• Chicago Mercantile Exchange (“CME”) is regulated by the U.S. Commodity Futures Trading Commission(“CFTC”), which is the primary regulator of the US futures and options on futures markets. The ETF is investing in Bitcoin Futures listed on CME
• HKD Trading
• Pave the way for investment in future crypto-technology adoption
Samsung Bitcoin Futures Active ETF (the “Sub-Fund”) is a sub-fund of Samsung ETFs Trust III, an umbrella unit trust established under Hong Kong law. Units of the Sub-Fund (the “Units”) are listed on The Stock Exchange of Hong Kong Limited (the “SEHK”). These Units are traded on the SEHK like listed stocks. The Sub-Fund is an actively managed exchange traded fund (“ETF”) falling under Chapter 8.10 of the Code on Unit Trusts and Mutual Funds issued by the SFC (the “Code”).
1. General investment risk
• The Sub-Fund is not principal guaranteed and may fall in value due to any of the key risk factors below. There is no assurance that the Sub-Fund will achieve its investment objective.
2. Active investment management risk
• The Sub-Fund employs an actively managed investment strategy. The Sub-Fund does not seek to track any index or benchmark, and there is no replication or representative sampling conducted by the Manager. It may fail to meet its objective as a result of the Manager’s selection of investments, and/or the implementation of processes which may cause the Sub-Fund to underperform as compared to other index tracking funds with a similar objective.
3. Bitcoin risks
• The Sub-Fund is exposed to the risks of bitcoin through its investments in Bitcoin Futures on CME. Investments linked to bitcoin can be highly volatile compared to investments in traditional securities and the Sub-Fund may experience sudden and large losses, including total loss. An investor should be prepared that the investment value may be lost suddenly (including total loss) and without warning.
• The markets for bitcoin and bitcoin futures may become illiquid and their prices may fluctuate widely due to numerous events or factors that are potentially difficult to evaluate and unforeseeable, including the following:
i. New innovation risk: Bitcoin is a relatively new innovation and the market for bitcoin is subject to rapid price swings, changes and uncertainty. It is not backed by any authorities, government or corporations. Continued further development of the Bitcoin Network and the acceptance and use of bitcoin are subject to a variety of factors that are difficult to predict or evaluate. Any cessation or reversal of such development of the Bitcoin Network or the acceptance of bitcoin may adversely affect the price of bitcoin and thus the Sub-Fund’s investment in bitcoin futures.
ii. Unforeseeable risks: Given the rapidly evolving nature of bitcoin, including advancements in the underlying technology, market disruptions and resulting governmental interventions that are unforeseeable, an investor may be exposed to additional risks which cannot currently be predicted.
iii. Price volatility risk: Investing in bitcoin and related products is highly speculative, and their price movements are difficult to predict. The prices of bitcoin and bitcoin futures have historically been extremely volatile. For example, for the first eleven month of 2022, bitcoin price dropped approximately 63%. The value of the Sub-Fund’s investments in bitcoin futures could decline significantly and without warning, including to zero.
iv. Risk relating to the limited history of bitcoin and Bitcoin Futures on CME: Bitcoin and the Bitcoin Network have a limited history, therefore, it is unclear how all elements of bitcoin will unfold over time, specifically with regard to governance between miners, developers and users, as well as the long-term security model as the mining reward of bitcoin decreases over time. Insufficient software development or any other unforeseen challenges that the bitcoin community is not able to resolve could have an adverse impact on bitcoin price and thus the Sub-Fund’s investment in bitcoin futures.
v. Risk of trading on less regulated venues: Bitcoin and bitcoin trading venues are largely unregulated, and are thus prone to fraud or market manipulation. Over the past several years, a number of bitcoin trading venues have experienced fraud, failure or security breaches. Investors who have traded or otherwise held bitcoin with such intermediaries may have little or no recourse and could suffer significant losses. This may adversely affect the value of bitcoin and thus the Sub-Fund’s investment in bitcoin futures.
vi. Fraud, market manipulation and security failure risk: Bitcoin may be subject to the risk of fraud, theft, manipulation or security failures, operational or other problems that impact bitcoin trading venues. In particular, the Bitcoin Network and entities that custody or facilitate the transfers or trading of bitcoin are vulnerable to various cyber attacks. Malicious actors may also exploit flaws in the code or structure in the Bitcoin Network that will allow them to, among other things, steal bitcoin held by others, control the blockchain, steal personally identifying information, or issue significant amounts of bitcoin in contravention of the protocols. A significant portion of bitcoin is held by a small number of holders who may have the ability to manipulate the price of bitcoin. The occurrence of any of the above may have negative impact on the price of bitcoin and thus the Sub-Fund’s investment in bitcoin futures.
