Unitholder and calculated as a percentage of the Issue Price of each Unit which is issued to that Unitholder;

"Trust Prospectus" the prospectus in Part A of this document relating to CSI Alpha Fund Series, as amended or supplemented from time to time;

"Valuation Point" means the close of business in the last relevant market to close on each relevant Dealing Day or such other time or times as the Manager may from time to time determine.

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33. SUMMARY

Set out below is a summary of the Fund. The summary information is derived from, and should be read in conjunction with, the full text of this Fund Specific Prospectus. Your attention is drawn to the section entitled "Risk Factors" in the Trust Prospectus and the section entitled "Fund Specific Risk Factors" in this Fund Specific Prospectus. Key information in respect of the Fund is as follows:

Issue Price means the Net Asset Value per Unit calculated as at the Valuation Point, and subject to a Subscription Charge and any fiscal and purchase charges

Dealing Day each Business Day and such day(s) as the Manager may from time to time determine

Initial Minimum Subscription Amount

RMB10,000

Subsequent Minimum Subscription Size

RMB10,000

Minimum Redemption Size RMB10,000

Minimum Holding RMB10,000

Manager CITIC Securities International Investment Management (HK) Limited

Trustee and Registrar BOCI-Prudential Trustee Limited

RQFII Licence Holder CITIC Securities International Company Limited, which conducts the relevant RQFII business through the Manager

Global Custodian Bank of China (Hong Kong) Limited

PRC Sub-Custodian Bank of China Limited

Fees payable by Unitholders

Subscription Charge Up to 5% of the Issue Price of each Unit

Transfer Fee Nil

Redemption Charge Nil

Fiscal and Purchase Charges Up to 2% of the Issue Price of each Unit (in case of subscription) or up to 2% of the Redemption Price of each Unit (in case of redemption) chargeable only to compensate the Fund for any dilution in the Fund's Net Asset Value as a result of a large volume of applications/redemptions by Unitholders, or a large application/redemption request from

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any Unitholder, on any Dealing Day and in the Manager's opinion the continuing Unitholders might otherwise be materially adversely affected.

Fees payable by the Fund

Management Fee 1% per annum of the Net Asset Value of the Fund

Performance Fee Nil

Trustee Fee 0.175% per annum of the Net Asset Value of the Fund until 31 May 2014, effective from 1 June 2014, up to 0.15% per annum of the Net Asset Value of the Fund, subject to a monthly minimum fee of RMB40,000

Trustee Set-Up Fee The Trustee is entitled to receive from the Trust once-off establishment fee of up to RMB10,000 for the establishment of each Fund of the Trust

Trustee Out-of-Pocket Expense Fee

The Trustee is entitled to receive reimbursement for out of pocket expenses such as postage and stationery

Global Custodian Fee Up to 0.10% per annum of the Net Asset Value of the Fund plus transaction fees at customary rates dependent on the market the Fund invests and out of pocket expenses incurred by the Global Custodian and the PRC Sub-Custodian

PRC Sub-Custodian Fee Covered under Global Custodian Fee

34. INVESTMENT OBJECTIVE AND POLICY

34.1 Currency Denomination

Units in the Fund are denominated in RMB.

34.2 Investment Objective

The investment objective of the Fund is to achieve long-term appreciation of the Unit price through capital growth and income appreciation by investing primarily in a diversified portfolio of RMB denominated and settled debt instruments and RMB denominated and settled equities or equity related securities, subject to the investment policy and restrictions set out below and the investment restrictions applicable to the Fund, as set out in the Trust Prospectus.

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34.3 Investment Policy

Asset Allocation Policy

The Fund will invest, in compliance with relevant asset allocation rules of RQFII Regulations, at least 80% of its Net Asset Value in RMB Debt Instruments which include IR Products and Credit Products in the PRC, and fixed income funds which are authorized by the CSRC for offer to the retail public in the PRC. No more than 20% of the Fund's Net Asset Value will be invested in (without any minimum investment allocation) RMB denominated and settled equities or equity related securities (mainly China A-shares) and equity funds which are authorised by the CSRC for offer to the retail public in the PRC, with any remainder held in RMB denominated cash or cash equivalents in the PRC.

The Fund's investment in both fixed income funds and equity funds which are authorized by the CSRC for offer to the retail public in the PRC will not in aggregate exceed 10% of the Net Asset Value of the Fund.

Sector Allocation and Diversification

The portfolio of the Fund will mainly consist of RMB Debt Instruments with different maturities and credit quality. Depending on market situations and subject to the asset allocation policy above, the Fund may also invest in fixed income funds and equity funds which are authorized by the CSRC for offer to the retail public in the PRC, China A-shares and RMB denominated and settled equities listed in the PRC. Each instrument in the portfolio of the Fund will be selected based on extensive fundamental research.

Subject to the above asset allocation policy, the Manager will adjust the allocation of investment among debt instruments, fixed income funds and equity funds which are authorized by the CSRC for offer to the retail public in the PRC, equities or equity related securities and cash or cash equivalents to seek better risk adjusted returns among various investment instruments. The Manager will also diversify its investment into different industry sectors with low correlations to reduce exposures to systematic risk.

For investment in debt instruments, the Manager will conduct extensive research on the fundamentals of issuers in order to seek excess return with regard to credit ratings and fundamentals.

Management of the Yield Curve

The Manager will adjust the allocation of the term or maturity structure of the debt instruments based on the expected changes in the shape of the RMB yield curve term structure.

The Manager may adopt a bullet-type, barbell-type or ladder-type strategy depending on prevailing market conditions. A bullet-type strategy is a strategy by which a portfolio is constructed concentrating in one maturity area in the expectation of a non-parallel shift of a yield curve; a barbell-type strategy is a strategy by which a portfolio is constructed concentrating in both short-term and long-term bonds in the expectation of a decline in interest rate in both ends of the yield curve; and a ladder-type strategy is a strategy by which a portfolio is constructed with equal allocation at each maturity group in the expectation of a parallel shift of a yield curve.

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Management of Duration

The Manager will adjust the duration risk of the investment portfolio based on expectations of global and the PRC's macroeconomic cycle and monetary policy. If RMB interest rate is expected to fall, the Manager will increase the average duration of the investment portfolio to better benefit from the capital gains from lower yield, and vice versa.

Product Selection

The Fund will invest at least 80% of its Net Asset Value in RMB Debt Instruments which include IR Products and Credit Products available through the interbank market and exchange market in Shanghai and Shenzhen stock exchanges, and fixed income funds which are authorized by the CSRC for offer to the retail public in the PRC. The Fund may invest up to 100% of its Net Asset Value in each of urban investment bonds, asset-backed securities (including asset-backed commercial papers) and any other types of RMB Debt Instruments. For more information and risks related to urban investment bonds and asset-backed securities, please refer to the paragraphs "Risk of investing in urban investment bonds" and "Risk of investing in asset-backed securities/ mortgage backed securities" respectively in the "Fund Specific Risk Factors" section.

While the Fund may invest up to 100% of its assets in IR Products (issued by the central government, policy bank or central bank) which are generally unrated, for Credit Products, the Fund will only invest in those with a minimum rating of 'AA' being rated by any of the PRC Rating Agencies at the time of acquisition.

In the event that a Credit Product is downgraded to below 'AA' rating after its acquisition by the Fund, the Manager will try to dispose such Credit Product, subject to market liquidity, and provided that it is in the best interest of the Unitholders. The Fund will not invest in Credit Products that are unrated or rated ‘BB+’ or below.

No more than 20% of the Fund's Net Asset Value will be invested in RMB denominated and traded equities or equity related securities (mainly China A-shares) in the PRC and equity funds which are authorized by the CSRC for offer to the retail public in the PRC, with any remainder held in RMB denominated cash or cash equivalents in the PRC.

Indicative asset allocation of the Fund

The following is an indicative investment allocation of the Fund. Investors should note that the Manager may from time to time adjust the asset allocation according to prevailing market conditions.

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Types of Assets Indicative percentage of the Fund's Net Asset Value

RMB Debt Instrument in the PRC and fixed income funds which are authorized by the CSRC for offer to the retail public in the PRC

80 - 100%

RMB denominated and settled equity securities, equity funds which are authorized by the CSRC for offer to the retail public in the PRC, and cash or cash equivalents in the PRC

up to 20%

Investment through the RQFII Quota

Currently, foreign investors are generally unable to invest in RQFII Permitted Securities other than through QFII Quotas (to the extent applicable) or RQFII Quotas approved under the QFII Regulations or RQFII Regulations respectively. Under the RQFII Regulations, amongst other eligible entities, Hong Kong subsidiaries of PRC domestic brokerages firms that meet the relevant prescribed eligibility requirements may apply to the CSRC for a securities investment licence as a RQFII and correspondingly apply to SAFE for RQFII Quota for investment into RQFII Permitted Securities. CITIC Securities International Company Limited has been approved as a RQFII under the RQFII Regulations, but is required to conduct its RQFII business through the Manager. CITIC Securities International Company Limited has been granted a RQFII Quota by SAFE which can be utilized by the Fund under the management of the Manager.

CITIC Securities International Company Limited was incorporated in Hong Kong on 9 April 1998 and has its principal office in Hong Kong. CITIC Securities International Company Limited is a wholly owned subsidiary of CITIC Securities Co., Ltd., a company incorporated in the PRC and regulated as a securities company by CSRC. The Manager is an indirect subsidiary of CITIC Securities International Company Limited.

The Fund will invest via the RQFII Quota granted to CITIC Securities International Company Limited by SAFE.

Financial Derivative Instruments

The Fund does not intend to invest in any financial derivative instruments for purposes of investment, hedging or otherwise.

Securities Lending and Repurchase Transactions

The Fund does not intend to enter into any securities lending transactions, repurchase/reverse repurchase transactions or other similar over-the-counter transactions. Should the Manager wishes to enter into any such transactions on behalf of the Fund, this will be subject to the prior approval of the SFC and at least one month's prior notice will be given to Unitholders.

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34.4 Effect of RQFII Regulations on Redemptions

The repatriation of invested capital and of income and capital gains of the Fund from PRC is subject to the RQFII Regulations. Currently, under the RQFII Regulations, remittance and repatriation for the account of the Fund may be effected on a daily basis through the RQFII Quota based on the net subscriptions and redemptions of Units of the Fund. At present, there is no regulatory prior approval requirement for repatriation of funds from the RQFII Quota however there is no certainty that no regulatory restrictions will apply to the repatriation of funds by the Fund in the PRC in the future.

Please note that redemptions on any Dealing Day are subject to redemption restrictions described in the Trust Prospectus (including suspension of redemption and/or delay of payment of redemption monies) and in case of repatriation restrictions being imposed in the future, it is possible that the Manager may not resume acceptance of redemption request and/or make payment of redemption monies for as long as the time required for repatriation of funds from the RQFII Quota subject to regulatory restrictions in the PRC.

34.5 RQFII Quota Limitation

The RQFII Quota granted to CITIC Securities International Company Limited by SAFE is shared among the Fund and other open-ended funds managed by the Manager. CITIC Securities International Company Limited (as RQFII) can allocate the available RQFII Quota flexibly across the open-ended funds under the management of the Manager. The Manager may allocate more RQFII Quota to the Fund from other open-ended funds to meet subscription demands. However, it is also possible that the Manager may not accept additional subscriptions when there is not enough RQFII Quota available to the Fund. The Manager will monitor the usage of the RQFII Quota from time to time and apply for additional RQFII Quota where necessary.

34.6 Potential Conflict of Interest

Investors should be aware that:

(i) the Trustee, the Global Custodian and the PRC Sub-Custodian are affiliates of each other; and

(ii) the Global Custodian, the PRC Sub-Custodian or their affiliates may act as a counterparty in a securities transaction of the Fund.

Potential conflicts of interest may exist in the performance of the functions of the Trustee, the Global Custodian and the PRC Sub-Custodian as they are affiliates of each other. However each entity has different set of business objectives, activities, reporting lines and senior management. Each of the Trustee, the Global Custodian and the PRC Sub-Custodian will comply with their respective regulatory obligations (where applicable) for managing conflicts of interests and have policies in place to deal with them. In particular there are effective Chinese walls and information barriers in place to separate the entities (internally and externally).

With respective to the potential conflicts of interest where the PRC Sub-Custodian, on one hand, acting as the custodian of the Fund, and on the other hand where it or its affiliates may act as the counterparty in securities transactions, within the PRC Sub-Custodian, there are

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segregation of duties between roles, functions and departments with effective Chinese walls and information barriers in place. The PRC Sub-Custodian has internal and external audit to ensure conflicts of interests are properly managed. The PRC Sub-Custodian is also subject to the supervision of the PBoC.

35. CUSTODY

The Trustee takes into its custody or under its control the Fund's assets, including PRC assets deposited in the securities and RMB cash accounts with the PRC Sub-Custodian (defined below), and holds the same in trust for Unitholders. The Trustee has appointed Bank of China (Hong Kong) Limited (the "Global Custodian") as its global custodian pursuant to a Custodian Agreement, pursuant to which the Global Custodian shall hold the assets of the Fund as custodian. The Global Custodian will appoint Bank of China Limited (the "PRC Sub-Custodian") as its sub-custodian pursuant to a RQFII Sub-Custodian Agreement among CITIC Securities International Company Limited (as RQFII), the Manager, the Global Custodian and the PRC Sub-Custodian, pursuant to which the PRC Sub-Custodian shall hold the assets of the Fund invested in the PRC through the RQFII Quota held by CITIC Securities International Company Limited. The RQFII Sub-Custodian Agreement will be supplemented by a RQFII supplemental custodian agreement to which the Trustee is also a party. The Trustee is liable for the acts and omissions of the PRC Sub-Custodian in relation to the assets forming part of the property of the Fund.

The Trustee registers the Fund's assets, including PRC assets deposited via the Global Custodian in the securities and RMB cash accounts opened and maintained with the PRC Sub-Custodian, to the order of the Trustee.

Instructions to execute transactions with respect to the Fund's assets in the securities account(s) and the RMB cash account(s) as well as other matters such as the repatriation of funds shall be given by the Manager and delivered through the Trustee and the Global Custodian to the PRC Sub-Custodian (i.e. not delivered to the PRC Sub-Custodian directly). The PRC Sub-Custodian will look to the Trustee via the Global Custodian for instructions and solely act in accordance with the instructions of the Trustee or authorities granted by the Trustee.

The Manager and the Trustee have obtained an opinion from PRC legal counsel to the effect that, as a matter of PRC laws:

(a) securities account(s) and RMB cash account(s) with the PRC Sub-Custodian, CSDCC and China Central Depositary & Clearing Co., Ltd. where applicable (respectively, the "securities account" and the "cash account") for the Fund shall be opened for the sole benefit and use of the Fund in accordance with all applicable laws and regulations of the PRC and with approval from all competent authorities in the PRC;

(b) the assets held/credited in the securities account (i) belong solely to the Fund, and (ii) are segregated and independent from the proprietary assets of CITIC Securities International Company Limited (as RQFII), the Manager, the PRC Sub-Custodian and any PRC broker of the Fund and from the assets of other clients of CITIC Securities International Company Limited (as RQFII), the Manager, the PRC Sub-Custodian and any PRC broker of the Fund;

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(c) the assets held/credited in the cash account (i) become an unsecured debt owing from the PRC Sub-Custodian to the Fund, and (ii) are segregated and independent from the proprietary assets of CITIC Securities International Company Limited (as RQFII), the Manager, and any PRC broker of the Fund, and from the assets of other clients of CITIC Securities International Company Limited (as RQFII), the Manager, and any PRC broker of the Fund;

(d) the Trustee, for and on behalf of the Fund, is the only entity which has a valid claim of ownership over the assets in the securities account and the debt in the amount deposited in the cash account of the Fund;

(e) if CITIC Securities International Company Limited, the Manager or any PRC broker of the Fund is liquidated, the assets contained in the securities account and cash account of the Fund will not form part of the liquidation assets of CITIC Securities International Company Limited, the Manager or such PRC broker of the Fund in liquidation in the PRC; and

(f) if the PRC Sub-Custodian is liquidated, (i) the assets contained in the securities account of the Fund will not form part of the liquidation assets of the PRC Sub-Custodian in liquidation in the PRC, and (ii) the assets contained in the cash account of the Fund will form part of the liquidation assets of the PRC Sub-Custodian in liquidation in the PRC and the Fund will become an unsecured creditor for the amount deposited in the cash account.

36. INVESTMENT RESTRICTIONS

The Fund is subject to the investment restrictions described in the "Investment Restrictions" section in the Trust Prospectus and the following restrictions:

According to the RQFII Regulations, (i) the Fund investing through RQFII may not hold more than the prescribed regulatory limit (currently at 10%) of the total outstanding shares in a company listed in mainland China, and (ii) the aggregate holdings of all offshore investors (through any QFIIs and RQFIIs) in China A-shares may not be more than the prescribed regulatory limit (currently at 30%) of the total outstanding shares in that company.

37. BORROWING RESTRICTIONS

The maximum borrowings of the Fund may not exceed 25% of its total Net Asset Value. For the purposes of this restriction, back-to-back loans do not count as borrowing.

Borrowing may only be effected outside mainland China on a temporary basis for the purpose of meeting redemption requests or defraying fees, costs, charges, expenses and disbursements of the Fund or the Trust in accordance with the provisions of the Trust Deed.

38. UNIT CLASSES

Units of the Fund will be sub-divided into Distribution Unit Class (where dividends declared will be paid to the Unitholders) and Accumulation Unit Class (where no dividends will be distributed). Units of the Distribution Unit Class and the Accumulation Unit Class are offered on the same terms except for the difference in distribution policy. Please refer to section 42 for further details.

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39. SUBSCRIPTION FOR UNITS

39.1 Issue Price

Each Unit will be offered at the Issue Price, being the Net Asset Value per Unit calculated as at the Valuation Point, and again subject to a Subscription Charge and any fiscal and purchase charges. The Manager may exercise its discretion to close the Fund for subscription when the RQFII Quota has been filled up.

Units were initially issued to the public in February 2013 at the initial issue price of RMB10 subject to the Subscription Charge.

39.2 Minimum subscription and minimum holding

The initial minimum subscription amount that must be subscribed for the Units is RMB10,000 with a subsequent minimum subscription of RMB10,000. The minimum holding of Units is RMB10,000. The Manager may, at its discretion, waive or modify these minimum limits.

39.3 Application procedure

When an investor submits the application form via his/her authorized distributor, that investor should confirm the relevant cut-off time with the authorized distributor. This cut-off time will be earlier than the application deadline of the Trustee listed below.

Applications for Units in the Fund received by the Trustee (from the Manager or authorized distributor) prior to 5:00 p.m. (Hong Kong time) on any Dealing Day will be effected at the Issue Price plus the Subscription Charge and each amount, if any, per Unit as the Manager may determine represents fiscal and purchase charges. An application for Units received by the Trustee (from the Manager or authorized distributor) after the application deadline on any Dealing Day, or on any day that is not a Dealing Day, will usually be processed on the next Dealing Day.

Subscriptions will only be accepted in RMB.

40. REDEMPTION OF UNITS

40.1 Redemption of Units

A Unitholder may redeem all or some of its Units in whole on any Dealing Day. A Unitholder wishing to redeem its Units should confirm the minimum redemption size with his/her authorized distributor. Partial redemptions may be made, as long as the minimum holding of RMB10,000 remains in the Unitholder's account after the redemption is completed. If, after redemption, a Unitholder would be left with a balance of Units having a value of less than the minimum holding, the Manager may decide that this request be treated as a request for redemption for the full balance of the Unitholder's holding of Units. A Unitholder wishing to redeem its Units should complete a redemption form and return it as instructed on the redemption form. Redemption forms can be obtained from the Manager or authorized distributor.

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40.2 Redemption procedure

When an investor submits the redemption request via his/her authorized distributor, that investor should confirm the relevant cut-off time with the authorized distributor. This cut-off time will be earlier than the redemption deadline of the Trustee listed below.

Unitholders may apply to convert Units in the Fund for Units of another sub-fund of the Trust, or Units between different classes in the Fund, that has the same base and class currency of RMB. Please see paragraph entitled "Conversion of units" in the Trust Prospectus.

Redemption requests for Units in the Fund received by the Trustee (from the Manager or authorized distributor) prior to 5:00 p.m. (Hong Kong time) on a Dealing Day will be effected at the Redemption Price less the Redemption Charge and each amount, if any, per Unit as the Manager may determine represents fiscal and purchase charges. Redemption requests received by the Trustee (from the Manager or authorized distributor) after 5:00 p.m. (Hong Kong time) on a Dealing Day, or on a day which is not a Dealing Day, will be processed on the next Dealing Day.

Generally the maximum interval between the receipt of a redemption deadline and the payment of redemption proceeds will not exceed four weeks. However a substantial portion of the Fund's investments may be subject to legal or regulatory requirements of the PRC which may render payment within four weeks impracticable. If there is a delay in receipt by the Manager or the Trustee of the proceeds on sale of the Fund's investments to meet redemption requests, the Manager or the Trustee may delay the payment of the relevant portion of the amount due on the redemption of Units.

If the Manager or the Trustee is required by the laws of any relevant jurisdiction to withhold any redemption moneys payable to the holder of a Unit the amount of such amount shall be deducted from the redemption moneys otherwise payable to such person.

All redemption moneys will be paid in RMB.

41. CALCULATION OF NET ASSET VALUE

The Net Asset Value per Unit will be determined by the Trustee as at the Valuation Point in accordance with the terms of the Trust Deed. The details of the valuation rules are described in the Trust Prospectus under "Calculation of Net Asset Value".

The Net Asset Value per Unit of the Fund will be published daily in the Standard and the Hong Kong Economic Times.

42. DISTRIBUTION POLICY

At the discretion of the Manager, declaration of dividends may be made on annual basis in December each year in RMB. However, the Manager has discretion to decide whether or not to declare any dividends, the frequency of distribution and amount of dividends. There is no guarantee of regular distribution and if distribution is made, the amount being distributed. It is the intention of the Manager that only the net income (the income net of expenses) for the Fund may be distributed. No distribution will be paid out of the Fund's capital.

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With respect to Distribution Unit Class, the amount of dividends declared will be paid to Unitholders accordingly.

With respect to Accumulation Unit Class, no distribution of dividends will be made. Therefore, any net income and net realized profits attributable to such Units will be reflected in the Net Asset Value of the Units.

43. CHARGES AND EXPENSES

Fees payable by Unitholders:

43.1 Subscription Charge and Redemption Charge

The Manager is entitled to receive a Subscription Charge of up to 5% of the Issue Price of each Unit and currently no Redemption Charge is applicable.

The Manager may pay the whole or a part of the proceeds from the Subscription Charge and/or Redemption Charge to any intermediary.

43.2 Transfer Fee

Should a Unitholder wish to transfer one or more Units, currently no transfer fee is chargeable to the transferor.

43.3 Fiscal and Purchase Charges

Up to 2% of the Issue Price of each Unit (in case of subscription) or up to 2% of the Redemption Price of each Unit (in case of redemption) may be chargeable only to compensate the Fund for any dilution in the Fund's Net Asset Value as a result of a large volume of applications/redemptions by Unitholders, or a large application/redemption request from any Unitholder, on any Dealing Day and in the Manager's opinion the continuing Unitholders might otherwise be materially adversely affected. Please refer to sections 10.1 and 11.2 of the Trust Prospectus for further details.

Fees payable by the Fund:

43.4 Management Fee

The Manager is entitled to receive, on an annual basis, a management fee from the Trust, currently at a rate of 1% per annum with respect to the Units of the Net Asset Value of the Fund calculated and accrued as at each Dealing Day. The management fee is payable monthly in arrears. The maximum rate of the management fee is 2% per annum of the Net Asset Value of the Fund.

43.5 Trustee Fee

The Trustee will receive an asset based fee of 0.175% per annum of the Net Asset Value of this Fund (the "Trustee Fee") until 31 May 2014 for trustee and registrar services. Effective from 1 June 2014, the Trustee Fee is up to 0.15% per annum of the Net Asset Value of this Fund. The maximum rate of the Trustee Fee is 0.5% per annum of the Net Asset Value of the Fund. The Trustee Fee is calculated and accrued as at each Dealing Day and is payable

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monthly in arrears. The Trustee Fee includes the fees payable for the services rendered in its capacity as trustee of the Trust and custodian of the assets of the Fund.

The Trustee is also entitled to receive from the Trust (a) once-off set up fee of up to RMB10,000 for the establishment of each sub-fund of the Trust; (b) reimbursement for relevant out-of-pocket expenses and disbursements incurred for the Fund; and (c) various transaction fees to cover settlement of transactions, the receipt of dividends from Fund assets and other fees and charges as agreed with the Manager from time to time.

Should the number of Unit Holders become greater than 30, the Trustee is entitled to RMB20 per monthly statement for each additional Unit Holder.

The Trustee Fee payable to BOCI-Prudential Trustee Limited in its capacity as the Trustee and Registrar of the Fund is subject to a minimum monthly fee of up to RMB40,000 for the Fund.

43.6 Global Custodian Fee and PRC Sub-Custodian Fee

The Global Custodian will receive an asset based fee of up to 0.10% per annum of the Net Asset Value of this Fund to perform its role as global custodian of the Fund and it is also entitled to (among others) transaction charges at customary market rates largely dependent on the markets where the Fund invests. The fee is calculated monthly and payable monthly in arrears. Such fees to the Global Custodian will also cover fees incurred by the PRC Sub-Custodian. Both the Global Custodian and PRC Sub-Custodian will be entitled to reimbursement by the Fund for any out-of-pocket expenses incurred in the course of their duties.

43.7 Establishment Expenses

The preliminary establishment expenses of the Fund amount to approximately RMB1,500,000 and will be amortised over such period of five financial years (or such other period as the Manager may determine).

It should be noted that the proposed treatment of amortising the cost and expenses associated with the launch of the Fund over five years is not in accordance with the requirements of International Financial Reporting Standards ("IFRS"), under which these costs and expenses should be expensed at the point of commencement of the Fund's operations. The Manager believes that such treatment is more equitable to the initial investors than expensing the entire amount as they are incurred and is of the opinion that the departure is unlikely to be material to the Fund's financial statements. However, if the amounts involved are material to the audit of the Fund's financial statements the Manager may be required to make adjustments in the annual financial statements of the Fund in order to comply with IFRS and if relevant will include a reconciliation note in the annual accounts of the Fund to reconcile amounts shown in the annual financial statements determined under IFRS to those arrived at by applying the amortisation basis to the cost and expenses associated with the launch of the Fund.

