PAK | Global X MSCI Pakistan ETF

PAK ISSUER

Global X Funds, as the issuer of the PAK fund, focuses on investing in the securities of the MSCI All Pakistan Select 25/50 Index, along with American Depositary Receipts (ADRs) and Global Depositary Receipts (GDRs) based on the securities in the Underlying Index. This fund invests primarily in companies economically tied to Pakistan, aligning with its investment objective. The fund's investment policies, requiring at least 80% investment in the Underlying Index and economically tied companies, are non-fundamental and subject to shareholder notice before changes. The Underlying Index, provided by MSCI, represents the broad Pakistan equity universe with minimal constituents and is independently sponsored by MSCI. Global X Management Company LLC employs a passive indexing approach, aiming to mirror the Underlying Index's performance rather than outperforming it. While the fund generally employs a replication strategy to mimic the Underlying Index's composition, it may resort to a representative sampling strategy under certain circumstances. With an expected correlation exceeding 95% between the Fund's performance and the Underlying Index, investors can anticipate a close alignment in returns. Additionally, the Fund's concentration in specific industries mirrors that of the Underlying Index, with a notable exposure to the materials sector as of December 31, 2022.

PAK DIVIDEND

Investors in the Global X Funds PAK ETF may benefit from potential dividends derived from the underlying securities held within the fund. The dividend yield of PAK is contingent upon the dividend-paying policies of the companies represented within the MSCI All Pakistan Select 25/50 Index, as well as any dividends accrued from American Depositary Receipts (ADRs) and Global Depositary Receipts (GDRs) included in the fund's portfolio. As of its investment strategy, which involves focusing on companies economically tied to Pakistan, dividend distributions may vary depending on the performance and dividend policies of these entities. Given the fund's passive indexing approach, investors can expect dividends to reflect the overall performance of the underlying index constituents, providing a potential income stream to investors seeking exposure to the Pakistani equity market. However, it's important to note that dividends are not guaranteed and may fluctuate over time based on various market conditions and company-specific factors.

PAK TRACKING

The tracking performance of the Global X Funds PAK ETF is closely tied to its benchmark index, the MSCI All Pakistan Select 25/50 Index. PAK aims to replicate the performance of this index by investing at least 80% of its total assets in securities that mirror the composition of the benchmark. Utilizing a replication strategy, the fund seeks to match the relative weightings of the securities in the underlying index, thereby aiming for a high degree of correlation with the index's performance. However, in certain situations where replication might be impractical or costly, such as when certain securities become illiquid or unavailable, the fund may resort to a representative sampling strategy. Despite potential deviations from exact replication, investors can expect PAK to closely track the performance of the MSCI All Pakistan Select 25/50 Index, with an anticipated correlation exceeding 95%. This tracking alignment offers investors a convenient and efficient means to gain exposure to the Pakistani equity market while minimizing tracking error.

PAK CORRELATION

The correlation of the Global X Funds PAK ETF with its underlying benchmark index, the MSCI All Pakistan Select 25/50 Index, serves as a key metric for investors assessing the fund's performance consistency. PAK aims to maintain a correlation exceeding 95% with the index, indicating a strong alignment between the fund's returns and those of the underlying securities. This high correlation reflects the fund's commitment to replicating the index's composition and relative weightings through its investment strategy. By closely tracking the index, PAK offers investors a reliable tool to gain exposure to the Pakistani equity market without the need for active management. However, it's important to note that while a high correlation suggests consistency in performance, it does not guarantee identical returns, as factors such as fees, expenses, and implementation strategies may lead to minor deviations from the index's performance over time

PAK SECTOR

The sector composition of the Global X Funds PAK ETF reflects the broader landscape of the Pakistani equity market, with holdings distributed across various industries. As of its investment strategy, PAK concentrates its investments in sectors to a degree similar to the concentration observed in its benchmark index, the MSCI All Pakistan Select 25/50 Index. The sector exposure of PAK may evolve over time based on changes in market conditions and economic trends within Pakistan. Additionally, as of December 31, 2022, the index had notable exposure to the materials sector, indicating that PAK's holdings may mirror this sectoral emphasis. However, investors should keep in mind that sector allocations within PAK can fluctuate, influenced by factors such as market dynamics, regulatory changes, and shifts in investor sentiment. Therefore, PAK offers investors a diversified approach to gaining exposure to various sectors of the Pakistani economy, potentially capturing opportunities for growth and diversification within the market.

PAK EXPOSURE

The exposure provided by the Global X Funds PAK ETF offers investors a convenient avenue to gain access to the Pakistani equity market. PAK invests at least 80% of its total assets in securities that replicate the composition of its benchmark index, the MSCI All Pakistan Select 25/50 Index. This index encompasses a broad range of Pakistani equities, including companies classified within Pakistan according to the MSCI Global Investable Market Index Methodology, as well as those headquartered or listed in Pakistan with significant operations in the country. Additionally, PAK may invest in American Depositary Receipts (ADRs) and Global Depositary Receipts (GDRs) based on the securities in the underlying index, further enhancing its exposure to Pakistani companies. By providing exposure to a diverse array of sectors and companies within Pakistan's equity market, PAK enables investors to participate in the country's economic growth potential while mitigating individual stock risk through broad market exposure.