Annual Report KraneShares CICC China Leaders 100 Index ETF KraneShares CSI China Internet ETF KraneShares Bosera MSCI China A Share ETF KraneShares E Fund China Commercial Paper ETF KraneShares MSCI All China Index ETF KraneShares MSCI One Belt One Road Index ETF KraneShares Emerging Markets Consumer Technology Index ETF KraneShares MSCI China Clean Technology Index ETF (Formerly, KraneShares MSCI China Environment Index ETF) KraneShares Electric Vehicles and Future Mobility Index ETF KraneShares MSCI All China Health Care Index ETF KraneShares CCBS China Corporate High Yield Bond USD Index ETF KraneShares Emerging Markets Healthcare Index ETF KraneShares MSCI Emerging Markets ex China Index ETF KraneShares MSCI China ESG Leaders Index ETF KraneShares Global Carbon ETF (Formerly KFA Global Carbon ETF) KraneShares CICC China 5G & Semiconductor Index ETF KraneShares CICC China Consumer Leaders Index ETF KraneShares SSE STAR Market 50 Index ETF March 31, 2021

Table of Contents

Shareholder Letter		1
Management Discussion of Fund Performance		4
Schedules of Investments/Consolidated Schedule of Investments
KraneShares CICC China Leaders 100 Index ETF		71
KraneShares CSI China Internet ETF		75
KraneShares Bosera MSCI China A Share ETF		78
KraneShares MSCI All China Index ETF		90
KraneShares MSCI One Belt One Road Index ETF		98
KraneShares Emerging Markets Consumer Technology Index ETF		104
KraneShares MSCI China Clean Technology Index ETF		108
KraneShares Electric Vehicles and Future Mobility Index ETF		111
KraneShares MSCI All China Health Care Index ETF		117
KraneShares CCBS China Corporate High Yield Bond USD Index ETF		120
KraneShares Emerging Markets Healthcare Index ETF		123
KraneShares MSCI Emerging Markets ex China Index ETF		128
KraneShares MSCI China ESG Leaders Index ETF		140
KraneShares Global Carbon ETF		145
KraneShares CICC China 5G & Semiconductor Index ETF		147
KraneShares CICC China Consumer Leaders Index ETF		149
KraneShares SSE STAR Market 50 Index ETF		151
Statements of Assets and Liabilities/Consolidated Statement of Assets and Liabilities		153
Statements of Operations/Consolidated Statements of Operations		159
Statements of Changes in Net Assets/Consolidated Statements of Changes in Net Assets		165
Financial Highlights/Consolidated Financial Highlights		180
Notes to Financial Statements/Consolidated Notes to Financial Statements		186
Report of Independent Registered Public Accounting Firm		218
Trustees and Officers of the Trust		221
Liquidity Risk Management Program		224
Approval of Advisory Agreements		225
Disclosure of Fund Expenses		231
Notice to Shareholders		234
Supplemental Information		236

The Funds file their complete schedules of Fund holdings with the Securities and Exchange Commission (the “Commission”) for the first and third quarters of each fiscal year as an exhibit to its reports on Form N-PORT within sixty days after the end of the period. The Funds’ Form N-PORT reports are available on the Commission’s website at http://www.sec.gov, and may be reviewed and copied at the Commission’s Public Reference Room in Washington, DC. Information on the operation of the Public Reference Room may be obtained by calling 1-800-SEC-0330.

A description of the policies and procedures that KraneShares Trust uses to determine how to vote proxies relating to Fund securities, as well as information relating to how the Funds voted proxies relating to Fund securities during the most recent 12-month year ended June 30, are available (i) without charge, upon request, by calling 855-857-2638; and (ii) on the Commission’s website at http://www.sec.gov.

Fund shares may only be purchased or redeemed from a Fund in large Creation Unit aggregations. Investors who cannot transact in Creation Units of a Fund’s shares must buy or sell Fund shares in the secondary market at their market price, which may be at a premium or discount to a Fund’s net asset value, with the assistance of a broker. In doing so, the investor may incur brokerage commissions and may pay more than net asset value when buying Fund shares and receive less than net asset value when selling Fund shares.

Shareholder Letter (Unaudited)

Dear Shareholders:

We are pleased to send you the Annual Report for KraneShares Exchange-traded funds (“ETFs”) for the 12-month period ended March 31, 2021.

For the period, the ETFs delivered the following returns:

Fund		Return			Underlying Index Return*			Morningstar Peer Group Median Return
KraneShares CICC China Leaders 100 Index ETF (KFYP)		28.90	%		32.82	%(a)		50.39	%(1)
KraneShares CSI China Internet ETF (KWEB)		67.77	%		69.26	%(b)		50.39	%(1)
KraneShares Bosera MSCI China A Share ETF (KBA)		50.00	%		51.10	%(c)		50.39	%(1)
KraneShares E Fund China Commercial Paper ETF (KCNY)		9.91	%		10.72	%(d)		13.47	%(2)
KraneShares MSCI All China Index ETF (KALL)		47.97	%		45.82	%(e)		50.39	%(1)
KraneShares MSCI One Belt One Road Index ETF (OBOR)		65.82	%		67.58	%(f)		27.03	%(3)
KraneShares Emerging Markets Consumer Technology Index ETF (KEMQ)		67.85	%		69.26	%(g)		62.08	%(4)
KraneShares MSCI China Clean Technology Index ETF (KGRN)		143.03	%		133.24	%(h)		50.39	%(1)
KraneShares Electric Vehicles and Future Mobility Index ETF (KARS)		122.46	%		124.89	%(i)		73.58	%(5)
KraneShares MSCI All China Health Care Index ETF (KURE)		61.06	%		63.50	%(j)		50.39	%(1)
KraneShares CCBS China Corporate High Yield Bond USD Index ETF (KCCB)		12.32	%		12.75	%(k)		19.30	%(6)
KraneShares Emerging Markets Healthcare Index ETF (KMED)		60.18	%		62.23	%(l)		62.08	%(4)
KraneShares MSCI Emerging Markets ex China Index ETF (KEMX)		71.19	%		68.77	%(m)		62.08	%(4)
KraneShares MSCI China ESG Leaders Index ETF (KESG)		29.05	%^		30.84	%(n)		N/A	​(1)
KraneShares Global Carbon ETF (KRBN)		41.95	%^		41.52	%(o)		N/A	​(N/A)
KraneShares CICC China 5G & Semiconductor Index ETF (KFVG)		-7.68	%^		-6.81	%(p)		N/A	​(1)
KraneShares CICC China Consumer Leaders Index ETF (KBUY)		3.28	%^		4.12	%(q)		N/A	​(1)
KraneShares SSE STAR Market 50 Index ETF (KSTR)		-15.76	%^		-16.59	%(r)		N/A	​(1)

*       Return as of March 31, 2021

^      Return period since Fund inception (less than one-year period):

KraneShares MSCI China ESG Leaders Index ETF, the Fund commenced operations on July 28, 2020.

KraneShares Global Carbon ETF, the Fund commenced operations on July 29, 2020.

KraneShares CICC China 5G & Semiconductor Index ETF, the Fund commenced operations on November 23, 2020.

KraneShares CICC China Consumer Leaders Index ETF, the Fund commenced operations on December 8, 2020.

KraneShares SSE STAR Market 50 Index ETF, the Fund commenced operations on January 26, 2021.

	Morningstar  Peer Group Median Return		Morningstar Peer Group Name
(1)	50.39%		U.S. ETF China Region
(2)	13.47%		U.S. ETF Emerging Markets Local Currency Bond
(3)	27.03%		U.S. ETF Infrastructure
(4)	62.08%		U.S. ETF Diversified Emerging Markets
(5)	73.58%		U.S. ETF Industrials
(6)	19.30%		U.S. ETF Emerging Markets Bond

Shareholder Letter (Unaudited) (continued)

(a)    The underlying index for KraneShares CICC China Leaders 100 Index ETF.

(b)    The underlying index for KraneShares CSI China Internet ETF.

(c)    The underlying index for KraneShares Bosera MSCI China A Share ETF.

(d)    The underlying index for KraneShares E Fund China Commercial Paper ETF.

(e)    The underlying index for KraneShares MSCI All China Index ETF.

(f)     The underlying index for KraneShares MSCI One Belt One Road Index ETF.

(g)    The underlying index for KraneShares Emerging Markets Consumer Technology Index ETF.

(h)    The underlying index for KraneShares MSCI China Clean Technology Index ETF.

(i)     The underlying index for KraneShares Electric Vehicles and Future Mobility Index ETF.

(j)     The underlying index for KraneShares MSCI All China Health Care Index ETF.

(k)    The underlying index for KraneShares CCBS China Corporate High Yield Bond USD Index ETF

(l)     The underlying index for KraneShares Emerging Markets Healthcare Index ETF.

(m)    The underlying index for KraneShares MSCI Emerging Markets ex China Index ETF.

(n)    The underlying index for KraneShares MSCI China ESG Leaders Index ETF.

(o)    The underlying index for KraneShares Global Carbon ETF.

(p)    The underlying index for KraneShares CICC China 5G & Semiconductor Index ETF.

(q)    The underlying index for KraneShares CICC China Consumer Leasers Index ETF.

(r)     The underlying index for KraneShares SSE Star Market 50 Index ETF.

The Morningstar Fund China Region Category portfolios invest almost exclusively in stocks from China, Taiwan, and Hong Kong. These portfolios invest at least 70% of total assets in equities and invest at least 75% of stock assets in one specific region or a combination of China, Taiwan, and/or Taiwan.

The Morningstar Fund Diversified Emerging Markets Category portfolios tend to divide their assets among 20 or more nations, although they tend to focus on the emerging markets of Asia and Latin America rather then those of the Middle East, Africa, or Europe. These portfolios invest predominantly in emerging market equities, but some funds also invest in both equities and fixed income instruments among emerging markets.

The Morningstar Fund Emerging Markets Bond portfolios invest more than 65% of their assets in foreign bonds from developing countries. The largest portion of the emerging-markets bond market comes from Latin America, followed by Eastern Europe. Africa, the Middle East, and Asia make up the rest.

The Morningstar Fund Industrials Category portfolios seek capital appreciation by investing in equity securities of US or non-US companies that are engaged in services related to cyclical industries. This includes and is not limited to companies in aerospace and defense, automotive, chemicals, construction, environmental services, machinery, paper and transportation.

The Morningstar Fund Infrastructure Category portfolios invest more than 60% of their assets in stocks of companies engaged in infrastructure activities. Industries considered to be part of the infrastructure sector include: oil & gas midstream; waste management; airports; integrated shipping; railroads; shipping & ports; trucking; engineering & construction; infrastructure operations; and the utilities sector.

The Morningstar Fund Emerging Markets Local Currency Bond Category portfolios invest more than 65% of their assets in foreign bonds from developing countries in the local currency. Funds in this category have a mandate to maintain exposure to currencies of emerging markets. The largest portion of the emerging markets bond market comes from Latin America, followed by Eastern Europe, Africa, the Middle East, and Asia.

Shareholder Letter (Unaudited) (concluded)

We are encouraged by the steady progress being made by China to increase access to local and Mainland Chinese markets for international investors, as well as by the heightened demand and awareness of these markets by the global investor community.

•   We believe that China will continue to grow and be an essential element of a well-designed investment portfolio.

•   We believe that investors should have low-cost§, transparent tools to obtain exposure to Chinese equity and fixed income markets.

•   China’s capital markets have fully recovered from the COVID-19 pandemic and, despite near-term volatility due to concerns surrounding inflation and new regulations, we believe the further development of China’s capital markets offers a long-term value proposition.

•   We are dedicated to helping investors obtain more complete passive market exposures and more balanced investment portfolios.

§              Buying and selling shares of the KraneShares ETFs will result in brokerage commissions.

Thank you for investing with us.

Jonathan Krane, CEO

March 31, 2021

Management Discussion of Fund Performance (Unaudited)

KraneShares CICC China Leaders 100 Index ETF

The KraneShares CICC China Leaders 100 Index ETF (the ‘‘Fund’’) seeks to provide investment results that, before fees and expenses, correspond generally to the price and yield performance of the CSI CICC Select 100 Index (the ‘‘Underlying Index’’).

The Underlying Index takes a smart-beta1 approach to systematically investing in companies listed in Mainland China. The strategy is based on China International Capital Corporation (“CICC”)’s latest research on China’s capital markets. This quantitative approach reflects CICC’s top down and bottom up research process, seeking to deliver the 100 leading companies in Mainland China.

China review

Global equity markets continued their upward trend in the second half of 2020, powered by growth and technology stocks as pandemic-induced trends favorable to the internet sector persisted worldwide. In 2021, vaccine availability turbocharged a global economic recovery, leading to a cyclical/value rotation that placed considerable pressure on growth stocks. This downside pressure was compounded by the March wind-down of leveraged bets. Meanwhile, the yield on the 10-Year US Treasury bond increased by nearly 0.75% in the first three months of 2021 from 0.92% to 1.64% despite no action from the US Federal Reserve (the Fed), accompanied by a rise in inflation in the United States. Growth and technology stocks in China followed a similar trajectory, reaching all-time highs before falling significantly. However, rates and inflation in China did not follow the US. This is a consequence of both China’s monetary response to the pandemic, which was more tactical, and China’s economy having recovered from the pandemic before the end of 2020, meaning that China experienced the inflationary effect of recovery earlier. Equity markets in the US, Europe, and China have pulled back from levels seen at the end of 2020 and beginning of 2021, though remain above pre-pandemic levels.

Mainland Chinese equities followed global equities higher in the second half of 2020 and lower in the first quarter of 2021 accompanied by inflation concerns and an increase in volatility. A strong economy that fully recovered from the global pandemic within the period led to gains in Mainland Chinese equities for the period. KFYP benefited from the barbell of strong performance of consumer staples and discretionary on one side, and financials, materials, and industrials on the other, all of which performed strongly within China A shares.

We see four key positive catalysts for China’s equity and bond markets in the year to come:

•   With the release of the 14th Five Year Plan (FYP), we now know that China’s government will continue to support “new economy” sectors such as internet services, electric vehicles, green energy and technology, and communication services. Consumer products could also see a boost from the government’s desire to upgrade the consumption habits of China’s population.

•   Foreign inflows into China’s Mainland equity market are outpacing MSCI inclusion, providing a potential long-term tailwind for the market.

•   Domestic participation in China’s Mainland equity market is also likely to increase over the next few years as domestic household assets move from real estate into equities, leading to a potential tailwind for the market. Real estate investment accounts for, on average, nearly 60% of Chinese household savings compared to 33% in the United States.

1       Smart beta is an investment style where a manager passively follows an index designed to take advantage of perceived systematic biases or inefficiencies in the market.

Management Discussion of Fund Performance (Unaudited) (continued)

KraneShares CICC China Leaders 100 Index ETF (continued)

•   Although the yield differential between China and the United States has narrowed over the past year, China’s 10-year government bond still offers a nearly 150 basis-point yield pickup over the 10-Year US Treasury.

China capital market overview (April 1, 2020 to March 31, 2021)

•   China’s equity market, as measured by the MSCI China All Shares Index, was up for the period, returning +45.82%, while China’s currency, the renminbi (RMB) appreciated 7.5% against the US dollar.

•   The best performing sectors across China’s equity markets included Consumer Discretionary (+100.11%), Information Technology (+71.16%), and Consumer Staples (+64.25%).

•   The worst performing sectors across China’s equity markets were Real Estate (+15.12%), Financials (+20.16%), and Utilities (+32.24%).

By the Fund’s fiscal year end on March 31, 2021 (the “reporting period”), the NAV of the Fund increased by 28.90%, while the Underlying Index increased by 32.82%.

At the end of the reporting period, the Fund held 25.75% of the portfolio in the Consumer Discretionary sector and 18.91% in the Industrials sector.

Management Discussion of Fund Performance (Unaudited) (continued)

KraneShares CICC China Leaders 100 Index ETF (continued)

Growth of a $10,000 Investment‡

(at Net Asset Value)‡

AVERAGE TOTAL RETURN FOR THE PERIOD ENDED MARCH 31, 2021*

One Year Return

Three Year Return

Five Year Return

Annualized Inception to Date

Net Asset Value

Market Price^

Net Asset Value

Market Price^

Net Asset Value

Market Price^

Net Asset Value

Market Price^

KraneShares CICC China Leaders 100 Index ETF

28.90

%

32.62

%‡

4.68

%‡

5.61

%‡

11.88

%‡

13.08

%‡

10.69

%‡

10.87

%‡

Hybrid KFYP Index (Net)**

N/A

32.82

%‡

N/A

6.06

%‡

N/A

11.85

%‡

N/A

10.84

%‡

S&P 500 Index

N/A

56.35

%‡

N/A

16.78

%‡

N/A

16.29

%‡

N/A

13.97

%‡

*       The Fund commenced operations on July 22, 2013.

**     The Hybrid KFYP Index (Net) consists of the CSI China Overseas Five Year Plan Index from the inception of the Fund through May 31, 2016, the Zacks New China Index from June 1, 2016 through November 1, 2018, and the CSI CICC Select 100 Index going forward. From June 1, 2016 to November 1, 2018, the Fund sought to provide investment results that, before fees and expenses, corresponded generally to the price and yield performance of the Zacks New China Index. Prior to June 1, 2016, the Fund was known as the KraneShares CSI New China ETF and sought to provide investment results that, before fees and expenses, corresponded generally to the price and yield performance of the CSI Overseas China Five-Year Plan Index. Hybrid KFYP Index (Net) Reflects reinvested dividends net of withholding taxes, but reflects no deduction for fees, expenses, or other taxes.