44. FUND SPECIFIC RISK FACTORS

Your attention is drawn to the section entitled "Risk Factors" in the Trust Prospectus, in addition there are some risks specific to this Fund.

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44.1 Regulatory development and oversight

At present, the securities market and regulatory framework for the securities industry in PRC is undergoing rapid growth and changes, which may lead to trading volatilities, difficulties in settlement and recording of transactions and in interpreting and applying the relevant regulations. In addition, some of the investment regulations under which the Fund intends to invest in the PRC are new, uncertain and may give the relevant PRC authorities wide discretion on their interpretation. There are no precedents on how such discretion might be exercised for issues that have not been clearly provided in the investment regulations, therefore leaving a considerable amount of uncertainty.

44.2 RMB denominated bonds or other debt instruments

The Fund will invest a substantial proportion of its assets in RMB Debt Instruments in the PRC.

PRC bond market risk

Investment in Chinese bond market may have higher volatility and price fluctuation than investment in bond products in more developed markets.

Credit risk of counterparties to RMB Debt Instruments

Unitholders should note that as mainland China's financial market is nascent, most of the RMB Debt Instruments are and will be unrated. While the Fund may invest in IR Products which are generally unrated, the Credit Products in which the Fund may invest will be with a minimum rating of 'AA' being rated by any of the PRC Rating Agencies at the time of acquisition to mitigate the credit risk. If the Credit Product is subsequently downgraded to below 'AA', the Manager may not dispose it immediately due to market liquidity and having regard to the interest of Unitholders.

RMB Debt Instruments can be issued by a variety of issuers inside or outside mainland China including commercial banks, state policy banks, corporations etc. These issuers may have different risk profiles and their credit quality may vary.

Furthermore RMB Debt Instruments are generally unsecured debt obligations not supported by any collateral. The Fund may be fully exposed to the credit/insolvency risk of its counterparties as an unsecured creditor.

In the event of bankruptcy or insolvency of any of the Fund's counterparties, the Fund may experience delays in liquidating its positions and may, thereby, incur significant losses (including declines in the value of its investment) or the inability to redeem any gains on investment during the period in which the Fund seeks to enforce its rights, and fees and expenses incurred in enforcing its rights.

Insolvency risk of debt issuer

The Manager may invest the Fund's assets in debt securities which rank junior to other outstanding securities and obligations of the issuer, all or a significant portion of which may be secured on substantially all of that issuer's assets. The assets of the Fund may also be invested in debt securities which are not protected by financial covenants or limitations on

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additional indebtedness. If the issuer of any of the debt instruments in which the Fund is invested defaults, the performance of the Fund will be negatively affected.

Liquidity risk

RMB Debt Instruments are not regularly traded and an active secondary market for these instruments is yet to be developed. The RMB Debt Instruments markets in the PRC are still at a developing stage and may have lower trading volumes than other more developed markets. The bid and offer spread of the price of RMB Debt Instruments (in both the interbank market and the exchange market) may be large and the Fund may incur significant trading and realisation costs. The Fund may suffer loss in trading such RMB Debt Instruments.

Interest rate risk

Impact of changes in macro-economic policies of mainland China (i.e. monetary policy, fiscal policy) will have an influence over capital markets affecting the pricing of the fixed income securities and thus, the return of the Fund. The value of RMB Debt Instruments held by the Fund generally will vary inversely with changes in interest rates and such variation may affect Unit prices accordingly.

Valuation risk

RMB Debt Instruments (including corporate bonds and commercial papers) are subject to the risk of mispricing or improper valuation, i.e. operational risk that the fixed income securities are not priced properly. Valuations are primarily based on the valuations from independent third party sources where the prices are available, accordingly valuations may sometimes involve uncertainty and judgemental determination and independent pricing information may not be available at all times. In the event of adverse market conditions where it is not possible to obtain any reference quotation from the market, the latest available quotations of the bond or commercial paper or the quotation of other bonds or commercial paper with very similar attributes may be used to estimate the fair market value. Such valuation methodology may not be equal to the actual liquidation price due to liquidity and size constraints. If valuation is proven to be incorrect, this will affect the Net Asset Value calculation of the Fund.

Credit rating risk

Many of the debt instruments in mainland China did not have rating assigned by international credit agencies. The credit appraisal system in mainland China is at an early stage of development, there is no standard credit rating methodology used in investment appraisal and the same rating scale may have a different meaning in different agencies. The assigned ratings may not reflect the actual financial strength of the appraised asset.

Credit rating downgrading risk

An issuer of RMB Debt Instruments may experience an adverse change in its financial condition which may in turn result in a decrease in the credit rating assigned by an internationally or PRC recognized statistical ratings organization to such issuer and RMB Debt Instruments issued by such issuer. Credit rating of RMB Debt Instruments reflects the issuer's ability to make timely payments of interest or principal - the lower the rating, the higher the risk of default. The adverse change in financial condition or decrease in credit rating of issuer may result in increased volatility in, and adverse impact on, the price of the

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relevant RMB Debt Instruments and negatively affect liquidity, making any such fixed-income security more difficult to sell.

Unrated debt securities

Up to 100% of the Fund’s assets may be invested in unrated debt securities (issued by the central government, policy bank or central bank). In the absence of credit rating, the credit quality of unrated debt securities is opaque. Unrated debt securities are generally subject to greater risk of loss of principal and interest than high-rated debt securities.

Risk of investing in high yield debt securities

High yield debt securities are particularly susceptible to interest rate changes and may experience significant price volatility. Any fluctuation in interest rates may have a direct effect on the income received by the Fund and its capital value.

Risk of investing in urban investment bonds

The Fund may invest all of its assets in urban investment bonds. Urban investment bonds are debt securities issued by local government agencies’ financing vehicles ("LGFVs") in PRC and are listed or traded in the interbank bond market. LGFVs are separate legal vehicles established by the local government or their affiliates to raise funds for public welfare investment or infrastructure projects. Although urban investment bonds are issued by LGFVs and appear to be connected with local government bodies, the debt is backed by tax revenues or cash flow of investment projects and such debts are typically not guaranteed by local governments or the central government of the PRC. Such local governmental bodies or the central government are not obligated to provide financial support in case of default. In such case the Fund could suffer significant loss and the Fund’s NAV could be adversely affected. The credit risk and price volatility of these bonds may be higher when compared with other bonds such as central bank bonds and policy bank bonds. Besides, liquidity may be low during adverse market situations.

Risk of investing in asset-backed securities/ mortgage backed securities

The Fund may invest all of its assets in asset-backed securities. Asset-backed securities which include asset backed commercial papers are backed by the cash flow stream of a single or a portfolio of underlying assets. The stability of the cash flow is highly dependent on the quality of the underlying assets. There may be a lack of transparency of the underlying assets' quality despite such asset-back securities may be given high credit ratings. Such lack of transparency may pose valuation risk with respect to the calculation the Fund’s net asset value and investors may be adversely affected. Asset-backed securities are also highly sensitive to market sentiments and have higher volatility than central bank bond and policy bank bonds. Asset-backed securities may be less liquid than other securities and are more difficult to be disposed of.

Distributions

With respect to Distribution Unit Class, the Manager may or may not make cash distributions in respect of the Fund. If no distributions are made, income earned by the Fund will be reinvested in the Fund and reflected in the value of its Units.

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Unitholders should note that the yield of holding the Units in the Fund can be lower than the yield of holding the underlying RMB Debt Instruments invested by the Fund directly.

44.3 Specific risk in interbank market and exchange market

Liquidity risk

The interbank market transaction account for predominant volume of daily market transactions in mainland China, there is no guarantee that such transaction volume can be sustainable in future. In case of the absence of an active interbank market or exchange market, the Fund may need to hold the RMB fixed income instruments until their maturity date. If sizeable redemption requests are received, the Fund may need to liquidate its investments at a substantial discount in order to satisfy such requests and the Fund may suffer losses in trading such instruments. Further, the bid and offer spread of the price of RMB fixed income instruments may be high (for both interbank market and exchange market), and the Fund may therefore incur significant trading costs and may even suffer losses when selling such investments.

Counterparty and settlement risk

The financial market of mainland China is at an early stage of development, investment in RMB fixed income instruments through interbank market will be subject to the counterparty risk of the issuers which may be unable or unwilling to make timely payments on principal and/or interest.

With respect to transactions in interbank market, the Fund will be exposed to higher counterparty risk on parties with whom it trades and when placing cash on deposit. The Fund will also be exposed to the risk of settlement default by a counterparty with which the Fund trades when buying and selling financial instruments (settlement risk). The risk of default of a counterparty is directly linked to the credit worthiness of the counterparty.

With respect to transactions in exchange market, the Fund will be exposed to the counterparty risk of CSDCC (acting as the central counterparty for bond transactions on the PRC Stock Exchanges).

Legal Risk

The securities transactions in the PRC are likely to be governed by PRC laws and regulation. The Chinese legal system is based on written statutes. Prior court decisions may be cited for reference but have limited precedential value. Agreements entered into by the Fund may be more difficult to enforce by legal proceeding in the PRC than in countries with more mature legal systems. Even if the agreements generally provide for arbitral proceeding for disputes arising out of the agreements to be in another jurisdiction, it may take more time to obtain effective enforcement in the PRC, of a arbitral award obtained in that jurisdiction.

44.4 Cash custody risk

Investors should note that cash deposited in the cash account of the Fund with the PRC Sub-Custodian will not be segregated but will be a debt owing from the PRC Sub-Custodian to the Fund as a depositor. Such cash will be co-mingled with cash belong to other clients of the PRC Sub-Custodian. In the event of bankruptcy or liquidation of the PRC Sub-Custodian, the Fund will not have any proprietary rights to the cash deposited in such cash account, and the

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Fund will become an unsecured creditor, ranking pari passu with all other unsecured creditors, of the PRC Sub-Custodian. The Fund may face difficulty and/or encounter delays in recovering such debt, or may not be able to recover it in full or at all, in which case the Fund will suffer losses.

44.5 RMB currency and conversion risk

The Fund will accept subscriptions and pay redemption amounts in RMB.

If a prospective Unitholder will convert its subscription monies from Hong Kong dollar or any other currency to RMB in order to invest in the Fund, it should keep in mind that may be adversely affected by changes in the exchange rates of the RMB. There is no guarantee that RMB will not depreciate against the Hong Kong dollar or any other currency. The value of the RMB is linked to a basket of currencies, and thus the value of the RMB against the Hong Kong dollar may rise or fall.

If at the time the Unitholder receives its RMB redemption proceeds it subsequently converts these back into Hong Kong dollar or any other currency, the Unitholder may suffer a loss if RMB has depreciated.

On a separate note, RMB is not a freely convertible currency. Further, the PRC government's imposition of restrictions on the repatriation of Renminbi out of mainland China may limit the depth of the Renminbi market in Hong Kong and reduce the liquidity of the Fund. The Chinese government's policies on exchange control and repatriation restrictions are subject to change, and the Fund's or the investors' position may be adversely affected.

44.6 Concentration risk/single country investment risk

The Fund is specialised. The Fund invests in securities with substantial exposure to mainland China. Although the Fund's portfolio will be well diversified in terms of the number of investments, Unitholders should be aware that the Fund is likely to be more volatile than a broad-based fund, or a fund that is not denominated in RMB. The Fund may be more susceptible to fluctuations in value resulting from adverse conditions encountered in the PRC. Investments in issuers located in a particular country or geographic region may have more risk because of particular market factors affecting that country or region, including political instability or unpredictable economic conditions.

44.7 PRC market risk

The Fund is not a bank deposit and is not guaranteed. There is no guarantee of the repayment of the principal investment. The profitability of the investments of the Fund could be adversely affected by a worsening of general economic conditions in the PRC or global markets. Factors such as PRC government policy, fiscal policy, interest rates, inflation, investor sentiment, the availability and cost of credit, the liquidity of the PRC financial markets and the level and volatility of securities prices could significantly affect the value of the Fund's underlying investments and thus the Unit price. Unitholders should note in particular that the underlying investments of the Fund may fall in value, and thus the Unit price may fall even if the RMB appreciates against the Hong Kong dollar and US dollar.

For example: (a) an economic downturn or significantly higher interest rates could adversely affect the credit quality of the on-balance sheet and off-balance sheet assets; (b) a market

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downturn or worsening of the economy could cause the Fund to incur mark to market losses in its trading portfolios.

44.8 RQFII Regime Risks

Under the prevailing regulations in mainland China, foreign investors can directly invest in the RQFII Permitted Securities through institutions that have obtained RQFII status in mainland China. The current RQFII Regulations impose strict restrictions (such as investment guidelines) on RQFII eligible securities investment. The Fund is not a RQFII, but the Fund may invest in RQFII Permitted Securities via the RQFII Quota granted to CITIC Securities International Company Limited by SAFE. The prevailing rules and regulations governing RQFIIs under the RQFII Regulations impose restrictions on investments and other operational aspects of investments which will restrict or affect the Fund's investments.

Investors should be aware that the Fund may need to maintain high cash balances for the purposes of, among others, payment of the fees of its service provides and to meet redemption requests. This may result in lesser amounts being invested than would otherwise be the case.

RQFII Regulations

The RQFII Regulations which regulate investments by RQFIIs in mainland China and the repatriation are relatively new and novel in nature. The application and interpretation of the RQFII Regulations are therefore relatively untested and there is uncertainty as to how they will be applied. CSRC and SAFE have been given wide discretions in the RQFII Regulations and there is no precedent or certainty as to how these discretions might be exercised now or in the future. At this stage of early development, the RQFII Regulations may be subject to further revisions in the future, there is no assurance whether such revisions will prejudice the RQFII, or whether the RQFII Quota which are subject to review from time to time by CSRC and SAFE may be withdrawn substantially or entirely. At the time of the launch of the Fund, the RQFII Regulations continue to develop and are undergoing continual change. CSRC and/or SAFE may have power in the future to impose new restrictions or conditions on or terminate the RQFII status of CITIC Securities International Company Limited which may adversely affect the Fund and the Unitholders. It is not possible to predict how such changes would affect the Fund.

RQFII Quotas

Investment by the Fund will be made and held through the RQFII Quota granted to CITIC Securities International Company Limited by SAFE. The RQFII Regulations apply to RQFII Quota(s) which may be obtained by CITIC Securities International Company Limited as RQFII from time to time for the Fund or other investors as a whole, and not simply to investments made by the Fund. Thus investors should be aware that violations of the RQFII Regulations arising out of activities related to any usage of RQFII Quota obtained by CITIC Securities International Company Limited (including utilization of RQFII Quota by the Fund and other than the Fund) could result in the revocation of or other regulatory action in respect of the RQFII Quota held by CITIC Securities International Company Limited as a whole, including the RQFII Quota utilised by the Fund. Likewise, regulatory limits on investment in RQFII Permitted Securities (as applicable) may apply in relation to the RQFII Quota held by CITIC Securities International Company Limited as a whole. Hence the ability of the Fund to make investments and/or repatriate monies from the RQFII Quota may be affected

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adversely by the investments, performance and/or repatriation of monies invested by other investors utilising the RQFII Quota obtained by CITIC Securities International Company Limited in the future.

In addition, any repatriation of monies by the Fund to meet obligations such as the payment of fees may adversely impact the ability of the Fund to repatriate monies to meet Unitholders' redemption requests.

There can be no assurance that the Fund will be able to obtain access to sufficient RQFII Quota to meet all proposed investments to be made by the Fund or that the investments of the Fund can be realised in a timely manner due to possible adverse changes in relevant laws or regulations which will hinder the Fund's ability to pursue the investment objectives or result in loss under extreme circumstances. Should CITIC Securities International Company Limited lose its RQFII status or retire or be removed, or the RQFII Quota be revoked or reduced, the Fund may not be able to invest in RQFII Permitted Securities through the RQFII Quota held by CITIC Securities International Company Limited, and the Fund may be required to dispose of its holdings, which would likely have a material adverse effect on the Fund.

RQFII Quota Limitation

The RQFII Quota granted to CITIC Securities International Company Limited by SAFE is shared among the Fund and other open-ended funds managed by the Manager. CITIC Securities International Company Limited (as RQFII) can allocate the available RQFII Quota flexibly across the open-ended funds under the management of the Manager. The Manager may allocate more RQFII Quota to the Fund from other open-ended funds to meet subscription demands. However, it is also possible that the Manager may not accept additional subscriptions when there is not enough RQFII Quota available to the Fund and would not be able to achieve further economies of scale or otherwise take advantage of the increased capital base.

Custody

Any RQFII Permitted Securities acquired by the Fund through the RQFII Quota held by CITIC Securities International Company Limited will be maintained by the PRC Sub-Custodian and will be registered in the joint names of CITIC Securities International Company Limited (as RQFII) and the Fund and for the sole benefit and use of the Fund subject to applicable laws. There will be segregation of assets by the PRC Sub-Custodian such that the assets of the Fund will not form part of the assets of CITIC Securities International Company Limited as RQFII, the Manager or the PRC Sub-Custodian.

However, subject to the investment regulations, CITIC Securities International Company Limited could be the party entitled to the securities in such securities trading account (albeit that this entitlement does not constitute an ownership interest or preclude the Manager purchasing the securities on behalf of the Fund). Such securities may be vulnerable to a claim by a liquidator of CITIC Securities International Company Limited and may not be as well protected as if they were registered solely in the name of the Fund. In particular, there is a risk that creditors of CITIC Securities International Company Limited may incorrectly assume that the Fund's assets belong to CITIC Securities International Company Limited and such creditors may seek to gain control of the Fund's assets to meet CITIC Securities International Company Limited's liabilities owed to such creditors.

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PRC Securities Brokers and Best Execution

The Fund may have difficulty in obtaining best execution of transactions in RQFII Permitted Securities subject to restriction/limitations under applicable RQFII Regulations or operational constraints such as the restriction/limitation as to the number of brokers that the Manager may appoint. The Fund will use PRC brokers appointed by the Manager to execute transactions in the PRC markets for the account of the Fund. If a PRC broker offers the Fund standards of execution which the Manager reasonably believes to be amongst best practice in the PRC marketplace, the Manager may determine that they should consistently execute transactions with that PRC broker (including where it is an affiliate) notwithstanding that they may not be executed at the best price and shall have no liability to account to the Fund in respect of the difference between the price at which the Fund executes transactions and any other price that may have been available in the market at that relevant time.

Limits on Redemption

Where the Fund is invested in the securities market in mainland China by investing through the RQFII Quota held by CITIC Securities International Company Limited, repatriation of funds from mainland China may be subject to the RQFII Regulations in effect from time to time. Currently there is no regulatory prior approval requirement for repatriation of funds from the RQFII Quota. However the relevant RQFII regulations are subject to uncertainty in their application and there is no certainty that no regulatory restrictions will apply to the repatriation of funds by the Fund in the PRC in the future. Accordingly, the investment regulations and/or the approach adopted by SAFE in relation to the repatriation may change from time to time.

Please note that redemptions on any Dealing Day are subject to redemption restrictions described in the Trust Prospectus (including suspension of redemption and/or delay of payment of redemption monies) and in case of repatriation restrictions being imposed in the future, it is possible that the Manager may not resume acceptance of redemption request and/or make payment of redemption monies for as long as the time required for repatriation of funds from the RQFII Quota subject to regulatory restrictions in the PRC.

For each RQFII Quota approved by SAFE, the relevant RQFII is required to utilize the RQFII Quota effectively within one year from the SAFE approval date. If the RQFII fails to utilize the RQFII Quota effectively, SAFE could reduce or revoke the RQFII Quota depending on the circumstances. As utilization of the RQFII Quota will depend on the subscription level of the Fund and redemptions by investors of the Fund, low subscription level or large redemptions by investors of the Fund might result in the RQFII Quota being reduced or lost permanently.

Investment Restrictions

Since there are limits on the total shares held by all underlying investors in one listed company under the RQFII Regulations, the capacity of the Fund to make investments in China A-shares will be affected by the activities of all underlying investors, not just the Manager.

The investment restrictions will be applied to all underlying investors. However, it will be difficult in practice for the Manager to monitor the investments of the underlying investors of the Fund since an investor may make investment through different RQFIIs or QFIIs.

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Violations of the RQFII Regulations (including ownership limits referred to above) by CITIC Securities International Company Limited or arising out of the activities relating to the use of any RQFII Quota granted to CITIC Securities International Company Limited (including the RQFII Quota utilized by other funds or entities) could result in the revocation of or other regulatory action in respect of the RQFII Quota granted to CITIC Securities International Company Limited, which could directly impact the Fund.

Disclosure of Interests and Short Swing Profit Rule

Under the PRC disclosure of interest requirements, the Fund may be deemed to be acting in concert with other funds managed within the Manager's group or a substantial shareholder of the Manager's group and therefore may be subject to the risk that the Fund's holdings may have to be reported in aggregate with the holdings of such other funds mentioned above should the aggregate holding triggers the reporting threshold under the PRC law, currently being 5% of the total issued shares of the relevant PRC listed company. This may expose the Fund's holdings to the public with an adverse impact on the performance of the Fund.

In addition, subject to the interpretation of PRC courts and PRC regulators, the operation of the PRC short swing profit rule may be applicable to the Fund's investments with the result that where the holdings of the Fund (possibly with the holdings of other investors deemed as concert parties of the Fund) exceed 5% of the total issued shares of a PRC listed company, the Fund may not reduce its holdings in such company within six months of the last purchase of shares of such company. If the Fund violates the rule and sells any of its holdings in such company in the six-month period, it may be required by the listed company to return any profits realised from such trading to the listed company. Moreover, under PRC civil procedures, the Fund's assets may be frozen to the extent of the claims made by such company. These risks may greatly impair the performance of the Fund.

44.9 PRC tax considerations

For further details relating to PRC taxes and the associated risks, please refer to section 17.2 of the Trust Prospectus headed "PRC Tax".

The value of the Fund's investments (and hence the Net Asset Value of the Fund) will be adversely affected by taxation levied against the Manager or CITIC Securities International Company Limited as RQFII in respect of the Fund's investments through the RQFII Quota held by CITIC Securities International Company Limited, for which the Fund will be required to reimburse the Manager or CITIC Securities International Company Limited. The PRC taxation regime that will apply to RQFIIs and investments made through RQFII quotas is currently unclear.

After careful consideration of the Manager’s assessment and having taken and considered independent professional tax advice on the Fund’s eligibility for treaty relief in the China-HK Arrangements and acting in accordance with such advice, the Manager considers that the Fund should qualify as a Hong Kong tax resident and it should be able to enjoy a WIT exemption on capital gains derived from investments in RMB Debt Instruments. Therefore, no PRC WIT provision will be made on the gross realized and unrealized capital gains derived from investments in RMB Debt Instruments.

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Pursuant to Circular 79, the Fund, investing through the RQFII Quota held by CITIC Securities International Company Limited, is temporarily exempt from PRC WIT on capital gains from investments in China A-shares effective from 17 November 2014, but those capital gains derived before that date should be subject to PRC WIT. In spite of the Circular 79 announcement, the Manager has determined, having taken and considered independent professional tax advice and acting in accordance with such advice, that:

• no PRC WIT provision will be made on the gross realized and unrealized capital gains derived from investments in China A-shares, except for those gross realized capital gains derived before 17 November 2014 from investments in China A-shares issued by PRC tax resident companies which are “land rich companies” (i.e. at least 50% of the PRC tax resident company’s assets are comprised, directly or indirectly, of immovable property situated in the PRC); and

• a 10% provision for PRC WIT will be made for the gross realized capital gains derived before 17 November 2014 by the Fund from investments in China A-shares issued by PRC tax resident companies which are land rich companies. The amount of any such tax provision made will be disclosed in the financial statements of the Fund. If there is a shortfall in the tax provision amount, the Net Asset Value of the Fund will be adversely affected as the Fund will have to bear the additional tax liabilities.

It should be noted that there are uncertainties regarding the Manager’s determination of PRC WIT provision in relation to capital gains derived from investments in PRC Securities, including:

• The China-HK Arrangement may be changed in the future and the Fund may ultimately be required to pay PRC WIT on capital gains.

• To date, the Fund has not yet obtained a Hong Kong Tax Resident Certificate (“HKTRC”) from the Inland Revenue Department of Hong Kong (“IRD”). If the PRC tax authorities enforce the collection of PRC WIT and require the Fund to provide a HKTRC in the future in order to obtain the PRC WIT exemption, the Manager will apply for a HKTRC on behalf of the Fund from the IRD for the relevant years. However, there is a risk that the Manager may not be able to obtain a HKTRC on behalf of the Fund.

• To date, the PRC tax authorities have not sought to enforce PRC WIT collection on capital gains derived by RQFIIs such as CITIC Securities International Company Limited. If the PRC tax authorities start to enforce PRC WIT collection on capital gains, the relief under the China-HK Arrangements is still subject to the final approval of the PRC tax authorities. Even if the Manager, in accordance with the independent professional tax advice, believes that the Fund should be eligible for such relief, the PRC tax authorities may ultimately hold a different view.

• Due to the limitation to the availability of the public information in the PRC (e.g. in respect of the market value of land and land use right), the information to be adopted by the PRC tax authorities in assessing land rich companies may be different from the information used by the Manager in assessing land rich companies which may result in different conclusion by the Manager for some China A-share companies to those of the PRC tax authorities.

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• The CIT exemption granted under Circular 79 for capital gains derived by RQFII from investments in China A-shares is temporary. As such, as and when the PRC authorities announce the expiry date of the exemption, the Fund may in future need to make provision to reflect taxes payable.

It should also be noted that there is a possibility of the PRC tax rules being changed and taxes being applied retrospectively. As such, the level of provision may be inadequate to meet actual PRC tax liabilities on investments made by the Fund. Consequently, Unitholders may be disadvantaged depending upon the final tax liabilities, the level of provision and when they subscribed and/or redeemed their Units.

If the actual tax levied by the PRC tax authorities is higher than that provided for by the Manager so that there is a shortfall in the tax provision amount, investors should note that the Net Asset Value of the Fund will be lowered as the Fund will ultimately have to bear the full amount tax liabilities. In this case, the additional tax liabilities will only impact Units in issue at the relevant time, and the then existing Unitholders and subsequent Unitholders will be disadvantaged as such Unitholders will bear, through the Fund, a disproportionately higher amount of tax liabilities as compared to that borne at the time of investment in the Fund.

On the other hand, the tax provision may be in excess of the actual PRC tax liabilities attributable to the Fund. In that case, those persons who have already redeemed their Units before the actual tax liabilities are determined will not be entitled or have any right to claim any part of such overprovision and as such may be disadvantaged. Notwithstanding the above change in tax provisioning policy, persons who have already redeemed their Units in the Fund before the return of any overprovision to the account of the Fund will not be entitled or have any right to claim any part of such overprovision.

