The asset allocation strategy of the fund provides for close tracking of the target index by investing in the target etf. In the case of increased tracking deviations due to indexing adjustments or other factors, the fund manager should take reasonable measures to avoid further increases in tracking deviations, in an effort to keep average daily tracking deviations within 0. 35 per cent and annual tracking errors within 4 per cent. In the course of its investment operations, the fund will decide to trade in targeted etfs by way of first-market foreclosures or secondary market transactions for securities, taking into account a combination of compliance, risk, efficiency, cost, etc. The fund will also seek to enhance the fund's revenue by moderately participating in the targeted etf share transactions and requisitions, foreclosure portfolio arbitrage. In addition to etf, which is the main investment target, the fund may invest in indexed component units (including depository certificates), alternative component units (including depository certificates), public fund-raising funds (including etfs) associated with the target index, financial derivatives such as futures, which track the same index, and other financial instruments issued by law in domestic and offshore markets, in pursuit of performance as closely as possible. The purpose of the investments of the equity (including certificates of deposit) investment strategy of the fund in the index component of the target, the alternative component (all of which include certificates of deposit) is to build a portfolio of shares to obtain the value of the bid. This part of the asset investment is mainly based on a complete reproduction, i. E., the composition of the index's composition unit (with depository certificates) and its weightings in the fund's equity portfolio, adjusted accordingly to the target index composition unit (with depository certificates) and the movement of its weights. However, when special circumstances (e. G. Insufficient liquidity) lead to the unavailability of a sufficient number of equities, the fund manager will use other reasonable investment methods to construct the fund's actual portfolio and pursue the performance of the index as closely as possible. The special circumstances include, but are not limited to, the following: (1) limitations of laws and regulations; (2) significant under-mobility of index composition units (including depository certificates); (3) long-term cut-off of portfolio shares (including depository certificates) of the index; (4) other reasonable reasons leading to severe constraints on the tracking of the index by the fund manager. The derivatives investment strategy (1) the offshore financial derivatives investment strategy, in order to better achieve the fund's investment objectives, will, subject to the conditions, invest in financial derivatives such as forward contracts, swaps and foreign exchange transactions approved by the csrc, with a view to reducing the level of tracking errors. Based on the principles of risk management, the fund will, for hedging purposes, primarily select liquid and dynamic financial derivatives to be traded. In order to better track the target index, the fund can also manage the fund's investments and deal with exchange rate risks in the recovery process by investing in foreign exchange futures, foreign exchange forwards, foreign exchange swaps, etc. (2) in order to better achieve the investment objectives of the financial derivatives investment strategy within the country, the fund may invest shares in futures, stock options and national debt futures. The fund will conduct transactions based on the principles of risk management, primarily by selecting highly liquid, traded derivative contracts. 1) in the futures investment strategy, the fund's investment unit will be presented with futures in strict accordance with the principles of risk management and hedging, hedge systemic risks and liquidity risks in certain exceptional circumstances. Earnings-based futures investments use highly liquid, traded contracts, hedging operations such as multiple or empty hedges, and seek to leverage stock-based futures to reduce transaction costs and track errors of stock warehousing adjustments to achieve the goal of effectively tracking target indices. 2) the epi fund will participate in stock options trading for the main purpose of hedging, in accordance with risk management principles. The fund will determine the timing and proportion of investments involved in stock options transactions, taking into account investment objectives, scale limits, risk-return characteristics and the relevant qualifications and requirements of laws and regulations. The fund invests in stock options, and the fund manager will establish, in accordance with the precautionary principle, a stock options trading decision-making department or panel that will delegate responsibility for the investment approval of stock options to specific managers in order to protect against the risks of stock options investments. 3) in accordance with the principles of risk management, the fund will invest in the futures of the national debt of the fund, with the aim of hedging, taking fully into account the liquidity and risk-return characteristics of the futures of the national debt, and will participate appropriately in futures investments of the national debt, subject to the control of risk. The fund may also participate in domestic financing and trans-lending of securities. The fund is involved in financing operations and will select the right counterparty, taking into account, inter alia, the cost of financing, the margin ratio, the offsetting bond conversion rate, and credit qualifications. At the same time, the ratio of financing is determined in the context of adequate liquidity of the fund's portfolio and effective control over the risk of leveraging finance. The fund's involvement in the transfer of securities lending will allow for a comprehensive analysis of market conditions, investor structure, historical ransoms of the fund, liquidity of loan securities, etc., and a reasonable determination of the scope, duration and proportion of the transfer of securities lending. In order to better achieve investment objectives, increase the return of funds and cover the costs of operating the fund, the fund may, subject to risk control, engage in offshore buy-back transactions and offshore stock lending transactions. In the future, with the development and enrichment of investment instruments in the securities market, the fund may adjust and update the relevant investment strategies as appropriate and announce them as required。
