Fintech

Consolidating and assessing climate and transition risks within operations is growing in importance. To do this effectively, a new infrastructure may be required. Examples include: data sourcing, data management, risk decision, monitoring and reporting.

When sectors of the economy engage in transformation, financing tools must also evolve. Green bonds and loans are examples of such innovation, however alternative offerings tailored to smaller enterprises could be developed to better address their needs.

The effective management and mitigation of climate related risks is growing in importance. The employment of insurance is a significant feature within this discipline. Examples vary from large scale natural disaster insurance to building insurance, especially in geographies vulnerable to the repercussions of climate change.

Accessing financial services is still an issue for many individuals. Fostering financial inclusion and making banking and insurance services available to a greater proportion of the world population, represents an opportunity for fintechs to make a positive impact.

A variation of the financial inclusion theme is the distribution of insurance products through non-traditional channels. Embedded insurance is growing and will allow more people to protect their belongings, assets and even potentially their health.

Services such as wealth management and tailored health insurance are expensive propositions. New technologies will allow more individuals to benefit from these services. Such technologies could prove to be important in the wellbeing of certain individuals.

Regulation & Compliance is an ever evolving field. They are growing in variety and complexity and as a consequence, there is a growing appetite for innovation. fintechs can promote governance by helping businesses understand and effectively address regulations.

Effective client due diligence is significant when onboarding new clients. Innovation in financial crime risk management could grow in importance as decentralised finance and crypto-currencies change the nature of financial crime risks.

With growing global wealth, financial market infrastructure could be stretched in areas such as payments and capital markets. New technologies could be designed to facilitate more sustainable growth.

Investing involves risk and the value of an investment and the income from it may fall as well as rise. You may not get back the full amount invested.

Further information on the potential risks can be found in the Key Investor Information Document (KID) and/or the Prospectus or Offering Memorandum.

• Market Risk: The value of investments may be affected by political and economic news, government policy, changes in technology and business practices, changes in demographics, cultures and populations, natural or human-caused disasters, pandemics, weather and climate patterns, scientific or investigative discoveries, costs and availability of energy, commodities and natural resources. The effects of market risk can be immediate or gradual, short-term or long-term, narrow or broad
• Fintech-Specific Risk: Start-ups and growth-stage companies in the financial technology sector may face unique regulatory hurdles, rapid technological changes, data privacy challenges, and cyber risks. These companies are often subject to evolving compliance obligations and competitive pressures from both incumbents and emerging firms
• Liquidity Risk: An investment in the Fund must be considered illiquid. The units of the Fund would not have a secondary market and there is generally no right to redeem. Investors should be prepared to bear the risk of owning their interests in the Fund for an extended period
• Valuation risk: Valuing fintech companies, especially privately held or emerging ones, may involve significant estimation and judgement. As such, valuations may be subject to revision and may not reflect the true market value.
• Operational and model risks: Fintech strategies often rely on complex technologies and proprietary models. They can fail to perform as expected or may be subject to cyber and operational vulnerabilities
• Leverage and counterparty risk: If leverage or derivative instruments are used, this may amplify returns as well as losses. There is also a risk that counterparties to financial transactions may default their obligations
• Not suitable for all investors: Fintech-related investments are generally considered speculative and are not suitable for all investors. They may only be appropriate for those with a high-risk tolerance and a long investment horizon. Before making an investment decision, prospective investors should review the full documentation of the fund and consult a qualified professional adviser to ensure the suitability of the investment in light of the financial circumstances and objectives

The presented fund is not authorized for public offering in Switzerland under Article 120 of the Federal Act on Collective Investment Schemes (CISA, KAG).

This material is exclusively intended for professional investors as defined in Article 4(3)(a-g) of the Swiss Financial Services Act (FinSA, FIDLEG).

This material is not intended for:

• Professional clients who are not institutional clients under Article 4(4) FinSA and who wish to opt-in for treatment as retail clients under Article 5(5) FinSA Or
• High-net-worth (HNW) retail clients and private investment structures created for them, who may declare themselves as professional investors (opting out)

Additional opting-in and opting-out options are available under FinSA. For further details, please refer to our website: https://www.assetmanagement.hsbc.ch/. If you wish to change your client categorization, please inform us.

Important Notice

When distributing this material solely to professional investors, the local business developer/client services team must include a copy of the Key Information Document (KID) and the Prospectus in the documentation. Please refer to the investor category overview for further details. HSBC Global Asset Management (Switzerland) AG having its registered office at Gartenstrasse 26, PO Box, CH-8002 Zurich has a license as an asset manager of collective investment schemes and as a representative of foreign collective investment schemes. Disputes regarding legal claims between the Client and HSBC Global Asset Management (Switzerland) AG can be settled by an ombudsman in mediation proceedings. HSBC Global Asset Management (Switzerland) AG is affiliated to the ombudsman FINOS having its registered address at Talstrasse 20, 8001 Zurich.

Investments in financial instruments carry general risks. For further details, please refer to the Swiss Bankers Association (SBA) brochure: "Risks Involved in Trading Financial Instruments."