Upon the availability of a definitive tax assessment or the issue of announcements or regulations by the competent authorities promulgating definitive tax assessment rules, the Manager will, as soon as practicable, make relevant adjustments to the amount of tax provision as it considers necessary.

Unitholders may, depending on their own circumstances, be subject to PRC tax or taxes in other jurisdictions. The Fund would not be able to guarantee that taxes paid at the Fund’s level will be attributable to any Unitholders for personal tax purposes.

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D. FUND SPECIFIC PROSPECTUS OF CSI RMB SHORT MATURITY BOND FUND

This Fund Specific Prospectus comprises information in relation to the CSI RMB Short Maturity Bond Fund (the "Fund"), a sub-fund of the Trust. Units in the Fund are now being offered for subscription on the terms set out in the Trust Prospectus and the Trust Deed. It is envisaged that further sub-funds of the Trust may be created in the future. The Trust is managed by CITIC Securities International Investment Management (HK) Limited.

45. CSI RMB SHORT MATURITY BOND FUND

This document relates to the CSI RMB Short Maturity Bond Fund, a sub-fund established under the Trust and authorized by the SFC pursuant to section 104 of the SFO. SFC authorization is not a recommendation or endorsement of the Fund, nor does it guarantee the commercial merits of the Fund or its performance. It does not mean the Fund is suitable for all investors nor is it an endorsement of its suitability for any particular investor or class of investors. This Fund Specific Prospectus should be read in conjunction with the Trust Prospectus and the Product Key Facts Statement relating to the Fund. In case of discrepancies between Part A (the Trust Prospectus) and Part D (this Fund Specific Prospectus) of this document in relation to the CSI RMB Short Maturity Bond Fund, this Part D shall prevail.

46. DEFINITIONS

Defined terms used in this Fund Specific Prospectus which are not defined below bear the same meanings as in the Trust Prospectus.

"Business Day" any day other than Saturday or Sunday, on which banks in Hong Kong and the PRC are open for normal banking business, but excluding any day on which a tropical cyclone warning signal 8 or higher or a black rain storm warning signal or any warning or signal considered by the Manager to be similar in effect is in force in Hong Kong after 9:00 a.m. (Hong Kong time) and before 5:00 p.m. (Hong Kong time) on that day unless the Manager and the Trustee otherwise agree;

"China A-shares" means securities of companies incorporated in China and listed on a PRC Stock Exchange, traded in RMB and available for investment by domestic investors, qualified foreign institutional investors and RQFIIs;

"Credit Products" has the meaning as defined at page 42;

"CSDCC" means the China Securities Depository & Clearing Corporation Limited;

"Dealing Day" each Business Day and such other day(s) as the Manager may from time to time determine;

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"Fund" the CSI RMB Short Maturity Bond Fund, being a sub-fund of the Trust offered pursuant to this Fund Specific Prospectus;

"IR Products" has the meaning as defined at page 42;

"Issue Price" the Net Asset Value per Unit calculated as at the Valuation Point on the Dealing Day relating to the application for the issue of Units;

"mainland China" or "PRC" means the People's Republic of China (excluding, for the purposes of the Trust Prospectus and this Fund Specific Prospectus, the Hong Kong Special Administrative Region, Macao Special Administrative Region and Taiwan);

"PRC Rating Agencies" means (i) China Cheng Xin International Credit Rating, (ii) China Lianhe Credit Rating, (iii) Dagong Global Credit Rating, (iv) Shanghai Brilliance Credit Rating and Investors Services, and (v) Pengyuan Credit Rating;

"PRC Stock Exchanges" means the Shanghai Stock Exchange, the Shenzhen Stock Exchange and any other stock exchange that opens in the PRC;

"QFII Quota" means a PRC foreign exchange investment quota granted to a qualified foreign institutional investor pursuant to the QFII Regulations;

"QFII Regulations" means the regulations and rules, as amended from time to time, governing the establishment and operation of qualified foreign institutional investors and QFII Quotas;

"Redemption Charge" a charge payable by the Unitholder and calculated as a percentage of the Redemption Price of each Unit which is being redeemed by that Unitholder;

"Redemption Price" the Net Asset Value per Unit calculated as at the Valuation Point on the Dealing Day relating to the application for redemption of Units;

"RMB" means Renminbi, the lawful currency of the PRC;

"RMB Debt Instruments" has the meaning as defined at page 42;

"RQFII" means a RMB qualified foreign institutional investor under the RQFII Regulations;

"RQFII Permitted Securities"

means securities and investments permitted to be held or made by RQFIIs under RQFII Regulations, which currently include the following RMB denominated financial instruments:

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(a) China A-shares;

(b) fixed income securities traded on the PRC Stock Exchanges or the interbank market in the PRC;

(c) PRC securities investment funds approved by the CSRC; and

(d) other financial instruments from time to time approved by CSRC or the People's Bank of China;

"RQFII Quota" means a RMB investment quota granted to a RQFII pursuant to the RQFII Regulations;

"RQFII Regulations" means the regulations and rules, as amended from time to time, governing the establishment and operation of RQFIIs and RQFII Quotas;

"SAFE" means the PRC State Administration of Foreign Exchange, the government agency responsible for matters relating to foreign exchange administration;

"Subscription Charge" a charge payable by the Unitholder and calculated as a percentage of the Issue Price of each Unit which is issued to that Unitholder;

"Trust Prospectus" the prospectus in Part A of this document relating to CSI Alpha Fund Series, as amended or supplemented from time to time;

"Valuation Point" means the close of business in the last relevant market to close on each relevant Dealing Day or such other time or times as the Manager may from time to time determine.

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47. SUMMARY

Set out below is a summary of the Fund. The summary information is derived from, and should be read in conjunction with, the full text of this Fund Specific Prospectus. Your attention is drawn to the section entitled "Risk Factors" in the Trust Prospectus and the section entitled "Fund Specific Risk Factors" in this Fund Specific Prospectus. Key information in respect of the Fund is as follows:

Issue Price means the Net Asset Value per Unit calculated as at the Valuation Point, and subject to a Subscription Charge and any fiscal and purchase charges

Dealing Day each Business Day and such day(s) as the Manager may from time to time determine

Initial Minimum Subscription Amount

RMB10,000

Subsequent Minimum Subscription Size

RMB10,000

Minimum Redemption Size RMB10,000

Minimum Holding RMB10,000

Manager CITIC Securities International Investment Management (HK) Limited

Trustee and Registrar BOCI-Prudential Trustee Limited

RQFII Licence Holder CITIC Securities International Company Limited, which conducts the relevant RQFII business through the Manager

Global Custodian Bank of China (Hong Kong) Limited

PRC Sub-Custodian Bank of China Limited

Fees payable by Unitholders

Subscription Charge Up to 5% of the Issue Price of each Unit

Transfer Fee Nil

Redemption Charge Nil

Fiscal and Purchase Charges Up to 2% of the Issue Price of each Unit (in case of subscription) or up to 2% of the Redemption Price of each Unit (in case of redemption) chargeable only to compensate the Fund for any dilution in the Fund's Net Asset Value as a result of a large volume of applications/redemptions by Unitholders, or a large application/redemption request from

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any Unitholder, on any Dealing Day and in the Manager's opinion the continuing Unitholders might otherwise be materially adversely affected.

Fees payable by the Fund

Management Fee 1% per annum of the Net Asset Value of the Fund

Performance Fee Nil

Trustee Fee Up to 0.15% per annum of the Net Asset Value of the Fund, subject to a monthly minimum fee of RMB40,000

Trustee Set-Up Fee The Trustee is entitled to receive from the Trust once-off establishment fee of up to RMB10,000 for the establishment of each Fund of the Trust

Trustee Out-of-Pocket Expense Fee

The Trustee is entitled to receive reimbursement for out of pocket expenses such as postage and stationery

Global Custodian Fee Up to 0.10% per annum of the Net Asset Value of the Fund plus transaction fees at customary rates dependent on the market the Fund invests and out of pocket expenses incurred by the Global Custodian and the PRC Sub-Custodian

PRC Sub-Custodian Fee Covered under Global Custodian Fee

48. INVESTMENT OBJECTIVE AND POLICY

48.1 Currency Denomination

Units in the Fund are denominated in RMB.

48.2 Investment Objective

The investment objective of the Fund is to achieve long-term appreciation of the Unit price through capital growth and income appreciation by investing primarily in a diversified portfolio of short maturity RMB denominated and settled debt instruments, subject to the investment policy and restrictions set out below and the investment restrictions applicable to the Fund, as set out in the Trust Prospectus.

48.3 Investment Policy

Asset Allocation Policy

The Fund will primarily invest in short-term RMB Debt Instruments and only invest in RMB Debt Instruments with remaining maturity of less than 3 years.

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The Fund will invest at least 50% of its Net Asset Value in central government bonds, policy bank bonds, central bank notes and financial bonds available through the PRC Stock Exchanges and interbank market in the PRC. Up to 10% of the Fund’s Net Asset Value may be invested in fixed income funds and money market funds which are authorized by the CSRC for offer to the retail public in the PRC. Up to 30% of the Fund’s Net Asset Value may be held in RMB denominated cash or cash equivalents in the PRC.

Please note that the Fund may invest up to 50% of its Net Asset Value in each of urban investment bonds, asset-backed securities (including asset-backed commercial papers) and any other types of RMB Debt Instruments. For more information and risks related to urban investment bonds and asset-backed securities, please refer to the paragraphs "Risk of investing in urban investment bonds" and "Risk of investing in asset-backed securities/ mortgage backed securities" respectively in the "Fund Specific Risk Factors" section.

While the Fund may invest up to 100% of its assets in central government bonds, policy bank bonds and central bank notes which are generally unrated, for other types of RMB Debt Instruments, the Fund will only invest in those or the issuer of which with a minimum rating of 'AAA' being rated by any of the PRC Rating Agencies at the time of acquisition. In the event that such RMB Debt Instrument is downgraded to below 'AAA' rating after its acquisition by the Fund, the Manager will try to dispose such RMB Debt Instrument, subject to market liquidity, and provided that it is in the best interest of the Unitholders. The Fund will not invest in RMB Debt Instruments that are rated 'BB+' or below.

Investment Strategy

Each instrument in the portfolio of the Fund will be selected based on extensive fundamental research. Subject to the above asset allocation policy, the Manager will adjust the allocation of investment among RMB Debt Instruments and cash or cash equivalents to seek better risk adjusted returns among various investment instruments. The portfolio of the Fund is intended to consist mainly of government or public debt securities, but the Manager will diversify the Fund's investments into other sectors to mitigate the risks.

The Manager will adjust the duration risk of the investment portfolio based on expectations of global and the PRC's macroeconomic cycle and monetary policy. If RMB interest rate is expected to fall, the Manager will increase the average duration of the investment portfolio to better benefit from the capital gains from lower yield, and vice versa.

Investment through the RQFII Quota

Currently, foreign investors are generally unable to invest in RQFII Permitted Securities other than through QFII Quotas (to the extent applicable) or RQFII Quotas approved under the QFII Regulations or RQFII Regulations respectively. Under the RQFII Regulations, amongst other eligible entities, Hong Kong subsidiaries of PRC domestic brokerages firms that meet the relevant prescribed eligibility requirements may apply to the CSRC for a securities investment licence as a RQFII and correspondingly apply to SAFE for RQFII Quota for investment into RQFII Permitted Securities. CITIC Securities International Company Limited has been approved as a RQFII under the RQFII Regulations, but is required to conduct its RQFII business through the Manager. CITIC Securities International Company Limited has been granted a RQFII Quota by SAFE which can be utilized by the Fund under the management of the Manager.

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CITIC Securities International Company Limited was incorporated in Hong Kong on 9 April 1998 and has its principal office in Hong Kong. CITIC Securities International Company Limited is a wholly owned subsidiary of CITIC Securities Co., Ltd., a company incorporated in the PRC and regulated as a securities company by CSRC. The Manager is an indirect subsidiary of CITIC Securities International Company Limited.

The Fund will invest via the RQFII Quota granted to CITIC Securities International Company Limited by SAFE.

Financial Derivative Instruments

The Fund does not intend to invest in any financial derivative instruments for purposes of investment, hedging or otherwise.

Securities Lending and Repurchase Transactions

The Fund does not intend to enter into any securities lending transactions, repurchase/reverse repurchase transactions or other similar over-the-counter transactions. Should the Manager wishes to enter into any such transactions on behalf of the Fund, this will be subject to the prior approval of the SFC and at least one month's prior notice will be given to Unitholders.

48.4 Effect of RQFII Regulations on Redemptions

The repatriation of invested capital and of income and capital gains of the Fund from PRC is subject to the RQFII Regulations. Currently, under the RQFII Regulations, remittance and repatriation for the account of the Fund may be effected on a daily basis through the RQFII Quota based on the net subscriptions and redemptions of Units of the Fund. At present, there is no regulatory prior approval requirement for repatriation of funds from the RQFII Quota however there is no certainty that no regulatory restrictions will apply to the repatriation of funds by the Fund in the PRC in the future.

Please note that redemptions on any Dealing Day are subject to redemption restrictions described in the Trust Prospectus (including suspension of redemption and/or delay of payment of redemption monies) and in case of repatriation restrictions being imposed in the future, it is possible that the Manager may not resume acceptance of redemption request and/or make payment of redemption monies for as long as the time required for repatriation of funds from the RQFII Quota subject to regulatory restrictions in the PRC.

48.5 RQFII Quota Limitation

The RQFII Quota granted to CITIC Securities International Company Limited by SAFE is shared among the Fund and other open-ended funds managed by the Manager. CITIC Securities International Company Limited (as RQFII) can allocate the available RQFII Quota flexibly across the open-ended funds under the management of the Manager. The Manager may allocate more RQFII Quota to the Fund from other open-ended funds to meet subscription demands. However, it is also possible that the Manager may not accept additional subscriptions when there is not enough RQFII Quota available to the Fund. The Manager will monitor the usage of the RQFII Quota from time to time and apply for additional RQFII Quota where necessary.

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48.6 Potential Conflict of Interest

Investors should be aware that:

(i) the Trustee, the Global Custodian and the PRC Sub-Custodian are affiliates of each other; and

(ii) the Global Custodian, the PRC Sub-Custodian or their affiliates may act as a counterparty in a securities transaction of the Fund.

Potential conflicts of interest may exist in the performance of the functions of the Trustee, the Global Custodian and the PRC Sub-Custodian as they are affiliates of each other. However each entity has different set of business objectives, activities, reporting lines and senior management. Each of the Trustee, the Global Custodian and the PRC Sub-Custodian will comply with their respective regulatory obligations (where applicable) for managing conflicts of interests and have policies in place to deal with them. In particular there are effective Chinese walls and information barriers in place to separate the entities (internally and externally).

With respective to the potential conflicts of interest where the PRC Sub-Custodian, on one hand, acting as the custodian of the Fund, and on the other hand where it or its affiliates may act as the counterparty in securities transactions, within the PRC Sub-Custodian, there are segregation of duties between roles, functions and departments with effective Chinese walls and information barriers in place. The PRC Sub-Custodian has internal and external audit to ensure conflicts of interests are properly managed. The PRC Sub-Custodian is also subject to the supervision of the PBoC.

49. CUSTODY

The Trustee takes into its custody or under its control the Fund's assets, including PRC assets deposited in the securities and RMB cash accounts with the PRC Sub-Custodian (defined below), and holds the same in trust for Unitholders. The Trustee has appointed Bank of China (Hong Kong) Limited (the "Global Custodian") as its global custodian pursuant to a Custodian Agreement, pursuant to which the Global Custodian shall hold the assets of the Fund as custodian. The Global Custodian will appoint Bank of China Limited (the "PRC Sub-Custodian") as its sub-custodian pursuant to a RQFII Sub-Custodian Agreement among CITIC Securities International Company Limited (as RQFII), the Manager, the Global Custodian and the PRC Sub-Custodian, pursuant to which the PRC Sub-Custodian shall hold the assets of the Fund invested in the PRC through the RQFII Quota held by CITIC Securities International Company Limited. The RQFII Sub-Custodian Agreement will be supplemented by a RQFII supplemental custodian agreement to which the Trustee is also a party. The Trustee is liable for the acts and omissions of the PRC Sub-Custodian in relation to the assets forming part of the property of the Fund.

The Trustee registers the Fund's assets, including PRC assets deposited via the Global Custodian in the securities and RMB cash accounts opened and maintained with the PRC Sub-Custodian, to the order of the Trustee.

Instructions to execute transactions with respect to the Fund's assets in the securities account(s) and the RMB cash account(s) as well as other matters such as the repatriation of funds shall be given by the Manager and delivered through the Trustee and the Global

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Custodian to the PRC Sub-Custodian (i.e. not delivered to the PRC Sub-Custodian directly). The PRC Sub-Custodian will look to the Trustee via the Global Custodian for instructions and solely act in accordance with the instructions of the Trustee or authorities granted by the Trustee.

The Manager and the Trustee have obtained an opinion from PRC legal counsel to the effect that, as a matter of PRC laws:

(a) securities account(s) and RMB cash account(s) with the PRC Sub-Custodian, CSDCC and China Central Depositary & Clearing Co., Ltd. where applicable (respectively, the "securities account" and the "cash account") for the Fund shall be opened in the joint names of CITIC Securities International Company Limited (as RQFII) and the Fund and for the sole benefit and use of the Fund in accordance with all applicable laws and regulations of the PRC and with approval from all competent authorities in the PRC;

(b) the assets held/credited in the securities account (i) belong solely to the Fund, and (ii) are segregated and independent from the proprietary assets of CITIC Securities International Company Limited (as RQFII), the Manager, the PRC Sub-Custodian and any PRC broker of the Fund and from the assets of other clients of CITIC Securities International Company Limited (as RQFII), the Manager, the PRC Sub-Custodian and any PRC broker of the Fund;

(c) the assets held/credited in the cash account (i) become an unsecured debt owing from the PRC Sub-Custodian to the Fund, and (ii) are segregated and independent from the proprietary assets of CITIC Securities International Company Limited (as RQFII), the Manager, and any PRC broker of the Fund, and from the assets of other clients of CITIC Securities International Company Limited (as RQFII), the Manager, and any PRC broker of the Fund;

(d) the Trustee, for and on behalf of the Fund, is the only entity which has a valid claim of ownership over the assets in the securities account and the debt in the amount deposited in the cash account of the Fund;

(e) if CITIC Securities International Company Limited, the Manager or any PRC broker of the Fund is liquidated, the assets contained in the securities account and cash account of the Fund will not form part of the liquidation assets of CITIC Securities International Company Limited, the Manager or such PRC broker of the Fund in liquidation in the PRC; and

(f) if the PRC Sub-Custodian is liquidated, (i) the assets contained in the securities account of the Fund will not form part of the liquidation assets of the PRC Sub-Custodian in liquidation in the PRC, and (ii) the assets contained in the cash account of the Fund will form part of the liquidation assets of the PRC Sub-Custodian in liquidation in the PRC and the Fund will become an unsecured creditor for the amount deposited in the cash account.

50. INVESTMENT RESTRICTIONS

The Fund is subject to the investment restrictions described in the "Investment Restrictions" section in the Trust Prospectus.

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51. BORROWING RESTRICTIONS

The maximum borrowings of the Fund may not exceed 25% of its total Net Asset Value. For the purposes of this restriction, back-to-back loans do not count as borrowing.

Borrowing may only be effected outside mainland China on a temporary basis for the purpose of meeting redemption requests or defraying fees, costs, charges, expenses and disbursements of the Fund or the Trust in accordance with the provisions of the Trust Deed.

52. UNIT CLASSES

Units of the Fund will be sub-divided into Distribution Unit Class (where dividends declared will be paid to the Unitholders) and Accumulation Unit Class (where no dividends will be distributed). Units of the Distribution Unit Class and the Accumulation Unit Class are offered on the same terms except for the difference in distribution policy. Please refer to section 56 for further details.

53. SUBSCRIPTION FOR UNITS

53.1 Issue Price

Each Unit will be offered at the Issue Price, being the Net Asset Value per Unit calculated as at the Valuation Point, and again subject to a Subscription Charge and any fiscal and purchase charges. The Manager may exercise its discretion to close the Fund for subscription when the RQFII Quota has been filled up.

Units were initially issued to the public in May 2014 at the initial issue price of RMB100 subject to the Subscription Charge.

53.2 Minimum subscription and minimum holding

The initial minimum subscription amount that must be subscribed for the Units is RMB10,000 with a subsequent minimum subscription of RMB10,000. The minimum holding of Units is RMB10,000. The Manager may, at its discretion, waive or modify these minimum limits.

53.3 Application procedure

When an investor submits the application form via his/her authorized distributor, that investor should confirm the relevant cut-off time with the authorized distributor. This cut-off time will be earlier than the application deadline of the Trustee listed below.

Applications for Units in the Fund received by the Trustee (from the Manager or authorized distributor) prior to 5:00 p.m. (Hong Kong time) on any Dealing Day will be effected at the Issue Price plus the Subscription Charge and each amount, if any, per Unit as the Manager may determine represents fiscal and purchase charges. An application for Units received by the Trustee (from the Manager or authorized distributor) after the application deadline on any Dealing Day, or on any day that is not a Dealing Day, will usually be processed on the next Dealing Day.

Subscriptions will only be accepted in RMB.

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54. REDEMPTION OF UNITS

54.1 Redemption of Units

A Unitholder may redeem all or some of its Units in whole on any Dealing Day. A Unitholder wishing to redeem its Units should confirm the minimum redemption size with his/her authorized distributor. Partial redemptions may be made, as long as the minimum holding of RMB10,000 remains in the Unitholder's account after the redemption is completed. If, after redemption, a Unitholder would be left with a balance of Units having a value of less than the minimum holding, the Manager may decide that this request be treated as a request for redemption for the full balance of the Unitholder's holding of Units. A Unitholder wishing to redeem its Units should complete a redemption form and return it as instructed on the redemption form. Redemption forms can be obtained from the Manager or authorized distributor.

54.2 Redemption procedure

When an investor submits the redemption request via his/her authorized distributor, that investor should confirm the relevant cut-off time with the authorized distributor. This cut-off time will be earlier than the redemption deadline of the Trustee listed below.

Unitholders may apply to convert Units in the Fund for Units of another sub-fund of the Trust, or Units between different classes in the Fund, that has the same base and class currency of RMB. Please see paragraph entitled "Conversion of units" in the Trust Prospectus.

Redemption requests for Units in the Fund received by the Trustee (from the Manager or authorized distributor) prior to 5:00 p.m. (Hong Kong time) on a Dealing Day will be effected at the Redemption Price less the Redemption Charge and each amount, if any, per Unit as the Manager may determine represents fiscal and purchase charges. Redemption requests received by the Trustee (from the Manager or authorized distributor) after 5:00 p.m. (Hong Kong time) on a Dealing Day, or on a day which is not a Dealing Day, will be processed on the next Dealing Day.

Generally the maximum interval between the receipt of a redemption deadline and the payment of redemption proceeds will not exceed four weeks. However a substantial portion of the Fund's investments may be subject to legal or regulatory requirements of the PRC which may render payment within four weeks impracticable. If there is a delay in receipt by the Manager or the Trustee of the proceeds on sale of the Fund’s investments to meet redemption requests, the Manager or the Trustee may delay the payment of the relevant portion of the amount due on the redemption of Units.

If the Manager or the Trustee is required by the laws of any relevant jurisdiction to withhold any redemption moneys payable to the holder of a Unit the amount of such amount shall be deducted from the redemption moneys otherwise payable to such person.

All redemption moneys will be paid in RMB.

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55. CALCULATION OF NET ASSET VALUE

The Net Asset Value per Unit will be determined by the Trustee as at the Valuation Point in accordance with the terms of the Trust Deed. The details of the valuation rules are described in the Trust Prospectus under "Calculation of Net Asset Value".

The Net Asset Value per Unit of the Fund will be published daily in the Standard and the Hong Kong Economic Times.

56. DISTRIBUTION POLICY

At the discretion of the Manager, declaration of dividends may be made on annual basis in December each year in RMB. However, the Manager has discretion to decide whether or not to declare any dividends, the frequency of distribution and amount of dividends. There is no guarantee of regular distribution and if distribution is made, the amount being distributed. It is the intention of the Manager that only the net income (the income net of expenses) for the Fund may be distributed. No distribution will be paid out of the Fund's capital.

With respect to Distribution Unit Class, the amount of dividends declared will be paid to Unitholders accordingly.

With respect to Accumulation Unit Class, no distribution of dividends will be made. Therefore, any net income and net realized profits attributable to such Units will be reflected in the Net Asset Value of the Units.

57. CHARGES AND EXPENSES

Fees payable by Unitholders:

57.1 Subscription Charge and Redemption Charge

The Manager is entitled to receive a Subscription Charge of up to 5% of the Issue Price of each Unit and currently no Redemption Charge is applicable.

The Manager may pay the whole or a part of the proceeds from the Subscription Charge and/or Redemption Charge (if any) to any intermediary.

57.2 Transfer Fee

Should a Unitholder wish to transfer one or more Units, currently no transfer fee is chargeable to the transferor.

57.3 Fiscal and Purchase Charges

Up to 2% of the Issue Price of each Unit (in case of subscription) or up to 2% of the Redemption Price of each Unit (in case of redemption) may be chargeable only to compensate the Fund for any dilution in the Fund's Net Asset Value as a result of a large volume of applications/redemptions by Unitholders, or a large application/redemption request from any Unitholder, on any Dealing Day and in the Manager's opinion the continuing Unitholders might otherwise be materially adversely affected. Please refer to sections 10.1 and 11.2 of the Trust Prospectus for further details.

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Fees payable by the Fund:

57.4 Management Fee

The Manager is entitled to receive, on an annual basis, a management fee from the Trust, currently at a rate of 1% per annum with respect to the Units of the Net Asset Value of the Fund calculated and accrued as at each Dealing Day. The management fee is payable monthly in arrears. The maximum rate of the management fee is 2% per annum of the Net Asset Value of the Fund.

57.5 Trustee Fee

The Trustee will receive an asset based fee of up to 0.15% per annum of the Net Asset Value of this Fund (the "Trustee Fee") for trustee and registrar services. The maximum rate of the Trustee Fee is 0.5% per annum of the Net Asset Value of the Fund. The Trustee Fee is calculated and accrued as at each Dealing Day and is payable monthly in arrears. The Trustee Fee includes the fees payable for the services rendered in its capacity as trustee of the Trust and custodian of the assets of the Fund.

