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Hang Seng HSCEI Covered Call Active ETF (Listed Class)

Stock Code: 3519

Hang Seng HSCEI Covered Call Active ETF (the “Fund”) offers both listed class of Units (“Listed Class Units”) and unlisted classes of Units (“Unlisted Class Units”). Switching between Unlisted Class Units and Listed Class Units is not available.

(Capitalised terms used herein but not otherwise defined will have the same meanings as defined in the Hong Kong Offering Document of the Hang Seng Investment Funds Series IV (the “Series”) and the relevant Appendix of the Fund)

  • The Fund aims to generate income and maintain prospects for capital appreciation while mitigating some downside risk through the use of covered call strategy.
  • The Manager employs an actively managed investment strategy for the Fund. In addition to seeking to obtain exposure to the constituent equity securities in the Reference Index in substantially the same weightings as these securities have in the Reference Index through investing directly in constituent equity securities of the Reference Index and Reference Index ETF and long positions of financial derivative instruments ("FDIs"), the Fund also writes call options on the Reference Index.
  • The Fund adopts a covered call strategy which involves writing call options (including ETF options) on the Reference Index. A covered call strategy offers some downside protection but limits potential upside, such as to profit from a significant increase in the Reference Index beyond the option strike price and the premium received. Notwithstanding the downside protection of a covered call strategy, you will still suffer substantial or total loss if the Reference Index level drops significantly.
  • The use of futures contracts involves risks that are potentially greater than the risks of investing directly in securities and other more traditional assets. The risks include but not limited to market risk, volatility risk, leverage risk, margin requirement risk, negative roll yields and “contango” risk, reference Index Futures position limit risk and failure of clearing house risk.
  • The Fund is subject to investment risks, equity market risk, concentration and Mainland market risk, risks associated with investment in FDIs, risks of investing in other collective investment schemes, termination risk, and reliance on the same group risk.
  • The Manager may at its discretion pay dividend out of capital. Such distribution may represent a return of an investor’s original investment or related capital gains, and may result in an immediate reduction on the Net Asset Value per Unit.
  • Different classes units are subject to different pricing and dealing arrangements and may be at an advantage or disadvantage depending on market conditions. The Net Asset Value per Unit of different classes may be different due to different fees and cost arrangement applicable to the units.
  • The Listed Class Units is subject to trading risks (for example, exchange traded price of Listed Class Units may be different from the Fund’s net asset value), trading hour differences risk and reliance on market maker risks.

Why choose Hang Seng HSCEI Covered Call Active ETF?

Active management to balance growth and income

Enhances income potential and aims for monthly distributions1

The distribution is not guaranteed, and the dividends may be paid out of the capital.
Investors should be aware of point 6 of the important risk warnings.

Remains resilient amid volatile market

Active management to balance growth and income

Actively sells HSCEI call options in response to market conditions to generate option premium while retaining the HSCEI’s solid growth potential.
Active management:
Writes (sells) Hang Seng China Enterprises Index call options, adjusting moneyness in line with prevailing market conditions.
Balances growth and income:
Generates option premium income while maintaining exposure to the HSCEI’s potential for growth.
Align with investor who:
  • Seeks to track the broad performance of Mainland China enterprises listed in Hong Kong.
  • Wants balanced exposure across “old” and “new” economy sectors.
  • Prioritises growth.
  • Aims to convert a portion of portfolio volatility into income.

Enhances income potential and aims for monthly distributions1

Generates option premium income by selling call options on the HSCEI to enhance portfolio yield potential.
** The distribution is not guaranteed, and the dividends may be paid out of the capital. Investors should be aware of point 6 of the important risk warnings.
Enhance Portfolio Income Potential

Remains resilient amid volatile market2

Seeks to build a less volatile portfolio and offset partial losses by writing call options.
HSCEI covered call strategy outperformed, with lower volatility
2020: Range-bound​
2021: Market downturn
HSCEI outperformed
2025: Market uptrend
2020: Range-bound 2021: Market downturn 2025: Market uptrend
Net total return Volatility Net total return Volatility Net total return Volatility
HSCEI Covered Call Index 3.0% 20.0% -12.1% 18.2% 22.1% 19.6%
Hang Seng China Enterprises Index -0.3% 24.3% -21.4% 22.9% 26.4% 25.6%

What is a Covered Call Strategy?3

Underlying Holdings
+
Write(Sell) Call Options
=
Covered Call Strategy
What are the merits and risks of writing call options?
Merit 1
Enhance income potential
Merit 2
Offset partial losses from the stock holdings
Merit 3
Volatility is typically lower than that of standard passive index strategies
Risk 1
Capped upside potential
If the HSCEI rises above the option strike price, investors may be unable to fully participate in the upside. This strategy may underperform a traditional index strategy in a significant market rally.
Risk 2
Downside risk remains
If the underlying index falls more than the option premium earned, the premium income may be insufficient to offset the loss arising from the fall in the asset’s market value.