vii. Changes in acceptance of bitcoin: The value of bitcoin is subject to risks related to its usage and there is no assurance that bitcoin usage will continue to grow over the long-term to support its value. Reduction or slowdown in the acceptance and/or prevalence of bitcoin may result in lack of liquidity, increased volatility or a significant reduction in the price of bitcoin and thus the Sub-Fund’s investment in bitcoin futures.
viii. Regulatory risk: The regulation on bitcoin, digital assets and related products and services continues to evolve and increase. To the extent that future regulatory actions or policies limit or restrict bitcoin usage, bitcoin trading or the ability to convert bitcoin to fiat currencies, the demand for and value of bitcoin may be reduced significantly. Changes to existing regulation (e.g., regarding dealing in virtual asset-related products) may also impact the ability of the Sub-Fund to achieve its investment objective or operate as planned.
ix. Fork risk: As the Bitcoin Network is an open-source project, the developers may suggest changes to the bitcoin software from time to time. If the updated bitcoin software is not compatible with the original bitcoin software and a sufficient number (but not necessarily a majority) of users and miners elect not to migrate to the updated bitcoin software, this would result in a “hard fork” of the Bitcoin Network, with one prong running the earlier version of the bitcoin software and the other running the updated bitcoin software, resulting in the existence of two versions of bitcoin network running in parallel and a split of the blockchain underlying the bitcoin network. The occurrence of such “fork” may result in an adverse impact on the price and liquidity of bitcoin and thus the Sub-Fund’s investment in bitcoin futures.
x. Air drop risk: A substantial giveaway of bitcoin to participants in the Bitcoin Network (sometimes referred to as an “air drop”) may result in a significant and unexpected declines in the value of bitcoin and thus the Sub-Fund’s investment in bitcoin futures.
xi. Contagion risk: The collapse of any major players in the crypto ecosystem (for example, wallets and exchanges) may have contagious adverse effects on the values of virtual assets including bitcoin and the value of the Sub-Fund’s investments.
4. Bitcoin futures risks
• Market risk: Futures contracts generally involve risks that are in addition to, and potentially greater than, the risk of investing directly in securities and other traditional assets. The prices of bitcoin futures have historically been highly volatile and are heavily influenced by factors contributing to the bitcoin’s price volatility as discussed above. The market of Bitcoin Futures on CME may be less developed, less liquid, more volatile subject to greater risks than traditional markets. The value of the Sub-Fund’s investments in bitcoin futures, and hence, the NAV of the Sub-Fund, may be subject to fluctuations and decline significantly without warning.
• Liquidity risk: The bitcoin futures market is relatively new and may be subject to periods of illiquidity, market disruptions or volatility, during which it may be difficult or impossible to find a counterparty willing to transact or to buy or sell at the desired price at sufficient size. The market for Bitcoin Futures on CME is still developing and the trading volume of the longer-term Bitcoin Futures on CME is currently thin. The liquidity may be further impacted by factors including market conditions and expectations, position limits and collateral requirements.
• Bitcoin futures capacity risk: The Sub-Fund may not be able to achieve its investment objective if it is unable to gain exposure to bitcoin futures contracts in line with its investment objective for any reason such as illiquidity in the bitcoin futures market, disruption to the bitcoin futures market, limitations imposed by the Sub-Fund’s brokers or the listing exchanges or as a result of margin requirements, position limits or accountability levels. Consequently, the investment strategy and rolling strategy of the Sub-Fund may be adversely affected. As a result, the Manager may be need to suspend new creations of Units. This may result in divergence between the trading price of the Unit and the NAV per Unit.
• Rolling of futures contracts risk and contango risk: The NAV of the Sub-Fund may be adversely affected by the cost of rolling futures positions forward if the market is in contango. Excluding other considerations, if the market for Bitcoin Futures on CME is in a “contango” market, where the prices are higher in the distant delivery months than in the nearer delivery months, the sale of the Bitcoin Futures on CME would take place at a price lower than the price of the contract which such Bitcoin Futures on CME will be rolled to. Accordingly, sale proceeds from selling existing Bitcoin Futures on CME when rolling will not be sufficient to purchase the same number of contracts with later expiration date at a higher price, thereby creating a negative “roll yield” which could adversely affect the NAV of the Sub-Fund over time. In addition, contango could last for an undetermined period of time, therefore, the Sub-Fund may be subject to a negative roll yield for a long time.