The Trustee is also entitled to receive from the Trust (a) once-off set up fee of up to RMB10,000 for the establishment of each sub-fund of the Trust; (b) reimbursement for relevant out-of-pocket expenses and disbursements incurred for the Fund; and (c) various transaction fees to cover settlement of transactions, the receipt of dividends from Fund assets and other fees and charges as agreed with the Manager from time to time.

Should the number of Unit Holders become greater than 30, the Trustee is entitled to RMB20 per monthly statement for each additional Unit Holder.

The Trustee Fee payable to BOCI-Prudential Trustee Limited in its capacity as the Trustee and Registrar of the Fund is subject to a minimum monthly fee of up to RMB40,000 for the Fund.

57.6 Global Custodian Fee and PRC Sub-Custodian Fee

The Global Custodian will receive an asset based fee of up to 0.10% per annum of the Net Asset Value of this Fund to perform its role as global custodian of the Fund and it is also entitled to (among others) transaction charges at customary market rates largely dependent on the markets where the Fund invests. The fee is calculated monthly and payable monthly in arrears. Such fees to the Global Custodian will also cover fees incurred by the PRC Sub-Custodian. Both the Global Custodian and PRC Sub-Custodian will be entitled to reimbursement by the Fund for any out-of-pocket expenses incurred in the course of their duties.

57.7 Establishment Expenses

The preliminary establishment expenses of the Fund amount to approximately RMB400,000 and will be amortised over such period of five financial years (or such other period as the Manager may determine).

It should be noted that the proposed treatment of amortising the cost and expenses associated with the launch of the Fund over five years is not in accordance with the requirements of International Financial Reporting Standards ("IFRS"), under which these costs and expenses

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should be expensed at the point of commencement of the Fund's operations. The Manager believes that such treatment is more equitable to the initial investors than expensing the entire amount as they are incurred and is of the opinion that the departure is unlikely to be material to the Fund's financial statements. However, if the amounts involved are material to the audit of the Fund's financial statements the Manager may be required to make adjustments in the annual financial statements of the Fund in order to comply with IFRS and if relevant will include a reconciliation note in the annual accounts of the Fund to reconcile amounts shown in the annual financial statements determined under IFRS to those arrived at by applying the amortisation basis to the cost and expenses associated with the launch of the Fund.

58. FUND SPECIFIC RISK FACTORS

Your attention is drawn to the section entitled "Risk Factors" in the Trust Prospectus, in addition there are some risks specific to this Fund.

58.1 Regulatory development and oversight

At present, the securities market and regulatory framework for the securities industry in PRC is undergoing rapid growth and changes, which may lead to trading volatilities, difficulties in settlement and recording of transactions and in interpreting and applying the relevant regulations. In addition, some of the investment regulations under which the Fund intends to invest in the PRC are new, uncertain and may give the relevant PRC authorities wide discretion on their interpretation. There are no precedents on how such discretion might be exercised for issues that have not been clearly provided in the investment regulations, therefore leaving a considerable amount of uncertainty.

58.2 RMB denominated bonds or other debt instruments

The Fund will invest a substantial proportion of its assets in RMB Debt Instruments in the PRC.

PRC bond market risk

Investment in Chinese bond market may have higher volatility and price fluctuation than investment in bond products in more developed markets.

Credit risk of counterparties to RMB Debt Instruments

Unitholders should note that as mainland China's financial market is nascent, most of the RMB Debt Instruments are and will be unrated. While the Fund may invest up to 100% of its assets in central government bonds, policy bank bonds and central bank notes which are generally unrated, the Fund will only invest in other types of RMB Debt Instruments with or the issuer of which a minimum rating of 'AAA' being rated by any of the PRC Rating Agencies at the time of acquisition to mitigate the credit risk. If the RMB Debt Instrument is subsequently downgraded to below 'AAA', the Manager may not dispose it immediately due to market liquidity and having regard to the interest of Unitholders.

RMB Debt Instruments can be issued by a variety of issuers inside or outside mainland China including commercial banks, state policy banks, corporations etc. These issuers may have different risk profiles and their credit quality may vary.

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Furthermore RMB Debt Instruments are generally unsecured debt obligations not supported by any collateral. The Fund may be fully exposed to the credit/insolvency risk of its counterparties as an unsecured creditor.

In the event of bankruptcy or insolvency of any of the Fund's counterparties, the Fund may experience delays in liquidating its positions and may, thereby, incur significant losses (including declines in the value of its investment) or the inability to redeem any gains on investment during the period in which the Fund seeks to enforce its rights, and fees and expenses incurred in enforcing its rights.

Insolvency risk of debt issuer

The Manager may invest the Fund's assets in debt securities which rank junior to other outstanding securities and obligations of the issuer, all or a significant portion of which may be secured on substantially all of that issuer's assets. The assets of the Fund may also be invested in debt securities which are not protected by financial covenants or limitations on additional indebtedness. If the issuer of any of the debt instruments in which the Fund is invested defaults, the performance of the Fund will be negatively affected.

Liquidity risk

RMB Debt Instruments are not regularly traded and an active secondary market for these instruments is yet to be developed. The RMB Debt Instruments markets in the PRC are still at a developing stage and may have lower trading volumes than other more developed markets. The bid and offer spread of the price of RMB Debt Instruments (in both the interbank market and the exchange market) may be large and the Fund may incur significant trading and realisation costs. The Fund may suffer loss in trading such RMB Debt Instruments.

Interest rate risk

Impact of changes in macro-economic policies of mainland China (i.e. monetary policy, fiscal policy) will have an influence over capital markets affecting the pricing of the fixed income securities and thus, the return of the Fund. The value of RMB Debt Instruments held by the Fund generally will vary inversely with changes in interest rates and such variation may affect Unit prices accordingly.

Valuation risk

RMB Debt Instruments (including corporate bonds and commercial papers) are subject to the risk of mispricing or improper valuation, i.e. operational risk that the fixed income securities are not priced properly. Valuations are primarily based on the valuations from independent third party sources where the prices are available, accordingly valuations may sometimes involve uncertainty and judgemental determination and independent pricing information may not be available at all times. In the event of adverse market conditions where it is not possible to obtain any reference quotation from the market, the latest available quotations of the bond or commercial paper or the quotation of other bonds or commercial paper with very similar attributes may be used to estimate the fair market value. Such valuation methodology may not be equal to the actual liquidation price due to liquidity and size constraints. If valuation is proven to be incorrect, this will affect the Net Asset Value calculation of the Fund.

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Credit rating risk

Many of the debt instruments in mainland China did not have rating assigned by international credit agencies. The credit appraisal system in mainland China is at an early stage of development, there is no standard credit rating methodology used in investment appraisal and the same rating scale may have a different meaning in different agencies. The assigned ratings may not reflect the actual financial strength of the appraised asset.

Credit rating downgrading risk

An issuer of RMB Debt Instruments may experience an adverse change in its financial condition which may in turn result in a decrease in the credit rating assigned by an internationally or PRC recognized statistical ratings organization to such issuer and RMB Debt Instruments issued by such issuer. Credit rating of RMB Debt Instruments reflects the issuer's ability to make timely payments of interest or principal - the lower the rating, the higher the risk of default. The adverse change in financial condition or decrease in credit rating of issuer may result in increased volatility in, and adverse impact on, the price of the relevant RMB Debt Instruments and negatively affect liquidity, making any such fixed-income security more difficult to sell.

Unrated debt securities

Up to 100% of the Fund’s assets may be invested in unrated debt securities (issued by the central government, policy bank or central bank). In the absence of credit rating, the credit quality of unrated debt securities is opaque. Unrated debt securities are generally subject to greater risk of loss of principal and interest than high-rated debt securities.

Risk of investing in high yield debt securities

High yield debt securities are particularly susceptible to interest rate changes and may experience significant price volatility. Any fluctuation in interest rates may have a direct effect on the income received by the Fund and its capital value.

Risk of investing in urban investment bonds

The Fund may invest up to 50% of its Net Asset Value in urban investment bonds. Urban investment bonds are debt securities issued by local government agencies’ financing vehicles (“LGFVs”) in PRC and are listed or traded in the interbank bond market. LGFVs are separate legal vehicles established by the local government or their affiliates to raise funds for public welfare investment or infrastructure projects. Although urban investment bonds are issued by LGFVs and appear to be connected with local government bodies, the debt is backed by tax revenues or cash flow of investment projects and such debts are typically not guaranteed by local governments or the central government of the PRC. Such local governmental bodies or the central government are not obligated to provide financial support in case of default. In such case the Fund could suffer significant loss and the Fund’s NAV could be adversely affected. The credit risk and price volatility of these bonds may be higher when compared with other bonds such as central bank bonds and policy bank bonds. Besides, liquidity may be low during adverse market situations.

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Risk of investing in asset-backed securities/ mortgage backed securities

The Fund may invest up to 50% of its Net Asset Value in asset-backed securities. Asset-backed securities which include asset backed commercial papers are backed by the cash flow stream of a single or a portfolio of underlying assets. The stability of the cash flow is highly dependent on the quality of the underlying assets. There may be a lack of transparency of the underlying assets' quality despite such asset-back securities may be given high credit ratings. Such lack of transparency may pose valuation risk with respect to the calculation the Fund’s net asset value and investors may be adversely affected. Asset-backed securities are also highly sensitive to market sentiments and have higher volatility than central bank bond and policy bank bonds. Asset-backed securities may be less liquid than other securities and are more difficult to be disposed of.

Distributions

With respect to Distribution Unit Class, the Manager may or may not make cash distributions in respect of the Fund. If no distributions are made, income earned by the Fund will be reinvested in the Fund and reflected in the value of its Units.

Unitholders should note that the yield of holding the Units in the Fund can be lower than the yield of holding the underlying RMB Debt Instruments invested by the Fund directly.

58.3 Specific risk in interbank market and exchange market

Liquidity risk

The interbank market transaction account for predominant volume of daily bond market transactions in mainland China, there is no guarantee that such transaction volume can be sustainable in future. In case of the absence of an active interbank market or exchange market, the Fund may need to hold the RMB fixed income instruments until their maturity date. If sizeable redemption requests are received, the Fund may need to liquidate its investments at a substantial discount in order to satisfy such requests and the Fund may suffer losses in trading such instruments. Further, the bid and offer spread of the price of RMB fixed income instruments may be high (for both interbank market and exchange market), and the Fund may therefore incur significant trading costs and may even suffer losses when selling such investments.

Counterparty and settlement risk

The financial market of mainland China is at an early stage of development, investment in RMB fixed income instruments through interbank market will be subject to the counterparty risk of the issuers which may be unable or unwilling to make timely payments on principal and/or interest.

With respect to transactions in interbank market, the Fund will be exposed to higher counterparty risk on parties with whom it trades and when placing cash on deposit. The Fund will also be exposed to the risk of settlement default by a counterparty with which the Fund trades when buying and selling financial instruments (settlement risk). The risk of default of a counterparty is directly linked to the credit worthiness of the counterparty.

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With respect to transactions in exchange market, the Fund will be exposed to the counterparty risk of CSDCC (acting as the central counterparty for bond transactions on the PRC Stock Exchanges).

Legal Risk

The securities transactions in the PRC are likely to be governed by PRC laws and regulation. The Chinese legal system is based on written statutes. Prior court decisions may be cited for reference but have limited precedential value. Agreements entered into by the Fund may be more difficult to enforce by legal proceeding in the PRC than in countries with more mature legal systems. Even if the agreements generally provide for arbitral proceeding for disputes arising out of the agreements to be in another jurisdiction, it may take more time to obtain effective enforcement in the PRC, of a arbitral award obtained in that jurisdiction.

58.4 Cash custody risk

Investors should note that cash deposited in the cash account of the Fund with the PRC Sub-Custodian will not be segregated but will be a debt owing from the PRC Sub-Custodian to the Fund as a depositor. Such cash will be co-mingled with cash belong to other clients of the PRC Sub-Custodian. In the event of bankruptcy or liquidation of the PRC Sub-Custodian, the Fund will not have any proprietary rights to the cash deposited in such cash account, and the Fund will become an unsecured creditor, ranking pari passu with all other unsecured creditors, of the PRC Sub-Custodian. The Fund may face difficulty and/or encounter delays in recovering such debt, or may not be able to recover it in full or at all, in which case the Fund will suffer losses.

58.5 RMB currency and conversion risk

The Fund will accept subscriptions and pay redemption amounts in RMB.

If a prospective Unitholder will convert its subscription monies from Hong Kong dollar or any other currency to RMB in order to invest in the Fund, it should keep in mind that may be adversely affected by changes in the exchange rates of the RMB. There is no guarantee that RMB will not depreciate against the Hong Kong dollar or any other currency. The value of the RMB is linked to a basket of currencies, and thus the value of the RMB against the Hong Kong dollar may rise or fall.

If at the time the Unitholder receives its RMB redemption proceeds it subsequently converts these back into Hong Kong dollar or any other currency, the Unitholder may suffer a loss if RMB has depreciated.

On a separate note, RMB is not a freely convertible currency. Further, the PRC government's imposition of restrictions on the repatriation of Renminbi out of mainland China may limit the depth of the Renminbi market in Hong Kong and reduce the liquidity of the Fund. The Chinese government's policies on exchange control and repatriation restrictions are subject to change, and the Fund's or the investors' position may be adversely affected.

58.6 Concentration risk/single country investment risk

The Fund is specialised. The Fund invests in securities with substantial exposure to mainland China. Although the Fund's portfolio will be well diversified in terms of the number of investments, Unitholders should be aware that the Fund is likely to be more volatile than a

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broad-based fund, or a fund that is not denominated in RMB. The Fund may be more susceptible to fluctuations in value resulting from adverse conditions encountered in the PRC. Investments in issuers located in a particular country or geographic region may have more risk because of particular market factors affecting that country or region, including political instability or unpredictable economic conditions.

58.7 PRC market risk

The Fund is not a bank deposit and is not guaranteed. There is no guarantee of the repayment of the principal investment. The profitability of the investments of the Fund could be adversely affected by a worsening of general economic conditions in the PRC or global markets. Factors such as PRC government policy, fiscal policy, interest rates, inflation, investor sentiment, the availability and cost of credit, the liquidity of the PRC financial markets and the level and volatility of securities prices could significantly affect the value of the Fund's underlying investments and thus the Unit price. Unitholders should note in particular that the underlying investments of the Fund may fall in value, and thus the Unit price may fall even if the RMB appreciates against the Hong Kong dollar and US dollar.

For example: (a) an economic downturn or significantly higher interest rates could adversely affect the credit quality of the on-balance sheet and off-balance sheet assets; (b) a market downturn or worsening of the economy could cause the Fund to incur mark to market losses in its trading portfolios.

58.8 RQFII Regime Risks

Under the prevailing regulations in mainland China, foreign investors can directly invest in the RQFII Permitted Securities through institutions that have obtained RQFII status in mainland China. The current RQFII Regulations impose strict restrictions (such as investment guidelines) on RQFII eligible securities investment. The Fund is not a RQFII, but the Fund may invest in RQFII Permitted Securities via the RQFII Quota granted to CITIC Securities International Company Limited by SAFE. The prevailing rules and regulations governing RQFIIs under the RQFII Regulations impose restrictions on investments and other operational aspects of investments which will restrict or affect the Fund's investments.

Investors should be aware that the Fund may need to maintain high cash balances for the purposes of, among others, payment of the fees of its service provides and to meet redemption requests. This may result in lesser amounts being invested than would otherwise be the case.

RQFII Regulations

The RQFII Regulations which regulate investments by RQFIIs in mainland China and the repatriation are relatively new and novel in nature. The application and interpretation of the RQFII Regulations are therefore relatively untested and there is uncertainty as to how they will be applied. CSRC and SAFE have been given wide discretions in the RQFII Regulations and there is no precedent or certainty as to how these discretions might be exercised now or in the future. At this stage of early development, the RQFII Regulations may be subject to further revisions in the future, there is no assurance whether such revisions will prejudice the RQFII, or whether the RQFII Quota which are subject to review from time to time by CSRC and SAFE may be withdrawn substantially or entirely. At the time of the launch of the Fund, the RQFII Regulations continue to develop and are undergoing continual change. CSRC

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and/or SAFE may have power in the future to impose new restrictions or conditions on or terminate the RQFII status of CITIC Securities International Company Limited which may adversely affect the Fund and the Unitholders. It is not possible to predict how such changes would affect the Fund.

RQFII Quotas

Investment by the Fund will be made and held through the RQFII Quota granted to CITIC Securities International Company Limited by SAFE. The RQFII Regulations apply to RQFII Quota(s) which may be obtained by CITIC Securities International Company Limited as RQFII from time to time for the Fund or other investors as a whole, and not simply to investments made by the Fund. Thus investors should be aware that violations of the RQFII Regulations arising out of activities related to any usage of RQFII Quota obtained by CITIC Securities International Company Limited (including utilization of the RQFII Quota by the Fund and other than the Fund) could result in the revocation of or other regulatory action in respect of the RQFII Quota held by CITIC Securities International Company Limited as a whole, including the RQFII Quota utilised by the Fund. Likewise, regulatory limits on investment in RQFII Permitted Securities (as applicable) may apply in relation to the RQFII Quota held by CITIC Securities International Company Limited as a whole. Hence the ability of the Fund to make investments and/or repatriate monies from the RQFII Quota may be affected adversely by the investments, performance and/or repatriation of monies invested by other investors utilising the RQFII Quota obtained by CITIC Securities International Company Limited in the future.

In addition, any repatriation of monies by the Fund to meet obligations such as the payment of fees may adversely impact the ability of the Fund to repatriate monies to meet Unitholders' redemption requests.

There can be no assurance that the Fund will be able to obtain access to sufficient RQFII Quota to meet all proposed investments to be made by the Fund or that the investments of the Fund can be realised in a timely manner due to possible adverse changes in relevant laws or regulations which will hinder the Fund's ability to pursue the investment objectives or result in loss under extreme circumstances. Should CITIC Securities International Company Limited lose its RQFII status or retire or be removed, or the RQFII Quota held by CITIC Securities International Company Limited be revoked or reduced, the Fund may not be able to invest in RQFII Permitted Securities through the RQFII Quota held by CITIC Securities International Company Limited, and the Fund may be required to dispose of its holdings, which would likely have a material adverse effect on the Fund.

RQFII Quota Limitation

The RQFII Quota granted to CITIC Securities International Company Limited by SAFE is shared among the Fund and other open-ended funds managed by the Manager. CITIC Securities International Company Limited (as RQFII) can allocate the available RQFII Quota flexibly across the open-ended funds under the management of the Manager. The Manager may allocate more RQFII Quota to the Fund from other open-ended funds to meet subscription demands. However, it is also possible that the Manager may not accept additional subscriptions when there is not enough RQFII Quota available to the Fund and would not be able to achieve further economies of scale or otherwise take advantage of the increased capital base.

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Custody

Any RQFII Permitted Securities acquired by the Fund through the RQFII Quota held by CITIC Securities International Company Limited will be maintained by the PRC Sub-Custodian and will be registered in the joint names of CITIC Securities International Company Limited (as RQFII) and the Fund and for the sole benefit and use of the Fund subject to applicable laws. There will be segregation of assets by the PRC Sub-Custodian such that the assets of the Fund will not form part of the assets of CITIC Securities International Company Limited as RQFII, the Manager or the PRC Sub-Custodian.

However, subject to the investment regulations, CITIC Securities International Company Limited could be the party entitled to the securities in such securities trading account (albeit that this entitlement does not constitute an ownership interest or preclude the Manager purchasing the securities on behalf of the Fund). Such securities may be vulnerable to a claim by a liquidator of CITIC Securities International Company Limited and may not be as well protected as if they were registered solely in the name of the Fund. In particular, there is a risk that creditors of CITIC Securities International Company Limited may incorrectly assume that the Fund's assets belong to CITIC Securities International Company Limited and such creditors may seek to gain control of the Fund's assets to meet CITIC Securities International Company Limited's liabilities owed to such creditors.

PRC Securities Brokers and Best Execution

The Fund may have difficulty in obtaining best execution of transactions in RQFII Permitted Securities subject to restriction/limitations under applicable RQFII Regulations or operational constraints such as the restriction/limitation as to the number of brokers that the Manager may appoint. The Fund will use PRC brokers appointed by the Manager to execute transactions in the PRC markets for the account of the Fund. If a PRC broker offers the Fund standards of execution which the Manager reasonably believes to be amongst best practice in the PRC marketplace, the Manager may determine that they should consistently execute transactions with that PRC broker (including where it is an affiliate) notwithstanding that they may not be executed at the best price and shall have no liability to account to the Fund in respect of the difference between the price at which the Fund executes transactions and any other price that may have been available in the market at that relevant time.

Limits on Redemption

Where the Fund is invested in the securities market in mainland China by investing through the RQFII Quota held by CITIC Securities International Company Limited, repatriation of funds from mainland China may be subject to the RQFII Regulations in effect from time to time. Currently there is no regulatory prior approval requirement for repatriation of funds from the RQFII Quota. However the relevant RQFII regulations are subject to uncertainty in their application and there is no certainty that no regulatory restrictions will apply to the repatriation of funds by the Fund in the PRC in the future. Accordingly, the investment regulations and/or the approach adopted by SAFE in relation to the repatriation may change from time to time.

Please note that redemptions on any Dealing Day are subject to redemption restrictions described in the Trust Prospectus (including suspension of redemption and/or delay of payment of redemption monies) and in case of repatriation restrictions being imposed in the future, it is possible that the Manager may not resume acceptance of redemption request

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and/or make payment of redemption monies for as long as the time required for repatriation of funds from the RQFII Quota subject to regulatory restrictions in the PRC.

For each RQFII Quota approved by SAFE, the relevant RQFII is required to utilize the RQFII Quota effectively within one year from the SAFE approval date. If the RQFII fails to utilize the RQFII Quota effectively, SAFE could reduce or revoke the RQFII Quota depending on the circumstances. As utilization of the RQFII Quota will depend on the subscription level of the Fund and redemptions by investors of the Fund, low subscription level or large redemptions by investors of the Fund might result in the RQFII Quota being reduced or lost permanently.

Investment Restrictions

There are limits on the total shares held by all underlying investors in one listed company under the RQFII Regulations. The investment restrictions will be applied to all underlying investors. However, it will be difficult in practice for the Manager to monitor the investments of the underlying investors since an investor may make investment through different RQFIIs or QFIIs. Violations of the RQFII Regulations (including ownership limits referred to above) by CITIC Securities International Company Limited or arising out of the activities relating to the use of any RQFII Quota granted to CITIC Securities International Company Limited (including the RQFII Quota utilized by other funds or entities) could result in the revocation of or other regulatory action in respect of the RQFII Quotas granted to CITIC Securities International Company Limited, which could directly impact the Fund.

58.9 Risks associated with investment in short-term debt instruments

The Fund will primarily invest in short-term debt instruments. Whilst the Fund may avoid potential risks associated with the holding of longer-term debt securities, this may also lead to the loss of opportunities for obtaining higher yields by investing in longer-term debt securities.

Short-term debt instruments are not risk-free and investing in the Fund is not the same as investing in money market funds or placing funds on deposit with a bank or deposit-taking company. The Manager has no obligation to redeem Units of the Fund at the Issue Price.

As the Fund invests significantly in short-term debt instruments with short maturities, it means the turnover rates of the Fund’s investments may be relatively high and the transaction costs incurred as a result of the purchase or sale of short-term debt instruments may also increase which in turn may have a negative impact on the Net Asset Value of the Fund.

58.10 Risks associated with investment in PRC money market funds

The Fund's investment in PRC money market funds is neither risk-free nor equivalent to placing funds on deposits with a bank or deposit-taking company. Money market funds are in general susceptible to short-term interest risk. For PRC money market funds with high asset allocation to deposit arrangements with a bank in the PRC, it is exposed to default risk and credit risk of the relevant bank as there is no bank deposit protection regime in PRC at present.

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58.11 PRC tax considerations

For further details relating to PRC taxes and the associated risks, please refer to section 17.2 of the Trust Prospectus headed "PRC Tax".

The value of the Fund's investments (and hence the Net Asset Value of the Fund) will be adversely affected by taxation levied against the Manager or CITIC Securities International Company Limited as RQFII in respect of the Fund's investments through the RQFII Quota held by CITIC Securities International Company Limited, for which the Fund will be required to reimburse the Manager or CITIC Securities International Company Limited. The PRC taxation regime that will apply to RQFIIs and investments made through RQFII quotas is currently unclear.

After careful consideration of the Manager’s assessment and having taken and considered independent professional tax advice on the Fund’s eligibility for treaty relief in the China-HK Arrangements and acting in accordance with such advice, the Manager considers that the Fund should qualify as a Hong Kong tax resident and it should be able to enjoy a WIT exemption on capital gains derived from RMB Debt Instruments under the China-HK Arrangements. In this regard, the Manager has determined, having taken and considered independent professional tax advice and acting in accordance with such advice, that no PRC WIT provision will be made on the gross realized and unrealized capital gains derived from investments in RMB Debt Instruments.

It should be noted that there are uncertainties regarding the Manager’s determination of PRC WIT provision in relation to capital gains derived from investments in RMB Debt Instruments, including:

• The China-HK Arrangements may be changed in the future and the Fund may ultimately be required to pay PRC WIT on capital gains.

• To date, the Fund has not obtained a Hong Kong Tax Resident Certificate (“HKTRC”) from the Inland Revenue Department of Hong Kong (“IRD”). If the PRC tax authorities enforce the collection of PRC WIT on capital gains and require the Fund to provide a HKTRC in the future in order to obtain the PRC WIT exemption, the Manager will apply for a HKTRC on behalf of the Fund from the IRD for the relevant years. However, there is a risk that the Manager may not be able to obtain a HKTRC on behalf of the Fund.

• To date, the PRC tax authorities have not sought to enforce PRC WIT collection on capital gains derived by RQFIIs such as CITIC Securities International Company Limited. If the PRC tax authorities start to enforce PRC WIT collection on capital gains, the relief under the China-HK Arrangements is still subject to the final approval of the PRC tax authorities. Even if the Manager, in accordance with the independent professional tax advice, believes that the Fund should be eligible for such relief, the PRC tax authorities may ultimately hold a different view.

It should also be noted that there is a possibility of the PRC tax rules being changed and taxes being applied retrospectively. In the event that tax is collected by the PRC tax authorities and the Fund is required to make payments reflecting tax liabilities for which no provision has been made, the Net Asset Value of the Fund will be adversely affected, as the Fund will ultimately have to bear the full amount of tax liabilities. In this case, the tax liabilities will

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only impact Units in issue at the relevant time, and the then existing Unitholders and subsequent Unitholders will be disadvantaged as such Unitholders will bear, through the Fund, a disproportionately higher amount of tax liabilities as compared to that borne at the time of investment in the Fund. Unitholders may, depending on their own circumstances, be subject to PRC tax or taxes in other jurisdictions. The Fund would not be able to guarantee that taxes paid at the Fund’s level will be attributable to any Unitholders for personal tax purposes.