‡      Unaudited.

^      Beginning December 23, 2020, market price returns are based on the official closing price of an ETF share or, if the official closing price isn’t available, the midpoint between the national best bid and national best offer (“NBBO”) as of the time the ETF calculates current NAV per share. Prior to that date, market price returns were based on the midpoint between the Bid and Ask price. NAVs are calculated using prices as of 4:00 PM Eastern Time.

Management Discussion of Fund Performance (Unaudited) (continued)

KraneShares CICC China Leaders 100 Index ETF (concluded)

The performance data quoted herein represents past performance and the return and value of an investment in the Fund will fluctuate so that, when redeemed, may be worth less than its original cost. Current performance may be lower or higher than the performance data quoted. Past performance is no guarantee of future performance and should not be considered as a representation of the future results of the Fund. For performance data current to the most recent month end, please call 855-857-2638 or visit www.kraneshares.com. The Fund’s performance assumes the reinvestment of all dividends and all capital gains. Index returns assume reinvestment of dividends and, unlike a Fund’s returns, do not reflect any fees or expenses. If such fees and expenses were included in the index returns, the performance would have been lower. As stated in the Fund’s prospectus, the Fund’s operating expense ratio is 0.69%. Please note that one cannot invest directly in an unmanaged index. There are no assurances that the Fund will meet its stated objectives. The Fund’s holdings and allocations are subject to change and should not be considered recommendations to buy individual securities. For further information on the Fund’s objectives, risks, and strategies, see the Fund’s prospectus. Returns shown do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption of Fund shares.

Management Discussion of Fund Performance (Unaudited) (continued)

KraneShares CSI China Internet ETF

The KraneShares CSI China Internet ETF (the ‘‘Fund’’) seeks to provide investment results that, before fees and expenses, correspond generally to the price and yield performance of the CSI Overseas China Internet Index (the ‘‘Underlying Index’’).

The Underlying Index is designed to measure the performance of the investable universe of publicly traded China-based companies whose primary business or businesses are in the Internet and Internet-related sectors (‘‘China Internet Companies’’), as defined by the index sponsor, China Securities Index Co., Ltd. (‘‘CSI’’).

China Review

Global equity markets continued their upward trend in the second half of 2020, powered by growth and technology stocks as pandemic-induced trends favorable to the internet sector persisted worldwide. In 2021, vaccine availability turbocharged a global economic recovery, leading to a cyclical/value rotation that placed considerable pressure on growth stocks. This downside pressure was compounded by the March wind-down of leveraged bets. Meanwhile, the yield on the 10-Year US Treasury bond increased by nearly 0.75% in the first three months of 2021 from 0.92% to 1.64% despite no action from the US Federal Reserve (the Fed), accompanied by a rise in inflation in the United States. Growth and technology stocks in China followed a similar trajectory, reaching all-time highs before falling significantly. However, rates and inflation in China did not follow the US. This is a consequence of both China’s monetary response to the pandemic, which was more tactical, and China’s economy having recovered from the pandemic before the end of 2020, meaning that China experienced the inflationary effect of recovery earlier. Equity markets in the US, Europe, and China have pulled back from levels seen at the end of 2020 and beginning of 2021, though remain above pre-pandemic levels.

US and Hong Kong listed China internet equities enjoyed strong performance in the second half of 2020, though experienced a correction from historic highs in the first quarter of 2021 due to inflation concerns, reopening, a rotation into value/cyclical sectors, new regulations and the unwinding of leveraged bets. The strategy’s largest sector allocations, Communication Services and Consumer Discretionary, drove the Fund’s returns for the period.

We see four key positive catalysts for China’s equity and bond markets in the year to come:

•   With the release of the 14th Five Year Plan (FYP), we now know that China’s government will continue to support “new economy” sectors such as internet services, electric vehicles, green energy and technology, and communication services. Consumer products could also see a boost from the government’s desire to upgrade the consumption habits of China’s population.

•   Foreign inflows into China’s Mainland equity market are outpacing MSCI inclusion, providing a potential long-term tailwind for the market.

•   Domestic participation in China’s Mainland equity market is also likely to increase over the next few years as domestic household assets move from real estate into equities, leading to a potential tailwind for the market. Real estate investment accounts for, on average, nearly 60% of Chinese household savings compared to 33% in the United States.

•   Although the yield differential between China and the United States has narrowed over the past year, China’s 10-year government bond still offers a nearly 150 basis-point yield pickup over the 10-Year US Treasury.

Management Discussion of Fund Performance (Unaudited) (continued)

KraneShares CSI China Internet ETF (continued)

China capital market overview (April 1, 2020 to March 31, 2021)

•   China’s equity market, as measured by the MSCI China All Shares Index, was up for the period, returning +45.82%, while China’s currency, the renminbi (RMB) appreciated 7.5% against the US dollar.

•   The best performing sectors across China’s equity markets included Consumer Discretionary (+100.11%), Information Technology (+71.16%), and Consumer Staples (+64.25%).

•   The worst performing sectors across China’s equity markets were Real Estate (+15.12%), Financials (+20.16%), and Utilities (+32.24%).

By the Fund’s fiscal year end on March 31, 2021 (the “reporting period”), the NAV of the Fund increased by 67.77%, while the Underlying Index increased by 69.26%.

At the end of the reporting period, the Fund held 44.01% of the portfolio in the Consumer Discretionary sector and 36.76% in the Communication Services sector.

Management Discussion of Fund Performance (Unaudited) (continued)

KraneShares CSI China Internet ETF (continued)

Growth of a $10,000 Investment‡

(at Net Asset Value)‡

AVERAGE TOTAL RETURN FOR THE PERIOD ENDED MARCH 31, 2021*

One Year Return

Three Year Return

Five Year Return

Annualized Inception to Date

Net Asset Value

Market Price^

Net Asset Value

Market Price^

Net Asset Value

Market Price^

Net Asset Value

Market Price^

KraneShares CSI China Internet ETF

67.77

%

69.34

%‡

8.67

%‡

8.98

%‡

17.43

%‡

17.59

%‡

16.54

%‡

16.69

%‡

CSI Overseas China Internet Index

N/A

69.26

%‡

N/A

9.25

%‡

N/A

17.59

%‡

N/A

16.71

%‡

S&P 500 Index

N/A

56.35

%‡

N/A

16.78

%‡

N/A

16.29

%‡

N/A

14.10

%‡

*       The Fund commenced operations on July 31, 2013.

‡      Unaudited.

^      Beginning December 23, 2020, market price returns are based on the official closing price of an ETF share or, if the official closing price isn’t available, the midpoint between the national best bid and national best offer (“NBBO”) as of the time the ETF calculates current NAV per share. Prior to that date, market price returns were based on the midpoint between the Bid and Ask price. NAVs are calculated using prices as of 4:00 PM Eastern Time.

The performance data quoted herein represents past performance and the return and value of an investment in the Fund will fluctuate so that, when redeemed, may be worth less than its original cost. Current performance may be lower or higher than the performance data quoted. Past performance is no guarantee of future performance and should not be considered as a representation of the future results of the Fund. For performance data current to the most recent month end, please call 855-857-2638 or visit www.kraneshares.com. The Fund’s performance assumes the reinvestment of all dividends and all capital gains. Index returns assume reinvestment of dividends and, unlike a Fund’s returns, do not reflect any fees or expenses. If such fees and expenses were included in the index returns, the performance would have been lower. As stated in the Fund’s prospectus, the Fund’s operating expense ratio is 0.73%. Please note that one cannot invest directly in an unmanaged

Management Discussion of Fund Performance (Unaudited) (continued)

KraneShares CSI China Internet ETF (concluded)

index. There are no assurances that the Fund will meet its stated objectives. The Fund’s holdings and allocations are subject to change and should not be considered recommendations to buy individual securities. For further information on the Fund’s objectives, risks, and strategies, see the Fund’s prospectus. Returns shown do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption of Fund shares.

Management Discussion of Fund Performance (Unaudited) (continued)

KraneShares Bosera MSCI China A Share ETF

The KraneShares Bosera MSCI China A Share ETF (the ‘‘Fund’’) seeks to provide investment results that, before fees and expenses, correspond to the price and yield performance of the MSCI China A Index (the ‘‘Underlying Index’’).

The Underlying Index is designed to track the progressive partial inclusion of A shares in the MSCI Emerging Markets Index over time. The index is designed for global investors accessing the A shares market using the Stock Connect framework and is calculated using China A Stock Connect listings based on the offshore renminbi (“RMB”) exchange rate (CNH).

China Review

Global equity markets continued their upward trend in the second half of 2020, powered by growth and technology stocks as pandemic-induced trends favorable to the internet sector persisted worldwide. In 2021, vaccine availability turbocharged a global economic recovery, leading to a cyclical/value rotation that placed considerable pressure on growth stocks. This downside pressure was compounded by the March wind-down of leveraged bets. Meanwhile, the yield on the 10-Year US Treasury bond increased by nearly 0.75% in the first three months of 2021 from 0.92% to 1.64% despite no action from the US Federal Reserve (the Fed), accompanied by a rise in inflation in the United States. Growth and technology stocks in China followed a similar trajectory, reaching all-time highs before falling significantly. However, rates and inflation in China did not follow the US. This is a consequence of both China’s monetary response to the pandemic, which was more tactical, and China’s economy having recovered from the pandemic before the end of 2020, meaning that China experienced the inflationary effect of recovery earlier. Equity markets in the US, Europe, and China have pulled back from levels seen at the end of 2020 and beginning of 2021, though remain above pre-pandemic levels.

Mainland Chinese equities followed global equities higher in the second half of 2020 and lower in the first quarter of 2021 accompanied by inflation concerns and a surge in volatility. A strong economy that fully recovered from the global pandemic within the period led to gains in Mainland Chinese equities for the period. China’s exports surged nearly 40% year-over-year in the first quarter of 2021 as global economies began to reopen, which helped power aggregate demand in China’s economy. While 2020’s performance was characterized by the work from home and shelter-in-place trade, late 2020 and early 2021 saw a comeback in consumer staples, which now represent the second largest sector held in the portfolio and was the largest contributor to the Fund’s performance for the period. The Fund was also strongly supported by the strength of Financials, Industrials and Health Care.

We see four key positive catalysts for China’s equity and bond markets in the year to come:

•   With the release of the 14th Five Year Plan (FYP), we now know that China’s government will continue to support “new economy” sectors such as internet services, electric vehicles, green energy and technology, and communication services. Consumer products could also see a boost from the government’s desire to upgrade the consumption habits of China’s population.

•   Foreign inflows into China’s Mainland equity market are outpacing MSCI inclusion, providing a potential long-term tailwind for the market.

•   Domestic participation in China’s Mainland equity market is also likely to increase over the next few years as domestic household assets move from real estate into equities, leading to a potential tailwind for the market. Real estate investment accounts for, on average, nearly 60% of Chinese household savings compared to 33% in the United States.

Management Discussion of Fund Performance (Unaudited) (continued)

KraneShares Bosera MSCI China A Share ETF (continued)

•   Although the yield differential between China and the United States has narrowed over the past year, China’s 10-year government bond still offers a nearly 150 basis-point yield pickup over the 10-Year US Treasury.

China capital market overview (April 1, 2020 to March 31, 2021)

•   China’s equity market, as measured by the MSCI China All Shares Index, was up for the period, returning +45.82%, while China’s currency, the renminbi (RMB) appreciated 7.5% against the US dollar.

•   The best performing sectors across China’s equity markets included Consumer Discretionary (+100.11%), Information Technology (+71.16%), and Consumer Staples (+64.25%).

•   The worst performing sectors across China’s equity markets were Real Estate (+15.12%), Financials (+20.16%), and Utilities (+32.24%).

By the Fund’s fiscal year end on March 31, 2021 (the “reporting period”), the NAV of the Fund increased by 50.00%, while the Underlying Index increased by 51.10%.

At the end of the reporting period, the Fund held 22.11% of the portfolio in the Financials sector and 19.29% in the Consumer Staples sector.

Management Discussion of Fund Performance (Unaudited) (continued)

KraneShares Bosera MSCI China A Share ETF (continued)

Growth of a $10,000 Investment‡

(at Net Asset Value)‡

AVERAGE TOTAL RETURN FOR THE PERIOD ENDED MARCH 31, 2021*

One Year Return

Three Year Return

Five Year Return

Annualized Inception to Date

Net Asset Value

Market Price^

Net Asset Value

Market Price^

Net Asset Value

Market Price^

Net Asset Value

Market Price^

KraneShares Bosera MSCI China A Share ETF

50.00

%

51.23

%‡

10.62

%‡

10.37

%‡

10.22

%‡

10.44

%‡

11.19

%‡

11.32

%‡

Hybrid KBA Index (Net)**

N/A

51.10

%‡

N/A

10.52

%‡

N/A

10.06

%‡

N/A

12.30

%‡

S&P 500 Index

N/A

56.35

%‡

N/A

16.78

%‡

N/A

16.29

%‡

N/A

13.44

%‡

*       The Fund commenced operations on March 4, 2014.

**     The Hybrid KBA Index consists of the MSCI China A Index from the inception of the Fund through October 23, 2014, the MSCI China A International Index from October 23, 2014 through December 26, 2017, the MSCI China A Inclusion Index from December 26, 2017 to May 29, 2019, and the MSCI China A Index going forward. From October 23, 2014 through December 26, 2017, the Fund sought investment results that, before fees and expenses, corresponded to the price and yield performance of the MSCI China A International Index. Prior to October 23, 2014, the Fund sought investment results that, before fees and expenses, corresponded to the price and yield performance of the MSCI China A Index.

‡      Unaudited.

^      Beginning December 23, 2020, market price returns are based on the official closing price of an ETF share or, if the official closing price isn’t available, the midpoint between the national best bid and national best offer (“NBBO”) as of the time the ETF calculates current NAV per share. Prior to that date, market price returns were based on the midpoint between the Bid and Ask price. NAVs are calculated using prices as of 4:00 PM Eastern Time.

The performance data quoted herein represents past performance and the return and value of an investment in the Fund will fluctuate so that, when redeemed, may be worth less than its original cost. Current performance may be lower or higher than the performance data quoted. Past performance is no guarantee of future performance and should not be considered as a representation of the

Management Discussion of Fund Performance (Unaudited) (continued)

KraneShares Bosera MSCI China A Share ETF (concluded)

future results of the Fund. For performance data current to the most recent month end, please call 855-857-2638 or visit www.kraneshares.com. The Fund’s performance assumes the reinvestment of all dividends and all capital gains. Index returns assume reinvestment of dividends and, unlike a Fund’s returns, do not reflect any fees or expenses. If such fees and expenses were included in the index returns, the performance would have been lower. As stated in the Fund’s prospectus, as supplemented, the Fund’s gross operating expense ratio is 0.79% and its net expense ratio is 0.59% due to a Fee Waiver whereby the Fund’s investment manager, Krane Funds Advisors, LLC, has contractually agreed to reduce its management fee by 0.20% of the Fund’s average daily net assets until August 1, 2021. Please note that one cannot invest directly in an unmanaged index. There are no assurances that the Fund will meet its stated objectives. The Fund’s holdings and allocations are subject to change and should not be considered recommendations to buy individual securities. For further information on the Fund’s objectives, risks, and strategies, see the Fund’s prospectus. Returns shown do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption of Fund shares.

Management Discussion of Fund Performance (Unaudited) (continued)

KraneShares E Fund China Commercial Paper ETF

The KraneShares E Fund China Commercial Paper ETF (the ‘‘Fund’’) seeks to provide investment results that, before fees and expenses, correspond to the price and yield performance of the CSI Diversified High Grade Commercial Paper Index (the ‘‘Underlying Index’’).

The Underlying Index seeks to track the performance of high-grade on-shore renminbi (“RMB”)-denominated (or “CNY”) commercial paper that is issued by corporate issuers in the People’s Republic of China’s (“China” or the “PRC”) and traded in the Chinese Inter-bank Bond Market (“CIBM”). For purposes of the Underlying Index, high-grade commercial paper is commercial paper that is issued by an issuer whose long-term bonds are rated AAA or equivalent by a Chinese credit rating agency; or commercial paper that is rated at least A-1 or equivalent by a Chinese credit rating agency and is issued by an issuer whose long-term bonds are rated at least AA+ or equivalent by a Chinese credit rating agency. All constituents in the Underlying Index are unsecured bonds. To qualify for inclusion in the Underlying Index, commercial paper issue must have at least RMB 600 million outstanding and a remaining term to final maturity of no more than one year (365 days) and no less than one month.

