NEW YORK--(BUSINESS WIRE)--As of market close on June 26, 2014, Market Vectors® ChinaAMC A-Share ETF (NYSE Arca: PEK®) will release its capital gains tax reserve back to PEK, it was announced today. The reserve’s release will add $0.07872 per share to PEK’s Net Asset Value.
Effective on June 26, 2014 at market close, PEK will no longer reserve 10 percent of its realized and unrealized gains from its A-Shares investments to meet any potential withholding tax liability that may be imposed by the People’s Republic of China, except with respect to realized and unrealized gains from PEK’s investments in A-Shares of land-rich enterprises, which are companies that have greater than 50% of their assets in land or real properties in China.
If China’s government begins applying rules regarding taxation of income from A-Shares investments to Renminbi Qualified Foreign Institutional Investors and/or begins collecting capital gains taxes on such investments, PEK could be subject to withholding tax liability. The impact of any such tax liability on PEK’s return could be material.
PEK seeks to replicate as closely as possible, before fees and expenses, the price and yield performance of the CSI 300 Index. The Index consists of 300 A-Share stocks listed on the Shenzen or Shanghai Stock Exchange.
About Market Vectors ETFs
Market Vectors exchange-traded products have been offered since 2006 and span many asset classes, including equities, fixed income (municipal and international bonds) and currency markets. The Market Vectors family is one of the largest providers of ETFs in the U.S. and worldwide.
Market Vectors ETFs are sponsored by Van Eck Global. Founded in 1955, Van Eck Global was among the first U.S. money managers helping investors achieve greater diversification through global investing. Today, the firm continues this tradition by offering innovative, actively managed investment choices in hard assets, emerging markets, precious metals including gold, and other alternative asset classes. Van Eck Global has offices around the world and managed approximately $32.9 billion in investor assets as of May 31, 2014.
The Market Vectors ChinaAMC A-Share ETF (“the Fund”) is subject to elevated risks associated with investments in securities of Chinese securities, including A-Shares, which include, among others, risks associated with the RQFII regime, political and economic instability, inflation, confiscatory taxation, nationalization and expropriation, market volatility, less reliable financial information, differences in accounting, auditing, and financial standards and requirements from those applicable to U.S. issuers, and uncertainty of implementation of existing Chinese law. In addition, the Fund is also subject to liquidity and valuation risks, currency risk, non-diversification risk, and other risks associated with foreign and emerging markets investments. Investors should be willing to accept a high degree of volatility and the potential of significant loss.
The Fund may gain exposure to the China A-Share market by directly investing in China A-Shares and investing in swaps that are linked to the performance of China A-Shares. The Adviser’s and Sub-adviser’s ability to manage the Fund depends upon the availability of China A-Shares and the willingness of swap counterparties to engage in swaps with the Fund linked to the performance of China A-Shares. The Fund may suffer significant losses if a swap counterparty fails to perform its obligations under the swap as a result of bankruptcy or otherwise. The Fund may enter into swap transactions with as few as one counterparty at any time. Swaps in which the Fund invests may need to be reset on a regular basis, which may increase the likelihood that the Fund will generate short-term capital gains and/or ordinary income. The Fund may also invest in shares of other funds, including exchange-traded funds (“ETFs”), and may absorb duplicate levels of fees with respect to investments in other funds.
CSI 300 Index and its logo are service marks of China Securities Index Co., Ltd. (“CSI”) and have been licensed for use by Van Eck Associates Corporation. The Market Vectors ChinaAMC A-Share ETF is not sponsored, endorsed, sold or promoted by CSI and CSI makes no representation regarding the advisability of investing in the Market Vectors ChinaAMC A-Share ETF.
The “Net Asset Value” (NAV) of a Market Vectors exchange-traded fund (ETF) is determined at the close of each business day, and represents the dollar value of one share of the fund; it is calculated by taking the total assets of the fund, subtracting total liabilities, and dividing by the total number of shares outstanding. The NAV is not necessarily the same as the ETF’s intraday trading value. Market Vectors ETF investors should not expect to buy or sell shares at NAV.
Fund shares are not individually redeemable and will be issued and redeemed at their NAV only through certain authorized broker-dealers in large, specified blocks of shares called “creation units” and otherwise can be bought and sold only through exchange trading. Creation units are issued and redeemed principally in kind. Shares may trade at a premium or discount to their NAV in the secondary market.
Investing involves substantial risk and high volatility, including possible loss of principal. An investor should consider the investment objective, risks, charges and expenses of the Fund carefully before investing. Please refer to the prospectus for complete risk information. To obtain a prospectus and summary prospectus, which contains this and other information, call 888.MKT.VCTR or visit marketvectorsetfs.com. Please read the prospectus and summary prospectus carefully before investing.
Not FDIC Insured – No Bank Guarantee – May Lose Value
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