Upon the availability of a definitive tax assessment or the issue of announcements or regulations by the competent authorities promulgating definitive tax assessment rules, the Manager will, as soon as practicable, make relevant adjustments to the amount of tax provision as it considers necessary.

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E. FUND SPECIFIC PROSPECTUS OF CSI RMB MONEY MARKET FUND

This Fund Specific Prospectus comprises information in relation to the CSI RMB Money Market Fund (the "Fund"), a sub-fund of the Trust. Units in the Fund are now being offered for subscription on the terms set out in the Trust Prospectus and the Trust Deed. It is envisaged that further sub-funds of the Trust may be created in the future. The Trust is managed by CITIC Securities International Investment Management (HK) Limited.

59. CSI RMB MONEY MARKET FUND

This document relates to the CSI RMB Money Market Fund, a sub-fund established under the Trust and authorized by the SFC pursuant to section 104 of the SFO. SFC authorization is not a recommendation or endorsement of the Fund, nor does it guarantee the commercial merits of the Fund or its performance. It does not mean the Fund is suitable for all investors nor is it an endorsement of its suitability for any particular investor or class of investors. This Fund Specific Prospectus should be read in conjunction with the Trust Prospectus and the Product Key Facts Statement relating to the Fund. In case of discrepancies between Part A (the Trust Prospectus) and Part E (this Fund Specific Prospectus) of this document in relation to the CSI RMB Money Market Fund, this Part E shall prevail.

Investors should note that purchase of a Unit in the Fund is not the same as placing funds on deposit with a bank or deposit taking company and that the Fund is not subject to the supervision of the Hong Kong Monetary Authority. The Fund does not have a constant Net Asset Value. The Manager has no obligation to redeem Units at the offer value.

60. DEFINITIONS

Defined terms used in this Fund Specific Prospectus which are not defined below bear the same meanings as in the Trust Prospectus.

"Business Day" any day other than Saturday or Sunday, on which banks in Hong Kong and the PRC are open for normal banking business, but excluding any day on which a tropical cyclone warning signal 8 or higher or a black rain storm warning signal or any warning or signal considered by the Manager to be similar in effect is in force in Hong Kong after 9:00 a.m. (Hong Kong time) and before 5:00 p.m. (Hong Kong time) on that day unless the Manager and the Trustee otherwise agree;

"China A-shares" means securities of companies incorporated in China and listed on a PRC Stock Exchange, traded in RMB and available for investment by domestic investors, qualified foreign institutional investors and RQFIIs;

"Credit Products" has the meaning as defined at page 42;

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"CSDCC" means the China Securities Depository & Clearing Corporation Limited;

"Dealing Day" each Business Day and such other day(s) as the Manager may from time to time determine;

"EUR" means Euro, the lawful currency of certain member states of the European Union;

"Fund" the CSI RMB Money Market Fund, being a sub-fund of the Trust offered pursuant to this Fund Specific Prospectus;

"Initial Issue Price" means the price at which Units of the Fund are issued during the Initial Period, as set out under the heading “Issue Price” in the section “Subscription for Units” in this Fund Specific Prospectus”;

"Initial Period" means from 9:00 a.m. (Hong Kong time) on 1 June 2015 until 12:00 p.m. (Hong Kong time) on 30 June 2015(or such other date as the Manager may in its discretion determine);

"IR Products" has the meaning as defined at page 42;

"Issue Price" the Net Asset Value per Unit calculated as at the Valuation Point on the Dealing Day relating to the application for the issue of Units;

"JPY" means Japanese Yen, the lawful currency of Japan;

"mainland China" or "PRC" means the People's Republic of China (excluding, for the purposes of the Trust Prospectus and this Fund Specific Prospectus, the Hong Kong Special Administrative Region, Macao Special Administrative Region and Taiwan);

"PRC Rating Agencies" means (i) China Cheng Xin International Credit Rating, (ii) China Lianhe Credit Rating, (iii) Dagong Global Credit Rating, (iv) Shanghai Brilliance Credit Rating and Investors Services, and (v) Pengyuan Credit Rating;

"PRC Stock Exchanges" means the Shanghai Stock Exchange, the Shenzhen Stock Exchange and any other stock exchange that opens in the PRC;

"QFII Quota" means a PRC foreign exchange investment quota granted to a qualified foreign institutional investor pursuant to the QFII Regulations;

"QFII Regulations" means the regulations and rules, as amended from time to time, governing the establishment and operation of qualified foreign institutional investors and QFII Quotas;

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"Redemption Charge" a charge payable by the Unitholder and calculated as a percentage of the Redemption Price of each Unit which is being redeemed by that Unitholder;

"Redemption Price" the Net Asset Value per Unit calculated as at the Valuation Point on the Dealing Day relating to the application for redemption of Units;

"RMB" means Renminbi, the lawful currency of the PRC;

"RQFII" means a RMB qualified foreign institutional investor under the RQFII Regulations;

"RQFII Permitted Securities"

means securities and investments permitted to be held or made by RQFIIs under RQFII Regulations, which currently include the following RMB denominated financial instruments:

(a) China A-shares;

(b) fixed income securities traded on the PRC Stock Exchanges or the interbank market in the PRC;

(c) PRC securities investment funds approved by the CSRC; and

(d) other financial instruments from time to time approved by CSRC or the People's Bank of China;

"RQFII Quota" means a RMB investment quota granted to a RQFII pursuant to the RQFII Regulations;

"RQFII Regulations" means the regulations and rules, as amended from time to time, governing the establishment and operation of RQFIIs and RQFII Quotas;

"SAFE" means the PRC State Administration of Foreign Exchange, the government agency responsible for matters relating to foreign exchange administration;

"Subscription Charge" a charge payable by the Unitholder and calculated as a percentage of the Initial Issue Price or Issue Price (as the case may be) of each Unit which is issued to that Unitholder;

"Trust Prospectus" the prospectus in Part A of this document relating to CSI Alpha Fund Series, as amended or supplemented from time to time;

"USD" means United States Dollar, the lawful currency of the United States of America;

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"Valuation Point" means the close of business in the last relevant market to close on each relevant Dealing Day or such other time or times as the Manager may from time to time determine.

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61. SUMMARY

Set out below is a summary of the Fund. The summary information is derived from, and should be read in conjunction with, the full text of this Fund Specific Prospectus. Your attention is drawn to the section entitled "Risk Factors" in the Trust Prospectus and the section entitled "Fund Specific Risk Factors" in this Fund Specific Prospectus. Key information in respect of the Fund is as follows:

Initial Issue Price RMB Accumulation Class and RMB Distribution Class: RMB 100 per Unit

JPY Accumulation Class and JPY-hedged Accumulation Class: JPY10,000 per Unit

USD Accumulation Class and USD-hedged Accumulation Class: USD100 per Unit

EUR Accumulation Class and EUR-hedged Accumulation Class: EUR100 per Unit

Initial Period means from 9:00 a.m. (Hong Kong time) on 1 June 2015 until 12:00 p.m. (Hong Kong time) on 30 June 2015 (or such other date as the Manager may in its discretion determine)

Issue Price means the Net Asset Value per Unit calculated as at the Valuation Point, and subject to a Subscription Charge and any fiscal and purchase charges

Dealing Day each Business Day and such day(s) as the Manager may from time to time determine

Initial Minimum Subscription Amount

RMB Accumulation Class and RMB Distribution Class: RMB10,000

JPY Accumulation Class and JPY-hedged Accumulation Class: JPY10,000,000

USD Accumulation Class and USD-hedged Accumulation Class: USD1,000,000

EUR Accumulation Class and EUR-hedged Accumulation Class: EUR1,000,000

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Subsequent Minimum Subscription Size

RMB Accumulation Class and RMB Distribution Class: RMB10,000

JPY Accumulation Class and JPY-hedged Accumulation Class: JPY10,000

USD Accumulation Class and USD-hedged Accumulation Class: USD100

EUR Accumulation Class and EUR-hedged Accumulation Class: EUR100

Minimum Redemption Size RMB Accumulation Class and RMB Distribution Class: RMB10,000

JPY Accumulation Class and JPY-hedged Accumulation Class: JPY10,000

USD Accumulation Class and USD-hedged Accumulation Class: USD100

EUR Accumulation Class and EUR-hedged Accumulation Class: EUR100

Minimum Holding RMB Accumulation Class and RMB Distribution Class: RMB10,000

JPY Accumulation Class and JPY-hedged Accumulation Class: JPY5,000,000

USD Accumulation Class and USD-hedged Accumulation Class: USD500,000

EUR Accumulation Class and EUR-hedged Accumulation Class: EUR500,000

Manager CITIC Securities International Investment Management (HK) Limited

Trustee and Registrar BOCI-Prudential Trustee Limited

RQFII Licence Holder CITIC Securities International Company Limited, which conducts the relevant RQFII business through the Manager

Global Custodian Bank of China (Hong Kong) Limited

PRC Sub-Custodian Bank of China Limited

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Fees payable by Unitholders

Subscription Charge Up to 2% of the Initial Issue Price or Issue Price (as the case may be) of each Unit

Transfer Fee Nil

Redemption Charge Nil

Fiscal and Purchase Charges Up to 1% of the Issue Price of each Unit (in case of subscription) or up to 1% of the Redemption Price of each Unit (in case of redemption) chargeable only to compensate the Fund for any dilution in the Fund's Net Asset Value as a result of a large volume of applications/redemptions by Unitholders, or a large application/redemption request from any Unitholder, on any Dealing Day and in the Manager's opinion the continuing Unitholders might otherwise be materially adversely affected.

Fees payable by the Fund

Management Fee For RMB Accumulation Class and RMB Distribution Class: 0.5% per annum of the Net Asset Value of the class

For all other classes: 0.3% per annum of the Net Asset Value of the class

Performance Fee Nil

Trustee Fee Up to 0.15% per annum of the Net Asset Value of the Fund, subject to a monthly minimum fee of RMB40,000

Trustee Set-Up Fee The Trustee is entitled to receive from the Trust once-off establishment fee of up to RMB8,000 for the establishment of each Fund of the Trust

Trustee Out-of-Pocket Expense Fee

The Trustee is entitled to receive reimbursement for out of pocket expenses such as postage and stationery

Global Custodian Fee Up to 0.1% per annum of the Net Asset Value of the Fund plus transaction fees at customary rates dependent on the market the Fund invests and out of pocket expenses incurred by the Global Custodian and the PRC Sub-Custodian

PRC Sub-Custodian Fee Covered under Global Custodian Fee

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62. INVESTMENT OBJECTIVE AND POLICY

62.1 Currency Denomination

The Fund is denominated in RMB.

This Fund currently issues the following Unit class(es) each with a separate Unit class currency as follows:

Unit class Unit class currency

RMB Accumulation Class RMB

RMB Distribution Class RMB

JPY Accumulation Class Japanese Yen

JPY-hedged Accumulation Class Japanese Yen

USD Accumulation Class USD

USD-hedged Accumulation Class USD

EUR Accumulation Class Euro

EUR-hedged Accumulation Class Euro

62.2 Investment Objective

The Fund seeks to achieve a rate of return higher than that normally available for offshore RMB personal deposits by investing primarily in short-term RMB Debt Instruments in the PRC, to the extent permitted by the PRC rules and regulations. The Fund may also invest in RMB denominated and settled short-term debt instruments that are issued and distributed outside the PRC.

62.3 Investment Policy

The Fund seeks to invest:

- not less than 80% of its total Net Asset Value in short-term RMB Debt Instruments which include IR Products and Credit Products distributed within the PRC and traded on the PRC interbank bond market and/or the PRC Stock Exchanges; and

- not more than 20% of its total Net Asset Value in RMB-denominated and settled short-term debt instruments issued and distributed outside the PRC.

The Fund will maintain an average portfolio maturity not exceeding 90 days, and will not purchase an instrument with a remaining maturity of more than 397 days, or two years in the case of government and other public securities (as defined under the "Investment Restrictions" section in the Trust Prospectus).

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Besides, the Fund will not invest in urban investment bonds or asset-backed securities (including asset-backed commercial papers).

The Fund may hold up to 20% of its total Net Asset Value in cash or bank deposits to manage liquidity.

The following credit rating criteria apply to the investments of the Fund:

- In relation to RMB Debt Instruments in the PRC, while the Fund may invest up to 100% of its assets in IR Products (issued by the central government, policy bank or central bank) which are generally unrated, for Credit Products, the Fund will only invest in those with a minimum rating of 'AAA' being rated by any of the PRC Rating Agencies at the time of acquisition. In the event that a Credit Product is downgraded to below 'AAA' rating after its acquisition by the Fund, the Manager will try to dispose such Credit Product, subject to market liquidity, and provided that it is in the best interest of the Unitholders. The Fund will not invest in Credit Products that are unrated or rated ‘AA-’ or below.

- For debt instruments issued and distributed outside the PRC, the Fund will not invest in securities (i) with a short-term credit rating below A-2 (or its equivalent) or a long-term credit rating below A- (or its equivalent) as rated by any international credit rating agency (such as Standard & Poor’s, Moody’s and Fitch), or (ii) that are unrated, except those unrated securities with a long-term issuer credit rating at or above A- (or its equivalent) as rated by any international credit rating agency (such as Standard & Poor’s, Moody’s and Fitch).

The indicative asset allocation is as follows:

Type of instruments Percentage limits (of the Fund’s

Net Asset Value) (Please see note below)

Short-term RMB Debt Instruments in the PRC

80-100%

Short-term RMB-denominated debt instruments issued and distributed outside the PRC

up to 20%

Cash and bank deposits up to 20%

Note: Despite the target allocation indicated above, investors should note that the Manager may exercise its discretion to adjust the allocation at any time, provided that it is in the best interest of the Fund to do so in light of the prevailing market conditions. The Manager may allocate a substantial portion (up to 100% of the Fund’s Net Asset Value) in cash or cash equivalents as the Manager determines appropriate in adverse market conditions (such as significant economy downturn, major financial crisis, war or political turmoil or changes in applicable legal or regulatory requirements or policies), having assessed the risks and returns of maintaining the target allocation.

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Hedging policy in relation to currency hedged Unit classes

The Fund offers currency hedged Units classes (with class names suffixed by “-hedged”). For currency hedged Unit classes, the Manager intends to minimise RMB currency risk against the respective Unit class currencies with target of full hedging to the portfolio The Manager will mainly invest in, but not limited to, forward contracts with not more than 12 months maturity.

There is no assurance that the hedging policy can be achieved, Please refer to the risk factor “Hedging risk” in the section entitled "Fund Specific Risk Factors" in this Fund Specific Prospectus for the risks relating to hedging.

Investment Strategy

Each instrument in the portfolio of the Fund will be selected based on our internal macro research. The Manager will adjust the duration risk of the investment portfolio based on expectations of the PRC's macroeconomic cycle and monetary policy. If RMB short term interest rate is expected to fall, the Manager will increase the average duration of the investment portfolio to better benefit from the capital gains from lower yield, and vice versa.

The Manager will conduct extensive research on the fundamentals of different issuers (in particular, the debt issuer’s creditworthiness), and adjust the portfolios to achieve better risk adjusted returns among various investment instruments.

Investment through the RQFII Quota

Currently, foreign investors are generally unable to invest in RQFII Permitted Securities other than through QFII Quotas (to the extent applicable) or RQFII Quotas approved under the QFII Regulations or RQFII Regulations respectively. Under the RQFII Regulations, amongst other eligible entities, Hong Kong subsidiaries of PRC domestic brokerages firms that meet the relevant prescribed eligibility requirements may apply to the CSRC for a securities investment licence as a RQFII and correspondingly apply to SAFE for RQFII Quota for investment into RQFII Permitted Securities. CITIC Securities International Company Limited has been approved as a RQFII under the RQFII Regulations, but is required to conduct its RQFII business through the Manager. CITIC Securities International Company Limited has been granted a RQFII Quota by SAFE which can be utilized by the Fund under the management of the Manager.

CITIC Securities International Company Limited was incorporated in Hong Kong on 9 April 1998 and has its principal office in Hong Kong. CITIC Securities International Company Limited is a wholly owned subsidiary of CITIC Securities Co., Ltd., a company incorporated in the PRC and regulated as a securities company by CSRC. The Manager is an indirect subsidiary of CITIC Securities International Company Limited.

The Fund will invest in the RMB Debt Instruments in the PRC via the RQFII Quota granted to CITIC Securities International Company Limited by SAFE.

Financial Derivative Instruments

Except for the currency hedging in respect of the currency hedged Unit classes, the Fund does not intend to invest in any structured products/structured deposits or financial derivative instruments for investment and other hedging purposes.

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Securities Lending and Repurchase Transactions

The Fund does not intend to enter into any securities lending transactions, repurchase/reverse repurchase transactions or other similar over-the-counter transactions. Should the Manager wishes to enter into any such transactions on behalf of the Fund, this will be subject to the prior approval of the SFC and at least one month's prior notice will be given to Unitholders.

62.4 Effect of RQFII Regulations on Redemptions

The repatriation of invested capital and of income and capital gains of the Fund from PRC is subject to the RQFII Regulations. Currently, under the RQFII Regulations, remittance and repatriation for the account of the Fund may be effected on a daily basis through the RQFII Quota based on the net subscriptions and redemptions of Units of the Fund. At present, there is no regulatory prior approval requirement for repatriation of funds from the RQFII Quota however there is no certainty that no regulatory restrictions will apply to the repatriation of funds by the Fund in the PRC in the future.

Please note that redemptions on any Dealing Day are subject to redemption restrictions described in the Trust Prospectus (including suspension of redemption and/or delay of payment of redemption monies) and in case of repatriation restrictions being imposed in the future, it is possible that the Manager may not resume acceptance of redemption request and/or make payment of redemption monies for as long as the time required for repatriation of funds from the RQFII Quota subject to regulatory restrictions in the PRC.

62.5 RQFII Quota Limitation

The RQFII Quota granted to CITIC Securities International Company Limited by SAFE is shared among the Fund and other open-ended funds managed by the Manager. CITIC Securities International Company Limited (as RQFII) can allocate the available RQFII Quota flexibly across the open-ended funds under the management of the Manager. The Manager may allocate more RQFII Quota to the Fund from other open-ended funds to meet subscription demands. However, it is also possible that the Manager may not accept additional subscriptions when there is not enough RQFII Quota available to the Fund. The Manager will monitor the usage of the RQFII Quota from time to time and apply for additional RQFII Quota where necessary.

62.6 Potential Conflict of Interest

Investors should be aware that:

(i) the Trustee, the Global Custodian and the PRC Sub-Custodian are affiliates of each other; and

(ii) the Global Custodian, the PRC Sub-Custodian or their affiliates may act as a counterparty in a securities transaction of the Fund.

Potential conflicts of interest may exist in the performance of the functions of the Trustee, the Global Custodian and the PRC Sub-Custodian as they are affiliates of each other. However each entity has different set of business objectives, activities, reporting lines and senior management. Each of the Trustee, the Global Custodian and the PRC Sub-Custodian will comply with their respective regulatory obligations (where applicable) for managing conflicts of interests and have policies in place to deal with them. In particular there are effective

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Chinese walls and information barriers in place to separate the entities (internally and externally).

With respective to the potential conflicts of interest where the PRC Sub-Custodian, on one hand, acting as the custodian of the Fund, and on the other hand where it or its affiliates may act as the counterparty in securities transactions, within the PRC Sub-Custodian, there are segregation of duties between roles, functions and departments with effective Chinese walls and information barriers in place. The PRC Sub-Custodian has internal and external audit to ensure conflicts of interests are properly managed. The PRC Sub-Custodian is also subject to the supervision of the PBoC.

63. CUSTODY

The Trustee takes into its custody or under its control the Fund's assets, including PRC assets deposited in the securities and RMB cash accounts with the PRC Sub-Custodian (defined below), and holds the same in trust for Unitholders. The Trustee has appointed Bank of China (Hong Kong) Limited (the "Global Custodian") as its global custodian pursuant to a Custodian Agreement, pursuant to which the Global Custodian shall hold the assets of the Fund as custodian. The Global Custodian will appoint Bank of China Limited (the "PRC Sub-Custodian") as its sub-custodian pursuant to a RQFII Sub-Custodian Agreement among CITIC Securities International Company Limited (as RQFII), the Manager, the Global Custodian and the PRC Sub-Custodian, pursuant to which the PRC Sub-Custodian shall hold the assets of the Fund invested in the PRC through the RQFII Quota held by CITIC Securities International Company Limited. The RQFII Sub-Custodian Agreement will be supplemented by a RQFII supplemental custodian agreement to which the Trustee is also a party. The Trustee is liable for the acts and omissions of the PRC Sub-Custodian in relation to the assets forming part of the property of the Fund.

The Trustee registers the Fund's assets, including PRC assets deposited via the Global Custodian in the securities and RMB cash accounts opened and maintained with the PRC Sub-Custodian, to the order of the Trustee.

Instructions to execute transactions with respect to the Fund's assets in the securities account(s) and the RMB cash account(s) as well as other matters such as the repatriation of funds shall be given by the Manager and delivered through the Trustee and the Global Custodian to the PRC Sub-Custodian (i.e. not delivered to the PRC Sub-Custodian directly). The PRC Sub-Custodian will look to the Trustee via the Global Custodian for instructions and solely act in accordance with the instructions of the Trustee or authorities granted by the Trustee.

The Manager and the Trustee have obtained an opinion from PRC legal counsel to the effect that, as a matter of PRC laws:

(a) securities account(s) and RMB cash account(s) with the PRC Sub-Custodian, CSDCC and China Central Depositary & Clearing Co., Ltd. where applicable (respectively, the "securities account" and the "cash account") for the Fund shall be opened in the joint names of CITIC Securities International Company Limited (as RQFII) and the Fund and for the sole benefit and use of the Fund in accordance with all applicable laws and regulations of the PRC and with approval from all competent authorities in the PRC;

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(b) the assets held/credited in the securities account (i) belong solely to the Fund, and (ii) are segregated and independent from the proprietary assets of CITIC Securities International Company Limited (as RQFII), the Manager, the PRC Sub-Custodian and any PRC broker of the Fund and from the assets of other clients of CITIC Securities International Company Limited (as RQFII), the Manager, the PRC Sub-Custodian and any PRC broker of the Fund;

(c) the assets held/credited in the cash account (i) become an unsecured debt owing from the PRC Sub-Custodian to the Fund, and (ii) are segregated and independent from the proprietary assets of CITIC Securities International Company Limited (as RQFII), the Manager, and any PRC broker of the Fund, and from the assets of other clients of CITIC Securities International Company Limited (as RQFII), the Manager, and any PRC broker of the Fund;

(d) the Trustee, for and on behalf of the Fund, is the only entity which has a valid claim of ownership over the assets in the securities account and the debt in the amount deposited in the cash account of the Fund;

(e) if CITIC Securities International Company Limited, the Manager or any PRC broker of the Fund is liquidated, the assets contained in the securities account and cash account of the Fund will not form part of the liquidation assets of CITIC Securities International Company Limited, the Manager or such PRC broker of the Fund in liquidation in the PRC; and

(f) if the PRC Sub-Custodian is liquidated, (i) the assets contained in the securities account of the Fund will not form part of the liquidation assets of the PRC Sub-Custodian in liquidation in the PRC, and (ii) the assets contained in the cash account of the Fund will form part of the liquidation assets of the PRC Sub-Custodian in liquidation in the PRC and the Fund will become an unsecured creditor for the amount deposited in the cash account.

64. INVESTMENT RESTRICTIONS

The Fund is subject to the applicable investment restrictions described in the "Investment Restrictions" section in the Trust Prospectus. In addition, the Fund shall be subject to the following additional investment restrictions:

(a) Subject to the provisions below, the Fund may only invest in deposits and debt securities.

(b) The Fund will maintain an average portfolio maturity not exceeding 90 days, and will not purchase an instrument with a remaining maturity of more than 397 days, or two years in the case of government and other public securities.

(c) The aggregate value of the Fund’s holding of instruments and deposits issued by a single issuer will not exceed 10% of the total Net Asset Value of the Fund except:

(i) where the issuer is a substantial financial institution and the total amount does not exceed 10% of the issuer's issued capital and published reserves, the limit may be increased to 25%; or

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(ii) in the case of government and other public securities, up to 30% may be invested in the same issue; or

(iii) in respect of any deposit of less than US$1,000,000 or its equivalent in RMB, where the Fund cannot otherwise diversify as a result of its size.

In this section, the term “government and other public securities” shall have the same meaning as in defined under the "Investment Restrictions" section in the Trust Prospectus.

65. BORROWING RESTRICTIONS

The Fund may borrow up to 10% of its total Net Asset Value but only on a temporary basis for the purpose of meeting redemption requests or defraying operating expenses.

66. UNIT CLASSES

The Fund currently offers the following Unit classes (each with a separate Unit class currency):

RMB Accumulation Class

RMB Distribution Class

JPY Accumulation Class

JPY-hedged Accumulation Class

USD Accumulation Class

USD-hedged Accumulation Class

EUR Accumulation Class

EUR-hedged Accumulation Class

Classes marked with “-hedged” are currency hedged Unit classes. Please refer to the heading “Hedging policy in relation to hedged Unit classes” in section 62.3 “Investment Policy” for further information.

67. SUBSCRIPTION FOR UNITS

67.1 Issue Price

Each Unit of a class will be offered to the public during the Initial Period at the following Initial Issue Price of such class subject to the Subscription Charge:

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Unit class Initial Issue Price

RMB Accumulation Class and RMB Distribution Class RMB 100 per Unit

JPY Accumulation Class and JPY-hedged Accumulation Class JPY10,000 per Unit

USD Accumulation Class and USD-hedged Accumulation Class USD100 per Unit

EUR Accumulation Class and EUR-hedged Accumulation Class EUR100 per Unit

The Manager may exercise its discretion to close the Fund for subscription when the RQFII Quota has been filled up.

Thereafter, each Unit will be offered at the Issue Price, being the Net Asset Value per Unit calculated as at the Valuation Point, and again subject to a Subscription Charge and any fiscal and purchase charges.

67.2 Minimum subscription and minimum holding

The initial minimum subscription amount that must be subscribed for the Units and the subsequent minimum subscription amount are as follows. The Manager may, at its discretion, waive or modify these minimum limits.