China Review

Global equity markets continued their upward trend in the second half of 2020, powered by growth and technology stocks as pandemic-induced trends favorable to the internet sector persisted worldwide. In 2021, vaccine availability turbocharged a global economic recovery, leading to a cyclical/value rotation that placed considerable pressure on growth stocks. This downside pressure was compounded by the March wind-down of leveraged bets. Meanwhile, the yield on the 10-Year US Treasury bond increased by nearly 0.75% in the first three months of 2021 from 0.92% to 1.64% despite no action from the US Federal Reserve (the Fed), accompanied by a rise in inflation in the United States. Growth and technology stocks in China followed a similar trajectory, reaching all-time highs before falling significantly. However, rates and inflation in China did not follow the US. This is a consequence of both China’s monetary response to the pandemic, which was more tactical, and China’s economy having recovered from the pandemic before the end of 2020, meaning that China experienced the inflationary effect of recovery earlier. Equity markets in the US, Europe, and China have pulled back from levels seen at the end of 2020 and beginning of 2021, though remain above pre-pandemic levels.

China commercial paper was a source of stability for the global bond market during the global pandemic. Following the resumption of normal economic activity in China early in the reporting period, the Fund saw strong performance. The 7.5% appreciation in the Renminbi against the US dollar during the period also contributed to the Fund’s positive performance for the period.

We see four key positive catalysts for China’s equity and bond markets in the year to come:

•   With the release of the 14th Five Year Plan (FYP), we now know that China’s government will continue to support “new economy” sectors such as internet services, electric vehicles, green energy and technology, and communication services. Consumer products could also see a boost from the government’s desire to upgrade the consumption habits of China’s population.

•   Foreign inflows into China’s Mainland equity market are outpacing MSCI inclusion, providing a potential long-term tailwind for the market.

Management Discussion of Fund Performance (Unaudited) (continued)

KraneShares E Fund China Commercial Paper ETF (continued)

•   Domestic participation in China’s Mainland equity market is also likely to increase over the next few years as domestic household assets move from real estate into equities, leading to a potential tailwind for the market. Real estate investment accounts for, on average, nearly 60% of Chinese household savings compared to 33% in the United States.

•   Although the yield differential between China and the United States has narrowed over the past year, China’s 10-year government bond still offers a nearly 150 basis-point yield pickup over the 10-Year US Treasury.

China capital market overview (April 1, 2020 to March 31, 2021)

•   China’s equity market, as measured by the MSCI China All Shares Index, was up for the period, returning +45.82%, while China’s currency, the renminbi (RMB) appreciated 7.5% against the US dollar.

By the Fund’s fiscal year end on March 31, 2021 (the “reporting period”), the NAV of the Fund increased by 9.91%, while the Underlying Index increased by 10.72%.

At the end of the reporting period, the Fund held 100.00% of the portfolio in cash.

Management Discussion of Fund Performance (Unaudited) (continued)

KraneShares E Fund China Commercial Paper ETF (continued)

Growth of a $10,000 Investment‡

(at Net Asset Value)‡

AVERAGE TOTAL RETURN FOR THE PERIOD ENDED MARCH 31, 2021*

One Year Return

Three Year Return

Five Year Return

Annualized Inception to Date

Net Asset Value

Market Price^

Net Asset Value

Market Price^

Net Asset Value

Market Price^

Net Asset Value

Market Price^

KraneShares E Fund China Commercial Paper ETF

9.91

%

10.56

%‡

1.38

%‡

1.46

%‡

2.59

%‡

2.59

%‡

1.87

%‡

1.85

%‡

CSI Diversified High Grade Commercial Paper Index

N/A

10.72

%‡

N/A

1.78

%‡

N/A

3.12

%‡

N/A

2.59

%‡

S&P U.S. Treasury Bill 3-6 Month Index**

N/A

0.15

%‡

N/A

1.63

%‡

N/A

1.29

%‡

N/A

1.06

%‡

S&P 500 Index

N/A

56.35

%‡

N/A

16.78

%‡

N/A

16.29

%‡

N/A

13.11

%‡

*       The Fund commenced operations on December 2, 2014.

**     Index added to provide a fixed income benchmark for fixed income funds.

‡      Unaudited.

^      Beginning December 23, 2020, market price returns are based on the official closing price of an ETF share or, if the official closing price isn’t available, the midpoint between the national best bid and national best offer (“NBBO”) as of the time the ETF calculates current NAV per share. Prior to that date, market price returns were based on the midpoint between the Bid and Ask price. NAVs are calculated using prices as of 4:00 PM Eastern Time.

The performance data quoted herein represents past performance and the return and value of an investment in the Fund will fluctuate so that, when redeemed, may be worth less than its original cost. Current performance may be lower or higher than the performance data quoted. Past performance is no guarantee of future performance and should not be considered as a representation of the future results of the Fund. For performance data current to the most recent month end, please call 855-857-2638 or visit www.kraneshares.com. The Fund’s performance assumes the reinvestment

Management Discussion of Fund Performance (Unaudited) (continued)

KraneShares E Fund China Commercial Paper ETF (concluded)

of all dividends and all capital gains. Index returns assume reinvestment of dividends and, unlike a Fund’s returns, do not reflect any fees or expenses. If such fees and expenses were included in the index returns, the performance would have been lower. As stated in the Fund’s prospectus, the Fund’s gross operating expense ratio is 0.70% and its net expense ratio is 0.58% due to a Fee Waiver Agreement whereby the Fund’s investment manager, Krane Funds Advisors, LLC, has contractually agreed to reduce its management fee by 0.12% of the Fund’s average daily net assets until August 1, 2021. Please note that one cannot invest directly in an unmanaged index. There are no assurances that the Fund will meet its stated objectives. The Fund’s holdings and allocations are subject to change and should not be considered recommendations to buy individual securities. For further information on the Fund’s objectives, risks, and strategies, see the Fund’s prospectus. Returns shown do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption of Fund shares.

Management Discussion of Fund Performance (Unaudited) (continued)

KraneShares MSCI All China Index ETF

The KraneShares MSCI All China Index ETF (the “Fund”) seeks to provide investment results that, before fees and expenses, correspond to the price and yield performance of a specific foreign equity securities index. The Fund’s current index is the MSCI China All Shares Index (the “Underlying Index”).

The Underlying Index seeks to track the equity market performance of companies based in China and listed in Mainland China, Hong Kong, and the United States. Companies available for inclusion must be headquartered in China and meet the market capitalization minimums required by the MSCI Global Investable Market Indexes Methodology.

China Review

Global equity markets continued their upward trend in the second half of 2020, powered by growth and technology stocks as pandemic-induced trends favorable to the internet sector persisted worldwide. In 2021, vaccine availability turbocharged a global economic recovery, leading to a cyclical/value rotation that placed considerable pressure on growth stocks. This downside pressure was compounded by the March wind-down of leveraged bets. Meanwhile, the yield on the 10-Year US Treasury bond increased by nearly 0.75% in the first three months of 2021 from 0.92% to 1.64% despite no action from the US Federal Reserve (the Fed), accompanied by a rise in inflation in the United States. Growth and technology stocks in China followed a similar trajectory, reaching all-time highs before falling significantly. However, rates and inflation in China did not follow the US. This is a consequence of both China’s monetary response to the pandemic, which was more tactical, and China’s economy having recovered from the pandemic before the end of 2020, meaning that China experienced the inflationary effect of recovery earlier. Equity markets in the US, Europe, and China have pulled back from levels seen at the end of 2020 and beginning of 2021, though remain above pre-pandemic levels.

China equities across all listing venues followed global equities higher in the second half of 2020 and lower in the first quarter of 2021 accompanied by inflation concerns and an increase in volatility. A strong economy that fully recovered from the global pandemic within the period led to gains in many equities whose revenues are primarily sourced from Mainland China. China’s exports surged nearly 40% year-over-year in the first quarter of 2021 as global economies began to reopen, which helped power aggregate demand in China’s economy. Mainland listed Chinese A shares contributed the most to performance, followed by US listed shares and then Hong Kong listed shares.

We see four key positive catalysts for China’s equity and bond markets in the year to come:

•   With the release of the 14th Five Year Plan (FYP), we now know that China’s government will continue to support “new economy” sectors such as internet services, electric vehicles, green energy and technology, and communication services. Consumer products could also see a boost from the government’s desire to upgrade the consumption habits of China’s population.

•   Foreign inflows into China’s Mainland equity market are outpacing MSCI inclusion, providing a potential long-term tailwind for the market.

•   Domestic participation in China’s Mainland equity market is also likely to increase over the next few years as domestic household assets move from real estate into equities, leading to a potential tailwind for the market. Real estate investment accounts for, on average, nearly 60% of Chinese household savings compared to 33% in the United States.

Management Discussion of Fund Performance (Unaudited) (continued)

KraneShares MSCI All China Index ETF (continued)

•   Although the yield differential between China and the United States has narrowed over the past year, China’s 10-year government bond still offers a nearly 150 basis-point yield pickup over the 10-Year US Treasury.

China capital market overview (April 1, 2020 to March 31, 2021)

•   China’s equity market, as measured by the MSCI China All Shares Index, was up for the period, returning +45.82%, while China’s currency, the renminbi (RMB) appreciated 7.5% against the US dollar.

•   The best performing sectors across China’s equity markets included Consumer Discretionary (+100.11%), Information Technology (+71.16%), and Consumer Staples (+64.25%).

•   The worst performing sectors across China’s equity markets were Real Estate (+15.12%), Financials (+20.16%), and Utilities (+32.24%).

By the Fund’s fiscal year end on March 31, 2021 (the “reporting period”), the NAV of the Fund increased by 47.97%, while the Underlying Index increased by 45.82%.

At the end of the reporting period, the Fund held 29.07% of the portfolio in the Consumer Discretionary sector and 19.36% in the Financials sector.

Management Discussion of Fund Performance (Unaudited) (continued)

KraneShares MSCI All China Index ETF (continued)

Growth of a $10,000 Investment‡

(at Net Asset Value)‡

AVERAGE TOTAL RETURN FOR THE PERIOD ENDED MARCH 31, 2021*

One Year Return

Three Year Return

Five Year Return

Annualized Inception to Date

Net Asset Value

Market Price^

Net Asset Value

Market Price^

Net Asset Value

Market Price^

Net Asset Value

Market Price^

KraneShares MSCI All China Index ETF

47.97

%

49.77

%‡

10.18

%‡

10.00

%‡

12.42

%‡

12.44

%‡

7.82

%‡

8.00

%‡

Hybrid KALL Index (Net)**

N/A

45.82

%‡

N/A

9.88

%‡

N/A

12.57

%‡

N/A

8.22

%‡

S&P 500 Index

N/A

56.35

%‡

N/A

16.78

%‡

N/A

16.29

%‡

N/A

13.28

%‡

*       The Fund commenced operations on February 12, 2015.

**     The Hybrid KALL Index (Net) consists of the FTSE Emerging incl. China Overseas non-R/QFII GDP Weighted Index from the inception of the Fund through July 31, 2018, and the MSCI China All Shares Index going forward. Prior to July 31, 2018, the Fund was known as the KraneShares FTSE Emerging Markets Plus ETF and sought to provide investment results that, before fees and expenses, corresponded generally to the price and yield performance of the FTSE Emerging incl. China Overseas non-R/QFII GDP Weighted Index.

‡      Unaudited.

^      Beginning December 23, 2020, market price returns are based on the official closing price of an ETF share or, if the official closing price isn’t available, the midpoint between the national best bid and national best offer (“NBBO”) as of the time the ETF calculates current NAV per share. Prior to that date, market price returns were based on the midpoint between the Bid and Ask price. NAVs are calculated using prices as of 4:00 PM Eastern Time.

The performance data quoted herein represents past performance and the return and value of an investment in the Fund will fluctuate so that, when redeemed, may be worth less than its original cost. Current performance may be lower or higher than the performance data quoted. Past performance is no guarantee of future performance and should not be considered as a representation of the future results of the Fund. For performance data current to the most recent month end, please call 855-857-2638 or visit www.kraneshares.com. The Fund’s performance assumes the reinvestment

Management Discussion of Fund Performance (Unaudited) (continued)

KraneShares MSCI All China Index ETF (concluded)

of all dividends and all capital gains. Index returns assume reinvestment of dividends and, unlike a Fund’s returns, do not reflect any fees or expenses. If such fees and expenses were included in the index returns, the performance would have been lower. As stated in the Fund’s prospectus, the Fund’s gross operating expense ratio is 0.69% and its net expense ratio is 0.49% due to an a Fee Waiver whereby the Fund’s investment manager, Krane Funds Advisors, LLC, has contractually agreed to reduce its management fee by 0.20% of the Fund’s average daily net assets until August 1, 2021. Please note that one cannot invest directly in an unmanaged index. There are no assurances that the Fund will meet its stated objectives. The Fund’s holdings and allocations are subject to change and should not be considered recommendations to buy individual securities. For further information on the Fund’s objectives, risks, and strategies, see the Fund’s prospectus. Returns shown do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption of Fund shares.

Management Discussion of Fund Performance (Unaudited) (continued)

KraneShares MSCI One Belt One Road Index ETF

The KraneShares MSCI One Belt One Road Index ETF (the “Fund”) seeks to provide investment results that, before fees and expenses, track the price and yield performance of the MSCI Global China Infrastructure Exposure Index (the “Underlying Index”).

The Underlying Index aims to identify potential beneficiaries of the One Belt One Road (“OBOR”) initiative based on how their geography, revenue, and sector attributes align with the broad theme. OBOR seeks to capture the economic growth and monetize the potential upside for the companies involved in China’s One Belt One Road initiative.

Global/Emerging Markets Review

Global equity markets continued their upward trend in the second half of 2020, powered by growth and technology stocks as pandemic-induced trends favorable to the internet sector persisted worldwide. In 2021, vaccine availability turbocharged a global economic recovery, leading to a cyclical/value rotation that placed considerable pressure on growth stocks. This downside pressure was compounded by the March wind-down of leveraged bets. Meanwhile, the yield on the 10-Year US Treasury bond increased by nearly 0.75% in the first three months of 2021 from 0.92% to 1.64% despite no action from the US Federal Reserve (the Fed), accompanied by a rise in inflation in the United States. Growth and technology stocks in China followed a similar trajectory, reaching all-time highs before falling significantly. However, rates and inflation in China did not follow the US. This is a consequence of both China’s monetary response to the pandemic, which was more tactical, and China’s having recovered from the pandemic before the end of 2020, meaning that China experienced the inflationary effect of recovery earlier. Equity markets in the US, Europe, and China have pulled back from levels seen at the end of 2020 and beginning of 2021, though remain above pre-pandemic levels.

Global companies poised to benefit from China’s One Belt One Road Initiative (also known as the Belt & Road Initiative) rebounded strongly from their lows during the coronavirus pandemic. Most projects under the initiative have now resumed work following pandemic-induced disruptions. Metals and mining companies made the largest contribution to the Fund’s performance during the period as metals prices rose sharply in the first quarter of 2021.

We see three key positive catalysts for Emerging Markets equities in the year to come:

•   Vaccine distribution may improve in Emerging economies following the US decision to waive patent restrictions on vaccines globally and is the key to a full recovery in emerging economies.

•   The normalization of commodity prices and their meteoric rise in 2021 is likely to benefit commodities exporting countries such as Indonesia, Chile, and Argentina.

•   The COVID-19 pandemic turbocharged the adoption of E-Commerce across emerging economies. We believe E-Commerce companies in Emerging Markets such as Mercado Libre are likely to retain users and continue to grow revenues as these economies continue to move online.

Emerging Markets Overview (April 1, 2020 to March 31, 2021)

•   Emerging Market equities, as measured by the MSCI Emerging Markets Index, were up for the period, returning +58.86%.

Management Discussion of Fund Performance (Unaudited) (continued)

KraneShares MSCI One Belt One Road Index ETF (continued)

•   The best performing sectors across the Emerging Market equity market included Information Technology (+103.94%), Materials (+96.45%), and Consumer Discretionary (+61.54%).

•   The worst performing sectors across the Emerging Market equity market included Real Estate (+20.20%), Utilities (+30.44%), and Consumer Staples (+34.12%).

By the Fund’s fiscal year end on March 31, 2021 (the “reporting period”), the NAV of the Fund increased by 65.82% while the Underlying Index increased by 67.58%.

At the end of the reporting period, the Fund held 33.84% of the portfolio in the Industrials sector and 33.52% in the Materials sector.

Management Discussion of Fund Performance (Unaudited) (continued)

KraneShares MSCI One Belt One Road Index ETF (continued)

Growth of a $10,000 Investment‡

(at Net Asset Value)‡

AVERAGE TOTAL RETURN FOR THE PERIOD ENDED MARCH 31, 2021*

One Year Return

Three Year Return

Annualized Inception to Date

Net Asset Value

Market Price^

Net Asset Value

Market Price^

Net Asset Value

Market Price^

KraneShares MSCI One Belt One Road Index ETF

65.82

%

69.66

%‡

7.23

%‡

7.01

%‡

6.84

%‡

7.13

%‡

MSCI Global China Infrastructure Exposure Index (Net)

N/A

67.58

%‡

N/A

9.02

%‡

N/A

8.46

%‡

S&P 500 Index

N/A

56.35

%‡

N/A

16.78

%‡

N/A

16.51

%‡

*       The Fund commenced operations on September 7, 2017.

‡      Unaudited.

^      Beginning December 23, 2020, market price returns are based on the official closing price of an ETF share or, if the official closing price isn’t available, the midpoint between the national best bid and national best offer (“NBBO”) as of the time the ETF calculates current NAV per share. Prior to that date, market price returns were based on the midpoint between the Bid and Ask price. NAVs are calculated using prices as of 4:00 PM Eastern Time.