Fund Information

Key facts

Investment Objective

Generate income and maintain prospects for capital appreciation while mitigating some downside risk through the use of covered call strategy.

Stock Code
3519
Listing Date
8 May 2026
Listing Exchange
The Stock Exchange of Hong Kong Limited (the "SEHK")
Issue Price
9.6
Lot Size
100
ISIN Code
HK0001298436
Base Currency
HKD
Trading Currency
HKD
Aggregate Management Fee
Up to 0.70% in respect of the Listed Class only
Total Expense Ratio (TER)4
1.10%
[1]

The portfolio income shown in the chart is for illustrative purposes only. The income level is referenced to the historical annualised distribution yield of the relevant covered call option index, together with the fund manager’s active management considerations. Past performance may not be indicative of future performance. The fund manager does not guarantee regular distributions or (if distributions are made) the amount distributed. A positive distribution yield (if any) does not imply that a positive return can be achieved.

[2]

Source: Hang Seng Investment, Hang Seng Indexes Company, Bloomberg, as at 31 December 2025. All index returns are calculated on a net total return basis in Hong Kong dollars. The HSCEI Covered Call Index aims to replicate the portfolios that employ the "Covered Call" investment strategy on the Hang Seng China Enterprises Index (“HSCEI”). The index performance incorporates both the returns of the HSCEI and the returns from selling corresponding at-the-money call options. Actual fund investment strategies may differ from the performance of the HSCEI Covered Call Index. Volatility is calculated based on the annualised daily index performance. Investing involves risks, including the potential loss of principal. Given that the HSCEI Covered Call Index was launched in 2019, this document does not focus on specific dates but instead uses the past five calendar years as the basis for analysis, identifying representative years to highlight various market conditions. The years referenced are for illustrative purposes only. Investment product prices may rise or fall, and past performance may not be indicative of future performance.

[3]

Source: Hang Seng Investment. For illustrative purposes only. Investment involves risks (including the risk of loss of principal). The price of investment products may rise or fall, and past performance may not be indicative of future performance.

[4]

Source: As the fund is newly established, this figure is an estimate only and represents the sum of the estimated ongoing expenses chargeable to the units over a 12-month period expressed as a percentage of the estimated average NAV of the units over the same period. The actual figures may be different from the estimate. Please refer to the “Fees and Expenses” section in the Prospectus for details. This figure may vary from year to year.

Disclaimer

This document is prepared by Hang Seng Investment Management Limited (“HSVM”). The content of this document shall not be changed or modified and its content shall not be used in any other manner unless with the prior written consent of HSVM. At the time of publication of this document, certain information contained in this document was obtained and prepared from sources which HSVM believes to be reliable, and the opinions believes to be reliable, and the opinions contained herein are for general reference only. HSVM does not warrant, guarantee or represent the accuracy, validity or completeness of such information. The information contained in this document may be indicative only and has not been independently verified and no guarantee, representation, warranty or undertaking, express or implied is made as to the fairness, accuracy, completeness or correctness of any information, projections or opinions contained in this document or the basis upon which any such projections or opinions have been based and no responsibility or liability is accepted in relation to the use of or reliance on any information, projections or opinions whatsoever contained in this document. HSVM reserves the right to change the content of the document without notice. Re-distribution of any part of this document by any means is strictly prohibited. The document is for reference only and is the view of HSVM and does not constitute and should not be regarded as an offer, or solicitation or recommendation to anyone to deal in or invest into any investment product. You should read the relevant investment product’s offering document (including the full text of the risk factors and charges stated therein). Investment involves risks (including the risk of loss of capital invested), prices of investment product units may go up as well as down, past performance is not indicative of future performance. A positive distribution rate (if any) does not imply a positive return. Fund award (if any) is for reference only and does not guarantee any fund performance or the performance of HSVM. The investments mentioned or discussed in this document may not be suitable for all investors. If you have any doubt about the information or investment product (including its offering document), you should seek independent professional financial advice. HSVM will not be liable to anyone for any cost, claims, fees, penalties, loss or liability incurred if the contents of this document is improperly used. The content of this document shall not be duplicated or stored or distributed or “Hang Seng Investment Management Limited”, “恒生投資管理有限公司”, “恒生投資管理” , “恒生投資” or any marks containing these names shall not be used without the prior written consent of HSVM. HSVM and Hang Seng Indexes Company Limited and other index companies (collectively “Index Companies”) are separate and independent entities, HSVM’s views and opinions do not represent the views or opinions of the Index Companies and HSVM cannot influence Index Companies on any matter. Where the investment products referred to in the document have been authorized by the Securities and Futures Commission or the China Securities Regulatory Commission or other regulators (as the case may be), such authorization is not a recommendation or endorsement of the investment products and does not guarantee the commercial merits of the investment products or their performance. It does not mean the investment products are suitable for all investors nor is it an endorsement of their suitability for any particular investor or class of investors. This document has not been reviewed by the Securities and Futures Commission.