Unit class Initial Minimum Subscription Amount

Subsequent Minimum Subscription Size

RMB Accumulation Class RMB10,000 RMB10,000

RMB Distribution Class RMB10,000 RMB10,000

JPY Accumulation Class JPY10,000,000 JPY10,000

JPY-hedged Accumulation Class JPY10,000,000 JPY10,000

USD Accumulation Class USD1,000,000 USD100

USD-hedged Accumulation Class USD1,000,000 USD100

EUR Accumulation Class EUR1,000,000 EUR100

EUR-hedged Accumulation Class EUR1,000,000 EUR100

67.3 Application procedure

When an investor submits the application form via his/her authorized distributor, that investor should confirm the relevant cut-off time with the authorized distributor. This cut-off time will be earlier than the application deadline of the Trustee listed below.

Any applications for subscription of Units during the Initial Period must be received by the Trustee (via the Manager or authorized distributor) by 12:00 p.m. (Hong Kong time) on or before the last day of the Initial Period.

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Thereafter, applications for Units in the Fund received by the Trustee (from the Manager or authorized distributor) prior to 12:00 p.m. (Hong Kong time) on any Dealing Day will be effected at the Issue Price plus the Subscription Charge and each amount, if any, per Unit as the Manager may determine represents fiscal and purchase charges. An application for Units received by the Trustee (from the Manager or authorized distributor) after the application deadline on any Dealing Day, or on any day that is not a Dealing Day, will usually be processed on the next Dealing Day.

Subscriptions will only be accepted in the respective Unit class currencies.

68. REDEMPTION OF UNITS

68.1 Redemption of Units

A Unitholder may redeem all or some of its Units in whole on any Dealing Day. A Unitholder wishing to redeem its Units should confirm the minimum redemption size with his/her authorized distributor. Partial redemptions may be made, as long as the minimum holding amount (as set out below for the relevant Unit classes) remains in the Unitholder's account after the redemption is completed. If, after redemption, a Unitholder would be left with a balance of Units having a value of less than the minimum holding, the Manager may decide that this request be treated as a request for redemption for the full balance of the Unitholder's holding of Units. A Unitholder wishing to redeem its Units should complete a redemption form and return it as instructed on the redemption form. Redemption forms can be obtained from the Manager or authorized distributor.

Unit class Minimum Holding

RMB Accumulation Class RMB10,000

RMB Distribution Class RMB10,000

JPY Accumulation Class JPY5,000,000

JPY-hedged Accumulation Class JPY5,000,000

USD Accumulation Class USD500,000

USD-hedged Accumulation Class USD500,000

EUR Accumulation Class EUR500,000

EUR-hedged Accumulation Class EUR500,000

68.2 Redemption procedure

When an investor submits the redemption request via his/her authorized distributor, that investor should confirm the relevant cut-off time with the authorized distributor. This cut-off time will be earlier than the redemption deadline of the Trustee listed below.

Unitholders may apply to convert Units in the Fund for Units of another sub-fund of the Trust, or Units between different classes in the Fund, that has the same base and class

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currency of RMB. Please see paragraph entitled "Conversion of units" in the Trust Prospectus.

Redemption requests for Units in the Fund received by the Trustee (from the Manager or authorized distributor) prior to 12:00 p.m. (Hong Kong time) on a Dealing Day will be effected at the Redemption Price less the Redemption Charge and each amount, if any, per Unit as the Manager may determine represents fiscal and purchase charges. Redemption requests received by the Trustee (from the Manager or authorized distributor) after 12:00 p.m. (Hong Kong time) on a Dealing Day, or on a day which is not a Dealing Day, will be processed on the next Dealing Day.

Generally the maximum interval between the receipt of a redemption deadline and the payment of redemption proceeds will not exceed four weeks. However a substantial portion of the Fund's investments may be subject to legal or regulatory requirements of the PRC which may render payment within four weeks impracticable. If there is a delay in receipt by the Manager or the Trustee of the proceeds on sale of the Fund’s investments to meet redemption requests, the Manager or the Trustee may delay the payment of the relevant portion of the amount due on the redemption of Units.

If the Manager or the Trustee is required by the laws of any relevant jurisdiction to withhold any redemption moneys payable to the holder of a Unit the amount of such amount shall be deducted from the redemption moneys otherwise payable to such person.

All redemption moneys will be paid in the respective Unit class currencies.

69. CALCULATION OF NET ASSET VALUE

The Net Asset Value per Unit will be determined by the Trustee as at the Valuation Point in accordance with the terms of the Trust Deed. The details of the valuation rules are described in the Trust Prospectus under "Calculation of Net Asset Value".

The Net Asset Value per Unit of the Fund will be published daily in the Standard and the Hong Kong Economic Times.

70. DISTRIBUTION POLICY

At the discretion of the Manager, declaration of dividends may be made in respect of the RMB Distribution Class on quarterly basis in March, June, September and December in RMB. However, the Manager has discretion to decide whether or not to declare any dividends, the frequency of distribution and amount of dividends. There is no guarantee of regular distribution and if distribution is made, the amount being distributed. It is the intention of the Manager that only the net income (the income net of expenses) for the Fund which is attributable to the RMB Distribution Class may be distributed. No distribution will be paid out of the capital or effectively out of the capital of the Fund which is attributable to the RMB Distribution Class.

With respect to the Accumulation Classes, no distribution of dividends will be made. Therefore, any net income and net realized profits attributable to such Units will be reflected in the Net Asset Value of such Units.

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71. CHARGES AND EXPENSES

Fees payable by Unitholders:

71.1 Subscription Charge and Redemption Charge

The Manager is entitled to receive a Subscription Charge of up to 2% of the Issue Price of each Unit and currently no Redemption Charge is applicable.

The Manager may pay the whole or a part of the proceeds from the Subscription Charge and/or Redemption Charge (if any) to any intermediary.

71.2 Transfer Fee

Should a Unitholder wish to transfer one or more Units, currently no transfer fee is chargeable to the transferor.

71.3 Fiscal and Purchase Charges

Up to 1% of the Issue Price of each Unit (in case of subscription) or up to 1% of the Redemption Price of each Unit (in case of redemption) may be chargeable only to compensate the Fund for any dilution in the Fund's Net Asset Value as a result of a large volume of applications/redemptions by Unitholders, or a large application/redemption request from any Unitholder, on any Dealing Day and in the Manager's opinion the continuing Unitholders might otherwise be materially adversely affected. Please refer to sections 10.1 and 11.2 of the Trust Prospectus for further details.

Fees payable by the Fund:

71.4 Management Fee

The Manager is entitled to receive, on an annual basis, a management fee from the Trust, currently at the following rates calculated and accrued as at each Dealing Day:

For RMB Accumulation Class and RMB Distribution Class: 0.5% per annum of the Net Asset Value of the class

For all other classes: 0.3% per annum of the Net Asset Value of the class

The management fee is payable monthly in arrears. The maximum rate of the management fee is 2% per annum of the Net Asset Value of the Fund.

71.5 Trustee Fee

The Trustee will receive an asset based fee of up to 0.15% per annum of the Net Asset Value of this Fund (the "Trustee Fee") for trustee and registrar services. The maximum rate of the Trustee Fee is 0.5% per annum of the Net Asset Value of the Fund. The Trustee Fee is calculated and accrued as at each Dealing Day and is payable monthly in arrears. The Trustee Fee includes the fees payable for the services rendered in its capacity as trustee of the Trust and custodian of the assets of the Fund.

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The Trustee is also entitled to receive from the Trust (a) once-off set up fee of up to RMB8,000 for the establishment of each sub-fund of the Trust; (b) reimbursement for relevant out-of-pocket expenses and disbursements incurred for the Fund; and (c) various transaction fees to cover settlement of transactions, the receipt of dividends from Fund assets and other fees and charges as agreed with the Manager from time to time.

Should the number of Unit Holders become greater than 30, the Trustee is entitled to RMB20 per monthly statement for each additional Unit Holder.

The Trustee Fee payable to BOCI-Prudential Trustee Limited in its capacity as the Trustee and Registrar of the Fund is subject to a minimum monthly fee of up to RMB40,000 for the Fund.

71.6 Global Custodian Fee and PRC Sub-Custodian Fee

The Global Custodian will receive an asset based fee of up to 0.1% per annum of the Net Asset Value of this Fund to perform its role as global custodian of the Fund and it is also entitled to (among others) transaction charges at customary market rates largely dependent on the markets where the Fund invests. The fee is calculated monthly and payable monthly in arrears. Such fees to the Global Custodian will also cover fees incurred by the PRC Sub-Custodian. Both the Global Custodian and PRC Sub-Custodian will be entitled to reimbursement by the Fund for any out-of-pocket expenses incurred in the course of their duties.

71.7 Establishment Expenses

The preliminary establishment expenses of the Fund amount to approximately RMB280,000

and will be amortised over such period of five financial years (or such other period as the Manager may determine).

It should be noted that the proposed treatment of amortising the cost and expenses associated with the launch of the Fund over five years is not in accordance with the requirements of International Financial Reporting Standards ("IFRS"), under which these costs and expenses should be expensed at the point of commencement of the Fund's operations. The Manager believes that such treatment is more equitable to the initial investors than expensing the entire amount as they are incurred and is of the opinion that the departure is unlikely to be material to the Fund's financial statements. However, if the amounts involved are material to the audit of the Fund's financial statements the Manager may be required to make adjustments in the annual financial statements of the Fund in order to comply with IFRS and if relevant will include a reconciliation note in the annual accounts of the Fund to reconcile amounts shown in the annual financial statements determined under IFRS to those arrived at by applying the amortisation basis to the cost and expenses associated with the launch of the Fund.

72. FUND SPECIFIC RISK FACTORS

Your attention is drawn to the section entitled "Risk Factors" in the Trust Prospectus, in addition there are some risks specific to this Fund.

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72.1 Regulatory development and oversight

At present, the securities market and regulatory framework for the securities industry in PRC is undergoing rapid growth and changes, which may lead to trading volatilities, difficulties in settlement and recording of transactions and in interpreting and applying the relevant regulations. In addition, some of the investment regulations under which the Fund intends to invest in the PRC are new, uncertain and may give the relevant PRC authorities wide discretion on their interpretation. There are no precedents on how such discretion might be exercised for issues that have not been clearly provided in the investment regulations, therefore leaving a considerable amount of uncertainty.

72.2 RMB denominated bonds or other debt instruments

The Fund will invest a substantial proportion of its assets in RMB-denominated debt instruments in the PRC.

PRC bond market risk

Investment in Chinese bond market may have higher volatility and price fluctuation than investment in bond products in more developed markets.

Credit risk of counterparties to RMB-denominated debt instruments

Unitholders should note that as mainland China's financial market is nascent, most of the onshore RMB-denominated debt instruments are and will be unrated. The Manager will follow the credit rating criteria set out in the investment policy of the Fund at the time of purchase of a RMB-denominated debt instrument. If the RMB-denominated debt instrument is subsequently downgraded, the Manager may not dispose it immediately due to market liquidity and having regard to the interest of Unitholders. However, the Manager will try to dispose the RMB-denominated debt instrument in any case when it is downgraded to below the prescribed credit rating as specified in the investment policy.

RMB-denominated debt instruments can be issued by a variety of issuers inside or outside mainland China including commercial banks, state policy banks, corporations etc. These issuers may have different risk profiles and their credit quality may vary.

Furthermore, RMB-denominated debt instruments are generally unsecured debt obligations not supported by any collateral. The Fund may be fully exposed to the credit/insolvency risk of its counterparties as an unsecured creditor.

In the event of bankruptcy or insolvency of any of the Fund's counterparties, the Fund may experience delays in liquidating its positions and may, thereby, incur significant losses (including declines in the value of its investment) or the inability to redeem any gains on investment during the period in which the Fund seeks to enforce its rights, and fees and expenses incurred in enforcing its rights.

Insolvency risk of debt issuer

The Manager may invest the Fund's assets in debt securities which rank junior to other outstanding securities and obligations of the issuer, all or a significant portion of which may be secured on substantially all of that issuer's assets. The assets of the Fund may also be invested in debt securities which are not protected by financial covenants or limitations on

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additional indebtedness. If the issuer of any of the debt instruments in which the Fund is invested defaults, the performance of the Fund will be negatively affected.

Liquidity risk

RMB-denominated debt instruments are not regularly traded and an active secondary market for these instruments is yet to be developed. Both the onshore interbank market and the exchange market and the offshore market for RMB-denominated debt instruments are still at a developing stage and may have lower trading volumes than other more developed markets. The bid and offer spread of the price of RMB-denominated debt instruments (in both the onshore and the offshore markets) may be large and the Fund may incur significant trading and realisation costs. The Fund may suffer loss in trading such RMB-denominated debt instruments.

Liquidity risk also includes the risk that the Fund will not be able to pay redemption proceeds within the allowable time period because of unusual market conditions, an unusually high volume of redemption requests, or other uncontrollable factors. To meet redemption requests, the Fund may be forced to sell investments, at an unfavourable time and/or conditions.

Interest rate risk

Impact of changes in macro-economic policies of mainland China (i.e. monetary policy, fiscal policy) will have an influence over capital markets affecting the pricing of the fixed income securities and thus, the return of the Fund. The value of RMB-denominated debt instruments held by the Fund generally will vary inversely with changes in interest rates and such variation may affect Unit prices accordingly.

Valuation risk

RMB-denominated debt instruments (including corporate bonds and commercial papers) are subject to the risk of mispricing or improper valuation, i.e. operational risk that the fixed income securities are not priced properly. Valuations are primarily based on the valuations from independent third party sources where the prices are available, accordingly valuations may sometimes involve uncertainty and judgemental determination and independent pricing information may not be available at all times. In the event of adverse market conditions where it is not possible to obtain any reference quotation from the market, the latest available quotations of the bond or commercial paper or the quotation of other bonds or commercial paper with very similar attributes may be used to estimate the fair market value. Such valuation methodology may not be equal to the actual liquidation price due to liquidity and size constraints. If valuation is proven to be incorrect, this will affect the Net Asset Value calculation of the Fund.

Credit rating risk

Many of the debt instruments in mainland China did not have rating assigned by international credit agencies. The credit appraisal system in mainland China is at an early stage of development, there is no standard credit rating methodology used in investment appraisal and the same rating scale may have a different meaning in different agencies. The assigned ratings may not reflect the actual financial strength of the appraised asset.

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Credit rating downgrading risk

An issuer of RMB-denominated debt instruments may experience an adverse change in its financial condition which may in turn result in a decrease in the credit rating assigned by an internationally or PRC recognized statistical ratings organization to such issuer and RMB-denominated debt instruments issued by such issuer. Credit rating of RMB-denominated debt instruments reflects the issuer's ability to make timely payments of interest or principal - the lower the rating, the higher the risk of default. The adverse change in financial condition or decrease in credit rating of issuer may result in increased volatility in, and adverse impact on, the price of the relevant RMB-denominated debt instruments and negatively affect liquidity, making any such fixed-income security more difficult to sell.

Unrated debt securities

Up to 100% of the Fund’s assets may be invested in unrated debt securities (issued by the central government, policy bank or central bank). In the absence of credit rating, the credit quality of unrated debt securities is opaque. Unrated debt securities are generally subject to greater risk of loss of principal and interest than high-rated debt securities.

Risk of investing in high yield debt securities

High yield debt securities are particularly susceptible to interest rate changes and may experience significant price volatility. Any fluctuation in interest rates may have a direct effect on the income received by the Fund and its capital value.

Risk associated with bank deposits

Bank deposits are subject to the credit risks of the relevant financial institutions. The Fund’s deposit may not be protected by any deposit protection schemes, or the value of the protection under the deposit protection schemes may not cover the full amount deposited by the Fund. Therefore, if the relevant financial institution defaults, the Fund may suffer losses as a result.

72.3 Specific risk in interbank market and exchange market

Liquidity risk

The interbank market transaction account for predominant volume of daily bond market transactions in mainland China, there is no guarantee that such transaction volume can be sustainable in future. In case of the absence of an active interbank market or exchange market, the Fund may need to hold the RMB fixed income instruments until their maturity date. If sizeable redemption requests are received, the Fund may need to liquidate its investments at a substantial discount in order to satisfy such requests and the Fund may suffer losses in trading such instruments. Further, the bid and offer spread of the price of RMB fixed income instruments may be high (for both interbank market and exchange market), and the Fund may therefore incur significant trading costs and may even suffer losses when selling such investments.

Counterparty and settlement risk

The financial market of mainland China is at an early stage of development, investment in RMB fixed income instruments through interbank market will be subject to the counterparty

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risk of the issuers which may be unable or unwilling to make timely payments on principal and/or interest.

With respect to transactions in interbank market, the Fund will be exposed to higher counterparty risk on parties with whom it trades and when placing cash on deposit. The Fund will also be exposed to the risk of settlement default by a counterparty with which the Fund trades when buying and selling financial instruments (settlement risk). The risk of default of a counterparty is directly linked to the credit worthiness of the counterparty.

With respect to transactions in exchange market, the Fund will be exposed to the counterparty risk of CSDCC (acting as the central counterparty for bond transactions on the PRC Stock Exchanges).

Legal Risk

The securities transactions in the PRC are likely to be governed by PRC laws and regulation. The Chinese legal system is based on written statutes. Prior court decisions may be cited for reference but have limited precedential value. Agreements entered into by the Fund may be more difficult to enforce by legal proceeding in the PRC than in countries with more mature legal systems. Even if the agreements generally provide for arbitral proceeding for disputes arising out of the agreements to be in another jurisdiction, it may take more time to obtain effective enforcement in the PRC, of a arbitral award obtained in that jurisdiction.

72.4 Cash custody risk

Investors should note that cash deposited in the cash account of the Fund with the PRC Sub-Custodian will not be segregated but will be a debt owing from the PRC Sub-Custodian to the Fund as a depositor. Such cash will be co-mingled with cash belong to other clients of the PRC Sub-Custodian. In the event of bankruptcy or liquidation of the PRC Sub-Custodian, the Fund will not have any proprietary rights to the cash deposited in such cash account, and the Fund will become an unsecured creditor, ranking pari passu with all other unsecured creditors, of the PRC Sub-Custodian. The Fund may face difficulty and/or encounter delays in recovering such debt, or may not be able to recover it in full or at all, in which case the Fund will suffer losses.

72.5 Hedging risk

Investors should note that while it is not the intention of the Manager, over-hedged or under-hedged positions may arise due to factors outside the control of the Manager such as fluctuation of the Net Asset Value of the Fund. There is no guarantee that hedging techniques of the currency hedged Unit classes of the Fund will achieve the desired result.

Hedging strategies may also be performed in relation to specific Unit classes. Each of the hedged classes of Units will hedge the Fund’s base currency back to its currency of denomination, on a best effort basis, with an aim to align the performance of the hedged class to that of the equivalent class denominated in the Fund’s base currency. The effects of hedging will be reflected in the net asset values of the relevant hedged class. Similarly, any expenses arising from such hedging transactions, which may be significant depending on prevailing market conditions, will be borne by the relevant hedged class in relation to which they have been incurred and will be reflected in the Net Asset Value of the relevant hedged classes. There is no assurance that the hedging strategies employed will be effective in

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delivering performance differentials that are reflective only of interest rate differences adjusted for costs and fees. There can be no assurance that any hedging strategy employed by the Manager will fully and effectively achieve a positive desirable effect and result. Furthermore, the volatility of the hedged classes measured in the Fund’s base currency may be higher than that of the equivalent class denominated in the Fund’s base currency.

It should also be noted that hedging transactions may be entered into whether the denominated currency of the relevant hedged class is declining or increasing in value relative to the Fund’s base currency and so, where such hedging is undertaken it may protect Unitholders in the relevant hedged class against a decrease in the value of the Fund’s base currency relative to the denominated currency of the relevant hedged class, but it may also preclude Unitholders from benefiting from an increase in the value of the Fund’s base currency.

In addition, if the counterparties of the hedging instruments default, Unitholders of the relevant currency hedged Unit classes may be exposed to foreign exchange risk on an unhedged basis and may suffer losses as a result.

72.6 RMB currency and conversion risk

The Fund will accept subscriptions and pay redemption amounts in the relevant Unit class currency.

Where an investor subscribes for Units denominated in a non-RMB currency, the Manager will convert such subscriptions into RMB prior to investment at the applicable exchange rate and subject to the applicable spread and conversion costs, if any. Where an investor redeems Units denominated in a non-RMB currency, the Manager will sell the Fund's investments denominated in RMB and convert such proceeds into non-RMB currency at the applicable exchange rate and subject to the applicable spread and conversion costs, if any. Furthermore, investors may be adversely affected by movement of the exchange rates between RMB and other currencies. If an investor invests in an unhedged non-RMB Unit Class, when RMB depreciates against such non-RMB currency, the Net Asset Value of such unhedged non-RMB Unit Class will be adversely affected.

As RMB is not freely convertible, currency conversion is also subject to availability of RMB at the relevant time (i.e. it is possible there is not sufficient RMB for currency conversion in case of sizeable subscriptions in non-RMB classes). The Manager has the absolute discretion to reject any application made in non-RMB currency funds (whether such application is in relation to a RMB class) where it determines that there is not sufficient RMB for currency conversion. In case of redemptions, currency conversion is also subject to the Fund's ability to convert the proceeds denominated in RMB into non-RMB currency which, in turn, might affect the Fund's ability to meet redemption requests from the Unitholders or delay the payment of redemption proceeds.

There is no guarantee that RMB will not depreciate. Further, the PRC government's imposition of restrictions on the repatriation of Renminbi out of mainland China may limit the depth of the Renminbi market in Hong Kong and reduce the liquidity of the Fund. The Chinese government's policies on exchange control and repatriation restrictions are subject to change, and the Fund's or the investors' position may be adversely affected.

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72.7 Onshore and offshore RMB markets risk

Investors should note that RMB is the only official currency of the PRC. While both onshore RMB (CNY) and offshore RMB (CNH) are the same currency, they are traded in different and separated markets. Since the two RMB markets operate independently where the flow between them is highly restricted, CNY and CNH are traded at different rates and their movement may not be in the same direction. The CNH rate may be at a premium or discount to the exchange rate for CNY rate. There may be significant bid and offer spreads, which may affect the value of the Units in the Fund.

72.8 Concentration risk/single country investment risk

The Fund is specialised. The Fund invests in securities with substantial exposure to mainland China. Although the Fund's portfolio will be well diversified in terms of the number of investments, Unitholders should be aware that the Fund is likely to be more volatile than a broad-based fund, or a fund that is not denominated in RMB. The Fund may be more susceptible to fluctuations in value resulting from adverse conditions encountered in the PRC. Investments in issuers located in a particular country or geographic region may have more risk because of particular market factors affecting that country or region, including political instability or unpredictable economic conditions.

72.9 PRC market risk

The Fund is not a bank deposit and is not guaranteed. There is no guarantee of the repayment of the principal investment. The profitability of the investments of the Fund could be adversely affected by a worsening of general economic conditions in the PRC or global markets. Factors such as PRC government policy, fiscal policy, interest rates, inflation, investor sentiment, the availability and cost of credit, the liquidity of the PRC financial markets and the level and volatility of securities prices could significantly affect the value of the Fund's underlying investments and thus the Unit price. Unitholders should note in particular that the underlying investments of the Fund may fall in value, and thus the Unit price may fall even if the RMB appreciates against the Hong Kong dollar and US dollar.

For example: (a) an economic downturn or significantly higher interest rates could adversely affect the credit quality of the on-balance sheet and off-balance sheet assets; (b) a market downturn or worsening of the economy could cause the Fund to incur mark to market losses in its trading portfolios.

72.10 RQFII Regime Risks

Under the prevailing regulations in mainland China, foreign investors can directly invest in the RQFII Permitted Securities through institutions that have obtained RQFII status in mainland China. The current RQFII Regulations impose strict restrictions (such as investment guidelines) on RQFII eligible securities investment. The Fund is not a RQFII, but the Fund may invest in RQFII Permitted Securities via the RQFII Quota granted to CITIC Securities International Company Limited by SAFE. The prevailing rules and regulations governing RQFIIs under the RQFII Regulations impose restrictions on investments and other operational aspects of investments which will restrict or affect the Fund's investments.

Investors should be aware that the Fund may need to maintain high cash balances for the purposes of, among others, payment of the fees of its service provides and to meet

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redemption requests. This may result in lesser amounts being invested than would otherwise be the case.

RQFII Regulations

The RQFII Regulations which regulate investments by RQFIIs in mainland China and the repatriation are relatively new and novel in nature. The application and interpretation of the RQFII Regulations are therefore relatively untested and there is uncertainty as to how they will be applied. CSRC and SAFE have been given wide discretions in the RQFII Regulations and there is no precedent or certainty as to how these discretions might be exercised now or in the future. At this stage of early development, the RQFII Regulations may be subject to further revisions in the future, there is no assurance whether such revisions will prejudice the RQFII, or whether the RQFII Quota which are subject to review from time to time by CSRC and SAFE may be withdrawn substantially or entirely. At the time of the launch of the Fund, the RQFII Regulations continue to develop and are undergoing continual change. CSRC and/or SAFE may have power in the future to impose new restrictions or conditions on or terminate the RQFII status of CITIC Securities International Company Limited which may adversely affect the Fund and the Unitholders. It is not possible to predict how such changes would affect the Fund.

RQFII Quotas

Investment by the Fund will be made and held through the RQFII Quota granted to CITIC Securities International Company Limited by SAFE. The RQFII Regulations apply to RQFII Quota(s) which may be obtained by CITIC Securities International Company Limited as RQFII from time to time for the Fund or other investors as a whole, and not simply to investments made by the Fund. Thus investors should be aware that violations of the RQFII Regulations arising out of activities related to any usage of RQFII Quota obtained by CITIC Securities International Company Limited (including utilization of the RQFII Quota by the Fund and other than the Fund) could result in the revocation of or other regulatory action in respect of the RQFII Quota held by CITIC Securities International Company Limited as a whole, including the RQFII Quota utilised by the Fund. Likewise, regulatory limits on investment in RQFII Permitted Securities (as applicable) may apply in relation to the RQFII Quota held by CITIC Securities International Company Limited as a whole. Hence the ability of the Fund to make investments and/or repatriate monies from the RQFII Quota may be affected adversely by the investments, performance and/or repatriation of monies invested by other investors utilising the RQFII Quota obtained by CITIC Securities International Company Limited in the future.

In addition, any repatriation of monies by the Fund to meet obligations such as the payment of fees may adversely impact the ability of the Fund to repatriate monies to meet Unitholders' redemption requests.