The performance data quoted herein represents past performance and the return and value of an investment in the Fund will fluctuate so that, when redeemed, may be worth less than its original cost. Current performance may be lower or higher than the performance data quoted. Past performance is no guarantee of future performance and should not be considered as a representation of the future results of the Fund. For performance data current to the most recent month end, please call 855-857-2638 or visit www.kraneshares.com. The Fund’s performance assumes the reinvestment of all dividends and all capital gains. Index returns assume reinvestment of dividends and, unlike a Fund’s returns, do not reflect any fees or expenses. If such fees and expenses were included in the index returns, the performance would have been lower. As stated in the Fund’s prospectus,

Management Discussion of Fund Performance (Unaudited) (continued)

KraneShares MSCI One Belt One Road Index ETF (concluded)

as supplemented, the Fund’s operating expense ratio is 0.80%. Please note that one cannot invest directly in an unmanaged index. There are no assurances that the Fund will meet its stated objectives. The Fund’s holdings and allocations are subject to change and should not be considered recommendations to buy individual securities. For further information on the Fund’s objectives, risks, and strategies, see the Fund’s prospectus. Returns shown do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption of Fund shares.

Management Discussion of Fund Performance (Unaudited) (continued)

KraneShares Emerging Markets Consumer Technology Index ETF

The KraneShares Emerging Markets Consumer Technology Index ETF (the “Fund”) seeks to provide investment results that, before fees and expenses, track the price and yield performance of the Solactive Emerging Markets Consumer Technology Index (the “Underlying Index”).

The Underlying Index selects companies from 26 eligible countries within emerging markets whose primary business or businesses are internet retail, internet software/services, purchase, payment processing, or software for internet and E-Commerce transactions.

Global/Emerging Markets Review

Global equity markets continued their upward trend in the second half of 2020, powered by growth and technology stocks as pandemic-induced trends favorable to the internet sector persisted worldwide. In 2021, vaccine availability turbocharged a global economic recovery, leading to a cyclical/value rotation that placed considerable pressure on growth stocks. This downside pressure was compounded by the March wind-down of leveraged bets. Meanwhile, the yield on the 10-Year US Treasury bond increased by nearly 0.75% in the first three months of 2021 from 0.92% to 1.64% despite no action from the US Federal Reserve (the Fed), accompanied by a rise in inflation in the United States. Growth and technology stocks in China followed a similar trajectory, reaching all-time highs before falling significantly. However, rates and inflation in China did not follow the US. This is a consequence of both China’s monetary response to the pandemic, which was more tactical, and China’s having recovered from the pandemic before the end of 2020, meaning that China experienced the inflationary effect of recovery earlier. Equity markets in the US, Europe, and China have pulled back from levels seen at the end of 2020 and beginning of 2021, though remain above pre-pandemic levels.

Consumer technology platforms all over the world saw tremendous expansion by all metrics during the pandemic and that expansion was reflected in their share prices. In the developing world, that momentum continued into 2021. However, emerging markets consumer technology equities followed global growth equities lower in the first quarter of 2021 amid inflation concerns, reopening, a rotation into value/cyclical sectors, and heightened volatility.

We see three key positive catalysts for Emerging Markets equities in the year to come:

•   Vaccine distribution may improve in Emerging economies following the US decision to waive patent restrictions on vaccines globally and is the key to a full recovery in emerging economies.

•   The normalization of commodity prices and their meteoric rise in 2021 is likely to benefit commodities exporting countries such as Indonesia, Chile, and Argentina.

•   The COVID-19 pandemic turbocharged the adoption of E-Commerce across emerging economies. We believe E-Commerce companies in Emerging Markets such as Mercado Libre are likely to retain users and continue to grow revenues as these economies continue to move online.

Emerging Markets Overview (April 1, 2020 to March 31, 2021)

•   Emerging Market equities, as measured by the MSCI Emerging Markets Index, were up for the period, returning +58.86%.

Management Discussion of Fund Performance (Unaudited) (continued)

KraneShares Emerging Markets Consumer Technology Index ETF (continued)

•   The best performing sectors across the Emerging Market equity market included Information Technology (+103.94%), Materials (+96.45%), and Consumer Discretionary (+61.54%).

•   The worst performing sectors across the Emerging Market equity market included Real Estate (+20.20%), Utilities (+30.44%), and Consumer Staples (+34.12%).

By the Fund’s fiscal year end on March 31, 2021 (the “reporting period”), the NAV of the Fund increased by 67.85%, while the Underlying Index increased by 69.26%.

At the end of the reporting period, the Fund held 42.87% of the portfolio in the Communication Services sector and 41.04% in the Consumer Discretionary sector.

Management Discussion of Fund Performance (Unaudited) (continued)

KraneShares Emerging Markets Consumer Technology Index ETF (continued)

Growth of a $10,000 Investment‡

(at Net Asset Value)‡

AVERAGE TOTAL RETURN FOR THE PERIOD ENDED MARCH 31, 2021*

One Year Return

Three Year Return

Annualized Inception to Date

Net Asset Value

Market Price^

Net Asset Value

Market Price^

Net Asset Value

Market Price^

KraneShares Emerging Markets Consumer Technology Index ETF

67.85

%

67.94

%‡

8.03

%‡

7.81

%‡

8.69

%‡

8.81

%‡

Solactive Emerging Markets Consumer Technology Index

N/A

69.26

%‡

N/A

8.82

%‡

N/A

10.00

%‡

S&P 500 Index

N/A

56.35

%‡

N/A

16.78

%‡

N/A

15.73

%‡

*       The Fund commenced operations on October 11, 2017.

‡      Unaudited.

^      Beginning December 23, 2020, market price returns are based on the official closing price of an ETF share or, if the official closing price isn’t available, the midpoint between the national best bid and national best offer (“NBBO”) as of the time the ETF calculates current NAV per share. Prior to that date, market price returns were based on the midpoint between the Bid and Ask price. NAVs are calculated using prices as of 4:00 PM Eastern Time.

The performance data quoted herein represents past performance and the return and value of an investment in the Fund will fluctuate so that, when redeemed, may be worth less than its original cost. Current performance may be lower or higher than the performance data quoted. Past performance is no guarantee of future performance and should not be considered as a representation of the future results of the Fund. For performance data current to the most recent month end, please call 855-857-2638 or visit www.kraneshares.com. The Fund’s performance assumes the reinvestment of all dividends and all capital gains. Index returns assume reinvestment of dividends and, unlike a Fund’s returns, do not reflect any fees or expenses. If such fees and expenses were included in the index returns, the performance would have been lower. As stated in

Management Discussion of Fund Performance (Unaudited) (continued)

KraneShares Emerging Markets Consumer Technology Index ETF (concluded)

the Fund’s prospectus, the Fund’s gross operating expense ratio is 0.81% and its net expense ratio is 0.61% due to a Fee Waiver whereby the Fund’s investment manager, Krane Funds Advisors, LLC, has contractually agreed to reduce its management fee by 0.20% of the Fund’s average daily net assets until August 1, 2021.

Please note that one cannot invest directly in an unmanaged index. There are no assurances that the Fund will meet its stated objectives. The Fund’s holdings and allocations are subject to change and should not be considered recommendations to buy individual securities. For further information on the Fund’s objectives, risks, and strategies, see the Fund’s prospectus. Returns shown do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption of Fund shares.

Management Discussion of Fund Performance (Unaudited) (continued)

KraneShares MSCI China Clean Technology Index ETF

The KraneShares MSCI China Clean Technology Index ETF (the “Fund”) seeks to provide investment results that, before fees and expenses, correspond to the price and yield performance of a specific foreign equity securities the MSCI China IMI Environment 10/40 Index (the “Underlying Index”).

The Underlying Index is comprised of securities that derive at least 50% of their revenues from environmentally beneficial products and services. The Underlying Index is based on five key Clean Technology environmental themes: Alternative Energy, Sustainable Water, Green Building, Pollution Prevention and Energy Efficiency. The Underlying Index aims to serve as a benchmark for investors seeking exposure to Chinese companies that focus on contributing to a more environmentally sustainable economy by making efficient use of scarce natural resources or by mitigating the impact of environmental degradation. Constituent selection is based on data from MSCI Environment, Social, and Governance (ESG).

China review

Global equity markets continued their upward trend in the second half of 2020, powered by growth and technology stocks as pandemic-induced trends favorable to the internet sector persisted worldwide. In 2021, vaccine availability turbocharged a global economic recovery, leading to a cyclical/value rotation that placed considerable pressure on growth stocks. This downside pressure was compounded by the March wind-down of leveraged bets. Meanwhile, the yield on the 10-Year US Treasury bond increased by nearly 0.75% in the first three months of 2021 from 0.92% to 1.64% despite no action from the US Federal Reserve (the Fed), accompanied by a rise in inflation in the United States. Growth and technology stocks in China followed a similar trajectory, reaching all-time highs before falling significantly. However, rates and inflation in China did not follow the US. This is a consequence of both China’s monetary response to the pandemic, which was more tactical, and China’s economy having recovered from the pandemic before the end of 2020, meaning that China experienced the inflationary effect of recovery earlier. Equity markets in the US, Europe, and China have pulled back from levels seen at the end of 2020 and beginning of 2021, though remain above pre-pandemic levels.

China clean technology equities outperformed global equities significantly in the second half of 2020 though came off of historic highs in the first quarter of 2021 due to inflation concerns and heightened volatility. However, they nonetheless maintained significant outperformance versus broader benchmarks. The growth of electric vehicles companies led the way in clean technology and contributed substantially to the Fund’s performance for the period.

We see four key positive catalysts for China’s equity and bond markets in the year to come:

•   With the release of the 14th Five Year Plan (FYP), we now know that China’s government will continue to support “new economy” sectors such as internet services, electric vehicles, green energy and technology, and communication services. Consumer products could also see a boost from the government’s desire to upgrade the consumption habits of China’s population.

•   Foreign inflows into China’s Mainland equity market are outpacing MSCI inclusion, providing a potential long-term tailwind for the market.

Management Discussion of Fund Performance (Unaudited) (continued)

KraneShares MSCI China Clean Technology Index ETF (continued)

•   Domestic participation in China’s Mainland equity market is also likely to increase over the next few years as domestic household assets move from real estate into equities, leading to a potential tailwind for the market. Real estate investment accounts for, on average, nearly 60% of Chinese household savings compared to 33% in the United States.

•   Although the yield differential between China and the United States has narrowed over the past year, China’s 10-year government bond still offers a nearly 150 basis-point yield pickup over the 10-Year US Treasury.

China capital market overview (April 1, 2020 to March 31, 2021)

•   China’s equity market, as measured by the MSCI China All Shares Index, was up for the period, returning +45.82%, while China’s currency, the renminbi (RMB) appreciated 7.5% against the US dollar.

•   The best performing sectors across China’s equity markets included Consumer Discretionary (+100.11%), Information Technology (+71.16%), and Consumer Staples (+64.25%).

•   The worst performing sectors across China’s equity markets were Real Estate (+15.12%), Financials (+20.16%), and Utilities (+32.24%).

By the Fund’s fiscal year end on March 31, 2021 (the “reporting period”), the NAV of the Fund increased by 143.03%, while the Underlying Index increased by 133.24%.

At the end of the reporting period, the Fund held 28.38% of the portfolio in the Industrials sector and 26.37% in the Consumer Discretionary sector.

Management Discussion of Fund Performance (Unaudited) (continued)

KraneShares MSCI China Clean Technology Index ETF (continued)

Growth of a $10,000 Investment‡

(at Net Asset Value)‡

AVERAGE TOTAL RETURN FOR THE PERIOD ENDED MARCH 31, 2021*

One Year Return

Three Year Return

Annualized Inception to Date

Net Asset Value

Market Price^

Net Asset Value

Market Price^

Net Asset Value

Market Price^

KraneShares MSCI China Clean Technology Index ETF

143.03

%

146.55

%‡

22.32

%‡

22.30

%‡

17.45

%‡

17.97

%‡

MSCI China IMI Environment 10/40 Index (Net)

N/A

133.24

%‡

N/A

21.03

%‡

N/A

16.46

%‡

S&P 500 Index

N/A

56.35

%‡

N/A

16.78

%‡

N/A

15.80

%‡

*       The Fund commenced operations on October 12, 2017.

‡      Unaudited.

^      Beginning December 23, 2020, market price returns are based on the official closing price of an ETF share or, if the official closing price isn’t available, the midpoint between the national best bid and national best offer (“NBBO”) as of the time the ETF calculates current NAV per share. Prior to that date, market price returns were based on the midpoint between the Bid and Ask price. NAVs are calculated using prices as of 4:00 PM Eastern Time.

The performance data quoted herein represents past performance and the return and value of an investment in the Fund will fluctuate so that, when redeemed, may be worth less than its original cost. Current performance may be lower or higher than the performance data quoted. Past performance is no guarantee of future performance and should not be considered as a representation of the future results of the Fund. For performance data current to the most recent month end, please call 855-857-2638 or visit www.kraneshares.com. The Fund’s performance assumes the reinvestment of all dividends and all capital gains. Index returns assume reinvestment of dividends and, unlike a Fund’s returns, do not reflect any fees or expenses. If such fees and expenses were included in the index returns, the performance would have been lower. As stated in the Fund’s prospectus, the Fund’s gross operating expense ratio is 0.79%. Please note that one cannot invest directly in an

Management Discussion of Fund Performance (Unaudited) (continued)

KraneShares MSCI China Clean Technology Index ETF (concluded)

unmanaged index. There are no assurances that the Fund will meet its stated objectives. The Fund’s holdings and allocations are subject to change and should not be considered recommendations to buy individual securities. For further information on the Fund’s objectives, risks, and strategies, see the Fund’s prospectus. Returns shown do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption of Fund shares.

Management Discussion of Fund Performance (Unaudited) (continued)

KraneShares Electric Vehicles and Future Mobility Index ETF

The KraneShares Electric Vehicles and Future Mobility Index ETF (the ‘‘Fund’’) seeks to provide investment results that, before fees and expenses, correspond to the price and yield performance of the Solactive Electric Vehicles and Future Mobility Index (the ‘‘Underlying Index’’).

The Underlying Index is designed to track the performance of companies engaged in the production of electric vehicles and/or their components, or engaged in other initiatives that may change the future of mobility. The Underlying Index includes issuers engaged in the electric vehicle production, autonomous driving, shared mobility, lithium and/or copper production, lithium-ion/lead acid batteries, hydrogen fuel cell manufacturing and/or electric infrastructure businesses.

Global/Emerging Markets Review

Global equity markets continued their upward trend in the second half of 2020, powered by growth and technology stocks as pandemic-induced trends favorable to the internet sector persisted worldwide. In 2021, vaccine availability turbocharged a global economic recovery, leading to a cyclical/value rotation that placed considerable pressure on growth stocks. This downside pressure was compounded by the March wind-down of leveraged bets. Meanwhile, the yield on the 10-Year US Treasury bond increased by nearly 0.75% in the first three months of 2021 from 0.92% to 1.64% despite no action from the US Federal Reserve (the Fed), accompanied by a rise in inflation in the United States. Growth and technology stocks in China followed a similar trajectory, reaching all-time highs before falling significantly. However, rates and inflation in China did not follow the US. This is a consequence of both China’s monetary response to the pandemic, which was more tactical, and China’s having recovered from the pandemic before the end of 2020, meaning that China experienced the inflationary effect of recovery earlier. Equity markets in the US, Europe, and China have pulled back from levels seen at the end of 2020 and beginning of 2021, though remain above pre-pandemic levels.

Despite the pandemic and a slumping global automotive industry, electric vehicle (EV) sales achieved 43% growth from 2019 to 2020, mostly due to strong adoption in Europe and China. For the first time in many years, Europe outpaced China in EV demand. Cost reduction, stricter emissions regulations, government incentives, and the rollout of new and affordable models are bringing EVs within reach of the mass consumer. Makers of cars and semiconductors made the greatest contributions to the Fund’s performance for the period.

We see three key positive catalysts for Emerging Markets equities in the year to come:

•   Vaccine distribution may improve in Emerging economies following the US decision to waive patent restrictions on vaccines globally and is the key to a full recovery in emerging economies.

•   The normalization of commodity prices and their meteoric rise in 2021 is likely to benefit commodities exporting countries such as Indonesia, Chile, and Argentina.

•   The COVID-19 pandemic turbocharged the adoption of E-Commerce across emerging economies. We believe E-Commerce companies in Emerging Markets such as Mercado Libre are likely to retain users and continue to grow revenues as these economies continue to move online.

Management Discussion of Fund Performance (Unaudited) (continued)

KraneShares Electric Vehicles and Future Mobility Index ETF (continued)

Emerging Markets Overview (April 1, 2020 to March 31, 2021)

•   Emerging Market equities, as measured by the MSCI Emerging Markets Index, were up for the period, returning +58.86%.

•   The best performing sectors across the Emerging Market equity market included Information Technology (+103.94%), Materials (+96.45%), and Consumer Discretionary (+61.54%).

•   The worst performing sectors across the Emerging Market equity market included Real Estate (+20.20%), Utilities (+30.44%), and Consumer Staples (+34.12%).

By the Fund’s fiscal year end on March 31, 2021 (the “reporting period”), the NAV of the Fund increased by 122.46%, while the Underlying Index increased by 124.89%.

