Risks Associated with Securities
Investors should note that all investments involve risks. Prices of securities may go up as well as down and may even become valueless. Investors should not only base on this marketing material alone to make any investment decision, but should read in detail the relevant Risk Disclosure Statements.
Investors should note that investing in different Renminbi-denominated securities and products involves different risks (including but are not limited to currency risk, exchange rate risk, credit risk of issuer / counterparty, interest rate risk, liquidity risk (where appropriate)).
The key risks of investing in the securities of Shanghai-Hong Kong Stock Connect include:
Transactions under the Northbound or Southbound Trading of Shanghai-Hong Kong Stock Connect will not be covered by the Investor Compensation Fund in Hong Kong.
Once the respective quota is used up, trading will be affected or will be suspended.
Shanghai-Hong Kong Stock Connect will only operate on days when both markets are open for trading and when banks in both markets are open on the corresponding settlement days. Investors should take note of the days Shanghai-Hong Kong Stock Connect is open for business and decide according to their own risk tolerance whether or not to take on the risk of price fluctuations in securities during the time when Shanghai-Hong Kong Stock Connect is not trading.
When some stocks are recalled from the scope of eligible stocks for trading via Shanghai-Hong Kong Stock Connect, the stocks can only be sold but NOT bought.
Investors will be exposed to currency risk if conversion of the local currency into RMB is required.
Risks Associated with Investment Fund
Investors should note that all investments involve risks (including the possibility of loss of the capital invested), price of fund units may go up as well as down and past performance is not indicative of future performance. Investors should read the relevant fund’s offering documents (including the full text of the risk factors stated therein) in detail before making any investment decision.
With respect to investing in RMB investment funds, non-RMB based investors are exposed to fluctuations in the RMB exchange rate against their base currencies. If investors wish or intend to convert the redemption proceeds (in RMB) into a different currency (for example Hong Kong dollars), they are subject to the relevant foreign exchange risk and may incur substantial capital loss from such conversion. There is no guarantee that RMB will not depreciate.
Investors should note that funds denominated in RMB involve RMB currency risk. Besides general exchange rate risks, RMB is subject to foreign exchange control by the PRC government. Furthermore, funds with underlying investments which are not denominated in RMB are subject to multiple currency conversion costs involved in making investments and liquidating investments, as well as the RMB exchange rate fluctuations and bid/offer spreads when assets are sold to meet redemption requests and other capital requirements (e.g. settling operation expenses). Apart from the RMB currency risk, investors should also note the other risk disclosures stated in the offering documents of the relevant funds, including but not limited to limited availability of underling investments denominated in RMB, credit risk of counterparties, interest rate risk, liquidity risk, possibility of not receiving RMB upon redemption etc (if applicable). If the funds invest in offshore RMB debt securities, investors should note that the quantity of debt securities issued outside mainland China that are available to the funds is currently limited, which may adversely affect the performance and return of the funds. This type of funds is denominated in RMB, but they are not protected deposit, they are not protected by the Deposit Protection Scheme in Hong Kong.
An ETF (“Exchange Traded Fund”) is different from a typical unit trust as it is listed on The Stock Exchange of Hong Kong Limited, and like other listed stocks, carry similar risks such as liquidity risk and risk of trading suspension. The market price per Unit could be significantly higher or lower than its net asset value per unit due to market demand and supply, liquidity and scale of trading spread in the secondary market and will fluctuate during the trading day.
Risk Associated with the MRF Arrangement
Quota restrictions: The Mainland-Hong Kong Mutual Recognition of Funds (MRF) scheme is subject to an overall quota restriction. Subscription of units in the Fund may be suspended at any time if such quota is used up.
Failure to meet eligibility requirements: If a Recognized Mainland Fund ceases to meet any of the eligibility requirements under the MRF, it may not be allowed to accept new subscriptions. In the worst scenario, the SFC may even withdraw its authorization for the Fund to be publicly offered in Hong Kong for breach of eligibility requirements. There is no assurance that the Fund can satisfy these requirements on a continuous basis.
Mainland tax risk: The tax arrangement on Mainland tax relating to investment in a Recognized Mainland Fund is currently unclear. Investors may be subject to uncertainties in the Mainland tax liabilities.
Different market practices: Market practices in the Mainland and Hong Kong may be different. In addition, operational arrangements of Recognized Mainland Funds and other public funds offered in Hong Kong may be different in certain ways. For example, a Recognized Mainland Fund may only accept subscriptions or redemption of units on a day when both the Mainland and Hong Kong markets are open, or it may have different cut-off times or dealing day arrangements versus other Hong Kong funds. Investors should ensure that they understand these differences and their implications.
Concentration Risk / Mainland Market Risk: The Fund invests primarily in securities related to the Mainland market and may be subject to additional concentration risk. Compared to investment in other markets, investing in the Mainland may give rise to different risks including political, policy, tax, economic, foreign exchange, legal, regulatory and liquidity risks.
Risks Associated with Capital Protected Investment Deposit
This is a structured product involving derivatives. The investment decision is yours but you should not invest in the Capital Protected Investment Deposit unless the intermediary who sells it to you has explained to you that the product is suitable for you having regard to your financial situation, investment experience and investment objectives. Investor should read the Important Facts Statement of the relevant investment type, the relevant term sheet, Terms and Conditions and risk disclosure statement before making any investment decision.
Investor should note that this product is not normal time deposit and thus should not be considered as normal time deposit or its alternative.
This product is not a protected deposit and is not protected by the Deposit Protection Scheme in Hong Kong.