There can be no assurance that the Fund will be able to obtain access to sufficient RQFII Quota to meet all proposed investments to be made by the Fund or that the investments of the Fund can be realised in a timely manner due to possible adverse changes in relevant laws or regulations which will hinder the Fund's ability to pursue the investment objectives or result in loss under extreme circumstances. Should CITIC Securities International Company Limited lose its RQFII status or retire or be removed, or the RQFII Quota held by CITIC Securities International Company Limited be revoked or reduced, the Fund may not be able to invest in RQFII Permitted Securities through the RQFII Quota held by CITIC Securities

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International Company Limited, and the Fund may be required to dispose of its holdings, which would likely have a material adverse effect on the Fund.

RQFII Quota Limitation

The RQFII Quota granted to CITIC Securities International Company Limited by SAFE is shared among the Fund and other open-ended funds managed by the Manager. CITIC Securities International Company Limited (as RQFII) can allocate the available RQFII Quota flexibly across the open-ended funds under the management of the Manager. The Manager may allocate more RQFII Quota to the Fund from other open-ended funds to meet subscription demands. However, it is also possible that the Manager may not accept additional subscriptions when there is not enough RQFII Quota available to the Fund and would not be able to achieve further economies of scale or otherwise take advantage of the increased capital base.

Custody

Any RQFII Permitted Securities acquired by the Fund through the RQFII Quota held by CITIC Securities International Company Limited will be maintained by the PRC Sub-Custodian and will be registered in the joint names of CITIC Securities International Company Limited (as RQFII) and the Fund and for the sole benefit and use of the Fund subject to applicable laws. There will be segregation of assets by the PRC Sub-Custodian such that the assets of the Fund will not form part of the assets of CITIC Securities International Company Limited as RQFII, the Manager or the PRC Sub-Custodian.

However, subject to the investment regulations, CITIC Securities International Company Limited could be the party entitled to the securities in such securities trading account (albeit that this entitlement does not constitute an ownership interest or preclude the Manager purchasing the securities on behalf of the Fund). Such securities may be vulnerable to a claim by a liquidator of CITIC Securities International Company Limited and may not be as well protected as if they were registered solely in the name of the Fund. In particular, there is a risk that creditors of CITIC Securities International Company Limited may incorrectly assume that the Fund's assets belong to CITIC Securities International Company Limited and such creditors may seek to gain control of the Fund's assets to meet CITIC Securities International Company Limited's liabilities owed to such creditors.

PRC Securities Brokers and Best Execution

The Fund may have difficulty in obtaining best execution of transactions in RQFII Permitted Securities subject to restriction/limitations under applicable RQFII Regulations or operational constraints such as the restriction/limitation as to the number of brokers that the Manager may appoint. The Fund will use PRC brokers appointed by the Manager to execute transactions in the PRC markets for the account of the Fund. If a PRC broker offers the Fund standards of execution which the Manager reasonably believes to be amongst best practice in the PRC marketplace, the Manager may determine that they should consistently execute transactions with that PRC broker (including where it is an affiliate) notwithstanding that they may not be executed at the best price and shall have no liability to account to the Fund in respect of the difference between the price at which the Fund executes transactions and any other price that may have been available in the market at that relevant time.

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Limits on Redemption

Where the Fund is invested in the securities market in mainland China by investing through the RQFII Quota held by CITIC Securities International Company Limited, repatriation of funds from mainland China may be subject to the RQFII Regulations in effect from time to time. Currently there is no regulatory prior approval requirement for repatriation of funds from the RQFII Quota. However the relevant RQFII regulations are subject to uncertainty in their application and there is no certainty that no regulatory restrictions will apply to the repatriation of funds by the Fund in the PRC in the future. Accordingly, the investment regulations and/or the approach adopted by SAFE in relation to the repatriation may change from time to time.

Please note that redemptions on any Dealing Day are subject to redemption restrictions described in the Trust Prospectus (including suspension of redemption and/or delay of payment of redemption monies) and in case of repatriation restrictions being imposed in the future, it is possible that the Manager may not resume acceptance of redemption request and/or make payment of redemption monies for as long as the time required for repatriation of funds from the RQFII Quota subject to regulatory restrictions in the PRC.

For each RQFII Quota approved by SAFE, the relevant RQFII is required to utilize the RQFII Quota effectively within one year from the SAFE approval date. If the RQFII fails to utilize the RQFII Quota effectively, SAFE could reduce or revoke the RQFII Quota depending on the circumstances. As utilization of the RQFII Quota will depend on the subscription level of the Fund and redemptions by investors of the Fund, low subscription level or large redemptions by investors of the Fund might result in the RQFII Quota being reduced or lost permanently.

Investment Restrictions

There are limits on the total shares held by all underlying investors in one listed company under the RQFII Regulations. The investment restrictions will be applied to all underlying investors. However, it will be difficult in practice for the Manager to monitor the investments of the underlying investors since an investor may make investment through different RQFIIs or QFIIs. Violations of the RQFII Regulations (including ownership limits referred to above) by CITIC Securities International Company Limited or arising out of the activities relating to the use of any RQFII Quota granted to CITIC Securities International Company Limited (including the RQFII Quota utilized by other funds or entities) could result in the revocation of or other regulatory action in respect of the RQFII Quotas granted to CITIC Securities International Company Limited, which could directly impact the Fund.

72.11 Risks associated with investment in short-term debt instruments

The Fund will primarily invest in short-term debt instruments. Whilst the Fund may avoid potential risks associated with the holding of longer-term debt securities, this may also lead to the loss of opportunities for obtaining higher yields by investing in longer-term debt securities.

Short-term debt instruments are not risk-free and investing in the Fund is not the same as investing in money market funds or placing funds on deposit with a bank or deposit-taking company. The Manager has no obligation to redeem Units of the Fund at the Issue Price.

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As the Fund invests significantly in short-term debt instruments with short maturities, it means the turnover rates of the Fund’s investments may be relatively high and the transaction costs incurred as a result of the purchase or sale of short-term debt instruments may also increase which in turn may have a negative impact on the Net Asset Value of the Fund.

72.12 PRC tax considerations

For further details relating to PRC taxes and the associated risks, please refer to section 17.2 of the Trust Prospectus headed "PRC Tax".

The value of the Fund's investments (and hence the Net Asset Value of the Fund) will be adversely affected by taxation levied against the Manager or CITIC Securities International Company Limited as RQFII in respect of the Fund's investments through the RQFII Quota held by CITIC Securities International Company Limited, for which the Fund will be required to reimburse the Manager or CITIC Securities International Company Limited. The PRC taxation regime that will apply to RQFIIs and investments made through RQFII quotas is currently unclear.

After careful consideration of the Manager’s assessment and having taken and considered independent professional tax advice on the Fund’s eligibility for treaty relief in the China-HK Arrangements and acting in accordance with such advice, the Manager considers that the Fund should qualify as a Hong Kong tax resident and it should be able to enjoy a WIT exemption on capital gains derived from investments in RMB Debt Instruments under the China-HK Arrangements. In this regard, the Manager has determined, having taken and considered independent professional tax advice and acting in accordance with such advice, that no PRC WIT provision will be made on the gross realized and unrealized capital gains derived from investments in RMB Debt Instruments.

It should be noted that there are uncertainties regarding the Manager’s determination of PRC WIT provision in relation to capital gains derived from investments in RMB Debt Instruments, including:

• The China-HK Arrangements may be changed in the future and the Fund may ultimately be required to pay PRC WIT on capital gains.

• To date, the Fund has not obtained a Hong Kong Tax Resident Certificate (“HKTRC”) from the Inland Revenue Department (“IRD”). If the PRC tax authorities enforce the collection of PRC WIT and require the Fund to provide a HKTRC in the future in order to obtain the PRC WIT exemption, the Manager will apply for a HKTRC on behalf of the Fund from the IRD for the relevant years. However, there is a risk that the Manager may not be able to obtain a HKTRC on behalf of the Fund.

• To date, the PRC tax authorities have not sought to enforce PRC WIT collection on capital gains derived by RQFIIs such as CITIC Securities International Company Limited for the Fund. If the PRC tax authorities start to enforce PRC WIT collection on capital gains, the relief under the China-HK Arrangements is still subject to the final approval of the PRC tax authorities. Even if the Manager, in accordance with the independent professional tax advice, believes that the Fund should be eligible for such relief, the PRC tax authorities may ultimately hold a different view.

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It should also be noted that there is a possibility of the PRC tax rules being changed and taxes being applied retrospectively. In the event that tax is collected by the PRC tax authorities and the Fund is required to make payments reflecting tax liabilities for which no provision has been made, the Net Asset Value of the Fund will be adversely affected, as the Fund will ultimately have to bear the full amount of tax liabilities. In this case, the tax liabilities will only impact Units in issue at the relevant time, and the then existing Unitholders and subsequent Unitholders will be disadvantaged as such Unitholders will bear, through the Fund, a disproportionately higher amount of tax liabilities as compared to that borne at the time of investment in the Fund. Unitholders may, depending on their own circumstances, be subject to PRC tax or taxes in other jurisdictions. The Fund would not be able to guarantee that taxes paid at the Fund’s level will be attributable to any Unitholders for personal tax purposes.

Upon the availability of a definitive tax assessment or the issue of announcements or regulations by the competent authorities promulgating definitive tax assessment rules, the Manager will, as soon as practicable, make relevant adjustments to the amount of tax provision as it considers necessary.

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F. FUND SPECIFIC PROSPECTUS OF CSI RMB CHINA A-SHARES DIVERSIFICATION FUND

This Fund Specific Prospectus comprises information in relation to the CSI RMB China A-Shares Diversification Fund (the "Fund"), a sub-fund of the Trust. Units in the Fund are now being offered for subscription on the terms set out in the Trust Prospectus and the Trust Deed. It is envisaged that further sub-funds of the Trust may be created in the future. The Trust is managed by CITIC Securities International Investment Management (HK) Limited.

73. CSI RMB CHINA A-SHARES DIVERSIFICATION FUND

This document relates to the CSI RMB China A-Shares Diversification Fund, a sub-fund established under the Trust and authorized by the SFC pursuant to section 104 of the SFO. SFC authorization is not a recommendation or endorsement of the Fund, nor does it guarantee the commercial merits of the Fund or its performance. It does not mean the Fund is suitable for all investors nor is it an endorsement of its suitability for any particular investor or class of investors. This Fund Specific Prospectus should be read in conjunction with the Trust Prospectus and the Product Key Facts Statement relating to the Fund. In case of discrepancies between Part A (the Trust Prospectus) and Part F (this Fund Specific Prospectus) of this document in relation to the CSI RMB China A-Shares Diversification Fund, this Part F shall prevail.

74. DEFINITIONS

Defined terms used in this Fund Specific Prospectus which are not defined below bear the same meanings as in the Trust Prospectus.

"Business Day" any day other than Saturday or Sunday, on which banks in Hong Kong and the PRC are open for normal banking business, but excluding any day on which a tropical cyclone warning signal 8 or higher or a black rain storm warning signal or any warning or signal considered by the Manager to be similar in effect is in force in Hong Kong after 9:00 a.m. (Hong Kong time) and before 5:00 p.m. (Hong Kong time) on that day unless the Manager and the Trustee otherwise agree;

"China A-shares" means securities of companies incorporated in China and listed on a PRC Stock Exchange, traded in RMB and available for investment by domestic investors, qualified foreign institutional investors and RQFIIs;

"China B-shares" means securities of companies incorporated in China and listed on a PRC Stock Exchange, traded in foreign currencies and available for investment by domestic PRC investors and foreign investors;

"CSDCC" means the China Securities Depository & Clearing Corporation Limited;

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"Dealing Day" each Business Day and such other day(s) as the Manager may from time to time determine;

"Fund" the CSI RMB China A-Shares Diversification Fund, being a sub-fund of the Trust offered pursuant to this Fund Specific Prospectus;

"Initial Issue Price" means the price at which Units of the Fund are issued during the Initial Period, as set out under the heading “Issue Price” in the section “Subscription for Units” in this Fund Specific Prospectus;

"Initial Period" means from 9:00 a.m. (Hong Kong time) on 23 February 2015 until 5:00 p.m. (Hong Kong time) on 20 March 2015 (or such other date as the Manager may in its discretion determine);

"Issue Price" the Net Asset Value per Unit calculated as at the Valuation Point on the Dealing Day relating to the application for the issue of Units;

"mainland China" or "PRC" means the People's Republic of China (excluding, for the purposes of the Trust Prospectus and this Fund Specific Prospectus, the Hong Kong Special Administrative Region, Macao Special Administrative Region and Taiwan);

"PRC Stock Exchanges" means the Shanghai Stock Exchange, the Shenzhen Stock Exchange and any other stock exchange that opens in the PRC;

"QFII Quota" means a PRC foreign exchange investment quota granted to a qualified foreign institutional investor pursuant to the QFII Regulations;

"QFII Regulations" means the regulations and rules, as amended from time to time, governing the establishment and operation of qualified foreign institutional investors and QFII Quotas;

"Redemption Charge" a charge payable by the Unitholder and calculated as a percentage of the Redemption Price of each Unit which is being redeemed by that Unitholder;

"Redemption Price" the Net Asset Value per Unit calculated as at the Valuation Point on the Dealing Day relating to the application for redemption of Units;

"RMB" means Renminbi, the lawful currency of the PRC;

"RQFII" means a RMB qualified foreign institutional investor under the RQFII Regulations;

"RQFII Permitted means securities and investments permitted to be held or

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Securities" made by RQFIIs under RQFII Regulations, which currently include the following RMB denominated financial instruments:

(a) China A-shares;

(b) fixed income securities traded on the PRC Stock Exchanges or the interbank market in the PRC;

(c) PRC securities investment funds approved by the CSRC; and

(d) other financial instruments from time to time approved by CSRC or the People's Bank of China;

"RQFII Quota" means a RMB investment quota granted to a RQFII pursuant to the RQFII Regulations;

"RQFII Regulations" means the regulations and rules, as amended from time to time, governing the establishment and operation of RQFIIs and RQFII Quotas;

"SAFE" means the PRC State Administration of Foreign Exchange, the government agency responsible for matters relating to foreign exchange administration;

"Subscription Charge" a charge payable by the Unitholder and calculated as a percentage of the Initial Issue Price or Issue Price (as the case may be) of each Unit which is issued to that Unitholder;

"Trust Prospectus" the prospectus in Part A of this document relating to CSI Alpha Fund Series, as amended or supplemented from time to time;

"Valuation Point" means the close of business in the last relevant market to close on each relevant Dealing Day or such other time or times as the Manager may from time to time determine.

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75. SUMMARY

Set out below is a summary of the Fund. The summary information is derived from, and should be read in conjunction with, the full text of this Fund Specific Prospectus. Your attention is drawn to the section entitled "Risk Factors" in the Trust Prospectus and the section entitled "Fund Specific Risk Factors" in this Fund Specific Prospectus. Key information in respect of the Fund is as follows:

Initial Issue Price Class RMB: RMB 100 per Unit

Initial Period means from 9:00 a.m. (Hong Kong time) on 23 February 2015 until 5:00 p.m. (Hong Kong time) on 20 March 2015 (or such other date as the Manager may in its discretion determine)

Issue Price means the Net Asset Value per Unit calculated as at the Valuation Point, and subject to a Subscription Charge and any fiscal and purchase charges

Dealing Day each Business Day and such day(s) as the Manager may from time to time determine

Initial Minimum Subscription Amount

Class RMB: RMB10,000

Subsequent Minimum Subscription Size

Class RMB: RMB10,000

Minimum Redemption Size Class RMB: RMB10,000

Minimum Holding Class RMB: RMB10,000

Manager CITIC Securities International Investment Management (HK) Limited

Trustee and Registrar BOCI-Prudential Trustee Limited

RQFII Licence Holder CITIC Securities International Company Limited, which conducts the relevant RQFII business through the Manager

Global Custodian Bank of China (Hong Kong) Limited

PRC Sub-Custodian Bank of China Limited

Fees payable by Unitholders

Subscription Charge Up to 5% of the Initial Issue Price or Issue Price (as the case may be) of each Unit

Transfer Fee Nil

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Redemption Charge Nil

Fiscal and Purchase Charges Up to 1% of the Issue Price of each Unit (in case of subscription) or up to 1% of the Redemption Price of each Unit (in case of redemption) chargeable only to compensate the Fund for any dilution in the Fund's Net Asset Value as a result of a large volume of applications/redemptions by Unitholders, or a large application/redemption request from any Unitholder, on any Dealing Day and in the Manager's opinion the continuing Unitholders might otherwise be materially adversely affected.

Fees payable by the Fund

Management Fee 1.5% per annum of the Net Asset Value of the Fund

Performance Fee Nil

Trustee Fee Up to 0.15% per annum of the Net Asset Value of the Fund, subject to a monthly minimum fee of RMB40,000

Trustee Set-Up Fee The Trustee is entitled to receive from the Trust once-off establishment fee of up to RMB8,000 for the establishment of each Fund of the Trust

Trustee Out-of-Pocket Expense Fee

The Trustee is entitled to receive reimbursement for out of pocket expenses such as postage and stationery

Global Custodian Fee Up to 0.1% per annum of the Net Asset Value of the Fund plus transaction fees at customary rates dependent on the market the Fund invests and out of pocket expenses incurred by the Global Custodian and the PRC Sub-Custodian

PRC Sub-Custodian Fee Covered under Global Custodian Fee

76. INVESTMENT OBJECTIVE AND POLICY

76.1 Currency Denomination

The Fund is denominated in RMB.

This Fund currently issues the following Unit class(es) each with a separate Unit class currency as follows:

Unit class Unit class currency

Class RMB RMB

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76.2 Investment Objective

The Fund seeks to achieve long-term appreciation of the Unit price through capital growth by primarily investing in a diversified portfolio of China A-shares, subject to the investment policy and restrictions set out below and the investment restrictions applicable to the Fund, as set out in the Trust Prospectus.

76.3 Investment Policy

To the extent permitted by the applicable regulations and investment restrictions, the Fund seeks to achieve the investment objective by investing at least 70% of its Net Asset Value in China A-shares directly via the RQFII Quota granted to CITIC Securities International Company Limited. The Fund invests with no prescribed industry sector or market capitalization limits.

The Fund will not invest in China B-shares or securities outside of the PRC. It is not intended that the Fund will invest in fixed income securities (including urban investment bonds or asset-backed securities/asset-backed commercial papers).

Up to 10% of the Fund’s Net Asset Value may be invested in equity funds and money market funds which are authorized by the CSRC for offer to the retail public in the PRC. The remaining assets of the Fund will be held in cash.

Investment through the RQFII Quota

Currently, foreign investors are generally unable to invest in RQFII Permitted Securities other than through QFII Quotas (to the extent applicable) or RQFII Quotas approved under the QFII Regulations or RQFII Regulations respectively. Under the RQFII Regulations, amongst other eligible entities, Hong Kong subsidiaries of PRC domestic brokerages firms that meet the relevant prescribed eligibility requirements may apply to the CSRC for a securities investment licence as a RQFII and correspondingly apply to SAFE for RQFII Quota for investment into RQFII Permitted Securities. CITIC Securities International Company Limited has been approved as a RQFII under the RQFII Regulations, but is required to conduct its RQFII business through the Manager. CITIC Securities International Company Limited has been granted a RQFII Quota by SAFE which can be utilized by the Fund under the management of the Manager.

CITIC Securities International Company Limited was incorporated in Hong Kong on 9 April 1998 and has its principal office in Hong Kong. CITIC Securities International Company Limited is a wholly owned subsidiary of CITIC Securities Co., Ltd., a company incorporated in the PRC and regulated as a securities company by CSRC. The Manager is an indirect subsidiary of CITIC Securities International Company Limited.

The Fund will invest in the China A-shares and other securities issued in the PRC via the RQFII Quota granted to CITIC Securities International Company Limited by SAFE.

Financial Derivative Instruments

The Fund does not intend to invest in any structured products/structured deposits or financial derivative instruments for hedging and investment purposes.

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Securities Lending and Repurchase Transactions

The Fund does not intend to enter into any securities lending transactions, repurchase/reverse repurchase transactions or other similar over-the-counter transactions. Should the Manager wishes to enter into any such transactions on behalf of the Fund, this will be subject to the prior approval of the SFC and at least one month's prior notice will be given to Unitholders.

76.4 Effect of RQFII Regulations on Redemptions

The repatriation of invested capital and of income and capital gains of the Fund from PRC is subject to the RQFII Regulations. Currently, under the RQFII Regulations, remittance and repatriation for the account of the Fund may be effected on a daily basis through the RQFII Quota based on the net subscriptions and redemptions of Units of the Fund. At present, there is no regulatory prior approval requirement for repatriation of funds from the RQFII Quota however there is no certainty that no regulatory restrictions will apply to the repatriation of funds by the Fund in the PRC in the future.

Please note that redemptions on any Dealing Day are subject to redemption restrictions described in the Trust Prospectus (including suspension of redemption and/or delay of payment of redemption monies) and in case of repatriation restrictions being imposed in the future, it is possible that the Manager may not resume acceptance of redemption request and/or make payment of redemption monies for as long as the time required for repatriation of funds from the RQFII Quota subject to regulatory restrictions in the PRC.

76.5 RQFII Quota Limitation

The RQFII Quota granted to CITIC Securities International Company Limited by SAFE is shared among the Fund and other open-ended funds managed by the Manager. CITIC Securities International Company Limited (as RQFII) can allocate the available RQFII Quota flexibly across the open-ended funds under the management of the Manager. The Manager may allocate more RQFII Quota to the Fund from other open-ended funds to meet subscription demands. However, it is also possible that the Manager may not accept additional subscriptions when there is not enough RQFII Quota available to the Fund. The Manager will monitor the usage of the RQFII Quota from time to time and apply for additional RQFII Quota where necessary.

76.6 Potential Conflict of Interest

Investors should be aware that:

(i) the Trustee, the Global Custodian and the PRC Sub-Custodian are affiliates of each other; and

(ii) the Global Custodian, the PRC Sub-Custodian or their affiliates may act as a counterparty in a securities transaction of the Fund.

Potential conflicts of interest may exist in the performance of the functions of the Trustee, the Global Custodian and the PRC Sub-Custodian as they are affiliates of each other. However each entity has different set of business objectives, activities, reporting lines and senior management. Each of the Trustee, the Global Custodian and the PRC Sub-Custodian will comply with their respective regulatory obligations (where applicable) for managing conflicts of interests and have policies in place to deal with them. In particular there are effective

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Chinese walls and information barriers in place to separate the entities (internally and externally).

With respective to the potential conflicts of interest where the PRC Sub-Custodian, on one hand, acting as the custodian of the Fund, and on the other hand where it or its affiliates may act as the counterparty in securities transactions, within the PRC Sub-Custodian, there are segregation of duties between roles, functions and departments with effective Chinese walls and information barriers in place. The PRC Sub-Custodian has internal and external audit to ensure conflicts of interests are properly managed. The PRC Sub-Custodian is also subject to the supervision of the PBoC.

77. CUSTODY

The Trustee takes into its custody or under its control the Fund's assets, including PRC assets deposited in the securities and RMB cash accounts with the PRC Sub-Custodian (defined below), and holds the same in trust for Unitholders. The Trustee has appointed Bank of China (Hong Kong) Limited (the "Global Custodian") as its global custodian pursuant to a Custodian Agreement, pursuant to which the Global Custodian shall hold the assets of the Fund as custodian. The Global Custodian will appoint Bank of China Limited (the "PRC Sub-Custodian") as its sub-custodian pursuant to a RQFII Sub-Custodian Agreement among CITIC Securities International Company Limited (as RQFII), the Manager, the Global Custodian and the PRC Sub-Custodian, pursuant to which the PRC Sub-Custodian shall hold the assets of the Fund invested in the PRC through the RQFII Quota held by CITIC Securities International Company Limited. The RQFII Sub-Custodian Agreement will be supplemented by a RQFII supplemental custodian agreement to which the Trustee is also a party. The Trustee is liable for the acts and omissions of the PRC Sub-Custodian in relation to the assets forming part of the property of the Fund.

The Trustee registers the Fund's assets, including PRC assets deposited via the Global Custodian in the securities and RMB cash accounts opened and maintained with the PRC Sub-Custodian, to the order of the Trustee.

Instructions to execute transactions with respect to the Fund's assets in the securities account(s) and the RMB cash account(s) as well as other matters such as the repatriation of funds shall be given by the Manager and delivered through the Trustee and the Global Custodian to the PRC Sub-Custodian (i.e. not delivered to the PRC Sub-Custodian directly). The PRC Sub-Custodian will look to the Trustee via the Global Custodian for instructions and solely act in accordance with the instructions of the Trustee or authorities granted by the Trustee.

The Manager and the Trustee have obtained an opinion from PRC legal counsel to the effect that, as a matter of PRC laws:

(a) securities account(s) and RMB cash account(s) with the PRC Sub-Custodian, CSDCC and China Central Depositary & Clearing Co., Ltd. where applicable (respectively, the "securities account" and the "cash account") for the Fund shall be opened in the joint names of CITIC Securities International Company Limited (as RQFII) and the Fund and for the sole benefit and use of the Fund in accordance with all applicable laws and regulations of the PRC and with approval from all competent authorities in the PRC;

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(b) the assets held/credited in the securities account (i) belong solely to the Fund, and (ii) are segregated and independent from the proprietary assets of CITIC Securities International Company Limited (as RQFII), the Manager, the PRC Sub-Custodian and any PRC broker of the Fund and from the assets of other clients of CITIC Securities International Company Limited (as RQFII), the Manager, the PRC Sub-Custodian and any PRC broker of the Fund;

(c) the assets held/credited in the cash account (i) become an unsecured debt owing from the PRC Sub-Custodian to the Fund, and (ii) are segregated and independent from the proprietary assets of CITIC Securities International Company Limited (as RQFII), the Manager, and any PRC broker of the Fund, and from the assets of other clients of CITIC Securities International Company Limited (as RQFII), the Manager, and any PRC broker of the Fund;

(d) the Trustee, for and on behalf of the Fund, is the only entity which has a valid claim of ownership over the assets in the securities account and the debt in the amount deposited in the cash account of the Fund;

(e) if CITIC Securities International Company Limited, the Manager or any PRC broker of the Fund is liquidated, the assets contained in the securities account and cash account of the Fund will not form part of the liquidation assets of CITIC Securities International Company Limited, the Manager or such PRC broker of the Fund in liquidation in the PRC; and

(f) if the PRC Sub-Custodian is liquidated, (i) the assets contained in the securities account of the Fund will not form part of the liquidation assets of the PRC Sub-Custodian in liquidation in the PRC, and (ii) the assets contained in the cash account of the Fund will form part of the liquidation assets of the PRC Sub-Custodian in liquidation in the PRC and the Fund will become an unsecured creditor for the amount deposited in the cash account.