At the end of the reporting period, the Fund held 39.23% of the portfolio in the Consumer Discretionary sector and 33.38% in the Information Technology sector.

Management Discussion of Fund Performance (Unaudited) (continued)

KraneShares Electric Vehicles and Future Mobility Index ETF (continued)

Growth of a $10,000 Investment‡

(at Net Asset Value)‡

AVERAGE TOTAL RETURN FOR THE PERIOD ENDED MARCH 31, 2021*

One Year Return

Three Year Return

Annualized Inception to Date

Net Asset Value

Market Price^

Net Asset Value

Market Price^

Net Asset Value

Market Price^

KraneShares Electric Vehicles and Future Mobility Index ETF

122.46

%

125.40

%‡

23.31

%‡

22.95

%‡

19.05

%‡

19.16

%‡

Solactive Electric Vehicles and Future Mobility Index

N/A

124.89

%‡

N/A

23.67

%‡

N/A

19.25

%‡

S&P 500 Index

N/A

56.35

%‡

N/A

16.78

%‡

N/A

13.72

%‡

*       The Fund commenced operations on January 18, 2018.

‡      Unaudited.

^      Beginning December 23, 2020, market price returns are based on the official closing price of an ETF share or, if the official closing price isn’t available, the midpoint between the national best bid and national best offer (“NBBO”) as of the time the ETF calculates current NAV per share. Prior to that date, market price returns were based on the midpoint between the Bid and Ask price. NAVs are calculated using prices as of 4:00 PM Eastern Time.

The performance data quoted herein represents past performance and the return and value of an investment in the Fund will fluctuate so that, when redeemed, may be worth less than its original cost. Current performance may be lower or higher than the performance data quoted. Past performance is no guarantee of future performance and should not be considered as a representation of the future results of the Fund. For performance data current to the most recent month end, please call 855-857-2638 or visit www.kraneshares.com. The Fund’s performance assumes the reinvestment of all dividends and all capital gains. Index returns assume reinvestment of dividends and, unlike a Fund’s returns, do not reflect any fees or expenses. If such fees and expenses were included in the index returns, the performance would have been lower. As stated in

Management Discussion of Fund Performance (Unaudited) (continued)

KraneShares Electric Vehicles and Future Mobility Index ETF (concluded)

the Fund’s prospectus, the Fund’s operating expense ratio is 0.72%. Please note that one cannot invest directly in an unmanaged index. There are no assurances that the Fund will meet its stated objectives. The Fund’s holdings and allocations are subject to change and should not be considered recommendations to buy individual securities. For further information on the Fund’s objectives, risks, and strategies, see the Fund’s prospectus. Returns shown do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption of Fund shares.

Management Discussion of Fund Performance (Unaudited) (continued)

KraneShares MSCI All China Health Care Index ETF

The KraneShares MSCI All China Health Care Index ETF (the “Fund”) seeks to provide investment results that, before fees and expenses, track the price and yield performance of a specific foreign equity securities index. The Fund’s current index is the MSCI China All Shares Health Care 10/40 Index (the “Underlying Index”).

The Underlying Index is a free float adjusted market capitalization weighted index designed to track the equity market performance of Chinese companies engaged in the health care sector. The securities in the Index include all types of publicly issued shares of Chinese issuers, which are listed in Mainland China, Hong Kong and United States. Issuers eligible for inclusion must be classified under the Global Industry Classification Standard as engaged in the healthcare sector. The issuers included in the Underlying Index may include small-cap, mid-cap and large-cap companies.

China Review

Global equity markets continued their upward trend in the second half of 2020, powered by growth and technology stocks as pandemic-induced trends favorable to the internet sector persisted worldwide. In 2021, vaccine availability turbocharged a global economic recovery, leading to a cyclical/value rotation that placed considerable pressure on growth stocks. This downside pressure was compounded by the March wind-down of leveraged bets. Meanwhile, the yield on the 10-Year US Treasury bond increased by nearly 0.75% in the first three months of 2021 from 0.92% to 1.64% despite no action from the US Federal Reserve (the Fed), accompanied by a rise in inflation in the United States. Growth and technology stocks in China followed a similar trajectory, reaching all-time highs before falling significantly. However, rates and inflation in China did not follow the US. This is a consequence of both China’s monetary response to the pandemic, which was more tactical, and China’s economy having recovered from the pandemic before the end of 2020, meaning that China experienced the inflationary effect of recovery earlier. Equity markets in the US, Europe, and China have pulled back from levels seen at the end of 2020 and beginning of 2021, though remain above pre-pandemic levels.

Health care was the second-best performing sector in China in 2020. Growth in China’s healthcare sector was broad as most sub-industries saw positive developments. Life sciences companies performed best in 2020 followed by medical devices, health care technology, and biotechnology. However, health care distribution companies’ operations were disrupted by the pandemic and struggled as a result. Meanwhile, the gulf between pharmaceutical companies with robust, innovative drug pipelines and those that remain dependent on generics widened.

We see four key positive catalysts for China’s equity and bond markets in the year to come:

•   With the release of the 14th Five Year Plan (FYP), we now know that China’s government will continue to support “new economy” sectors such as internet services, electric vehicles, green energy and technology, and communication services. Consumer products could also see a boost from the government’s desire to upgrade the consumption habits of China’s population.

•   Foreign inflows into China’s Mainland equity market are outpacing MSCI inclusion, providing a potential long-term tailwind for the market.

•   Domestic participation in China’s Mainland equity market is also likely to increase over the next few years as domestic household assets move from real estate into equities, leading to a potential tailwind for the market. Real estate investment accounts for, on average, nearly 60% of Chinese household savings compared to 33% in the United States.

Management Discussion of Fund Performance (Unaudited) (continued)

KraneShares MSCI All China Health Care Index ETF (continued)

•   Although the yield differential between China and the United States has narrowed over the past year, China’s 10-year government bond still offers a nearly 150 basis-point yield pickup over the 10-Year US Treasury.

China capital market overview (April 1, 2020 to March 31, 2021)

•   China’s equity market, as measured by the MSCI China All Shares Index, was up for the period, returning +45.82%, while China’s currency, the renminbi (RMB) appreciated 7.5% against the US dollar.

•   The best performing sectors across China’s equity markets included Consumer Discretionary (+100.11%), Information Technology (+71.16%), and Consumer Staples (+64.25%).

•   The worst performing sectors across China’s equity markets were Real Estate (+15.12%), Financials (+20.16%), and Utilities (+32.24%).

By the Fund’s fiscal year end on March 31, 2021 (the “reporting period”), the NAV of the Fund increased by 61.06%, while the Underlying Index increased 63.50%.

At the end of the reporting period, the Fund held 100% of the portfolio in the Health Care sector.

Management Discussion of Fund Performance (Unaudited) (continued)

KraneShares MSCI All China Health Care Index ETF (continued)

Growth of a $10,000 Investment‡

(at Net Asset Value)‡

AVERAGE TOTAL RETURN FOR THE PERIOD ENDED MARCH 31, 2021*

One Year Return

Three Year Return

Annualized Inception to Date

Net Asset Value

Market Price^

Net Asset Value

Market Price^

Net Asset Value

Market Price^

KraneShares MSCI All China Health Care Index ETF

61.06

%

63.78

%‡

13.11

%‡

13.04

%‡

14.67

%‡

15.26

%‡

MSCI China All Shares Health Care 10/40 Index

N/A

63.50

%‡

N/A

13.65

%‡

N/A

15.50

%‡

S&P 500 Index

N/A

56.35

%‡

N/A

16.78

%‡

N/A

13.55

%‡

*       The Fund commenced operations on January 31, 2018.

‡      Unaudited.

^      Beginning December 23, 2020, market price returns are based on the official closing price of an ETF share or, if the official closing price isn’t available, the midpoint between the national best bid and national best offer (“NBBO”) as of the time the ETF calculates current NAV per share. Prior to that date, market price returns were based on the midpoint between the Bid and Ask price. NAVs are calculated using prices as of 4:00 PM Eastern Time.

The performance data quoted herein represents past performance and the return and value of an investment in the Fund will fluctuate so that, when redeemed, may be worth less than its original cost. Current performance may be lower or higher than the performance data quoted. Past performance is no guarantee of future performance and should not be considered as a representation of the future results of the Fund. For performance data current to the most recent month end, please call 855-857-2638 or visit www.kraneshares.com. The Fund’s performance assumes the reinvestment of all dividends and all capital gains. Index returns assume reinvestment of dividends and, unlike a Fund’s returns, do not reflect any fees or expenses. If such fees and expenses were included in the index returns, the performance would have been lower. As stated in the Fund’s prospectus, the Fund’s gross operating expense ratio is 0.79% and its net expense ratio

Management Discussion of Fund Performance (Unaudited) (continued)

KraneShares MSCI All China Health Care Index ETF (concluded)

is 0.65% due to a Fee Waiver whereby the Fund’s investment manager, Krane Funds Advisors, LLC, has contractually agreed to reduce its management fee by 0.14% of the Fund’s average daily net assets until August 1, 2021. Please note that one cannot invest directly in an unmanaged index. There are no assurances that the Fund will meet its stated objectives. The Fund’s holdings and allocations are subject to change and should not be considered recommendations to buy individual securities. For further information on the Fund’s objectives, risks, and strategies, see the Fund’s prospectus. Returns shown do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption of Fund shares.

Management Discussion of Fund Performance (Unaudited) (continued)

KraneShares CCBS China Corporate High Yield Bond USD Index ETF

The KraneShares CCBS China Corporate High Yield Bond USD Index ETF (the “Fund”) seeks to provide investment results that, before fees and expenses, track the price and yield performance of a specific fixed income securities index. The Fund’s current index is the Solactive USD China Corporate High Yield Bond Index (the “Underlying Index”).

The Underlying Index seeks to track the performance of outstanding high yield debt securities denominated in U.S. dollars issued by Chinese companies. For purposes of the Underlying Index, Chinese companies include companies that conduct the majority of their business activities in, are headquartered in or have the majority of their business assets, profits, or revenues in China or Hong Kong as determined by the index provider, Solactive, AG (“Index Provider”).

China Review

Global equity markets continued their upward trend in the second half of 2020, powered by growth and technology stocks as pandemic-induced trends favorable to the internet sector persisted worldwide. In 2021, vaccine availability turbocharged a global economic recovery, leading to a cyclical/value rotation that placed considerable pressure on growth stocks. This downside pressure was compounded by the March wind-down of leveraged bets. Meanwhile, the yield on the 10-Year US Treasury bond increased by nearly 0.75% in the first three months of 2021 from 0.92% to 1.64% despite no action from the US Federal Reserve (the Fed), accompanied by a rise in inflation in the United States. Growth and technology stocks in China followed a similar trajectory, reaching all-time highs before falling significantly. However, rates and inflation in China did not follow the US. This is a consequence of both China’s monetary response to the pandemic, which was more tactical, and China’s economy having recovered from the pandemic before the end of 2020, meaning that China experienced the inflationary effect of recovery earlier. Equity markets in the US, Europe, and China have pulled back from levels seen at the end of 2020 and beginning of 2021, though remain above pre-pandemic levels.

China USD-denominated high yield corporate bonds were a rare source of yield throughout the period amid a low interest rate environment globally. The period saw the Fund recover from its March 2020 low as economic activity returned to normal in China and many issuers in the Fund saw their incomes rise and their credit quality improve as a result.

We see four key positive catalysts for China’s equity and bond markets in the year to come:

•   With the release of the 14th Five Year Plan (FYP), we now know that China’s government will continue to support “new economy” sectors such as internet services, electric vehicles, green energy and technology, and communication services. Consumer products could also see a boost from the government’s desire to upgrade the consumption habits of China’s population.

•   Foreign inflows into China’s Mainland equity market are outpacing MSCI inclusion, providing a potential long-term tailwind for the market.

•   Domestic participation in China’s Mainland equity market is also likely to increase over the next few years as domestic household assets move from real estate into equities, leading to a potential tailwind for the market. Real estate investment accounts for, on average, nearly 60% of Chinese household savings compared to 33% in the United States.

•   Although the yield differential between China and the United States has narrowed over the past year, China’s 10-year government bond still offers a nearly 150 basis-point yield pickup over the 10-Year US Treasury.

Management Discussion of Fund Performance (Unaudited) (continued)

KraneShares CCBS China Corporate High Yield Bond USD Index ETF (continued)

China capital market overview (April 1, 2020 to March 31, 2021)

•   China’s equity market, as measured by the MSCI China All Shares Index, was up for the period, returning +45.82%, while China’s currency, the renminbi (RMB) appreciated 7.5% against the US dollar.

•   The best performing sectors across China’s equity markets included Consumer Discretionary (+100.11%), Information Technology (+71.16%), and Consumer Staples (+64.25%).

•   The worst performing sectors across China’s equity markets were Real Estate (+15.12%), Financials (+20.16%), and Utilities (+32.24%).

By the Fund’s fiscal year end on March 31, 2021 (the “reporting period”), the NAV of the Fund increased by 12.32%, while the Underlying Index increased by 12.75%.

At the end of the reporting period, the Fund held 51.10% of the portfolio in the Industrials sector and 28.01% in cash.

Management Discussion of Fund Performance (Unaudited) (continued)

KraneShares CCBS China Corporate High Yield Bond USD Index ETF (continued)

Growth of a $10,000 Investment‡

(at Net Asset Value)‡

AVERAGE TOTAL RETURN FOR THE PERIOD ENDED MARCH 31, 2021*

One Year Return

Annualized Inception to Date

Net Asset Value

Market Price^

Net Asset Value

Market Price^

KraneShares CCBS China Corporate High Yield Bond USD Index ETF

12.32

%

10.36

%‡

4.97

%‡

4.89

%‡

Solactive USD China Corporate High Yield Bond Index

N/A

12.75

%‡

N/A

6.40

%‡

Lipper China Region Funds Classification

N/A

57.88

%‡

N/A

14.83

%‡

*       The Fund commenced operations on June 26, 2018.

‡      Unaudited.

^      Beginning December 23, 2020, market price returns are based on the official closing price of an ETF share or, if the official closing price isn’t available, the midpoint between the national best bid and national best offer (“NBBO”) as of the time the ETF calculates current NAV per share. Prior to that date, market price returns were based on the midpoint between the Bid and Ask price. NAVs are calculated using prices as of 4:00 PM Eastern Time.

The performance data quoted herein represents past performance and the return and value of an investment in the Fund will fluctuate so that, when redeemed, may be worth less than its original cost. Current performance may be lower or higher than the performance data quoted. Past performance is no guarantee of future performance and should not be considered as a representation of the future results of the Fund. For performance data current to the most recent month end, please call 855-857-2638 or visit www.kraneshares.com. The Fund’s performance assumes the reinvestment of all dividends and all capital gains. Index returns assume reinvestment of dividends and, unlike a Fund’s returns, do not reflect any fees or expenses. If such fees and expenses were included in the index returns, the performance would have been lower. As stated in the Fund’s prospectus, the Fund’s operating expense ratio is 0.70%. Please note that one cannot invest directly in an unmanaged index. There are no assurances that the Fund will meet its stated

Management Discussion of Fund Performance (Unaudited) (continued)

KraneShares CCBS China Corporate High Yield Bond USD Index ETF (concluded)

objectives. The Fund’s holdings and allocations are subject to change and should not be considered recommendations to buy individual securities. For further information on the Fund’s objectives, risks, and strategies, see the Fund’s prospectus. Returns shown do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption of Fund shares.

Management Discussion of Fund Performance (Unaudited) (continued)

KraneShares Emerging Markets Healthcare Index ETF

The KraneShares Emerging Markets Healthcare Index ETF (the ‘‘Fund’’) seeks to provide investment results that, before fees and expenses, correspond to the price and yield performance of the Solactive Emerging Markets Healthcare Index (the ‘‘Underlying Index’’).

The Underlying Index seeks to track the equity market performance of companies engaged in the health care sector in various emerging markets. The issuers include small-cap, mid-cap, and large-cap companies involved in hospital management, healthcare management, pharmaceutical manufacturing, and biotechnology, among other sub-industries.

Global/Emerging Markets Review

Global equity markets continued their upward trend in the second half of 2020, powered by growth and technology stocks as pandemic-induced trends favorable to the internet sector persisted worldwide. In 2021, vaccine availability turbocharged a global economic recovery, leading to a cyclical/value rotation that placed considerable pressure on growth stocks. This downside pressure was compounded by the March wind-down of leveraged bets. Meanwhile, the yield on the 10-Year US Treasury bond increased by nearly 0.75% in the first three months of 2021 from 0.92% to 1.64% despite no action from the US Federal Reserve (the Fed), accompanied by a rise in inflation in the United States. Growth and technology stocks in China followed a similar trajectory, reaching all-time highs before falling significantly. However, rates and inflation in China did not follow the US. This is a consequence of both China’s monetary response to the pandemic, which was more tactical, and China’s having recovered from the pandemic before the end of 2020, meaning that China experienced the inflationary effect of recovery earlier. Equity markets in the US, Europe, and China have pulled back from levels seen at the end of 2020 and beginning of 2021, though remain above pre-pandemic levels.