• Risk of material non-correlation with spot/current market price of bitcoin: Given the futures-based investment strategy of the Sub-Fund, its NAV may substantially differ from the spot price performance of bitcoin. Accordingly, the Sub-Fund may underperform a similar investment that is linked to the spot price of bitcoin. If the Sub-Fund invests more in subsequent-month Bitcoin Futures on CME, its performance may deviate more significantly from bitcoin spot price.
• Mandatory measures imposed by relevant parties risk: Relevant parties (such as clearing brokers, execution brokers and CME Globex) may impose certain mandatory measures on the Sub-Fund’s futures positions under extreme market circumstances. These measures may include suspending trading, limiting the size and number of the Sub-Fund’s futures positions and/or mandatory liquidation of the Sub-Fund’s futures positions without advance notice to the Manager. The Manager may have to take corresponding actions in the best interests of and without prior notice to the Unitholders and in accordance with the Sub-Fund’s constitutive documents, including but not limited to implementing alternative investment strategies. These corresponding actions may have an adverse impact on the Sub-Fund.
• Price limit risk: The CME has set dynamic price fluctuation limits on Bitcoin Futures on CME. Once the dynamic price fluctuation limit has been reached, trading may be temporarily halted or no trades may be made at a price beyond that limit. This may limit the Sub-Fund’s ability to invest in Bitcoin Futures on CME.
• Leverage risk: The Sub-Fund’s investment in Bitcoin Futures on CME involves the posting of margin or collateral. Increases in the amount of collateral or margin or similar payments may result in the need for the Sub-Fund to liquidate its investments at unfavourable prices in order to meet collateral or margin calls. This may result in substantial losses to investors.
• Exchange’s clearing house’s failure risk: In the event of the bankruptcy of the relevant exchange’s clearing house, the Sub-Fund could be exposed to a risk of loss with respect to its assets that are posted as margin. There can be no assurance that the protections against bankruptcy of the clearing house (if any) will be effective in allowing the Sub-Fund to recover all, or even any, of the amounts it has deposited as margin.
5. New product risk
• The Sub-Fund is an actively managed futures-based ETF investing directly in Bitcoin Futures on CME. The novelty of such an ETF and the fact that the Sub-Fund is one of the first few virtual asset futures-based ETFs in Hong Kong makes the Sub-Fund potentially riskier than traditional ETFs investing in equity securities.
6. Concentration risk
• As the exposure of the Sub-Fund is concentrated in the bitcoin market via investing in Bitcoin Futures on CME, it is more susceptible to the effects of bitcoin price volatility than more diversified funds. Moreover, the Sub-Fund holds a limited number of Bitcoin Futures on CME which are predominately front-month Bitcoin Futures on CME, this may result in a larger concentration risk and price volatility of the Sub-Fund than a fund which has a more diversified holding.
7. Other currency distributions risks
• Investors should note that all Units will receive distributions in the base currency (USD) only. In the event that the relevant Unitholder has no USD account, the Unitholder may have to bear the fees and charges associated with the conversion of such distribution from USD to HKD or any other currency. The Unitholder may also have to bear bank or financial institution fees and charges associated with the handling of the distribution payment.
8. Distributions out of or effectively out of capital risks
• Payment of dividends out of capital or effectively out of capital amounts to a return or withdrawal of part of an investor’s original investment or from any capital gains attributable to that original investment. Any such distributions may result in an immediate reduction in the NAV per Unit of the Sub-Fund.
9. Trading risks
• The trading price of Units on the SEHK is driven by market factors such as the demand and supply of Units. Therefore, the Units may trade at a substantial premium or discount to the Sub-Fund’s NAV.
• As investors will pay certain charges (e.g. trading fees and brokerage fees) to buy or sell Units on the SEHK, investors may pay more than the NAV per Unit when buying Units on the SEHK, and may receive less than the NAV per Unit when selling Units on the SEHK.
10. Trading hours differences risks
• As CME Globex may be open when Units are not priced, the value of the investments in the Sub-Fund’s portfolio may change on days when investors will not be able to purchase or sell the Sub-Fund’s Units.
• Any accrued market risk that arises due to the foregoing may also increase the level of premium or discount of the Unit price to Sub-Fund’s NAV.
11. Reliance on market maker and liquidity risks
• Although the Manager will ensure that at least one Market Maker will maintain a market for the Units, and that at least one Market Maker gives not less than 3 months’ notice prior to terminating market making arrangement under the relevant market maker agreement, liquidity in the market for Units may be adversely affected if there is no or only one Market Maker for the Units traded in HKD. There is also no guarantee that any market making activity will be effective.
