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.

• Risk that the Fund may not meet its investment objective and policy: There is no guarantee that the Fund will meet its investment objective. The Fund’s ability to achieve its investment objective will depend in particular on, without limitation, the Fund successfully executing its investment objective and policy and the performance of the Investments. There can be no assurance as to the level of capital return and/or volatility over the Fund’s term
• 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
• Venture Capital Risk: Investment in unquoted companies often involves assuming higher levels of risk given their early stage of development and absence of liquidity
• 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
• Investors in alternatives products should bear in mind that these products can be highly speculative and may not be suitable for all clients. Investors should ensure they understand the features of the products and Fund strategies and the risks involved before deciding whether or not to invest in such products. Such investments are generally intended for investors who are willing to bear the risks associated with such investments, which can include: loss of all or a substantial portion of the investment, lack of liquidity in that there may be no secondary market for the Strategy and none may be expected to develop; volatility of returns; prohibitions and/or material restrictions on transferring interests in the Strategy; absence of information regarding valuations and pricing; delays in tax reporting; key man and adviser risk; limited or no transparency to underlying investments; limited or no regulatory oversight and less regulation and higher fees than mutual strategies
• Please note that alternatives related investments are generally illiquid, long term investments that do not display the liquid or transparency characteristics often found in other investments (e.g. listed securities). It can take time for money to be invested and for investments to produce returns after initial losses. As such alternatives related investments should be considered as a very high risk investment and are only suitable as part of a diversified portfolio. Before making such investments, prospective investors should carefully consider the risks set forth in the relevant investment documents. If you are in any doubt about the contents of the relevant investment documents you should consult your accountant, legal or professional adviser or financial adviser

For Professional Clients only and should not be distributed to or relied upon by Retail Clients.

Issued and approved in the UK by HSBC Global Asset Management (UK) Limited (“AMEU”), which is authorised and regulated by the Financial Conduct Authority. HSBC Asset Management is a group of companies in many countries and territories throughout the world that are engaged in investment advisory and fund management activities, which are ultimately owned by HSBC Holdings Plc. HSBC Asset Management is the brand name for the asset management business of the HSBC Group.

The material contained herein is for marketing purposes and is for your information only. This document is not contractually binding nor are we required to provide this to you by any legislative provision. It does not constitute legal, tax or investment advice or a recommendation to any reader of this material to buy or sell investments. You must not, therefore, rely on the content of this document when making any investment decisions. This document is not intended for distribution to or use by any person or entity in any jurisdiction or country where such distribution or use would be contrary to law or regulation. This document is not and should not be construed as an offer to sell or the solicitation of an offer to purchase or subscribe to any investment. The contents are confidential and may not be reproduced or further distributed to any person or entity, whether in whole or in part, for any purpose. This document is intended for discussion only and shall not be capable of creating any contractual or other legal obligations on the part of AMEU or any other HSBC Group company. This document is based on information obtained from sources believed to be reliable but which have not been independently verified. AMEU and HSBC Group accept no responsibility as to its accuracy or completeness. Care has been taken to ensure the accuracy of this presentation but AMEU accepts no responsibility for any errors or omissions contained therein.

This document and any issues or disputes arising out of or in connection with it (whether such disputes are contractual or non-contractual in nature, such as claims in tort, for breach of statute or regulation or otherwise) shall be governed by and construed in accordance with English law.

Any views expressed were held at the time of preparation and are subject to change without notice. While any forecast, projection or target where provided is indicative only and not guaranteed in any way. AMEU accepts no liability for any failure to meet such forecast, projection or target. The value of investments and any income from them can go down as well as up and investors may not get back the amount originally invested. Any performance information shown refers to the past and should not be seen as an indication of future returns.

Recipients of this communication who intend to acquire an investment in a Fund are reminded that any such acquisition may only be made on the basis of the final form of the Offering Memorandum or Prospectus, fund legal documentation, and on satisfaction of the requirements of the applicable Subscription Document. It is the responsibility of prospective investors to satisfy themselves as to full compliance with the relevant laws and regulations of any territory in connection with any application to participate in the Fund.

Detailed information for article 8 and 9 sustainable investment products, as categorised under the Sustainable Finance Disclosure Regulation (SFDR), including; description of the environmental or social characteristics or the sustainable investment objective; methodologies used to assess, measure and monitor the environmental or social characteristics and the impact of the selected sustainable investments and; objectives and benchmark information, can be found at:

www.assetmanagement.hsbc.co.uk/en/institutional-investor/investment-expertise/sustainable-investments/sustainable-investment-product-offering

To help improve our service and in the interests of security we may record and/or monitor your communication with us. AMEU provides information to Institutions, Professional Advisers and their clients on the investment products and services of the HSBC Group.

www.assetmanagement.hsbc.com/uk

Copyright © HSBC Global Asset Management (UK) Limited 2024. All rights reserved.