Company: CAF
Filing Date: 2025-03-06
Form Type: N-CSR
Source: 0001104659-25-021323
Chunk: 58

Company: Morgan Stanley China A Share Fund, Inc.
Filing Date: 2025-03-06
Form: N-CSR
Chunk 58
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 sell or otherwise dispose of investments at inopportune times or prices, or impair the Fund's ability to meet its investment objective or invest in accordance with its investment strategies.

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Morgan Stanley China A Share Fund, Inc.

December 31, 2024

Principal Risks (unaudited) (cont'd)

ESG Investment Risk

To the extent that the Adviser and/or the Sub-Adviser consider environmental, social and/or governance ("ESG") issues as a component in their investment decision-making process, the Fund's performance may be impacted. Additionally, the Adviser's and/or the Sub-Adviser's consideration of ESG issues in its investment decision-making process may require subjective analysis and the ability of the Adviser and/or the Sub-Adviser to consider ESG issues may be difficult if data about a particular issuer (or obligor) is limited. The Adviser's and/or the Sub-Adviser's consideration of ESG issues may contribute to the Adviser's and/or the Sub-Adviser's decision to forgo opportunities to buy certain securities. ESG issues with respect to an issuer (or obligor) or the Adviser's and/or the Sub-Adviser's assessment of such may change over time.

Derivatives

The Fund may, but is not required to, use derivatives and other similar instruments for a variety of purposes, including hedging, risk management, portfolio management or to seek to earn income. Derivative instruments used by the Fund will be counted towards the Fund's exposure in the types of securities listed herein to the extent they have economic characteristics similar to such securities. A derivative is a financial instrument whose value is based, in part, on the value of an underlying asset, interest rate, index or financial instrument. Prevailing interest rates and volatility levels, among other things, also affect the value of derivative instruments. Derivatives and other similar instruments that create synthetic exposure often are subject to risks similar to those of the underlying asset or instrument and may be subject to additional risks, including imperfect correlation between the value of the derivative and the underlying asset, risks of default by the counterparty to certain transactions, magnification of losses incurred due to changes in the market value of the securities, instruments, indices or interest rates to which the derivative instrument relates, risks that the transactions may not be liquid, risks arising from margin and payment requirements, risk arising from mispricing or valuation complexity and operational and legal