Global capital markets have experienced considerable turbulence since the second half of 2026, with a marked divergence emerging across major indices amid a confluence of uncertainties. The rally previously spearheaded by hard-tech sectors has transitioned into a consolidation phase, while the Hong Kong equity market has staged a robust recovery, underscoring its distinctive valuation appeal. Data from Wind reveals that the Hang Seng Index has surged 8.41% since July, leading major global benchmarks, whereas Japan's Nikkei 225 and Korea's KOSPI have declined by 8.64% and 18.48%, respectively, over the same period.
The driving force behind this rally is the persistent influx of "smart money." Southbound capital significantly increased its allocation to Hong Kong stocks during July and August, with net purchases reaching HKD 62.87 billion in July alone—a surge of over 130% compared to June. As of September 11, cumulative net southbound buying since July has approached HKD 100 billion, with tech leaders and dividend-yielding assets emerging as the primary targets of this capital flow. Against this backdrop, the ChinaAMC CSI Hong Kong Stock Connect Internet ETF Feeder Fund (A-share class: 027278, C-share class: 027279) officially began its offering period on September 14, 2026. The fund aims to track the performance of the CSI Hong Kong Stock Connect Internet Index (Ticker: 931637) indirectly via the ChinaAMC CSI Hong Kong Stock Connect Internet ETF, providing investors with an efficient conduit for one-stop allocation to leading Hong Kong-listed internet companies.
Zeroing In On Industry Leaders: AI Catalysts Elevate The Value Proposition Of HK-Listed Internet Giants
For discerning investors seeking exposure to Hong Kong's tech sector, the index selection is the critical first step. The CSI Hong Kong Stock Connect Internet Index (931637), with a base date of December 30, 2016, selects 30 leading listed companies whose principal business operations relate to the internet from the Stock Connect universe. The index spans core verticals including social media, e-commerce, local life services, frontier AI technologies, and digital entertainment, aiming to mirror the overall performance of internet-themed companies within the Stock Connect framework. The index is highly concentrated, encapsulating the core assets of China's internet economy. Its construction methodology inherently favors industry champions, a trait underscored by Wind data as of September 11, 2026, which shows the top five constituent stocks accounting for a combined 60.99% weight, and the top ten for 83.57%. These platform leaders possess mature business models and steady cash flows while concurrently investing in second growth curves such as AI. Bolstered by formidable barriers in capital, data, and user scale, these frontrunners exhibit stronger resilience against risks and higher certainty for long-term growth. Mirroring the industrial logic of the "Magnificent Seven" in the US Nasdaq, these dominant enterprises are better positioned to fully capitalize on industry tailwinds.
From a valuation perspective, following a period of deep prior corrections, the Hong Kong internet sector's valuations have been compressed to historically low levels. Wind data, as of September 11, 2026, shows the index's price-to-earnings ratio (PE-TTM) at 19.71 times and price-to-book ratio (PB) at 2.28 times, placing it at approximately the 8% and 1.16% percentile points, respectively, over the past five years. Horizontally, Hong Kong tech valuations remain substantially below principal tech benchmarks like the Nasdaq and the ChiNext Index. Given that the fundamentals of Chinese AI assets are deeply interwoven with the global tech wave and domestic industrial upgrades, this valuation gap does not yet appear to fully price in their growth potential. Historically, the index has demonstrated high beta characteristics, boasting an annualized volatility of approximately 35% and exhibiting potent offensive attributes during upward market phases. Data shows the index has led performance in up-years for Hong Kong equities: gaining 109.3% in 2020, followed by increases of 23.0% in 2024 and 27.0% in 2025. Conversely, this high beta also entails pronounced drawdowns during market declines, marking it as a typically high-volatility instrument suited for investors with a higher risk appetite seeking to capture Hong Kong's recovery upside. (Data source: Wind; trend comparison data spans 2022-09-10 to 2026-08-26; risk-return comparison data spans 2017.1.1 to 2025.12.31. The underlying index's net value growth rates over the last five complete fiscal years (2021-2025) were: -36.61%, -23.01%, -24.74%, 23.05%, and 27.02%. Interval return (annualized) = [(1+interval return)^(250/trading days)-1]*100%. Past index performance is not indicative of future results and does not represent fund performance. Performance of other funds managed by the fund manager does not guarantee the performance of this fund.)
Capital flows often provide the most compelling evidence. According to Wind data through August 26, 2026, the scale of products tracking the CSI Hong Kong Stock Connect Internet Index reached RMB 54.151 billion. This figure ranks first among six comparable indices for Hong Kong internet and tech, significantly outpacing peers such as the Guozheng HK Stock Connect Internet Index (RMB 412 million), the Hang Seng Internet Index (RMB 28.284 billion), and the CSI HK Stock Connect Technology Index (RMB 18.51 billion).
