At a glance
KCAI charges 0.79% a year, above the 0.48% average of the 2 funds most like it (the most expensive of 3). It has $3.2M in assets, the 3rd largest of that group; it paid 185.7% of its price in distributions over the past 12 months, semiannual. Over the past year it returned +9.8% with distributions reinvested (S&P 500: +11.5%), the best of those 3 funds. Its ten largest positions make up 35.0% of the fund, out of 38 in all.
The short version
KraneShares China Alpha Index ETF (KCAI) tracks the Qi China Alpha Index, which uses a machine-learning model to pick up to 50 mainland Chinese stocks (China A-shares) it expects to beat the CSI 300, a benchmark of large Chinese companies. Its 0.79% expense ratio (annual fee) is above the 0.48% average of the similar funds we compared, and its assets were only about $3.2 million as of June 30, 2026.
Price history
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KCAI +9.8% over the year to Oct 27, 2026, total return with distributions reinvested.
How it has behaved
| YTD | 1 yr | 3 yr | 5 yr | 10 yr | Since start | |
|---|---|---|---|---|---|---|
| KCAI official prospectus, to Dec 31, 2025 | — | +52.90% | — | — | — | +47.74% |
| MSCI China All Shares Index (Reflects no deduction for fees, expenses or taxes) index, same period | — | +28.94% | — | — | — | +34.55% |
| Qi China Alpha Index (Reflects no deduction for fees, expenses or taxes) index, same period | — | +55.10% | — | — | — | +50.04% |
| KCAI price data to Oct 27, 2026 | +5.7% | +9.8% | — | — | — | +30.2% |
- Over the year to Oct 27, 2026, KCAI returned +9.8%, 1st of 3 among similar funds.
- Its worst full calendar year was 2025 (+53.0%); its best was 2025 (+53.0%).
- The deepest fall in its price history was 26.6% (Oct 7, 2024 to Apr 7, 2025), recovered by Aug 12, 2025.
Show as a table
| Year | Price data | Prospectus (official) |
|---|---|---|
| 2026 (to date) | +5.7% | — |
| 2025 | +53.0% | +52.90% |
| 2008 financial crisis stocks fell Oct 9, 2007 – Mar 9, 2009 | Before this security existed |
|---|---|
| 2020 COVID crash stocks fell Feb 19, 2020 – Mar 23, 2020 | Before this security existed |
| 2022 bear market stocks fell Jan 3, 2022 – Oct 12, 2022 | Before this security existed |
Dividends and income
Show as a table
| Year | Per share | Change |
|---|---|---|
| 2026 (to date) | $17.1300 | |
| 2025 | $10.8000 |
What's inside
As of Jun 30, 2026, the fund held 38 securities; the ten largest made up 35.05% of assets.
| Holding | Weight | |
|---|---|---|
| Zhejiang Juhua Co., Ltd. | 4.65% | |
| Wus Printed Circuit Kunshan Co Ltd | 3.97% | |
| Suzhou TFC Optical Communication Co Ltd | 3.79% | |
| Zhongji Innolight Co Ltd | 3.54% | |
| China Galaxy Securities Co., Ltd. | 3.34% | |
| SATELLITE CHEMICAL CO., LTD. | 3.24% | |
| INDUSTRIAL AND COMMERCIAL BANK OF CHINA LIMITED | 3.16% | |
| BANK OF CHINA LIMITED | 3.14% | |
| CHINA CONSTRUCTION BANK CORPORATION | 3.11% | |
| Bank of Beijing Co., Ltd. | 3.11% | |
| AGRICULTURAL BANK OF CHINA LIMITED | 3.08% | |
| Bank of Communications Co., Ltd. | 3.08% | |
| Bank of Shanghai Co., Ltd. | 3.07% | |
| Bank of Jiangsu Co., Ltd. | 3.06% | |
| HUA XIA BANK CO., Limited | 3.03% |
By country
China 100.77%By asset type
Stocks 100.77%What changed recently
- Over the three months to Jun 30, 2026, investors withdrew a net $7.9M (creations minus redemptions, per the N-PORT report).
- Monthly total returns reported for that quarter: -2.46%, +0.03%, +3.37%.
How it works
KCAI seeks to match, before fees, the Qi China Alpha Index, created by Quant Insight Ltd. and calculated by Solactive AG. The index aims to beat the CSI 300 Index, which tracks the 300 largest, most-traded China A-shares (shares of mainland companies listed in Shanghai and Shenzhen). A machine-learning model (software trained on historical prices, financial data, market trends, company size and sector) picks the stocks and sets their weights.
Candidates are Shanghai- and Shenzhen-listed A-shares with a market value of at least $1 billion, average 30-day trading value of at least $5 million, and not subject to U.S. sanctions. The model holds at most 50 stocks, capped at 5% each, and the index is rebuilt and reweighted monthly. The fund's portfolio turnover, a yearly measure of how much of the portfolio is replaced, was 174%. As of March 31, 2026, the index held 41 stocks, with financials at 41% and industrials at 21%.