Investment in this product is subject to the credit risk of the Bank.
Renminbi (RMB) is subject to foreign exchange control by the PRC government and thus investors investing in the Currency-Linked Capital Protected Investment Deposit involving RMB are subject to the currency risk of RMB.
Risk Disclosure of MaxiInterest Investment Deposit
This is a structured product involving derivatives. The investment decision is yours but you should not invest in the MaxiInterest Investment Deposit unless the intermediary who sells it to you has explained to you that the product is suitable for you having regard to your financial situation, investment experience and investment objectives. Investors should read the relevant Important Facts Statement, Terms and Conditions and risk disclosure statement before making any investment decision.
Investors should note that this product is not capital protected and is not a normal time deposit, and thus should not be considered as normal time deposit or its alternative.
Earnings on this product are limited to the nominal interest payable. As the principal and the earning will be paid in the Deposit Currency or the Linked Currency, whichever has depreciated against the other, investors will have to bear the potential losses due to currency depreciation, which may be substantial. If the product is withdrawn before maturity, investors will also have to bear the costs involved. Such losses and costs may reduce the earnings and the principal amount of this product. Investors should seek professional advice where necessary. The relevant Terms and Conditions of this product are available upon request to the staff of the Bank.
This product is not a protected deposit and is not protected by the Deposit Protection Scheme in Hong Kong.
Investment in this product is subject to the credit risk of the Bank.
Renminbi (RMB) is subject to foreign exchange control by the PRC government and thus investors investing in the MaxiInterest Investment Deposit involving RMB are subject to the currency risk of RMB.
Risk Disclosure of FX and Precious Metal Margin Trading Services
The risk of loss in leveraged foreign exchange and precious metal trading can be substantial. You may sustain losses in excess of your initial margin funds. Placing contingent orders, such as “stop-loss” or “stop-limit” orders, will not necessarily limit losses to the intended amounts. Market conditions may make it impossible to execute such orders. You may be called upon at short notice to deposit additional margin funds. If the required funds are not provided within the prescribed time, your position may be liquidated. You will remain liable for any resulting deficit in your Account. You should therefore carefully consider whether FX and precious metal margin trading is suitable for you in light of your own financial position and investment objectives.
Renminbi (RMB) is subject to foreign exchange control by the PRC government. If your Margin Trading Contract involves Offshore Renminbi, you will be subject to foreign control and currency risk of RMB.
Investment involves risks. The above risk disclosure cannot disclose all the risks involved. You should read and understand all the relevant documents and risk disclosure (in particular, the Risk Disclosure Statement contained in the relevant application form) before making any investment decision.
The contents of this website have not been reviewed by any regulatory authority in Hong Kong. You are advised to exercise caution in relation to this website. If you are uncertain of or do not understand the nature of and the risks involved in leveraged foreign exchange and precious metal trading, you should seek independent professional advice.
Risk Disclosure for Structured Product
Investors should note that all investment involves risks. Prices of investment products may go up as well as down and may even become valueless. Investors should not only base on this marketing material alone to make any investment decision, but should read in detail the offering documents and the Risk Disclosure Statements of the relevant investment products.
Risk Warning of Equity Linked Structured Product
Investment involves risks. Prices of investment products may go up or down and may become valueless. Past performance of investment products may not be indicative of future performance. Investors should not only base on this marketing material alone to make any investment decision, but should read the relevant investment product's offering documents and Risk Disclosure Statements in detail before making any investment decision. Equity Linked Investments ("ELIs") are structured products involving derivatives. The investment decision is yours but you should not invest in the ELIs unless the intermediary who sells it to you has explained to you that the product is suitable for you having regard to your financial situation, investment experience and investment objectives. Investors should read the relevant offering documents of the ELIs before making any investment decision.
ELIs are not capital protected. In the worst case scenario, you could lose all of your investment.
ELIs are unlisted structured products embedded with derivatives and are not equivalent to nor should they be treated as time deposits. They are NOT protected deposits for the purposes of the Deposit Protection Scheme.
Investors should also read the risk factors set out in the relevant offering documents of the ELIs.
Risk Disclosure of Equity Linked Structured Product
The market value of the equity linked structured product may fluctuate and investors may sustain a total loss of their investment. Prospective investors should therefore ensure that they understand the nature of the equity linked structured product and carefully study the risk factors set out in the offering documents for the equity linked structured product and, where necessary, seek independent professional advice, before they decide whether to invest in equity linked structured product. If you purchase the equity linked structured product, you are relying upon the creditworthiness of the Issuer of equity linked structured product.
Renminbi (RMB) is subject to foreign exchange control by the PRC government and thus investors investing in this Product involving RMB are subject to the currency risk of RMB.
Risks Associated with RMB Bonds
Investment involves risks. The prices of bonds can and do fluctuate and any individual bond may experience upward or downward movements, and may even become valueless. There is an inherent risk that losses may be incurred rather than profit made as a result of buying and selling bonds. Holders of bonds bear the credit risk of the issuer.
RMB Currency Risk
Renminbi ("RMB") is subject to exchange rate risk. Fluctuation in the exchange rate of RMB may result in losses in the event that the customer subsequently converts RMB into another currency (including Hong Kong Dollars). Exchange controls imposed by the relevant authorities may also adversely affect the applicable exchange rate. RMB is currently not freely convertible and conversion of RMB may be subject to certain policy, regulatory requirements and/or restrictions (which are subject to changes from time to time without notice). The actual conversion arrangement will depend on the policy, regulatory requirements and/or restrictions prevailing at the relevant time.