Emerging markets health care companies enjoyed positive share price performance for the period as the pandemic caused an increase in demand for healthcare services in the developing world. Pharmaceuticals and biotechnology made the greatest contributions to the Fund’s performance for the period.

We see three key positive catalysts for Emerging Markets equities in the year to come:

•   Vaccine distribution may improve in Emerging economies following the US decision to waive patent restrictions on vaccines globally and is the key to a full recovery in emerging economies.

•   The normalization of commodity prices and their meteoric rise in 2021 is likely to benefit commodities exporting countries such as Indonesia, Chile, and Argentina.

•   The COVID-19 pandemic turbocharged the adoption of E-Commerce across emerging economies. We believe E-Commerce companies in Emerging Markets such as Mercado Libre are likely to retain users and continue to grow revenues as these economies continue to move online.

Emerging Markets Overview (April 1, 2020 to March 31, 2021)

•   Emerging Market equities, as measured by the MSCI Emerging Markets Index, were up for the period, returning +58.86%.

•   The best performing sectors across the Emerging Market equity market included Information Technology (+103.94%), Materials (+96.45%), and Consumer Discretionary (+61.54%).

•   The worst performing sectors across the Emerging Market equity market included Real Estate (+20.20%), Utilities (+30.44%), and Consumer Staples (+34.12%).

Management Discussion of Fund Performance (Unaudited) (continued)

KraneShares Emerging Markets Healthcare Index ETF (continued)

By the Fund’s fiscal year end on March 31, 2021 (the “reporting period”), the NAV of the Fund increased by 60.18%, while the Underlying Index increased by 62.23%.

At the end of the reporting period, the Fund held 100% of the portfolio in the Health Care sector.

Management Discussion of Fund Performance (Unaudited) (continued)

KraneShares Emerging Markets Healthcare Index ETF (continued)

Growth of a $10,000 Investment‡

(at Net Asset Value)‡

AVERAGE TOTAL RETURN FOR THE PERIOD ENDED MARCH 31, 2021*

One Year Return

Annualized Inception to Date

Net Asset Value

Market Price^

Net Asset Value

Market Price^

KraneShares Emerging Markets Healthcare Index ETF

60.18

%

61.48

%‡

12.57

%‡

12.93

%‡

Solactive Emerging Markets Healthcare Index

N/A

62.23

%‡

N/A

13.55

%‡

S&P 500 Index

N/A

56.35

%‡

N/A

14.87

%‡

*       The Fund commenced operations on August 29, 2018.

‡      Unaudited.

^      Beginning December 23, 2020, market price returns are based on the official closing price of an ETF share or, if the official closing price isn’t available, the midpoint between the national best bid and national best offer (“NBBO”) as of the time the ETF calculates current NAV per share. Prior to that date, market price returns were based on the midpoint between the Bid and Ask price. NAVs are calculated using prices as of 4:00 PM Eastern Time.

The performance data quoted herein represents past performance and the return and value of an investment in the Fund will fluctuate so that, when redeemed, may be worth less than its original cost. Current performance may be lower or higher than the performance data quoted. Past performance is no guarantee of future performance and should not be considered as a representation of the future results of the Fund. For performance data current to the most recent month end, please call 855-857-2638 or visit www.kraneshares.com. The Fund’s performance assumes the reinvestment of all dividends and all capital gains. Index returns assume reinvestment of dividends and, unlike a Fund’s returns, do not reflect any fees or expenses. If such fees and expenses were included in the index returns, the performance would have been lower. As stated in the Fund’s prospectus, the Fund’s operating expense ratio is 0.80%. Please note that one cannot invest directly in an unmanaged index. There are no assurances that the Fund will meet its stated

Management Discussion of Fund Performance (Unaudited) (continued)

KraneShares Emerging Markets Healthcare Index ETF (concluded)

objectives. The Fund’s holdings and allocations are subject to change and should not be considered recommendations to buy individual securities. For further information on the Fund’s objectives, risks, and strategies, see the Fund’s prospectus. Returns shown do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption of Fund shares.

Management Discussion of Fund Performance (Unaudited) (continued)

KraneShares MSCI Emerging Markets ex China Index ETF

The KraneShares MSCI Emerging Markets ex China Index ETF (the “Fund”) seeks to provide investment results that, before fees and expenses, correspond generally to the price and yield performance of a specific equity securities index. The Fund’s current index is the MSCI Emerging Markets ex China Index (the “Underlying Index”).

The Underlying Index is a free float-adjusted market capitalization weighted index designed to track the equity market performance of mid- and large-cap companies of emerging market countries, excluding China. The Underlying Index is based on the MSCI Emerging Markets Index (“universe”), but excludes the securities of Chinese issuers.

Global/Emerging Markets Review

Global equity markets continued their upward trend in the second half of 2020, powered by growth and technology stocks as pandemic-induced trends favorable to the internet sector persisted worldwide. In 2021, vaccine availability turbocharged a global economic recovery, leading to a cyclical/value rotation that placed considerable pressure on growth stocks. This downside pressure was compounded by the March wind-down of leveraged bets. Meanwhile, the yield on the 10-Year US Treasury bond increased by nearly 0.75% in the first three months of 2021 from 0.92% to 1.64% despite no action from the US Federal Reserve (the Fed), accompanied by a rise in inflation in the United States. Growth and technology stocks in China followed a similar trajectory, reaching all-time highs before falling significantly. However, rates and inflation in China did not follow the US. This is a consequence of both China’s monetary response to the pandemic, which was more tactical, and China’s having recovered from the pandemic before the end of 2020, meaning that China experienced the inflationary effect of recovery earlier. Equity markets in the US, Europe, and China have pulled back from levels seen at the end of 2020 and beginning of 2021, though remain above pre-pandemic levels.

Emerging market equities outside of China recovered from their March 2020 lows during the period as internet-based companies lead the way. However, emerging markets equities also experienced an increase in volatility as investors rotated to value/cyclical stocks in developed markets. That being said, emerging markets equities were buoyed somewhat by inflation fears in developed economies and the possibility of a weaker dollar in 2021. The information technology and financial sectors made the greatest contribution to the Fund’s performance for the period.

We see three key positive catalysts for Emerging Markets equities in the year to come:

•   Vaccine distribution may improve in Emerging economies following the US decision to waive patent restrictions on vaccines globally and is the key to a full recovery in emerging economies.

•   The normalization of commodity prices and their meteoric rise in 2021 is likely to benefit commodities exporting countries such as Indonesia, Chile, and Argentina.

•   The COVID-19 pandemic turbocharged the adoption of E-Commerce across emerging economies. We believe E-Commerce companies in Emerging Markets such as Mercado Libre are likely to retain users and continue to grow revenues as these economies continue to move online.

Emerging Markets Overview (April 1, 2020 to March 31, 2021)

•   Emerging Market equities, as measured by the MSCI Emerging Markets Index, were up for the period, returning +58.86%.

Management Discussion of Fund Performance (Unaudited) (continued)

KraneShares MSCI Emerging Markets ex China Index ETF (continued)

•   The best performing sectors across the Emerging Market equity market included Information Technology (+103.94%), Materials (+96.45%), and Consumer Discretionary (+61.54%).

•   The worst performing sectors across the Emerging Market equity market included Real Estate (+20.20%), Utilities (+30.44%), and Consumer Staples (+34.12%).

By the Fund’s fiscal year end on March 31, 2021 (the “reporting period”), the NAV of the Fund increased by 71.19%, while the Underlying Index increased by 68.77%.

At the end of the reporting period, the Fund held 33.18% of the portfolio in the Information Technology sector and 21.28% in the Financials sector.

Management Discussion of Fund Performance (Unaudited) (continued)

KraneShares MSCI Emerging Markets ex China Index ETF (continued)

Growth of a $10,000 Investment‡

(at Net Asset Value)‡

AVERAGE TOTAL RETURN FOR THE PERIOD ENDED MARCH 31, 2021*

One Year Return

Annualized Inception to Date

Net Asset Value

Market Price^

Net Asset Value

Market Price^

KraneShares MSCI Emerging Markets ex China Index ETF

71.19

%

70.23

%‡

14.06

%‡

14.16

%‡

MSCI Emerging Markets Ex China Index

N/A

68.77

%‡

N/A

11.70

%‡

S&P 500 Index

N/A

56.35

%‡

N/A

19.72

%‡

*       The Fund commenced operations on April 12, 2019.

‡      Unaudited.

^      Beginning December 23, 2020, market price returns are based on the official closing price of an ETF share or, if the official closing price isn’t available, the midpoint between the national best bid and national best offer (“NBBO”) as of the time the ETF calculates current NAV per share. Prior to that date, market price returns were based on the midpoint between the Bid and Ask price. NAVs are calculated using prices as of 4:00 PM Eastern Time.

The performance data quoted herein represents past performance and the return and value of an investment in the Fund will fluctuate so that, when redeemed, may be worth less than its original cost. Current performance may be lower or higher than the performance data quoted. Past performance is no guarantee of future performance and should not be considered as a representation of the future results of the Fund. For performance data current to the most recent month end, please call 855-857-2638 or visit www.kraneshares.com. The Fund’s performance assumes the reinvestment of all dividends and all capital gains. Index returns assume reinvestment of dividends and, unlike a Fund’s returns, do not reflect any fees or expenses. If such fees and expenses were included in the index returns, the performance would have been lower. As stated in the Fund’s prospectus, as supplemented, the Fund’s gross operating expense ratio is 0.60% and its net expense ratio is 0.25% due to a Fee Waiver whereby the Fund’s investment manager, Krane

Management Discussion of Fund Performance (Unaudited) (continued)

KraneShares MSCI Emerging Markets ex China Index ETF (concluded)

Funds Advisors, LLC, has contractually agreed to reduce its management fee by 0.35% of the Fund’s average daily net assets until August 1, 2021. Please note that one cannot invest directly in an unmanaged index. There are no assurances that the Fund will meet its stated objectives. The Fund’s holdings and allocations are subject to change and should not be considered recommendations to buy individual securities. For further information on the Fund’s objectives, risks, and strategies, see the Fund’s prospectus. Returns shown do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption of Fund shares.

Management Discussion of Fund Performance (Unaudited) (continued)

KraneShares MSCI China ESG Leaders Index ETF

The KraneShares MSCI China ESG Leaders Index ETF (the “Fund”) seeks to provide investment results that, before fees and expenses, correspond generally to the price and yield performance of a specific equity securities index. The Fund’s current index is the MSCI China ESG Leaders 10/40 Index (the “Underlying Index”).

The Underlying Index is designed to provide exposure to companies with high Environmental, Social and Governance (ESG) ratings relative to their sector peers. The Underlying Index consists of large and mid-cap companies in China. In order to ensure diversification, the Underlying Index limits individual constituent weights to 10% and sector weights to 40% of its composition.

China Review

Global equity markets continued their upward trend in the second half of 2020, powered by growth and technology stocks as pandemic-induced trends favorable to the internet sector persisted worldwide. In 2021, vaccine availability turbocharged a global economic recovery, leading to a cyclical/value rotation that placed considerable pressure on growth stocks. This downside pressure was compounded by the March wind-down of leveraged bets. Meanwhile, the yield on the 10-Year US Treasury bond increased by nearly 0.75% in the first three months of 2021 from 0.92% to 1.64% despite no action from the US Federal Reserve (the Fed), accompanied by a rise in inflation in the United States. Growth and technology stocks in China followed a similar trajectory, reaching all-time highs before falling significantly. However, rates and inflation in China did not follow the US. This is a consequence of both China’s monetary response to the pandemic, which was more tactical, and China’s economy having recovered from the pandemic before the end of 2020, meaning that China experienced the inflationary effect of recovery earlier. Equity markets in the US, Europe, and China have pulled back from levels seen at the end of 2020 and beginning of 2021, though remain above pre-pandemic levels.

Chinese companies with high MSCI ESG ratings performed well during the period. Many high ESG-rated companies are engaged in internet services businesses and continued to benefit from pandemic induced trends such as work from home. Internet services companies and electric vehicles manufacturers contributed the most to the Fund’s performance for the period.

We see four key positive catalysts for China’s equity and bond markets in the year to come:

•   With the release of the 14th Five Year Plan (FYP), we now know that China’s government will continue to support “new economy” sectors such as internet services, electric vehicles, green energy and technology, and communication services. Consumer products could also see a boost from the government’s desire to upgrade the consumption habits of China’s population.

•   Foreign inflows into China’s Mainland equity market are outpacing MSCI inclusion, providing a potential long-term tailwind for the market.

•   Domestic participation in China’s Mainland equity market is also likely to increase over the next few years as domestic household assets move from real estate into equities, leading to a potential tailwind for the market. Real estate investment accounts for, on average, nearly 60% of Chinese household savings compared to 33% in the United States.

•   Although the yield differential between China and the United States has narrowed over the past year, China’s 10-year government bond still offers a nearly 150 basis-point yield pickup over the 10-Year US Treasury.

Management Discussion of Fund Performance (Unaudited) (continued)

KraneShares MSCI China ESG Leaders Index ETF (continued)

China capital market overview (April 1, 2020 to March 31, 2021)

•   China’s equity market, as measured by the MSCI China All Shares Index, was up for the period, returning +45.82%, while China’s currency, the renminbi (RMB) appreciated 7.5% against the US dollar.

•   The best performing sectors across China’s equity markets included Consumer Discretionary (+100.11%), Information Technology (+71.16%), and Consumer Staples (+64.25%).

•   The worst performing sectors across China’s equity markets were Real Estate (+15.12%), Financials (+20.16%), and Utilities (+32.24%).

By the Fund’s fiscal year end on March 31, 2021 (the “reporting period”), the NAV of the Fund increased by 29.05%, while the Underlying Index increased by 29.46%.

At the end of the reporting period, the Fund held 26.63% of the portfolio in the Consumer Discretionary sector and 16.07% in the Financials sector.

Management Discussion of Fund Performance (Unaudited) (continued)

KraneShares MSCI China ESG Leaders Index ETF (concluded)

Growth of a $10,000 Investment‡

(at Net Asset Value)‡

AVERAGE TOTAL RETURN FOR THE PERIOD ENDED MARCH 31, 2021*

		Cumulative Inception to Date
		Net Asset Value			Market Price^
KraneShares MSCI China ESG Leaders Index ETF		29.05	%		31.05	%‡
MSCI China ESG Leaders 10/40 Index		N/A			29.46	%‡

*       The Fund commenced operations on July 28, 2020.

‡      Unaudited.

^      Beginning December 23, 2020, market price returns are based on the official closing price of an ETF share or, if the official closing price isn’t available, the midpoint between the national best bid and national best offer (“NBBO”) as of the time the ETF calculates current NAV per share. Prior to that date, market price returns were based on the midpoint between the Bid and Ask price. NAVs are calculated using prices as of 4:00 PM Eastern Time.

The performance data quoted herein represents past performance and the return and value of an investment in the Fund will fluctuate so that, when redeemed, may be worth less than its original cost. Current performance may be lower or higher than the performance data quoted. Past performance is no guarantee of future performance and should not be considered as a representation of the future results of the Fund. For performance data current to the most recent month end, please call 855-857-2638 or visit www.kraneshares.com. The Fund’s performance assumes the reinvestment of all dividends and all capital gains. Index returns assume reinvestment of dividends and, unlike a Fund’s returns, do not reflect any fees or expenses. If such fees and expenses were included in the index returns, the performance would have been lower. As stated in the Fund’s prospectus, the Fund’s operating expense ratio is 0.59%. Please note that one cannot invest directly in an unmanaged index. There are no assurances that the Fund will meet its stated objectives. The Fund’s holdings and allocations are subject to change and should not be considered recommendations to buy individual securities. For further information on the Fund’s objectives, risks, and strategies, see the Fund’s prospectus. Returns shown do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption of Fund shares.

Management Discussion of Fund Performance (Unaudited) (continued)

KraneShares Global Carbon ETF

The KraneShares Global Carbon ETF (the “Fund”) seeks to provide a total return that, before fees and expenses, exceeds that of the IHS Markit Global Carbon Index (the ‘‘Index’’) over a complete market cycle.

The Index offers broad coverage of cap-and-trade carbon allowances by tracking the most traded carbon credit futures contracts. The index introduces a new measure for hedging risk and going long the price of carbon while supporting responsible investing.

Carbon Credits Market Review

Carbon Credits markets worldwide have had a phenomenal rise over the past year as auction prices rose across carbon markets in the US and Europe. Futures prices in the EU’s Emissions Trading System (ETS) have risen the most out of the three markets tracked by the IHS Markit Global Carbon Index and the EU’s ETS was the largest contributor to the Fund’s performance. Meanwhile, the American Petroleum Institute (API), one of the most powerful lobbyists in the United States, expressed support for carbon pricing to reduce emissions.1 The API’s announcement removes a formidable roadblock to the widespread expansion of emissions trading systems in the United States. The past year also saw the opening of new markets for carbon credits in the UK and China.

We see three key positive catalysts for carbon credits markets in the year to come:

•   The opening of carbon markets in the UK and China. China’s National Emissions Trading System (ETS) alone accounts for over 6% of global greenhouse gas emissions.

•   The European Union is putting into law a target of reducing net greenhouse gas emissions by at least 55% by 2030 and a net-zero target by 2050.

•   The Biden administration has set the social cost benchmark for emitting one ton of CO2 at $51 and directed federal agencies to incorporate this benchmark into all climate impact analyses.2 The new measure, though abstract, is far higher than current prices for carbon credits.

