Fixed-Income

Fund house	Two-Year Ranking	Three-Year Ranking	Five-Year Ranking

ChinaAMC Fixed Income Team

Fully integrated team of 77 professionals, one of largest in the industry.

Investment Process

ChinaAMC’s fixed income team utilizes both top-down and bottom-up selection processes to manage portfolios.

Disciplined Investment Process

ChinaAMC’s fixed income team utilizes a disciplined investment process to systematically identify investment opportunities.

Research

Full range of strategies

Macro economy

Money market

Interest rate

Credit

Convertible bond

Global markets

Alternative investment

Each strategy team is led by a PM and joined by analysts and traders.

Regular strategy meetings

Daily: Information sharing

Weekly: Strategy formulation

Monthly: Investment guidance by the Investment Committee
Investment

Client analysis

Investment horizon

Target return

Risk tolerance

Investment restrictions

Other requirements

Portfolio construction

Asset allocation

Industry selection

Security selection
Compliance & Risk Control

Culture of firm-wide risk management

Both ex-ante and ex- post

Multi-layered and inter- departmental

Regulatory risk

Close communication with regulators

Credit risk

Internal credit rating by credit research team

Proprietary rating methodology & system

Bond-pool management

Liquidity risk

High-frequency monitoring of key liquidity-risk meas

Dedicated money-market trading team

Counterparty risk

Name-by-name exposure control
Trading

Centralized trading

department with execution independent from investment decision making

Fair trading policy

Entire process of order management and execution is system based and fully documented
Evaluation

Ex-post compliance and riskanalysis

Investment performance closely monitored by Head of Fixed Income and evaluated by the Investment Committee

Long track record of credit research

ChinaAMC’s in-house credit research team was set up in early 2006, one of the earliest in the industry to do so.

ChinaAMC’s Fixed-income Investment Team is embedded in the company-level Investment & Research Platform, which enables seamless communication and sharing with Marco and Equity team. The Credit Research Team is established under the Fixed-income Investment Team. It is given full room to conduct research independently.

Internal Rating Process - Rating Model

Our ratings are forward-looking and reflect our expectations for future financial and operating performance.

Our rating methodology is comprised of both Quantitative and Qualitative Analysis.

We have dedicated rating model for different industries and LGFV.

Issuance considerations include : the relative ranking of different classes of debt, and the assessment of credit support from other entities.

Quantitative Analysis

Scale
Profitability
Efficiency
Cash flow
Leverage

Qualitative Analysis

Industry Analysis
Business Profile
Market position
Financial Policy
Governance

Rating Criteria of Investment Portfolios

ChinaAMC’s proprietary rating system further breaks down external ratings to differentiate risks.

The Internal Rating

Provide a better rating distinction than External Rating which only has limited rating levels.

More objective and accurate using stringent standards ,deep research and investigation.

Excluding the bonds with the highest default risk.

Timely judgment on credit risk under frequent review on the outlook of the issuer.

Credit Risk Monitoring Mechanism

ChinaAMC’s proprietary credit risk monitoring system enables timely response to credit risk events.

Negative information monitoring:

Monitor negative news and information of the issuer including major changes and rating adjustments using IT system and manual screening daily.
Early-warning system

Setup a series of financial early-warning models to identify potential credit risk.
Credit blacklist

Establish a blacklist for companies with bad credit record and exclude them from the investable pool or downgrade according to the severity.

Risk Management Process

Risk control procedures are installed at every key step of the investment and operational process.

Investment activities shall be aligned with the regulations and the internal investment guidelines which is agreed by clients and the Investment Committee.

To timely detect risk points during investment process.

Risk management reports shall be timely delivered to the portfolio managers and the Investment Committee, etc.

Clear accountability to make sure full coverage of each risk point.