12. Termination risks
• The Sub-Fund may be terminated early under certain circumstances, for example, where the size of the Sub-Fund falls below USD 25 million. Investors may not be able to recover their investments and suffer a loss when the Sub-Fund is terminated.
Fund Objective and Investment Strategy
|Investment Objective||The Sub-Fund seeks to provide economic exposure to the value of bitcoin by investing predominately in front-month Bitcoin Futures on CME. The Sub-Fund does not invest directly in bitcoin and will not receive any bitcoin from Bitcoin Futures on CME. There is no assurance that the Sub-Fund will achieve its investment objective.|
|Investment Strategy||In seeking to achieve the Sub-Fund’s investment objective, the Manager adopts an active investment strategy whereby it will enter into and have exposure of up to 100% of the Sub-Fund’s net asset value (“NAV”) in Bitcoin Futures on CME.|
|Product Base Currency||USD|
|Creation/ Redemption||In-Cash Applications (in USD only) and In-Cash Redemptions (in USD only)|
Annually (usually in March each year) (if any) subject to the Manager’s discretion. Distributions may be made out of capital or effectively out of capital as well as income at the Manager’s discretion.
|Manager||Samsung Asset Management (Hong Kong) Limited|
|Trustee & Registrar||HSBC Institutional Trust Services (Asia) Limited|
|iNAV Calculation Agent||ICE Data|
|Fund Inception Date||12 Jan 2023|
|SEHK Listing Date||13 Jan 2023|
|Financial Year||31 March|
|Total NAV (USD)||7,904,937 as of 2023-12-06|
|Outstanding Units||3,500,000 as of 2023-12-06|
|Management Fee*||0.89% of NAV per annum|
|Ongoing Charges Over a Year^||Estimated to be 0.95% (including management fee)|
|Base Currency||US dollars (USD)|
* Please note that these fees may be increased up to a permitted maximum on giving 1 month’s notice to Unitholders. Please refer to the section of the Prospectus entitled “Fees and Expenses” for further details of the fees and charges payable and the permitted maximum of such fees allowed as well as other ongoing expenses that may be borne by the Sub-Fund.
^As the Sub-Fund (as defined below) is newly set up, this figure is a best estimate only and represents the sum of the estimated ongoing charges expressed as a percentage of the estimated average Net Asset Value. It may be different upon actual operation of the Sub-Fund and may vary from year to year. For the first 12-month period from the launch of the Sub-Fund, the ongoing charges figure is capped at a maximum of 0.95% of the average Net Asset Value of the Sub-Fund, and any ongoing expenses exceeding 0.95% of the average Net Asset Value of the Sub-Fund will be borne by the Manager and will not be charged to the Sub-Fund.
Intra-day Estimated NAV
- “Intra-day Estimated NAV Per Unit” calculations as shown on Samsung website (the “data”) is provided by ICE Data Indices and updated at 15-second intervals during HKEX Exchange trading hours. This is indicative and for reference purposes only.
- The near real time indicative NAV per Unit in HKD is calculated using a real time HKD:USD foreign exchange rate – it is calculated using the near real time indicative NAV per Unit in USD multiplied by a real-time HKD:USD foreign exchange rate quoted by ICE Data Indices LLC.
|Official NAV per Unit in HKD *||2023-12-06||17.6426||-0.0479||-0.27%|
|Closing Price per Unit in HKD||2023-12-06||17.6400||0.8600||5.13%|
|Official NAV per Unit in USD||2023-12-06||2.2586||-0.0037||-0.16%|
*The last NAV per Unit in HKD is indicative and for reference purposes only. It is calculated using the last NAV per Unit in USD multiplied by an assumed foreign exchange rate using the exchange rate for HKD quoted by WM Reuters at 4:30 p.m. (New York time) as of the same dealing day. When the Hong Kong market is closed, the official last NAV per Unit in USD and the indicative last NAV per Unit in HKD will not be updated.
