Important information:• The Fund invests primarily in Russia Equities.• The Fund is subject to the concentration and emerging market risks of investing in a single emerging market.• The Fund’s investments may involve substantial market, currency, volatility, regulatory and political risks. Investors may suffer substantial loss of their investments in the Fund.• Unit trusts are not equivalent to time deposits. Investors should not invest in the Fund solely based on the information provided in this document and should read the

offering document of the Fund for details.

Why Russian equities now?

2 Rising domestic consumption 4 Valuations are comparatively cheap

Russian consumers remain resilient despite the global financial crisis. The growing wave of consumption inRussia has been supported by rising wages and theimprovement in employment. Besides, Russians were not highly leveraged with debt and they tend not to have high mortgages

Russian equity valuations are among the cheapest in the world – on both a country and sector basis

Russian equities look attractive relative to globalemerging markets and all of the key sectors, and are trading at a discount to GEM peers

Infrastructure investments expected to fuel growth

31 Oil price remains supportive

Russia is one of the world’s largest producers andexporters of oil. Strong demand in emerging markets should be supportive to oil price in the medium term

As long as oil price remains above US$60 per barrel,Russia is likely to be on target to achieve 4-5% GDP growth in 20101

The investment/GDP ratio is still lower than otheremerging economies such as India, China and SouthKorea5

The Russian government has committed to spend more than US$30 billion to build the facilities and infrastructurefor the 2014 Winter Olympics in Sochi5, and an additionalUS$3.9 billion for the 2018 FIFA World Cup6

GDP growth sensitivity to oil price2

Sources: 1HSBC. Data as at 31 October 2010; 2Ministry of Finance and Renaissance Capital Estimates. Data as at end June 2010; 3Bloomberg. Data as at 31 October 2010; 4IMF, State statistics service and CIA World Factbook. Data as at end June 2010; 5RIA Rovost. Data as at 7 June 2010; 6Citigroup Global Markets. Data as at 3 December 2010; 7IBES, MSCI, JP Morgan estimates. Data as at 2 December 2010.

HSBC Global Investment Funds – Russia EquityPoised for growth on soaring global commodities demand

1086420-2-4-6-8

-10US$30 US$40 US$50 US$60 US$70 US$80 US$90 US$100

Breakeven oil price:around $60/barrel

Current oil price:around $90/barrel Investment spending is set to grow4

%120

100

80

60

40

20

0

1990

1991

1992

1993

1994

1995

1996

1997

1998

1999

2000

2001

2002

2003

2004

2005

2006

2007

2008

E

2009

E

Index of Russian Investment

%

Q1 2011

2011 estimated P/E comparison by country7

X18

16

14

12

10

8

6

4

2

Russia Korea Brazil EM

Estimated P/E 2011

China Taiwan India

6.0

10.3 10.9 11.3 11.8 12.3

15.9

0Retail sales y-o-y growth Consumer confidence (rhs)

Retail sales and consumer confidence have rebounded3

% %50-5-10-15-20-25-30-35-40

25201510

50

-5-10-15

01/0

1

01/0

2

01/0

3

01/0

4

01/0

5

01/0

6

01/0

7

01/0

8

01/0

9

01/1

0

Investment involves risk. Past performance is not indicative of future performance. Please refer to the offering document for further details including the risk factors. The document has not been reviewed by the Securities and Futures Commission.

The document is prepared for general information purposes only. All views expressed cannot be construed as an offer or recommendation by HSBC Global Asset Management (Hong Kong) Limited (“AMHK”). AMHK and HSBC Group shall not be held liable for damages arising out of any person’s reliance upon this information. Any person considering an investment should seek independent advice on the suitability or otherwise of the particular investment.

Issued by HSBC Global Asset Management (Hong Kong) Limited Q12

011_

Rus

sia

Equ

ity_P

FS

www.assetmanagement.hsbc.com/hk

Investment objectiveThe Fund seeks long-term capital growth mainly through a concentrated portfolio of investments in equity and equity equivalent securities of companies listed on a major stock exchange or other regulated markets in Russia, as well as companies with significant operations or carry out a preponderant part of their business activities in Russia.

About the FundHigh-conviction approach

The Fund invests in a concentrated portfolio of 20-40 stocks

An experienced and dedicated investment team Lead manager Douglas Helfer has a 14-year track record in managing Russian equities and is supported by HSBC’s strong global emerging markets

equity investment team

Sources: 1HSBC Investment Funds (Hong Kong) Limited and Morningstar, Inc. Data as at 31 December 2010. Bid to Bid price with dividend reinvested. †Subject to on-going review by the Hong Kong and Shanghai Banking Corporation Limited.

Suitable investorsThe Fund may be suitable for investors who:

have a medium- to long-term investment horizon seek access to the promising Russia growth story and is willing to

accept the risk of single country investments want to access the stock selection expertise of an experienced team

Potential riskThe Fund may be subject to the following risks:

Investing in emerging markets involves a greater risk of loss than investing in more developed markets due to, among other factors, greater political, tax, economic, foreign exchange, liquidity, market volatility (such as interest rate and price volatility) and regulatory risks

Russia’s equity market is correlated to the oil price, significant movement in oil prices may affect the Fund’s performance

Sudden increase in global risk aversion may trigger stock market volatility

Corporate governance issues such as lack of transparency in shareholdings may remain a risk

Given the nature of politics and governance in Russia, this may affect the stability of Russia

Fund details1

Fund size

Fund prices (bid/offer)

Class

Launch date

Currency

Initial charge

Management fee

Fund manager

Investment advisor

Fund code

US$315.33 million

US$8.359 / US$8.822

AD

20 December 2007

USD

Up to 5.25%

1.75% per annum

Douglas Helfer

HSBC Global Asset Management (UK) Limited

U62402 (Risk level 5†)

Outlook Supportive oil price will act as a key positive driver of the Russian economy, which is attractively valued. Russian equities are trading at around 40%

discount to the global emerging markets

Oil prices is likely to remain firm on the back of growing demand in Asia, limited spare production capacity in the coming year and fairly strong compliance within OPEC on production agreements. Oil price is forecast to trade in a range of US$75-90 a barrel this year

Consumption continues to be a strong theme in Russia and the domestic economy is poised for recovery, but external factors will continue to dominate short-term performance

Fund strategy The Fund remains overweight deep-value energy and telecommunications names. For instance, the Russian oil industry is trading at around 40-50%

discount to global and GEM peers

The Fund retains its consumer and financial sector exposure and its underweight to utilities, given concern over the probability of tariff increases announced by the government as part of the sector’s ongoing liberalisation program

From the beginning of July the underweight to steel names has been closed given significant underperformance versus the benchmark

Asset allocation1Performance1

Cumulative performance (US$ %)

The Fund

Calendar year performance (US$ %)

10

23.7

29.0

09

145.9

143.7

08

-73.4

-72.4

20/12/07 to31/12/07

2.4

1.3

The Fund

MSCI Russia 10/40

3 mths

15.3

YTD

23.7

6 mths

33.0Oil & Gas 33.7%

Other 2.1%Cash 1.3%

Basic Materials 28.6%

Industrials 0.9%

Financials 14.5%

Consumer Goods 1.7%

Telecommunications 7.1%

Utilities 4.1%

Consumer Services 6.1%