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china new econ

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250% MarketGrader China Overseas200% 100 Index 150% The MarketGrader China 100 Index seeks to follow the most fundamentally sound companies with the best growth prospects in all of China but whose stocks are listed outside100% Mainland China, where strict restrictions on foreign ownership of local shares exist. Since its constituents are equally weighted the50% index gives each company an equal opportunity to contribute to the performance of the portfolio regardless of market size, sector or business model. It was designed to offer investors who follow market cap weight- 0% ed benchmarks an alternative way to capture the growth in one of the fastest growing economies in the emerging markets and the second largest in the world. -50% -100% 03/31/2016 12/31/2007 12/31/2008 12/31/2009 12/31/2010 12/30/2011 12/31/2012 12/31/2013 12/31/2014 12/31/2015 Index Rules Performance

Underlying Universe china overseas - pending Cumulative Total Return, Jan. 2008 - Mar. 2016* All data as of March 31, 2016 Companies domiciled in China, listed in 70% exchanges outside of Mainland China, in- cluding Hong Kong, Singapore and the U.S., 50% covered by MarketGrader.com. 30%

Objective 10% Designed to serve as the basis of investment funds providing access to investors to some -10% of the most promising stocks in China. -30%

Weighting -50% The index is equally weighted. 03/31/2016 -70% 12/31/2007 12/31/2008 12/31/2009 12/31/2010 12/30/2011 12/31/2012 12/31/2013 12/31/2014 12/31/2015 Rebalance Frequency Semi-annually on the third Friday of March MG China Overseas 100 - TR - GR and September. Cumulative 2008 2009 2010 2011 2012 2013 2014 2015 2016 3 Year 5 Year Inception Selection Criteria Stocks are selected based on their overall MGC OS -54.0 107.8 15.1 -32.3 22.3 32.2 -3.4 -3.3 -7.2 8.9 -5.0 4.4 Emerging Mkts MarketGrader fundamental score on a HSI - GR -46.1 56.6 8.3 -17.3 27.7 6.5 5.5 -3.9 -4.8 4.2 4.2 -3.8 scale of one hundred (100). Score is cal- 65% culated based on 24 fundamental factors All values in USD. Sources: FactSet, MarketGrader.com across Growth, Value, Profitability and Cash 45% Flow. 25% Annualized Returns, Volatility and Sharpe Ratio Market Cap Requirements 5% All selections must have a minimum total 3 Years 5 Years Since Inception (01/01/2008) market cap of $100 million. At least 25% of -15% Anlzd Anlzd Sharpe Anlzd Anlzd Sharpe Anlzd Anlzd Sharpe all index components must have a market Return StdDev Ratio Return StdDev Ratio Return StdDev Ratio -35% cap of at least USD $3 billion. MG China Overseas 100 2.88 22.16 0.13 -1.01 25.65 -0.04 0.52 30.57 0.01

Hang-55% Seng Index - GR 1.39 18.35 0.07 1.18 20.11 0.06 -0.09 23.32 -0.02 Liquidity Requirements 03/31/2016 A minimum 3-month daily traded value of All-75% values in USD. Frequency: Monthly Sources: FactSet, MarketGrader.com 12/31/2007 12/31/2008 12/31/2009 12/31/2010 12/30/2011 12/31/2012 12/31/2013 12/31/2014 12/31/2015 USD $2 million.

Sector Limits The number of selections in a single eco- Upside Capture & Downside Capture Ratios nomic sector cannot exceed 20% of the index (20 companies). 3 Years 5 Years Since Inception (01/01/2008) MG China Overseas 100 Up Down Capture Up Down Capture Up Down Capture Capture Capture Ratio Capture Capture Ratio Capture Capture Ratio

vs. HSI - GR 87.23% 84.06% 1.04 95.98% 100.00% 0.96 103.78% 102.61% 1.01

All values in USD. Frequency: Weekly Sources: FactSet, MarketGrader.com Licensing opportunities [email protected] Sources: FactSet, MarketGrader.com +1 (305) 529-1767 * The MarketGrader China Overseas 100 Index was first published on March 20, 2015. Backtested performance information is www.marketgrader.com purely hypothetical and is solely for informational purposes. Backtested performance does not represent actual performance, and should not be interpreted as an indication of actual performance. Past performance is not indicative of future results. Hang Seng Index is a registered trademark of HSI Securities Ltd. MarketGrader.com © 2016. MarketGrader China Overseas 100 Index