Carbon Credits Market Overview (April 1, 2020 to March 31, 2021)

•   European Union carbon allowances were sold at auction for an average price of €19.05 on May 14, 2020 compared to the March 31,2021 price of €25.92, an increase of 36.06%.3

•   Carbon allowances offered as part of the Regional Greenhouse Gas Initiative (RGGI) in the Eastern United States were sold at $5.65 on March 11, 2020 and at $7.60 on March 3, 2021, an increase of 34.51%.4

By the Fund’s fiscal year end on March 31, 2021 (the “reporting period”), the NAV of the Fund increased by 41.95%, while the Index increased by 41.52%.

70.49% of the portfolio was exposed to the European Union Allowance (EUA) 2021 Future and 14.08% was exposed to the California Carbon Allowance (CCA) Vintage 2021 Future.

1.      Mann, Ted. “Oil Trade Group is Poised to Endorse Carbon Pricing,” The Wall Street Journal. March 1, 2021.

2.      Chemnick, Jean. “Cost of Carbon Pollution Pegged at $51 a Ton,” Scientific American. March 1, 2021.

3.      Data from EMBER as of 3/31/2021.

4.      Auction prices sourced from the Regional Greenhouse Gas Initiative (RGGI).

Management Discussion of Fund Performance (Unaudited) (continued)

KraneShares Global Carbon ETF (concluded)

Growth of a $10,000 Investment‡

(at Net Asset Value)‡

AVERAGE TOTAL RETURN FOR THE PERIOD ENDED MARCH 31, 2021*

		Cumulative Inception to Date
		Net Asset Value			Market Price^
KraneShares Global Carbon ETF		41.95	%		43.45	%‡
IHS Markit Global Carbon Index		N/A			41.52	%‡

*       The Fund commenced operations on July 29, 2020.

‡      Unaudited.

^      Beginning December 23, 2020, market price returns are based on the official closing price of an ETF share or, if the official closing price isn’t available, the midpoint between the national best bid and national best offer (“NBBO”) as of the time the ETF calculates current NAV per share. Prior to that date, market price returns were based on the midpoint between the Bid and Ask price. NAVs are calculated using prices as of 4:00 PM Eastern Time.

The performance data quoted herein represents past performance and the return and value of an investment in the Fund will fluctuate so that, when redeemed, may be worth less than its original cost. Current performance may be lower or higher than the performance data quoted. Past performance is no guarantee of future performance and should not be considered as a representation of the future results of the Fund. For performance data current to the most recent month end, please call 855-857-2638 or visit www.kraneshares.com. The Fund’s performance assumes the reinvestment of all dividends and all capital gains. Index returns assume reinvestment of dividends and, unlike a Fund’s returns, do not reflect any fees or expenses. If such fees and expenses were included in the index returns, the performance would have been lower. As stated in the Fund’s prospectus, the Fund’s operating expense ratio is 0.79%. Please note that one cannot invest directly in an unmanaged index. There are no assurances that the Fund will meet its stated objectives. The Fund’s holdings and allocations are subject to change and should not be considered recommendations to buy individual securities. For further information on the Fund’s objectives, risks, and strategies, see the Fund’s prospectus. Returns shown do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption of Fund shares.

Management Discussion of Fund Performance (Unaudited) (continued)

KraneShares CICC China 5G & Semiconductor Index ETF

The KraneShares CICC China 5G & Semiconductor Index ETF (the “Fund”) seeks to provide investment results that, before fees and expenses, correspond generally to the price and yield performance of a specific equity securities index. The Fund’s current index is the CICC China 5G and Semiconductor Leaders Index (the “Underlying Index”).

The Underlying Index is designed to track the performance of companies engaged in the 5G and semiconductor related businesses, including 5G equipment, semiconductors, electronic components and big data centers.

China Review

Global equity markets continued their upward trend in the second half of 2020, powered by growth and technology stocks as pandemic-induced trends favorable to the internet sector persisted worldwide. In 2021, vaccine availability turbocharged a global economic recovery, leading to a cyclical/value rotation that placed considerable pressure on growth stocks. This downside pressure was compounded by the March wind-down of leveraged bets. Meanwhile, the yield on the 10-Year US Treasury bond increased by nearly 0.75% in the first three months of 2021 from 0.92% to 1.64% despite no action from the US Federal Reserve (the Fed), accompanied by a rise in inflation in the United States. Growth and technology stocks in China followed a similar trajectory, reaching all-time highs before falling significantly. However, rates and inflation in China did not follow the US. This is a consequence of both China’s monetary response to the pandemic, which was more tactical, and China’s economy having recovered from the pandemic before the end of 2020, meaning that China experienced the inflationary effect of recovery earlier. Equity markets in the US, Europe, and China have pulled back from levels seen at the end of 2020 and beginning of 2021, though remain above pre-pandemic levels.

Chinese companies engaged in the 5G development and semiconductor industries came under pressure from the Fund’s launch on November 24, 2020 amid a global rotation into value/cyclical stocks that was not lost on Chinese investors. Nonetheless, these companies still possess strong growth potential as China’s government continues to prioritize 5G development and import substitution in the semiconductor industry, as alluded to in the 14th Five Year Plan. The current global semiconductor shortage has only also increased pressure on China’s chipmakers to develop the capacity to produce more advanced microchips. As such, we believe that the downdraft during the period has created an attractive entry point for long-term investors.

We see four key positive catalysts for China’s equity and bond markets in the year to come:

•   With the release of the 14th Five Year Plan (FYP), we now know that China’s government will continue to support “new economy” sectors such as internet services, electric vehicles, green energy and technology, and communication services. Consumer products could also see a boost from the government’s desire to upgrade the consumption habits of China’s population.

•   Foreign inflows into China’s Mainland equity market are outpacing MSCI inclusion, providing a potential long-term tailwind for the market.

•   Domestic participation in China’s Mainland equity market is also likely to increase over the next few years as domestic household assets move from real estate into equities, leading to a potential tailwind for the market. Real estate investment accounts for, on average, nearly 60% of Chinese household savings compared to 33% in the United States.

Management Discussion of Fund Performance (Unaudited) (continued)

KraneShares CICC China 5G & Semiconductor Index ETF (continued)

•   Although the yield differential between China and the United States has narrowed over the past year, China’s 10-year government bond still offers a nearly 150 basis-point yield pickup over the 10-Year US Treasury.

China capital market overview (April 1, 2020 to March 31, 2021)

•   China’s equity market, as measured by the MSCI China All Shares Index, was up for the period, returning +45.82%, while China’s currency, the renminbi (RMB) appreciated 7.5% against the US dollar.

•   The best performing sectors across China’s equity markets included Consumer Discretionary (+100.11%), Information Technology (+71.16%), and Consumer Staples (+64.25%).

•   The worst performing sectors across China’s equity markets were Real Estate (+15.12%), Financials (+20.16%), and Utilities (+32.24%).

By the Fund’s fiscal year end on March 31, 2021 (the “reporting period”), the NAV of the Fund decreased by -7.68%, while the Underlying Index decreased by -6.81%.

At the end of the reporting period, the Fund held 94.29% of the portfolio in the Information Technology sector and 5.71% in cash.

Management Discussion of Fund Performance (Unaudited) (continued)

KraneShares CICC China 5G & Semiconductor Index ETF (continued)

Growth of a $10,000 Investment‡

(at Net Asset Value)‡

AVERAGE TOTAL RETURN FOR THE PERIOD ENDED MARCH 31, 2021*

		Cumulative Inception to Date
		Net Asset Value			Market Price^
KraneShares CICC China 5G & Semiconductor Index ETF		-7.68	%		-7.00	%‡
CICC China 5G And Semiconductor Leaders Index		N/A			-6.81	%‡
S&P 500 Index		N/A			11.65	%‡

*       The Fund commenced operations on November 23, 2020.

‡      Unaudited.

^      Beginning December 23, 2020, market price returns are based on the official closing price of an ETF share or, if the official closing price isn’t available, the midpoint between the national best bid and national best offer (“NBBO”) as of the time the ETF calculates current NAV per share. Prior to that date, market price returns were based on the midpoint between the Bid and Ask price. NAVs are calculated using prices as of 4:00 PM Eastern Time.

The performance data quoted herein represents past performance and the return and value of an investment in the Fund will fluctuate so that, when redeemed, may be worth less than its original cost. Current performance may be lower or higher than the performance data quoted. Past performance is no guarantee of future performance and should not be considered as a representation of the future results of the Fund. For performance data current to the most recent month end, please call 855-857-2638 or visit www.kraneshares.com. The Fund’s performance assumes the reinvestment of all dividends and all capital gains. Index returns assume reinvestment of dividends and, unlike a Fund’s returns, do not reflect any fees or expenses. If such fees and expenses were included in the index returns, the performance would have been lower. As stated in the Fund’s prospectus, the Fund’s gross operating expense ratio is 0.79% and its net expense ratio is 0.65% due to a Fee Waiver whereby the Fund’s investment manager, Krane Funds Advisors, LLC, has contractually agreed to reduce its management fee by 0.14% of the Fund’s average daily net assets until August 1, 2021.

Management Discussion of Fund Performance (Unaudited) (continued)

KraneShares CICC China 5G & Semiconductor Index ETF (concluded)

Please note that one cannot invest directly in an unmanaged index. There are no assurances that the Fund will meet its stated objectives. The Fund’s holdings and allocations are subject to change and should not be considered recommendations to buy individual securities. For further information on the Fund’s objectives, risks, and strategies, see the Fund’s prospectus. Returns shown do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption of Fund shares.

Management Discussion of Fund Performance (Unaudited) (continued)

KraneShares CICC China Consumer Leaders Index ETF

The KraneShares CICC China Consumer Leaders Index ETF (the “Fund”) seeks to provide investment results that, before fees and expenses, correspond generally to the price and yield performance of a specific equity securities index. The Fund’s current index is the CICC China Consumer Leaders Index (the “Underlying Index”).

The Underlying Index consists of the investable universe of publicly traded China-based companies whose primary business or businesses are in the consumption-related industries such as home appliance, food & beverage, apparel & clothing, hotels, restaurants, and duty-free goods.

China Review

Global equity markets continued their upward trend in the second half of 2020, powered by growth and technology stocks as pandemic-induced trends favorable to the internet sector persisted worldwide. In 2021, vaccine availability turbocharged a global economic recovery, leading to a cyclical/value rotation that placed considerable pressure on growth stocks. This downside pressure was compounded by the March wind-down of leveraged bets. Meanwhile, the yield on the 10-Year US Treasury bond increased by nearly 0.75% in the first three months of 2021 from 0.92% to 1.64% despite no action from the US Federal Reserve (the Fed), accompanied by a rise in inflation in the United States. Growth and technology stocks in China followed a similar trajectory, reaching all-time highs before falling significantly. However, rates and inflation in China did not follow the US. This is a consequence of both China’s monetary response to the pandemic, which was more tactical, and China’s economy having recovered from the pandemic before the end of 2020, meaning that China experienced the inflationary effect of recovery earlier. Equity markets in the US, Europe, and China have pulled back from levels seen at the end of 2020 and beginning of 2021, though remain above pre-pandemic levels.

Chinese companies engaged in consumer products sectors saw strong performance during the period as China resumed normal economic activity relatively early in the period. They also benefitted from a burgeoning preference for local brands in certain product categories. Companies in the alcoholic beverages, electronics, and appliances industries contributed the most to the Fund’s performance for the period.

We see four key positive catalysts for China’s equity and bond markets in the year to come:

•   With the release of the 14th Five Year Plan (FYP), we now know that China’s government will continue to support “new economy” sectors such as internet services, electric vehicles, green energy and technology, and communication services. Consumer products could also see a boost from the government’s desire to upgrade the consumption habits of China’s population.

•   Foreign inflows into China’s Mainland equity market are outpacing MSCI inclusion, providing a potential long-term tailwind for the market.

•   Domestic participation in China’s Mainland equity market is also likely to increase over the next few years as domestic household assets move from real estate into equities, leading to a potential tailwind for the market. Real estate investment accounts for, on average, nearly 60% of Chinese household savings compared to 33% in the United States.

•   Although the yield differential between China and the United States has narrowed over the past year, China’s 10-year government bond still offers a nearly 150 basis-point yield pickup over the 10-Year US Treasury.

Management Discussion of Fund Performance (Unaudited) (continued)

KraneShares CICC China Consumer Leaders Index ETF (continued)

China capital market overview (April 1, 2020 to March 31, 2021)

•   China’s equity market, as measured by the MSCI China All Shares Index, was up for the period, returning +45.82%, while China’s currency, the renminbi (RMB) appreciated 7.5% against the US dollar.

•   The best performing sectors across China’s equity markets included Consumer Discretionary (+100.11%), Information Technology (+71.16%), and Consumer Staples (+64.25%).

•   The worst performing sectors across China’s equity markets were Real Estate (+15.12%), Financials (+20.16%), and Utilities (+32.24%).

By the Fund’s fiscal year end on March 31, 2021 (the “reporting period”), the NAV of the Fund increased by 3.28%, while the Underlying Index increased by 4.12%.

At the end of the reporting period, the Fund held 61.47% of the portfolio in the Consumer Staples sector and 38.47% in the Consumer Discretionary sector.

Management Discussion of Fund Performance (Unaudited) (continued)

KraneShares CICC China Consumer Leaders Index ETF (concluded)

Growth of a $10,000 Investment‡

(at Net Asset Value)‡

AVERAGE TOTAL RETURN FOR THE PERIOD ENDED MARCH 31, 2021*

		Cumulative Inception to Date
		Net Asset Value			Market Price^
KraneShares CICC China Consumer Leaders Index ETF		3.28	%		4.44%‡
CICC China Consumer Leaders Index		N/A			4.12%‡
S&P 500 Index		N/A			8.12%‡

*       The Fund commenced operations on December 8, 2020.

‡      Unaudited.

^      Beginning December 23, 2020, market price returns are based on the official closing price of an ETF share or, if the official closing price isn’t available, the midpoint between the national best bid and national best offer (“NBBO”) as of the time the ETF calculates current NAV per share. Prior to that date, market price returns were based on the midpoint between the Bid and Ask price. NAVs are calculated using prices as of 4:00 PM Eastern Time.

The performance data quoted herein represents past performance and the return and value of an investment in the Fund will fluctuate so that, when redeemed, may be worth less than its original cost. Current performance may be lower or higher than the performance data quoted. Past performance is no guarantee of future performance and should not be considered as a representation of the future results of the Fund. For performance data current to the most recent month end, please call 855-857-2638 or visit www.kraneshares.com. The Fund’s performance assumes the reinvestment of all dividends and all capital gains. Index returns assume reinvestment of dividends and, unlike a Fund’s returns, do not reflect any fees or expenses. If such fees and expenses were included in the index returns, the performance would have been lower. As stated in the Fund’s prospectus, the Fund’s operating expense ratio is 0.69%. Please note that one cannot invest directly in an unmanaged index. There are no assurances that the Fund will meet its stated objectives. The Fund’s holdings and allocations are subject to change and should not be considered recommendations to buy individual securities. For further information on the Fund’s objectives, risks, and strategies, see the Fund’s prospectus. Returns shown do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption of Fund shares.

Management Discussion of Fund Performance (Unaudited) (continued)

KraneShares SSE STAR Market 50 Index ETF

The KraneShares SSE STAR Market 50 Index ETF (the “Fund”) seeks to provide investment results that, before fees and expenses, correspond generally to the price and yield performance of the Shanghai Stock Exchange (SSE) Science and Technology Innovation Board 50 Index (the “Underlying Index”).

The Underlying Index is comprised of the 50 largest companies listed on the SSE Science and Technology Innovation Board (STAR Market) as determined by market capitalization and liquidity.

China Review

Global equity markets continued their upward trend in the second half of 2020, powered by growth and technology stocks as pandemic-induced trends favorable to the internet sector persisted worldwide. In 2021, vaccine availability turbocharged a global economic recovery, leading to a cyclical/value rotation that placed considerable pressure on growth stocks. This downside pressure was compounded by the March wind-down of leveraged bets. Meanwhile, the yield on the 10-Year US Treasury bond increased by nearly 0.75% in the first three months of 2021 from 0.92% to 1.64% despite no action from the US Federal Reserve (the Fed), accompanied by a rise in inflation in the United States. Growth and technology stocks in China followed a similar trajectory, reaching all-time highs before falling significantly. However, rates and inflation in China did not follow the US. This is a consequence of both China’s monetary response to the pandemic, which was more tactical, and China’s economy having recovered from the pandemic before the end of 2020, meaning that China experienced the inflationary effect of recovery earlier. Equity markets in the US, Europe, and China have pulled back from levels seen at the end of 2020 and beginning of 2021, though remain above pre-pandemic levels.

Companies listed on the STAR Board of the Shanghai Stock Exchange came under pressure from the Fund’s launch on January 27, 2021 to the end of the period amid a global rotation into value/cyclical stocks that was not lost on Chinese investors. Nonetheless, these companies still possess strong growth potential as China’s leading science and technology recent IPOs. As such, we believe that the downdraft during the period has created an attractive entry point for long-term investors.