Passive Investing Excellence: ChinaAMC's Extensive Global ETF Footprint
Selecting an index fund entails not only evaluating the tracked index but also the expertise of the fund manager behind it. In the realm of passive investing, ChinaAMC stands as a clear industry leader. Having launched the country's first ETF in 2004—the ChinaAMC SSE 50 ETF—the firm has consistently spearheaded the evolution of index investing in China. Wind data indicates that as of July 31, 2026, ChinaAMC's ETF scale reached RMB 633.679 billion, ranking first in the industry. By July 30, 2026, its total ETF assets under management surpassed RMB 630 billion, with average daily scale for equity ETFs maintaining the top industry position for 21 consecutive years (2005-2025). As of August 5, the firm managed 132 non-money-market ETFs (excluding feeder funds). Ranging from broad-based to sector-specific themes and spanning domestic to overseas markets, ChinaAMC has crafted arguably the most comprehensive and advanced ETF product shelf in the industry, earning it the moniker of the "LEGO Master" of asset management. It is also the only fund company to have won the Passive Investment Golden Bull Award for eight consecutive years.
The firm brings equally profound experience and strategic foresight to the Hong Kong ETF segment. It issued the mainland's first cross-border ETF—the ChinaAMC Hang Seng Index ETF—and has subsequently launched several flagship products, including the Hang Seng Internet ETF and the Hang Seng Tech ETF, offering investors diversified tools for Hong Kong market allocation. Superior index-tracking capabilities and abundant on-exchange liquidity constitute pivotal factors for institutions and long-term capital when selecting Hong Kong tech ETFs. Strong investment research constitutes the bedrock of product success. ChinaAMC's Quantitative Investment Department, one of the industry's earliest dedicated quantitative teams, comprises nearly 40 seasoned investment professionals and researchers from domestic and international backgrounds. The designated fund manager, Lu Yayun, and his team bring profound experience in index investing, product management, and risk control, ensuring the fund's operational stability.
Seizing The Moment: Positioning For A Value Re-Rating Amid Structural Shifts
The primary market debate surrounding Hong Kong internet stocks currently centers on whether substantial AI investments might persistently erode profits. However, positive signals are increasingly evident. On one front, competitive intensity in sectors like food delivery is subsiding, freeing up room for margin expansion. Concurrently, AI commercialization is accelerating, with surging token call volumes boosting cloud vendor revenues. AI is transitioning from a cost center towards an incremental profit driver, potentially setting the stage for a "Davis Double Play" for the sector. While short-term market volatility may persist, extremely low valuations and a clear long-term thesis present a compelling window for strategic accumulation at lower levels. The launch of the ChinaAMC CSI Hong Kong Stock Connect Internet ETF Feeder Fund (A-share class: 027278, C-share class: 027279) arrives at an opportune moment, offering investors bullish on China's technological future a convenient instrument to share in the growth dividends of leading Hong Kong-listed internet enterprises.
Risk Disclosure: This fund is a feeder fund investing in a target ETF, which is an equity index fund. Consequently, the fund's risk and return profile is higher than that of hybrid, bond, or money market funds. As the fund invests in Hong Kong securities, it is subject to special risks associated with the Stock Connect mechanism, including differences in the investment environment, underlying assets, market regulations, and trading rules. These risks include significant price volatility in Hong Kong stocks, exchange rate risk, and risks arising from potentially non-continuous trading days under the Stock Connect mechanism. This fund is classified as a medium-to-high risk (R4) product; the specific risk rating result is subject to the ratings provided by the fund manager and sales institutions. The subscription fee for A-class shares does not exceed 0.3%; for C-class shares, the sales service fee is 0.2% per annum, with no subscription fee charged. The fund management fee is 0.15% and the custody fee is 0.05%. Performance of other funds managed by the fund manager does not guarantee the performance of this fund. Historical index performance does not indicate future fund performance. The fund manager is committed to managing fund assets with honesty, diligence, and responsibility but does not guarantee fund profitability nor a minimum return. This document is not a legal document and is for reference only. All information or opinions expressed do not constitute final operational advice for investment, legal, accounting, or tax matters, and the company does not provide any guarantee regarding final operational advice based on the contents of this document. Under no circumstances shall the company be liable for any losses incurred by anyone due to the use of any content in this document. The fund manager reminds investors of the "buyer beware" principle. Investment risks arising from fund operations, trading price fluctuations of listed fund shares, and changes in net asset value shall be borne by the investor after making an investment decision. Before investing, investors should carefully read the Fund Contract, Prospectus, and Product Key Facts Statement, fully understand the fund's risk-return characteristics and product features, carefully consider various risk factors, assess their own risk tolerance based on their investment objectives, horizon, experience, and financial condition, and make rational and prudent investment decisions based on an understanding of the product and suitability opinions, independently assuming investment risks. The products mentioned in this document are issued and managed by ChinaAMC Fund Management Co., Ltd. Distributors do not bear the responsibility for product investment, redemption, or risk management. Market risk exists; investment requires caution.
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