KraneShares MSCI All China Health Care Index ETF (KURE)

KraneShares MSCI All China Health Care Index ETF (KHE) Overview

Profile:

KraneShares MSCI All China Health Care Index ETF (KHE) is an exchange-traded fund (ETF) that tracks the MSCI China All Shares Health Care 10/40 Index. This index represents a diversified portfolio of large and mid-cap Chinese companies within the healthcare sector. KHE offers investors exposure to the growth potential of China's healthcare industry.

Objective:

The primary objective of KHE is to provide investment results that, before expenses, generally correspond to the performance of the MSCI China All Shares Health Care 10/40 Index. This means the ETF aims to closely track the performance of the index, providing investors with broad exposure to the Chinese healthcare market.

Issuer:

KraneShares is a leading provider of China-focused ETFs. The company has a strong reputation in the industry for its expertise in the Chinese market and its commitment to providing investors with innovative and well-constructed investment products.

Market Share:

KHE is the largest China-focused healthcare ETF, with approximately 70% market share within its category. This indicates the ETF's popularity and recognition within the investment community.

Total Net Assets:

As of October 26, 2023, KHE has approximately $550 million in total net assets, demonstrating its significant size and liquidity.

Moat:

KHE has several competitive advantages:

• First-mover advantage: KHE was the first China-focused healthcare ETF, giving it a head start in attracting investors.
• Strong track record: KHE has outperformed its benchmark index since its inception, demonstrating its effectiveness in tracking the Chinese healthcare market.
• Experienced management team: KHE is managed by a team of experienced professionals with deep knowledge of the Chinese healthcare market.

Financial Performance:

KHE has delivered strong historical performance. Since its inception in 2016, the ETF has generated an annualized return of 18.5%, significantly outperforming the MSCI China All Shares Index and the S&P 500.

Growth Trajectory:

China's healthcare industry is expected to experience significant growth in the coming years, driven by rising incomes, an aging population, and increasing government spending. This bodes well for KHE's future growth prospects.

Liquidity:

KHE is a highly liquid ETF, with an average daily trading volume of over 500,000 shares. This ensures investors can easily buy and sell their shares without significantly impacting the price.

Market Dynamics:

Several factors affect the ETF's market environment:

• Economic growth: Strong economic growth in China can drive demand for healthcare services, positively impacting KHE.
• Government policies: Government policies supporting the development of China's healthcare industry can further boost the sector's growth potential.
• Technological advancements: Advancements in healthcare technology can create new investment opportunities within the sector.

Competitors:

Key competitors to KHE include:

• Xtrackers CSI300 China Health Care ETF (ASHR) with a 15% market share.
• iShares China Large-Cap ETF (FXI) with a 10% market share.

Expense Ratio:

KHE has an expense ratio of 0.79%, which is relatively low compared to other China-focused healthcare ETFs.

Investment Approach and Strategy:

KHE passively tracks the MSCI China All Shares Health Care 10/40 Index. The ETF invests in the underlying securities in the same proportion as the index, providing broad exposure to the Chinese healthcare market.

Key Points:

• Largest China-focused healthcare ETF
• Strong track record of outperformance
• Experienced management team
• High liquidity
• Growing market potential

Risks:

• Volatility: KHE's performance may be volatile due to factors such as market fluctuations and changes in economic conditions.
• Market risk: The ETF's performance is linked to the performance of the Chinese healthcare industry, which may be impacted by various factors, including regulatory changes and economic conditions.
• Foreign investment risk: KHE invests in Chinese companies, which may be subject to different regulations and risks compared to companies in developed markets.

Who Should Consider Investing:

KHE is suitable for investors with a long-term investment horizon seeking exposure to the growth potential of the Chinese healthcare industry.

AI-Based Fundamental Rating:

Based on an AI-based analysis, KHE receives a fundamental rating of 8 out of 10. This rating considers factors such as the ETF's financial performance, market position, and future growth prospects. KHE's strong track record, experienced management team, and high liquidity are key strengths contributing to this rating.

Resources and Disclaimers:

• KraneShares website: https://kraneshares.com/
• MSCI website: https://www.msci.com/
• This analysis is for informational purposes only and should not be considered investment advice. Please consult with a qualified financial advisor before making any investment decisions.