Index composition data as of April 9, 2016 china 200 china small cap Index Bio Top 20 Stocks by Fundamentals Average Market Cap $13,561.90 china 200 china small cap Ticker Name Grade Median Market Cap $4,551.43 BIDU Baidu, Inc. Sponsored ADR 86.5 Average 3 Mo. Dollar Volume $44,803,615.42 2018.HK AAC Technologies Holdings Inc. 82.1 Average 3 Mo. Trading Volume 14,013,124 HOLI HollySys Automation Technologies 81.3 Last Rebalance Date 3/21/16 327.HK PAX Global Technology Limited 80.8 Companies Replaced 38 3898.HK Zhuzhou CRRC Times Electric Co. 80.3 Biggest Sector Increase Utilities ATHM Autohome, Inc. Sponsored ADR 80.1 Biggest Sector Decrease Health Care QIHU Qihoo 360 Technology Co., Ltd. 78.8 NTES NetEase, Inc. Sponsored ADR 78.4 Fundamental Attributes Median YY YY, Inc. Sponsored ADR 78.3 Trailing P/E Ratio 15.4 CBPO China Biologic Products, Inc. 78.0 Forward P/E Ratio 5.9 2208.HK Xinjiang Goldwind Science & Tech. 77.9 Earnings Yield 6.0 1071.HK Huadian Power International Corp. 77.4 Price/Book Ratio 2.9 1999.HK Man Wah Holdings Limited 76.2 Revenue Change - 3 Years 74.1% 3908.HK China International Capital Corp. 75.5 Operating Income Change - 3 Years 96.8% 1776.HK GF Securities Co., Ltd. 75.4 Operating Margin 20.8% 2380.HK China Power International Dev. 75.4 Earnings per Share (EPS) 3-Year Growth 21.0% BABA Alibaba Group Holding Ltd. 75.3 Long-Term Debt to Capital 30.8% 165.HK China Everbright Limited 75.3 Return on Equity 17.2% 2382.HK Sunny Optical Technology 75.3 Dividend Yield 1.94% 700.HK Holdings Ltd. 73.3 Beta 0.55 china new economy china overseas 100 Sector Breakdown Most Selections Since Inception Ticker Name Times china new economy 9.0%china overseas 100 Consumer Discretionary 17.0% 1.0% Consumer Staples BIDU Baidu, Inc 18 16.2% Energy NTES Netease Inc 18 6.0% Financials 700.HK Tencent Holdings Ltd 18 Health Care 2018.HK AAC Technologies Holdings Inc 15 1.0% Industrials 688.HK China Overseas Land & Investment 15 Materials 20.0% Technology 303.HK VTech Holdings Ltd 14 20.0% Telecommunication 1880.HK Belle International Holdings Ltd 14 Utilities 2333.HK Great Wall Motor Co Ltd 12 10.0% 2020.HK Products Ltd 12 151.HK China Holdings Ltd 11 270.HK Ltd 11 Market Cap Breakdown 1109.HK Ltd 10 4.0% EDU New Oriental Education & Technol- 10 7.0% 18.0% 3898.HK Zhuzhou CSR Times Electric Co Ltd 10 Mega ( > $10B ) CYOU Changyou.com Ltd 10 Large ( $3B to $10B ) 460.HK Sihuan Pharmaceutical Holdings 9 Mid ( $1B to $3B ) Small ( $500M to $1B ) 1066.HK Shandong Weigao Group Medical 9 28.0% Micro ( < $500M ) 2128.HK China Lesso Group Holdings Ltd 9 2688.HK ENN Energy Holdings Ltd 9

43.0% 3618.HK Chongqing Rural Commercial Bank 8

EM Global

MarketGrader.com © 2016. Sources: FactSet, MarketGrader.com EM Global