On the afternoon of October 15th, the Hong Kong Stock Connect innovative drug sector continued to rally, with ASCENTAGE-B leading gains of nearly 6%, while CStone Pharmaceuticals-B, Innocare Pharma-B, and 3SBIO rebounded by over 4%.

The Hong Kong Stock Connect Innovative Drug ETF (520880), which allocates 100% to innovative drug R&D companies, oscillated upward in the afternoon session, with intraday gains reaching as high as 2% and trading volume exceeding 340 million yuan.

Notably, the ETF continued to trade at a premium, reflecting relatively strong buying interest. Over the previous three days, the Hong Kong Stock Connect Innovative Drug ETF (520880) had attracted net subscriptions of over 129 million yuan on market dips.

On the news front, the ESMO (European Society for Medical Oncology) 2025 Annual Meeting will be held in Berlin from October 17-21, where multiple Chinese innovative drug companies will announce breakthrough clinical research results, involving significant progress in treatment areas including renal cancer and lung cancer.

From a liquidity perspective, the Federal Reserve turned "dovish" overnight, with Powell hinting at preserving the possibility of rate cuts in October. Against the backdrop of Fed rate cuts in Q4, Chinese and US pharmaceutical sectors are expected to experience synchronized momentum.

On the industry front, Innocare Pharma recently completed a BD transaction with $100 million upfront payment and total value exceeding $2 billion. Sinolink Securities pointed out that global innovative drug product licensing collaborations are intensifying toward year-end, with the innovative drug sector awaiting sustained catalysis from BD activities.

【Innovative Drug "New Force" — Hong Kong Stock Connect Innovative Drug ETF (520880): No CXO Exposure, Pure Innovative Drugs, High Elasticity in Hong Kong Stocks】

The Hong Kong Stock Connect Innovative Drug ETF (520880) passively tracks the Hang Seng Hong Kong Stock Connect Innovative Drug Selection Index, which currently contains no CXO exposure and allocates 100% to innovative drug R&D companies, representing a pure innovative drug index that precisely characterizes the hardcore strength of innovative drugs. Off-exchange investors can focus on its feeder fund: 025221.

Since the beginning of this year, the Hang Seng Hong Kong Stock Connect Innovative Drug Selection Index has shown higher elasticity and stronger offensive capability among similar indices. As of the end of September, it had accumulated gains of 108.14% year-to-date, leading among innovative drug indices.

The Hong Kong Stock Connect Innovative Drug ETF (520880) is the first ETF in the market tracking this index. As of the end of September, the fund had assets of 1.806 billion yuan and average daily trading volume of 493 million yuan since listing, making it the largest in scale and most liquid among ETFs tracking the same index.

Reminder: Market volatility may be significant recently, and short-term gains or losses do not indicate future performance. Investors must make rational investments based on their financial situation and risk tolerance, paying high attention to position sizing and risk management.

Risk Warning: The Hong Kong Stock Connect Innovative Drug ETF passively tracks the Hang Seng Hong Kong Stock Connect Innovative Drug Selection Index. The index base date is December 31, 2020, with publication date of July 17, 2023. Since the publication of the Hang Seng Hong Kong Stock Connect Innovative Drug Selection Index, the annual returns for complete years have been: 2021: -22.72%; 2022: -16.48%; 2023: -19.76%; 2024: -14.16%. Index constituent composition is adjusted timely according to index compilation rules, and historical backtesting performance does not predict future index performance. Individual stocks mentioned in the text are for display purposes only. Stock descriptions do not constitute investment advice in any form, nor do they represent holding information or trading activities of any fund under the management company. The fund management company assesses the risk level of the Hong Kong Stock Connect Innovative Drug ETF and Medical ETF feeder funds as R4-Medium-High Risk, suitable for aggressive (C4) and above investors, while Medical ETF and Pharmaceutical ETF risk levels are R3-Medium Risk, suitable for balanced (C3) and above investors. Any information appearing in this article (including but not limited to individual stocks, comments, predictions, charts, indicators, theories, any form of expression, etc.) is for reference only. Investors must take responsibility for any independent investment decisions. Furthermore, any views, analyses, and predictions in this article do not constitute investment advice in any form to readers, nor do they bear any responsibility for direct or indirect losses arising from the use of this article's content. Performance of other funds managed by the fund management company does not guarantee fund performance. Past performance of funds does not represent future performance. Fund investment involves risks, and fund investment should be approached with caution.

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