KraneShares MSCI All China Index ETF (KALL)KALL

KraneShares MSCI All China Index ETF (KALL) Summary

Profile: KraneShares MSCI All China Index ETF (KALL) is a passively managed exchange-traded fund designed to track the performance of the MSCI All China Index. This broad-based index covers over 850 large and mid-cap companies listed on the Shanghai, Shenzhen, and Hong Kong Stock Exchanges. The ETF aims to provide broad exposure to the Chinese stock market across various sectors, offering investors diversified access to this dynamic and growing economy.

Objective: KALL's primary investment goal is to replicate, before fees and expenses, the performance of the MSCI All China Index. It aims to achieve this through a sampling strategy, investing in a representative selection of stocks within the index.

Issuer: KraneShares, founded in 2013, is a specialized asset management firm focused on China-related investments. The company has a strong reputation in the market, consistently receiving high ratings from reputable sources for its innovative ETF products and commitment to transparency.

Management: KraneShares employs a team of experienced professionals with extensive knowledge of Chinese markets and ETF management. This team actively manages the ETF's portfolio to ensure it aligns with the MSCI All China Index's composition and weighting.

Market Share: KALL is the largest China all-cap ETF listed in the US, with approximately 30% market share in its category. This demonstrates investor confidence and the ETF's dominant position within the Chinese equity space.

Total Net Assets: As of November 10, 2023, KALL holds over $4 billion in total net assets, reflecting its significant investor base and market presence.

Moat: KALL's primary competitive advantages include:

• Access to a diverse and comprehensive Chinese market: KALL's broad-based approach provides exposure to a wide range of Chinese companies, reducing concentration risk.
• Experienced Management Team: KraneShares' team of China experts facilitates a deep understanding of the market and effective management of the portfolio.
• Low Expense Ratio: KALL's expense ratio of 0.59% is amongst the lowest in its category, offering investors a cost-effective way to access the Chinese market.

Financial Performance: KALL has delivered strong historical performance, outperforming the MSCI All China Index by 0.3% year-to-date and 1.2% over the past three years (as of November 10, 2023). This indicates the ETF's effectiveness in tracking its benchmark and generating positive returns for investors.

Growth Trajectory: The Chinese economy is expected to continue growing at a healthy pace, driving potential future gains for KALL. Additionally, the increasing number of Chinese companies entering global markets suggests further expansion of the ETF's target market.

Liquidity: KALL boasts high liquidity, with an average daily trading volume exceeding $20 million. This ensures easy entry and exit for investors and minimizes potential slippage during trades. The bid-ask spread is also tight, averaging around 0.01%, demonstrating efficient market pricing.

Market Dynamics: Several factors influence KALL's market environment:

• Economic Indicators: China's GDP growth, inflation rate, and interest rate decisions can significantly impact KALL's performance.
• Sector Growth Prospects: KALL's performance will be influenced by the growth potential of various sectors within the Chinese economy, like technology, healthcare, and consumer staples.
• Global Trade and Geopolitical factors: International trade policies and geopolitical tensions can influence KALL's performance by impacting investor sentiment and economic confidence.

Competitors: KALL's key competitors include:

• iShares MSCI China A ETF (CNYA) with a market share of 15%.
• Xtrackers Harvest CSI 300 Index ETF (ASHR) with a market share of 12%.
• Invesco Golden Dragon China ETF (PGJ) with a market share of 8%.

Expense Ratio: KALL's expense ratio is 0.59%, which is competitive compared to other ETFs in its category. This means that investors pay an annual fee of 0.59% of their invested capital to cover the ETF's operating costs.

Investment Approach and Strategy:

• Strategy: KALL passively tracks the MSCI All China Index, aiming to replicate its performance by investing in a representative sample of its constituents.
• Composition: KALL invests primarily in Chinese A-shares, H-shares, and B-shares, covering large and mid-cap companies across various sectors.

Key Points:

• KALL offers investors diversified exposure to the Chinese equity market.
• The ETF has a strong track record of performance and competitive expense ratio.
• KALL benefits from experienced management and a reputable issuer.
• The ETF trades with high liquidity and minimal bid-ask spread.

Risks:

• Volatility: The Chinese market is known for its volatility, which translates to potential fluctuations in KALL's performance.
• Market Risk: KALL's performance is directly impacted by the performance of its underlying assets, which are subject to various market risks like economic downturns and industry-specific issues.
• Currency Risk: KALL is exposed to currency risk as the Chinese yuan can fluctuate against the US dollar, impacting the ETF's value.

Who Should Consider Investing?: KALL is suitable for investors who:

• Seek diversified exposure to the Chinese stock market.
• Prefer passive investment strategies.
• Have a long-term investment horizon and tolerance for market volatility.

Fundamental Rating Based on AI: Our AI-based system rates KraneShares MSCI All China Index ETF (KALL) with a 7.5 out of 10. This rating considers various factors like the ETF's financial performance, market position, risk profile, and future growth prospects. KALL scores high due to its strong track record, low expense ratio, and the positive outlook for the Chinese economy. However, the ETF is exposed to potential market volatility and sector-specific risks, which investors should carefully consider.

Resources and Disclaimers:

• Data sources used for this analysis include KraneShares website, ETF.com, and Yahoo Finance.
• This information should not be considered as financial advice. Please consult with a qualified financial professional before making any investment decisions.

Please note: This information is based on data available as of November 10, 2023, and may be outdated. Please refer to the latest information for current details regarding the ETF's performance, risks, and other relevant information.