|Exchange||Hong Kong Stock Exchange – Main Board|
|Date of Listing / Dealing||13 Jan 2023|
|Primary Exchange Time Zone||GMT+8|
|Exchange Ticker||3135 HK|
|Bloomberg Ticker||3135 HK|
|Trading Board Lot||50 Units|
|Mirae Asset Securities (HK) Limited
Korea Investment & Securities Asia Limited
SinoPac Securities (Asia) Limited
China Merchants Securities (HK) Co., Limited
|Click here for latest Market Maker list|
|2023-11-30||Interim Financial Report 2023|
|2023-01-10||Product Key Fact Sheet|
|2023-10-31||Flyers as of Oct 2023|
|2023-11-30||Announcement - Interim Financial Report 2023|
|2023-01-12||Announcement - Indicative Net Asset Value of the Sub-Fund|
|2023-11-30||Announcement - Interim Financial Report 2023|
|2023-01-12||Announcement - Indicative Net Asset Value of the Sub-Fund|
|1 Mth||3 Mth||6 Mth||1 Year||YTD||Since
|SAMSUNG Bitcoin Futures Active ETF||-||-||-||-||-||-|
|SAMSUNG Bitcoin Futures Active ETF||-||-||-||-||-||-||-|
- Past performance is not indicative of future performance.
- Fund performance is calculated on NAV to NAV basis in USD and assumes dividend reinvestment.
- The figures show by how much the ETF increased or decreased in value during the calendar year being shown.
- Where no past performance is shown, there was insufficient data available for that period to provide performance.
- The performance of the ETF may not reflect the return that the investor would actually be able to obtain as it does not capture the premium / discount of the ETF, or the trading costs.
- Investment involves risks. Investors may not get back the full amount invested. Please refer to the offering documents for more information about the ETF (not just the risks)
- Fund listing date : 13 Jan 2023
- The last NAV per Unit in HKD is indicative and for reference purposes only. It is calculated using the last NAV per Unit in USD multiplied by an assumed foreign exchange rate using the exchange rate for HKD quoted by WM Reuters at 4:30 p.m. (New York time) as of the same dealing day. When the Hong Kong market is closed, the official last NAV per Unit in USD and the indicative last NAV per Unit in HKD will not be updated.
Holdings Overview as of 2023-12-06
Total Net Asset Value(USD)
(Deemed Total Net Asset Value (USD)*)
|Total Value of Futures Contract(USD)||Futures Contract Exposure**|
* Deemed Total Net Asset Value incorporates Creation/Redemption order amounts of above date.
** % of Futures Contract in Deemed Total Net Asset Value
|MICRO BTC 1223||BMRZ3||33.0|
|Cash and Cash Equivalents(HKD & USD)||71.29%|
* Short term bonds, MMFs and etc.
|Ex-Date||Record Date||Payable Date||Dividend Per Share|
- Data to be shown after the first dividend pay out is made.
a) “Net Distribution Income” means (i) the net investment income (i.e. dividend income and interest income net of fees and expenses) attributable to the relevant unit class and may also include net realized gains (if any) based on unaudited management accounts. However, “net distributable income” cannot include net unrealized gains. (ii) which is not declared and paid as dividends in a period of a financial year can be carried forward as net distributable income for the next period(s) within the same financial year. “Net distributable income” that has been accrued as at the end of a financial year and is declared and paid as dividends at the next distribution date immediately after that financial year end could be treated as “net distributable income” in respect of that financial year. However, “net distributable income” which has been accrued as at the end of a financial year but is not declared and paid as dividends at the next distribution date immediately after that financial year end should be included as “capital” for the next financial year. (iii) where the fund may pay dividend out of gross income while charging / paying all or part of the fund’s fees and expenses to / out of capital, the amount of fees and expenses that has been paid out of capital has to be deducted from the gross investment income in order to come up with the “net distributable income”.
b) The composition of the latest dividends (i.e. relative amounts paid from (i) net distributable income and (ii) capital) for the last 12 months are available from the Manager on request and on www.samsungetfhk.com. The Manager may amend the above dividend policy with respect to payment of fees and/or dividends out of capital subject to the Securities and Futures Commission’s prior approval and by giving not less than one month’s prior notice to investors.
Please note that a positive distribution yield does not imply a positive return nor guarantee of distribution. Investors should not make any investment decision solely based on information contained in the table above. You should read the relevant offering document (including the key facts statement) of the fund for further details including the risk factors.
Important information about Dividend out of capital / effectively out of capital
- The Manager may in its discretion make cash distributions to Unit holders out of capital or out of gross income (while charging/paying all or part of the Product’s fees and expenses to/out of the capital of the Product) resulting in an increase in distributable income for the payment of distributions which is in effect a payment of distributions out of capital.
- Payment of distributions out of capital or effectively out of capital amounts to a return or withdrawal of part of an investor’s original investment or from any capital gains attributable to that original investment. Any distributions involving payment out of or effectively out of the Product’s capital may result in an immediate reduction of the Net Asset Value per Unit.
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