78. BORROWING RESTRICTIONS

The maximum borrowings of the Fund may not exceed 25% of its total Net Asset Value. For the purposes of this restriction, back-to-back loans do not count as borrowing.

Borrowing may only be effected outside mainland China on a temporary basis for the purpose of meeting redemption requests or defraying fees, costs, charges, expenses and disbursements of the Fund or the Trust in accordance with the provisions of the Trust Deed.

The Fund does not engage in short selling of securities. The Fund does not intend to invest in physical commodities and/or commodity based investments (other than securities issued by companies engaged in producing, processing or trading in commodities).

79. UNIT CLASSES

The Fund currently offers the following Unit class (with a separate Unit class currency):

Class RMB

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80. SUBSCRIPTION FOR UNITS

80.1 Issue Price

Each Unit of a class will be offered to the public during the Initial Period at the following Initial Issue Price of such class subject to the Subscription Charge:

Unit class Initial Issue Price

Class RMB RMB 100 per Unit

The Manager may exercise its discretion to close the Fund for subscription when the RQFII Quota has been filled up.

Thereafter, each Unit will be offered at the Issue Price, being the Net Asset Value per Unit calculated as at the Valuation Point, and again subject to a Subscription Charge and any fiscal and purchase charges.

80.2 Minimum subscription and minimum holding

The initial minimum subscription amount that must be subscribed for the Units and the subsequent minimum subscription amount are as follows. The Manager may, at its discretion, waive or modify these minimum limits.

Unit class Initial Minimum Subscription Amount

Subsequent Minimum Subscription Size

Class RMB RMB10,000 RMB10,000

80.3 Application procedure

When an investor submits the application form via his/her authorized distributor, that investor should confirm the relevant cut-off time with the authorized distributor. This cut-off time will be earlier than the application deadline of the Trustee listed below.

Any applications for subscription of Units during the Initial Period must be received by the Trustee (via the Manager or authorized distributor) by 5:00 p.m. (Hong Kong time) on or before the last day of the Initial Period.

Thereafter, applications for Units in the Fund received by the Trustee (from the Manager or authorized distributor) prior to 5:00 p.m. (Hong Kong time) on any Dealing Day will be effected at the Issue Price plus the Subscription Charge and each amount, if any, per Unit as the Manager may determine represents fiscal and purchase charges. An application for Units received by the Trustee (from the Manager or authorized distributor) after the application deadline on any Dealing Day, or on any day that is not a Dealing Day, will usually be processed on the next Dealing Day.

Subscriptions will only be accepted in RMB.

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81. REDEMPTION OF UNITS

81.1 Redemption of Units

A Unitholder may redeem all or some of its Units in whole on any Dealing Day. A Unitholder wishing to redeem its Units should confirm the minimum redemption size with his/her authorized distributor. Partial redemptions may be made, as long as the minimum holding amount (as set out below for the relevant Unit classes) remains in the Unitholder's account after the redemption is completed. If, after redemption, a Unitholder would be left with a balance of Units having a value of less than the minimum holding, the Manager may decide that this request be treated as a request for redemption for the full balance of the Unitholder's holding of Units. A Unitholder wishing to redeem its Units should complete a redemption form and return it as instructed on the redemption form. Redemption forms can be obtained from the Manager or authorized distributor.

Unit class Minimum Holding

Class RMB RMB10,000

81.2 Redemption procedure

When an investor submits the redemption request via his/her authorized distributor, that investor should confirm the relevant cut-off time with the authorized distributor. This cut-off time will be earlier than the redemption deadline of the Trustee listed below.

Unitholders may apply to convert Units in the Fund for Units of another sub-fund of the Trust, or Units between different classes in the Fund, that has the same base and class currency of RMB. Please see paragraph entitled "Conversion of units" in the Trust Prospectus.

Redemption requests for Units in the Fund received by the Trustee (from the Manager or authorized distributor) prior to 5:00 p.m. (Hong Kong time) on a Dealing Day will be effected at the Redemption Price less the Redemption Charge and each amount, if any, per Unit as the Manager may determine represents fiscal and purchase charges. Redemption requests received by the Trustee (from the Manager or authorized distributor) after 5:00 p.m. (Hong Kong time) on a Dealing Day, or on a day which is not a Dealing Day, will be processed on the next Dealing Day.

Generally the maximum interval between the receipt of a redemption deadline and the payment of redemption proceeds will not exceed four weeks. However a substantial portion of the Fund's investments may be subject to legal or regulatory requirements of the PRC which may render payment within four weeks impracticable. If there is a delay in receipt by the Manager or the Trustee of the proceeds on sale of the Fund’s investments to meet redemption requests, the Manager or the Trustee may delay the payment of the relevant portion of the amount due on the redemption of Units.

If the Manager or the Trustee is required by the laws of any relevant jurisdiction to withhold any redemption moneys payable to the holder of a Unit the amount of such amount shall be deducted from the redemption moneys otherwise payable to such person.

All redemption moneys will be paid in RMB.

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82. CALCULATION OF NET ASSET VALUE

The Net Asset Value per Unit will be determined by the Trustee as at the Valuation Point in accordance with the terms of the Trust Deed. The details of the valuation rules are described in the Trust Prospectus under "Calculation of Net Asset Value".

The Net Asset Value per Unit of the Fund will be published daily in the Standard and the Hong Kong Economic Times.

83. DISTRIBUTION POLICY

The Manager does not presently intend to make cash distributions in respect of the Fund. Income earned by the Fund will be reinvested in the Fund and reflected in the value of its Units.

84. CHARGES AND EXPENSES

Fees payable by Unitholders:

84.1 Subscription Charge and Redemption Charge

The Manager is entitled to receive a Subscription Charge of up to 5% of the Issue Price of each Unit and currently no Redemption Charge is applicable.

The Manager may pay the whole or a part of the proceeds from the Subscription Charge and/or Redemption Charge (if any) to any intermediary.

84.2 Transfer Fee

Should a Unitholder wish to transfer one or more Units, currently no transfer fee is chargeable to the transferor.

84.3 Fiscal and Purchase Charges

Up to 1% of the Issue Price of each Unit (in case of subscription) or up to 1% of the Redemption Price of each Unit (in case of redemption) may be chargeable only to compensate the Fund for any dilution in the Fund's Net Asset Value as a result of a large volume of applications/redemptions by Unitholders, or a large application/redemption request from any Unitholder, on any Dealing Day and in the Manager's opinion the continuing Unitholders might otherwise be materially adversely affected. Please refer to sections 10.1 and 11.2 of the Trust Prospectus for further details.

Fees payable by the Fund:

84.4 Management Fee

The Manager is entitled to receive, on an annual basis, a management fee from the Trust, currently at a rate of 1.5% per annum with respect to the Units of the Net Asset Value of the Fund calculated and accrued as at each Dealing Day. The management fee is payable monthly in arrears. The maximum rate of the management fee is 2% per annum of the Net Asset Value of the Fund.

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84.5 Trustee Fee

The Trustee will receive an asset based fee of up to 0.15% per annum of the Net Asset Value of this Fund (the "Trustee Fee") for trustee and registrar services. The maximum rate of the Trustee Fee is 0.5% per annum of the Net Asset Value of the Fund. The Trustee Fee is calculated and accrued as at each Dealing Day and is payable monthly in arrears. The Trustee Fee includes the fees payable for the services rendered in its capacity as trustee of the Trust and custodian of the assets of the Fund.

The Trustee is also entitled to receive from the Trust (a) once-off set up fee of up to RMB8,000 for the establishment of each sub-fund of the Trust; (b) reimbursement for relevant out-of-pocket expenses and disbursements incurred for the Fund; and (c) various transaction fees to cover settlement of transactions, the receipt of dividends from Fund assets and other fees and charges as agreed with the Manager from time to time.

Should the number of Unit Holders become greater than 30, the Trustee is entitled to RMB20 per monthly statement for each additional Unit Holder.

The Trustee Fee payable to BOCI-Prudential Trustee Limited in its capacity as the Trustee and Registrar of the Fund is subject to a minimum monthly fee of up to RMB40,000 for the Fund.

84.6 Global Custodian Fee and PRC Sub-Custodian Fee

The Global Custodian will receive an asset based fee of up to 0.1% per annum of the Net Asset Value of this Fund to perform its role as global custodian of the Fund and it is also entitled to (among others) transaction charges at customary market rates largely dependent on the markets where the Fund invests. The fee is calculated monthly and payable monthly in arrears. Such fees to the Global Custodian will also cover fees incurred by the PRC Sub-Custodian. Both the Global Custodian and PRC Sub-Custodian will be entitled to reimbursement by the Fund for any out-of-pocket expenses incurred in the course of their duties.

84.7 Establishment Expenses

The preliminary establishment expenses of the Fund amount to approximately RMB280,000and will be amortised over such period of five financial years (or such other period as the Manager may determine).

It should be noted that the proposed treatment of amortising the cost and expenses associated with the launch of the Fund over five years is not in accordance with the requirements of International Financial Reporting Standards ("IFRS"), under which these costs and expenses should be expensed at the point of commencement of the Fund's operations. The Manager believes that such treatment is more equitable to the initial investors than expensing the entire amount as they are incurred and is of the opinion that the departure is unlikely to be material to the Fund's financial statements. However, if the amounts involved are material to the audit of the Fund's financial statements the Manager may be required to make adjustments in the annual financial statements of the Fund in order to comply with IFRS and if relevant will include a reconciliation note in the annual accounts of the Fund to reconcile amounts shown in the annual financial statements determined under IFRS to those arrived at by applying the amortisation basis to the cost and expenses associated with the launch of the Fund.

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85. FUND SPECIFIC RISK FACTORS

Your attention is drawn to the section entitled "Risk Factors" in the Trust Prospectus, in addition there are some risks specific to this Fund.

85.1 Regulatory development and oversight

At present, the securities market and regulatory framework for the securities industry in PRC is undergoing rapid growth and changes, which may lead to trading volatilities, difficulties in settlement and recording of transactions and in interpreting and applying the relevant regulations. In addition, some of the investment regulations under which the Fund intends to invest in the PRC are new, uncertain and may give the relevant PRC authorities wide discretion on their interpretation. There are no precedents on how such discretion might be exercised for issues that have not been clearly provided in the investment regulations, therefore leaving a considerable amount of uncertainty.

85.2 Cash custody risk

Investors should note that cash deposited in the cash account of the Fund with the PRC Sub-Custodian will not be segregated but will be a debt owing from the PRC Sub-Custodian to the Fund as a depositor. Such cash will be co-mingled with cash belong to other clients of the PRC Sub-Custodian. In the event of bankruptcy or liquidation of the PRC Sub-Custodian, the Fund will not have any proprietary rights to the cash deposited in such cash account, and the Fund will become an unsecured creditor, ranking pari passu with all other unsecured creditors, of the PRC Sub-Custodian. The Fund may face difficulty and/or encounter delays in recovering such debt, or may not be able to recover it in full or at all, in which case the Fund will suffer losses.

85.3 RMB currency and conversion risk

The Fund will accept subscriptions and pay redemption amounts in RMB.

If a prospective Unitholder will convert its subscription monies from Hong Kong dollar or any other currency to RMB in order to invest in the Fund, it should keep in mind that may be adversely affected by changes in the exchange rates of the RMB. There is no guarantee that RMB will not depreciate against the Hong Kong dollar or any other currency. The value of the RMB is linked to a basket of currencies, and thus the value of the RMB against the Hong Kong dollar may rise or fall.

If at the time the Unitholder receives its RMB redemption proceeds it subsequently converts these back into Hong Kong dollar or any other currency, the Unitholder may suffer a loss if RMB has depreciated.

On a separate note, RMB is not a freely convertible currency. Further, the PRC government's imposition of restrictions on the repatriation of Renminbi out of mainland China may limit the depth of the Renminbi market in Hong Kong and reduce the liquidity of the Fund. The Chinese government's policies on exchange control and repatriation restrictions are subject to change, and the Fund's or the investors' position may be adversely affected.

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85.4 Onshore and offshore RMB markets risk

Investors should note that RMB is the only official currency of the PRC. While both onshore RMB (CNY) and offshore RMB (CNH) are the same currency, they are traded in different and separated markets. Since the two RMB markets operate independently where the flow between them is highly restricted, CNY and CNH are traded at different rates and their movement may not be in the same direction. The CNH rate may be at a premium or discount to the exchange rate for CNY rate. There may be significant bid and offer spreads, which may affect the value of the Units in the Fund.

85.5 Concentration risk/single country investment risk

The Fund is specialised. The Fund invests in securities with substantial exposure to mainland China. Although the Fund's portfolio will be well diversified in terms of the number of investments, Unitholders should be aware that the Fund is likely to be more volatile than a broad-based fund, or a fund that is not denominated in RMB. The Fund may be more susceptible to fluctuations in value resulting from adverse conditions encountered in the PRC. Investments in issuers located in a particular country or geographic region may have more risk because of particular market factors affecting that country or region, including political instability or unpredictable economic conditions.

85.6 PRC market risk

The Fund is not a bank deposit and is not guaranteed. There is no guarantee of the repayment of the principal investment. The profitability of the investments of the Fund could be adversely affected by a worsening of general economic conditions in the PRC or global markets. Factors such as PRC government policy, fiscal policy, interest rates, inflation, investor sentiment, the availability and cost of credit, the liquidity of the PRC financial markets and the level and volatility of securities prices could significantly affect the value of the Fund's underlying investments and thus the Unit price. Unitholders should note in particular that the underlying investments of the Fund may fall in value, and thus the Unit price may fall even if the RMB appreciates against the Hong Kong dollar and US dollar.

For example: (a) an economic downturn or significantly higher interest rates could adversely affect the credit quality of the on-balance sheet and off-balance sheet assets; (b) a market downturn or worsening of the economy could cause the Fund to incur mark to market losses in its trading portfolios.

85.7 Specific risks relating to the China A-share market

The existence of a liquid trading market for China A-shares may depend on whether there is supply of, and demand for, such China A-shares. The price at which securities may be purchased or sold by the Fund and the Net Asset Value of the Fund may be adversely affected if trading markets for China A-shares are limited or absent. The China A-share market may be more volatile and unstable (for example, due to the risk of suspension of a particular stock or government intervention). High market volatility and potential settlement difficulties in the China A-share markets may also result in significant fluctuations in the prices of the securities traded on such markets and thereby may adversely affect the value of the Fund.

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Securities exchanges in China typically have the right to suspend or limit trading in any security traded on the relevant exchange. In particular, trading band limits are imposed by the stock exchanges in China on China A-shares, where trading in any China A-share security on the relevant stock exchange may be suspended if the trading price of the security has increased or decreased to the extent beyond the trading band limit. A suspension will render it impossible for the Manager to liquidate positions and can thereby expose the Fund to significant losses. Further, when the suspension is subsequently lifted, it may not be possible for the Manager to liquidate positions at a favourable price.

85.8 RQFII Regime Risks

Under the prevailing regulations in mainland China, foreign investors can directly invest in the RQFII Permitted Securities through institutions that have obtained RQFII status in mainland China. The current RQFII Regulations impose strict restrictions (such as investment guidelines) on RQFII eligible securities investment. The Fund is not a RQFII, but the Fund may invest in RQFII Permitted Securities via the RQFII Quota granted to CITIC Securities International Company Limited by SAFE. The prevailing rules and regulations governing RQFIIs under the RQFII Regulations impose restrictions on investments and other operational aspects of investments which will restrict or affect the Fund's investments.

Investors should be aware that the Fund may need to maintain high cash balances for the purposes of, among others, payment of the fees of its service provides and to meet redemption requests. This may result in lesser amounts being invested than would otherwise be the case.

RQFII Regulations

The RQFII Regulations which regulate investments by RQFIIs in mainland China and the repatriation are relatively new and novel in nature. The application and interpretation of the RQFII Regulations are therefore relatively untested and there is uncertainty as to how they will be applied. CSRC and SAFE have been given wide discretions in the RQFII Regulations and there is no precedent or certainty as to how these discretions might be exercised now or in the future. At this stage of early development, the RQFII Regulations may be subject to further revisions in the future, there is no assurance whether such revisions will prejudice the RQFII, or whether the RQFII Quota which are subject to review from time to time by CSRC and SAFE may be withdrawn substantially or entirely. At the time of the launch of the Fund, the RQFII Regulations continue to develop and are undergoing continual change. CSRC and/or SAFE may have power in the future to impose new restrictions or conditions on or terminate the RQFII status of CITIC Securities International Company Limited which may adversely affect the Fund and the Unitholders. It is not possible to predict how such changes would affect the Fund.

RQFII Quotas

Investment by the Fund will be made and held through the RQFII Quota granted to CITIC Securities International Company Limited by SAFE. The RQFII Regulations apply to RQFII Quota(s) which may be obtained by CITIC Securities International Company Limited as RQFII from time to time for the Fund or other investors as a whole, and not simply to investments made by the Fund. Thus investors should be aware that violations of the RQFII Regulations arising out of activities related to any usage of RQFII Quota obtained by CITIC Securities International Company Limited (including utilization of the RQFII Quota by the

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Fund and other than the Fund) could result in the revocation of or other regulatory action in respect of the RQFII Quota held by CITIC Securities International Company Limited as a whole, including the RQFII Quota utilised by the Fund. Likewise, regulatory limits on investment in RQFII Permitted Securities (as applicable) may apply in relation to the RQFII Quota held by CITIC Securities International Company Limited as a whole. Hence the ability of the Fund to make investments and/or repatriate monies from the RQFII Quota may be affected adversely by the investments, performance and/or repatriation of monies invested by other investors utilising the RQFII Quota obtained by CITIC Securities International Company Limited in the future.

In addition, any repatriation of monies by the Fund to meet obligations such as the payment of fees may adversely impact the ability of the Fund to repatriate monies to meet Unitholders' redemption requests.

There can be no assurance that the Fund will be able to obtain access to sufficient RQFII Quota to meet all proposed investments to be made by the Fund or that the investments of the Fund can be realised in a timely manner due to possible adverse changes in relevant laws or regulations which will hinder the Fund's ability to pursue the investment objectives or result in loss under extreme circumstances. Should CITIC Securities International Company Limited lose its RQFII status or retire or be removed, or the RQFII Quota held by CITIC Securities International Company Limited be revoked or reduced, the Fund may not be able to invest in RQFII Permitted Securities through the RQFII Quota held by CITIC Securities International Company Limited, and the Fund may be required to dispose of its holdings, which would likely have a material adverse effect on the Fund.

RQFII Quota Limitation

The RQFII Quota granted to CITIC Securities International Company Limited by SAFE is shared among the Fund and other open-ended funds managed by the Manager. CITIC Securities International Company Limited (as RQFII) can allocate the available RQFII Quota flexibly across the open-ended funds under the management of the Manager. The Manager may allocate more RQFII Quota to the Fund from other open-ended funds to meet subscription demands. However, it is also possible that the Manager may not accept additional subscriptions when there is not enough RQFII Quota available to the Fund and would not be able to achieve further economies of scale or otherwise take advantage of the increased capital base.

Custody

Any RQFII Permitted Securities acquired by the Fund through the RQFII Quota held by CITIC Securities International Company Limited will be maintained by the PRC Sub-Custodian and will be registered in the joint names of CITIC Securities International Company Limited (as RQFII) and the Fund and for the sole benefit and use of the Fund subject to applicable laws. There will be segregation of assets by the PRC Sub-Custodian such that the assets of the Fund will not form part of the assets of CITIC Securities International Company Limited as RQFII, the Manager or the PRC Sub-Custodian.

However, subject to the investment regulations, CITIC Securities International Company Limited could be the party entitled to the securities in such securities trading account (albeit that this entitlement does not constitute an ownership interest or preclude the Manager purchasing the securities on behalf of the Fund). Such securities may be vulnerable to a claim

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by a liquidator of CITIC Securities International Company Limited and may not be as well protected as if they were registered solely in the name of the Fund. In particular, there is a risk that creditors of CITIC Securities International Company Limited may incorrectly assume that the Fund's assets belong to CITIC Securities International Company Limited and such creditors may seek to gain control of the Fund's assets to meet CITIC Securities International Company Limited's liabilities owed to such creditors.

PRC Securities Brokers and Best Execution

The Fund may have difficulty in obtaining best execution of transactions in RQFII Permitted Securities subject to restriction/limitations under applicable RQFII Regulations or operational constraints such as the restriction/limitation as to the number of brokers that the Manager may appoint. The Fund will use PRC brokers appointed by the Manager to execute transactions in the PRC markets for the account of the Fund. If a PRC broker offers the Fund standards of execution which the Manager reasonably believes to be amongst best practice in the PRC marketplace, the Manager may determine that they should consistently execute transactions with that PRC broker (including where it is an affiliate) notwithstanding that they may not be executed at the best price and shall have no liability to account to the Fund in respect of the difference between the price at which the Fund executes transactions and any other price that may have been available in the market at that relevant time.

Limits on Redemption

Where the Fund is invested in the securities market in mainland China by investing through the RQFII Quota held by CITIC Securities International Company Limited, repatriation of funds from mainland China may be subject to the RQFII Regulations in effect from time to time. Currently there is no regulatory prior approval requirement for repatriation of funds from the RQFII Quota. However the relevant RQFII regulations are subject to uncertainty in their application and there is no certainty that no regulatory restrictions will apply to the repatriation of funds by the Fund in the PRC in the future. Accordingly, the investment regulations and/or the approach adopted by SAFE in relation to the repatriation may change from time to time.

Please note that redemptions on any Dealing Day are subject to redemption restrictions described in the Trust Prospectus (including suspension of redemption and/or delay of payment of redemption monies) and in case of repatriation restrictions being imposed in the future, it is possible that the Manager may not resume acceptance of redemption request and/or make payment of redemption monies for as long as the time required for repatriation of funds from the RQFII Quota subject to regulatory restrictions in the PRC.

For each RQFII Quota approved by SAFE, the relevant RQFII is required to utilize the RQFII Quota effectively within one year from the SAFE approval date. If the RQFII fails to utilize the RQFII Quota effectively, SAFE could reduce or revoke the RQFII Quota depending on the circumstances. As utilization of the RQFII Quota will depend on the subscription level of the Fund and redemptions by investors of the Fund, low subscription level or large redemptions by investors of the Fund might result in the RQFII Quota being reduced or lost permanently.

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Investment Restrictions

There are limits on the total shares held by all underlying investors in one listed company under the RQFII Regulations. The investment restrictions will be applied to all underlying investors. However, it will be difficult in practice for the Manager to monitor the investments of the underlying investors since an investor may make investment through different RQFIIs or QFIIs. Violations of the RQFII Regulations (including ownership limits referred to above) by CITIC Securities International Company Limited or arising out of the activities relating to the use of any RQFII Quota granted to CITIC Securities International Company Limited (including the RQFII Quota utilized by other funds or entities) could result in the revocation of or other regulatory action in respect of the RQFII Quotas granted to CITIC Securities International Company Limited, which could directly impact the Fund.

Disclosure of Interests and Short Swing Profit Rule

Under the PRC disclosure of interest requirements, the Fund may be deemed to be acting in concert with other funds managed within the Manager's group or a substantial shareholder of the Manager's group and therefore may be subject to the risk that the Fund's holdings may have to be reported in aggregate with the holdings of such other funds mentioned above should the aggregate holding triggers the reporting threshold under the PRC law, currently being 5% of the total issued shares of the relevant PRC listed company. This may expose the Fund's holdings to the public with an adverse impact on the performance of the Fund.

In addition, subject to the interpretation of PRC courts and PRC regulators, the operation of the PRC short swing profit rule may be applicable to the Fund's investments with the result that where the holdings of the Fund (possibly with the holdings of other investors deemed as concert parties of the Fund) exceed 5% of the total issued shares of a PRC listed company, the Fund may not reduce its holdings in such company within six months of the last purchase of shares of such company. If the Fund violates the rule and sells any of its holdings in such company in the six-month period, it may be required by the listed company to return any profits realised from such trading to the listed company. Moreover, under PRC civil procedures, the Fund's assets may be frozen to the extent of the claims made by such company. These risks may greatly impair the performance of the Fund.

85.9 Risks associated with investment in PRC money market funds

The Fund's investment in PRC money market funds is neither risk-free nor equivalent to placing funds on deposits with a bank or deposit-taking company. Money market funds are in general susceptible to short-term interest risk. For PRC money market funds with high asset allocation to deposit arrangements with a bank in the PRC, it is exposed to default risk and credit risk of the relevant bank as there is no bank deposit protection regime in PRC at present.

85.10 PRC tax considerations

For further details relating to PRC taxes and the associated risks, please refer to section 17.2 of the Trust Prospectus headed "PRC Tax".

The value of the Fund's investments (and hence the Net Asset Value of the Fund) will be adversely affected by taxation levied against the Manager or CITIC Securities International Company Limited as RQFII in respect of the Fund's investments through the RQFII Quota

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held by CITIC Securities International Company Limited, for which the Fund will be required to reimburse the Manager or CITIC Securities International Company Limited.

Pursuant to Circular 79, the Fund, investing through the RQFII Quota held by CITIC Securities International Company Limited, is temporarily exempt from PRC WIT on capital gains from investments in China A-shares effective from 17 November 2014. Therefore, no PRC WIT provision will be made on the gross realized and unrealized capital gains derived from investments in China A-shares. It should also be noted that the CIT exemption granted under Circular 79 for capital gains derived by RQFII from investments in China A-shares is temporary. As such, as and when the PRC authorities announce the expiry date of the exemption, the Fund may in future need to make provision to reflect taxes payable. Also, there is a possibility of the PRC tax rules being changed and taxes being applied retrospectively. In the event that tax is collected by the PRC tax authorities and the Fund is required to make payments reflecting tax liabilities for which no provision has been made, the Net Asset Value of the Fund will be adversely affected, as the Fund will ultimately have to bear the full amount of tax liabilities. In this case, the tax liabilities will only impact Units in issue at the relevant time, and the then existing Unitholders and subsequent Unitholders will be disadvantaged as such Unitholders will bear, through the Fund, a disproportionately higher amount of tax liabilities as compared to that borne at the time of investment in the Fund. Upon the availability of a definitive tax assessment or the issue of announcements or regulations by the competent authorities promulgating definitive tax assessment rules, the Manager will, as soon as practicable, make relevant adjustments to the amount of tax provision as it considers necessary.

Unitholders may, depending on their own circumstances, be subject to PRC tax or taxes in other jurisdictions. The Fund would not be able to guarantee that taxes paid at the Fund’s level will be attributable to any Unitholders for personal tax purposes.