The adviser, Krane Funds Advisors, invests mainly through Stock Connect, a trading link that runs through exchanges outside mainland China. It expects to hold every index stock, but up to 20% may go into other holdings such as derivative contracts, other funds or cash. The fund is non-diversified, so it can put more money into fewer companies.
What it really costs
- KCAI charges 0.79% a year, versus an average of 0.48% for the similar funds below (3rd of 3, cheapest first).
- Of that, 0.78% is the management fee; the rest covers other fund expenses.
- Using the prospectus's standard example, $10,000 invested would cost about $81 in the first year and $978 over 10 years (assuming a 5% annual return).
| Cost of $10,000 (SEC example) | 1 yr | 3 yrs | 5 yrs | 10 yrs |
|---|---|---|---|---|
| KCAI | $81 | $252 | $439 | $978 |
In a retirement portfolio
A concentrated, single-country fund of China A-shares, run by a machine-learning index with a record only since August 2024, fits a higher-risk satellite role rather than the core.
KCAI could add mainland Chinese stocks, which can move differently from U.S. shares. Launched August 28, 2024, it has no record from the 2008, 2020 or 2022 downturns. Its only full calendar year, 2025, gained 52.9%. Its deepest drop was 26.6%, from October 7, 2024 to April 7, 2025; it recovered by August 12, 2025, about 4.2 months after the low. Cashing out near that low to cover spending would have locked in steep losses.
It pays distributions twice a year, but payouts over the past year equaled 185.7% of the share price as of October 27, 2026, far beyond what stock dividends produce and no guide to future income. Costs are high: the SEC's standard $10,000 example shows $81 in expenses after one year and $978 after 10 years. Past results don't predict the future, and a plan should look at the whole portfolio, not one fund.
Who it may suit — and who should look elsewhere
May suit
- Investors who want China A-shares picked by a machine-learning model aiming to beat the CSI 300, and can accept a record starting August 2024.
- Those holding a small, higher-risk satellite slice who can sit through drops like the 26.6% fall from October 2024 to April 2025.
- Investors comfortable with a bank-heavy mix: June 30, 2026 holdings included Bank of China, China Construction Bank and other lenders at about 3% each.
Look elsewhere if
- Cost-focused investors: KCAI's 0.79% expense ratio is above ASHR's 0.65% and CXSE's 0.32%, both much larger funds.
- Those wary of tiny funds: assets were about $3.2 million as of June 30, 2026, and very small ETFs are more likely to close.
- Investors in taxable accounts wary of tax bills: payouts over the past year equaled 185.7% of the share price as of October 27, 2026.
Close alternatives
Matched by closest holdings overlap from the latest N-PORT reports (no similar fund shares 20% or more of its holdings).
Net assets from each fund's latest N-PORT or annual report where available. Returns through Oct 27, 2026.Questions investors ask
Is KCAI an AI ETF?
Not in the sense of owning AI companies; it uses AI to pick stocks. Its index, the Qi China Alpha Index, relies on a machine-learning model from Quant Insight Ltd. to choose up to 50 China A-shares and their weights each month, aiming to beat the CSI 300 Index. As of June 30, 2026, the fund held 38 stocks, led by Zhejiang Juhua at 4.6%, Wus Printed Circuit Kunshan at 4.0% and Suzhou TFC Optical Communication at 3.8%, plus many Chinese banks.
What's the difference between KCAI and ASHR?
ASHR tracks the CSI 300 Index itself, while KCAI tracks an index that tries to beat it. ASHR's index covers the 300 largest A-share companies; KCAI held 38 stocks as of June 30, 2026, and their holdings overlap by only about 9%. ASHR charges 0.65% a year versus KCAI's 0.79% and is far larger, at about $1.6 billion as of August 31, 2026. On price, KCAI gained 9.8% in the year to October 27, 2026, while ASHR lost 6.2%.
Did KCAI beat the Chinese stock market?
In its only full calendar year, yes. The fund returned 52.9% in 2025, versus 28.94% for the MSCI China All Shares Index, the broad benchmark in its prospectus. From its August 28, 2024 launch through December 31, 2025, it averaged 47.74% a year against 34.55% for that index. It trailed its own Qi China Alpha Index, which gained 55.1% in 2025, as index funds generally do after fees and trading costs. A record this short says little about whether the model will keep working.
Does KCAI pay dividends?
Yes, KCAI pays distributions twice a year. Payouts over the past year totaled $27.93 per share, equal to 185.7% of the share price as of October 27, 2026. That is far more than stock dividends normally produce, so it is not a guide to future income. Funds with high turnover, 174% for this one, can realize and distribute capital gains (trading profits), which are taxable in a regular brokerage account.
Is KCAI suitable for retirement?
It may suit only a small, higher-risk slice of a retirement portfolio, not the core. KCAI owns only Chinese stocks and follows a machine-learning index with a record starting in August 2024. It fell 26.6% from October 2024 to April 2025 before recovering. Its 0.79% expense ratio is above the 0.48% average of similar funds, and with about $3.2 million in assets as of June 30, 2026, it is very small; small funds are more likely to be closed.