We see four key positive catalysts for China’s equity and bond markets in the year to come:

•   With the release of the 14th Five Year Plan (FYP), we now know that China’s government will continue to support “new economy” sectors such as internet services, electric vehicles, green energy and technology, and communication services. Consumer products could also see a boost from the government’s desire to upgrade the consumption habits of China’s population.

•   Foreign inflows into China’s Mainland equity market are outpacing MSCI inclusion, providing a potential long-term tailwind for the market.

•   Domestic participation in China’s Mainland equity market is also likely to increase over the next few years as domestic household assets move from real estate into equities, leading to a potential tailwind for the market. Real estate investment accounts for, on average, nearly 60% of Chinese household savings compared to 33% in the United States.

•   Although the yield differential between China and the United States has narrowed over the past year, China’s 10-year government bond still offers a nearly 150 basis-point yield pickup over the 10-Year US Treasury.

Management Discussion of Fund Performance (Unaudited) (continued)

KraneShares SSE STAR Market 50 Index ETF (continued)

China capital market overview (April 1, 2020 to March 31, 2021)

•   China’s equity market, as measured by the MSCI China All Shares Index, was up for the period, returning +45.82%, while China’s currency, the renminbi (RMB) appreciated 7.5% against the US dollar.

•   The best performing sectors across China’s equity markets included Consumer Discretionary (+100.11%), Information Technology (+71.16%), and Consumer Staples (+64.25%).

•   The worst performing sectors across China’s equity markets were Real Estate (+15.12%), Financials (+20.16%), and Utilities (+32.24%).

By the Fund’s fiscal year end on March 31, 2021 (the “reporting period”), the NAV of the Fund decreased by -15.76%, while the Underlying Index decreased by -16.59%.

At the end of the reporting period, the Fund held 64.39% of the portfolio in the Information Technology sector and 14.69% in the Health Care sector.

Management Discussion of Fund Performance (Unaudited) (concluded)

KraneShares SSE STAR Market 50 Index ETF (concluded)

Growth of a $10,000 Investment‡

(at Net Asset Value)‡

AVERAGE TOTAL RETURN FOR THE PERIOD ENDED MARCH 31, 2021*

		Cumulative Inception to Date
		Net Asset Value			Market Price^
KraneShares SSE Star Market 50 Index ETF		-15.76	%		-15.16	%‡
SSE Science & Technology Innovation Board 50 Index		N/A			-16.59	%‡

*       The Fund commenced operations on January 26, 2021.

‡      Unaudited.

^      Beginning December 23, 2020, market price returns are based on the official closing price of an ETF share or, if the official closing price isn’t available, the midpoint between the national best bid and national best offer (“NBBO”) as of the time the ETF calculates current NAV per share. Prior to that date, market price returns were based on the midpoint between the Bid and Ask price. NAVs are calculated using prices as of 4:00 PM Eastern Time.

The performance data quoted herein represents past performance and the return and value of an investment in the Fund will fluctuate so that, when redeemed, may be worth less than its original cost. Current performance may be lower or higher than the performance data quoted. Past performance is no guarantee of future performance and should not be considered as a representation of the future results of the Fund. For performance data current to the most recent month end, please call 855-857-2638 or visit www.kraneshares.com. The Fund’s performance assumes the reinvestment of all dividends and all capital gains. Index returns assume reinvestment of dividends and, unlike a Fund’s returns, do not reflect any fees or expenses. If such fees and expenses were included in the index returns, the performance would have been lower. As stated in the Fund’s prospectus, the Fund’s operating expense ratio is 0.89%. Please note that one cannot invest directly in an unmanaged index. There are no assurances that the Fund will meet its stated objectives. The Fund’s holdings and allocations are subject to change and should not be considered recommendations to buy individual securities. For further information on the Fund’s objectives, risks, and strategies, see the Fund’s prospectus. Returns shown do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption of Fund shares.

Schedule of Investments March 31, 2021

KraneShares CICC China Leaders 100 Index ETF

		Shares		Value
COMMON STOCK — 100.0%‡
CHINA — 100.0%
Communication Services — 5.3%
China South Publishing & Media Group, Cl A		24,800		$	39,650
Focus Media Information Technology, Cl A		354,000			500,689
Oriental Pearl Group, Cl A		70,600			103,406
Wasu Media Holding, Cl A		19,200			24,288
					668,033
Consumer Discretionary — 25.8%
Anhui Zhongding Sealing Parts, Cl A		25,200			38,177
Changchun Faway Automobile Components, Cl A		18,500			26,335
Chongqing Zongshen Power Machinery, Cl A		23,800			25,972
Chow Tai Seng Jewellery, Cl A		10,000			53,313
FAWER Automotive Parts, Cl A		24,300			27,592
Guangdong Xinbao Electrical Appliances Holdings, Cl A		11,000			58,678
Guangzhou Automobile Group, Cl A		31,900			49,640
Haier Smart Home, Cl A		130,400			619,684
Hisense Home Appliances Group, Cl A		15,600			39,801
Huayu Automotive Systems, Cl A		54,300			228,167
Lao Feng Xiang, Cl A		4,400			37,212
Midea Group, Cl A		54,500			683,036
SAIC Motor, Cl A		120,800			362,150
Shanghai Yuyuan Tourist Mart Group, Cl A		53,500			87,411
TCL Technology Group, Cl A		483,500			688,272
Weifu High-Technology Group, Cl A		17,200			62,077
Wuchan Zhongda Group, Cl A		87,300			64,665
Xiamen Comfort Science & Technology Group, Cl A		15,000			39,436
Xiamen Intretech, Cl A		4,700			45,896
					3,237,514

The accompanying notes are an integral part of the financial statements.

Schedule of Investments March 31, 2021

KraneShares CICC China Leaders 100 Index ETF (continued)

		Shares		Value
COMMON STOCK (continued)
Consumer Staples — 8.7%
Beijing Dabeinong Technology Group, Cl A		101,100		$	129,742
Henan Shuanghui Investment & Development, Cl A		35,800			223,709
Inner Mongolia Yili Industrial Group, Cl A		115,000			701,617
Tecon Biology		25,900			42,633
					1,097,701
Energy — 2.8%
China Shenhua Energy, Cl A		113,601			348,013
Financials — 8.9%
Avic Capital, Cl A		184,400			112,418
China Merchants Securities, Cl A		127,800			382,746
GF Securities, Cl A		101,900			243,366
Guotai Junan Securities, Cl A		155,400			384,639
					1,123,169
Health Care — 5.2%
China Animal Healthcare*(A)(B)(C)		4,000			—
China Resources Sanjiu Medical & Pharmaceutical, Cl A		13,400			49,955
Guangzhou Baiyunshan Pharmaceutical Holdings, Cl A		19,300			81,922
Jinyu Bio-Technology, Cl A		38,800			113,008
Shanghai Kehua Bio-Engineering, Cl A		14,100			32,557
Xiamen Kingdomway Group, Cl A		8,400			50,455
Yunnan Baiyao Group, Cl A		17,600			323,260
					651,157
Industrials — 18.9%
Beijing New Building Materials, Cl A		34,900			229,575
Camel Group, Cl A		23,100			37,495
China Gezhouba Group, Cl A		95,200			109,982
China Meheco, Cl A		18,300			38,546
China Railway Group, Cl A		350,800			315,983
CNHTC Jinan Truck, Cl A		9,200			53,563
Fujian Longking, Cl A		25,700			37,799
Fujian Longma Environmental Sanitation Equipment, Cl A		14,400			40,602
Hangcha Group, Cl A		11,900			42,440
Hangxiao Steel Structure, Cl A		44,500			28,282
Jiangsu Expressway, Cl A		17,100			25,932
Jiangsu Linyang Energy, Cl A		36,100			39,010
Ningbo Zhoushan Port, Cl A		108,900			69,212
Shandong Hi-speed, Cl A		21,500			20,644
Shanghai Construction Group, Cl A		153,400			70,841
Shanghai Hanbell Precise Machinery, Cl A		7,400			28,207
Shanghai Mechanical and Electrical Industry, Cl A		11,100			32,651
Shanghai Tunnel Engineering, Cl A		64,900			54,008
Sichuan Road & Bridge, Cl A		65,600			60,689
TangShan Port Group, Cl A		102,100			42,793
Weichai Power, Cl A		165,100			484,138
Xiamen C & D, Cl A		59,200			75,971
Xinjiang Goldwind Science & Technology, Cl A		95,100			205,384
Zhejiang Wanliyang, Cl A		23,200			26,590
Zhejiang Weixing New Building Materials, Cl A		21,700			83,543

The accompanying notes are an integral part of the financial statements.

Schedule of Investments March 31, 2021

KraneShares CICC China Leaders 100 Index ETF (continued)

		Shares		Value
COMMON STOCK (continued)
Industrials (continued)
Zhejiang Yankon Group, Cl A		24,200		$	14,606
Zhuzhou Kibing Group, Cl A		55,500			109,373
					2,377,859
Information Technology — 2.7%
Chaozhou Three-Circle Group, Cl A		37,500			239,362
Hanergy Thin Film Power Group*(A)(B)(C)		65,064			—
MLS, Cl A		25,600			51,893
Shenzhen Topband, Cl A		31,200			52,545
					343,800
Materials — 9.9%
China Lumena New Materials(A)(B)(C)		718			—
CSG Holding		47,247			45,294
DeHua TB New Decoration Materials, Cl A		18,700			30,838
Fangda Special Steel Technology, Cl A		37,100			50,551
Guangdong Tapai Group, Cl A		24,600			46,267
Hongda Xingye, Cl A		62,400			33,287
Inner Mongolia Junzheng Energy & Chemical Industry Group, Cl A		116,200			93,510
ORG Technology, Cl A		58,300			47,804
Shenzhen Jinjia Group, Cl A		30,300			44,841
Tianhe Chemicals Group*(A)(B)(C)		40,000			—
Xinyangfeng Agricultural Technology, Cl A		22,400			60,735
Yintai Gold, Cl A		57,400			77,948
Zibo Qixiang Tengda Chemical, Cl A		24,500			33,383
Zijin Mining Group, Cl A		463,100			678,995
					1,243,453
Real Estate — 10.4%
China Merchants Shekou Industrial Zone Holdings, Cl A		109,100			204,026
China Vanke, Cl A		160,000			731,573
Financial Street Holdings, Cl A		41,200			42,888
Gemdale, Cl A		77,700			142,227
Greenland Holdings, Cl A		125,700			107,094
Shanghai Lujiazui Finance & Trade Zone Development, Cl A		30,300			50,198
Shanghai Shimao, Cl A		38,800			25,665
					1,303,671
Utilities — 1.4%
Hubei Energy Group, Cl A		67,200			65,959
Shenergy, Cl A		84,500			79,848
Shenzhen Gas, Cl A		19,900			22,838
					168,645
TOTAL CHINA					12,563,015
TOTAL COMMON STOCK (Cost $11,832,245)					12,563,015
TOTAL INVESTMENTS — 100.0% (Cost $11,832,245)					12,563,015
OTHER ASSETS LESS LIABILITIES — 0.0%					6
NET ASSETS — 100%				$	12,563,021

‡      Industries are utilized for compliance purposes, whereas sectors are utilized for reporting.

The accompanying notes are an integral part of the financial statements.

Schedule of Investments March 31, 2021

KraneShares CICC China Leaders 100 Index ETF (concluded)

*       Non-income producing security.

(A)   Security is fair valued using methods determined in good faith by the Fair Value Committee of the Board of Trustees. The total value of such securities as of March 31, 2021 was $0 and represents 0.0% of Net Assets.

(B)   Level 3 security in accordance with fair value hierarchy.

(C)   Security considered illiquid. The total value of such securities as of March 31, 2021 was $0 and represents 0.0% of Net Assets. (Unaudited)

Cl — Class

The following summarizes the market value of the Fund’s investments used as of March 31, 2021, based on the inputs used to value them:

Investments in Securities		Level 1			Level 2			Level 3^			Total
Common Stock
China
Communication Services		$	668,033		$	—		$	—		$	668,033
Consumer Discretionary			3,237,514			—			—			3,237,514
Consumer Staples			1,097,701			—			—			1,097,701
Energy			348,013			—			—			348,013
Financials			1,123,169			—			—			1,123,169
Health Care			651,157			—			—			651,157
Industrials			2,377,859			—			—			2,377,859
Information Technology			343,800			—			—			343,800
Materials			1,243,453			—			—			1,243,453
Real Estate			1,303,671			—			—			1,303,671
Utilities			168,645			—			—			168,645
Total Common Stock			12,563,015			—			—			12,563,015
Total Investments in Securities		$	12,563,015		$	—		$	—		$	12,563,015

^      A reconciliation of Level 3 investments, including certain disclosures related to significant inputs used in valuing Level 3 investments is only presented when the Fund has over 1% of Level 3 investments at the beginning and/or end of the period in relation to net assets.

For the year ended March 31, 2021, there have been no transfers in or out of Level 3.

Amounts designated as “—” are $0 or have been rounded to $0.

The accompanying notes are an integral part of the financial statements.

Schedule of Investments March 31, 2021

KraneShares CSI China Internet ETF

		Shares		Value
COMMON STOCK — 99.5%‡
CHINA — 90.4%
Communication Services — 33.0%
Autohome ADR		440,778		$	41,111,364
Baidu ADR*		976,566			212,451,933
Bilibili ADR*		1,362,218			145,839,059
China Literature*(A)		3,767,200			37,287,016
DouYu International Holdings ADR*		1,175,678			12,238,808
HUYA ADR*(A)		522,421			10,176,761
iQIYI ADR*		2,171,509			36,090,480
JOYY ADR		418,997			39,272,589
Momo ADR		1,083,487			15,970,598
NetEase ADR		1,560,243			161,110,692
Tencent Holdings		5,049,275			396,176,932
Tencent Music Entertainment Group ADR*		3,672,462			75,248,746
Weibo ADR*		502,023			25,332,081
					1,208,307,059
Consumer Discretionary — 40.8%
Alibaba Group Holding ADR*		1,656,294			375,531,539
Alibaba Group Holding*		800			22,638
Baozun ADR*		425,460			16,227,044
Dada Nexus ADR*		664,950			18,046,743
GSX Techedu ADR*(A)		705,728			23,910,065
JD.com ADR*		1,844,800			155,571,984
Meituan, Cl B*		7,104,200			272,491,616
Pinduoduo ADR*		1,745,500			233,687,540
TAL Education Group ADR*		2,243,513			120,813,175
Trip.com Group ADR*		4,346,505			172,251,993
Vipshop Holdings ADR*		3,503,150			104,604,059
					1,493,158,396
Financials — 3.9%
Lufax Holding ADR*(A)		5,412,702			78,592,433
ZhongAn Online P&C Insurance, Cl H*(A)		10,351,200			62,444,453
					141,036,886

The accompanying notes are an integral part of the financial statements.

Schedule of Investments March 31, 2021

KraneShares CSI China Internet ETF (continued)

		Shares		Value
COMMON STOCK (continued)
Health Care — 3.7%
Alibaba Health Information Technology*		29,548,000		$	83,614,404
Ping An Healthcare and Technology*		4,186,200			52,499,469
					136,113,873
Industrials — 0.4%
51job ADR*		248,382			15,548,713
Information Technology — 3.9%
Agora ADR*(A)		516,404			25,959,629
Chindata Group Holdings ADR*		1,080,067			17,864,308
Kingsoft		6,750,000			44,800,597
Kingsoft Cloud Holdings ADR*		646,127			25,405,714
Weimob*		13,428,000			30,018,669
					144,048,917
Real Estate — 4.7%
KE Holdings ADR*		3,008,078			171,400,284
TOTAL CHINA					3,309,614,128
HONG KONG — 9.1%
Communication Services — 4.1%
Alibaba Pictures Group*		99,604,000			12,939,827
Archosaur Games*(A)		1,817,000			3,608,549
Kuaishou Technology, Cl B*		3,838,600			133,311,295
					149,859,671
Consumer Discretionary — 3.6%
JD Health International*		7,548,950			108,265,913
Koolearn Technology Holding*(A)		2,958,000			6,734,444
Tongcheng-Elong Holdings*		8,038,000			18,134,597
					133,134,954
Information Technology — 1.4%
Ming Yuan Cloud Group Holdings*(A)		8,573,000			39,091,235
Yeahka*(A)		1,578,000			10,859,032
					49,950,267
TOTAL HONG KONG					332,944,892
TOTAL COMMON STOCK (Cost $3,420,986,014)					3,642,559,020
SHORT-TERM INVESTMENT(B)(C) — 5.4%
Invesco Government & Agency Portfolio, Cl Institutional, 0.030%		199,656,233			199,656,233
TOTAL SHORT-TERM INVESTMENT (Cost $199,656,233)					199,656,233
TOTAL INVESTMENTS — 104.9% (Cost $3,620,642,247)					3,842,215,253
OTHER ASSETS LESS LIABILITIES — (4.9)%					(179,955,220	)
NET ASSETS — 100%				$	3,662,260,033

‡      Industries are utilized for compliance purposes, whereas sectors are utilized for reporting.

*       Non-income producing security.

The accompanying notes are an integral part of the financial statements.

Schedule of Investments March 31, 2021

KraneShares CSI China Internet ETF (concluded)

(A)   This security or a partial position of this security is on loan at March 31, 2021. The total market value of securities on loan at March 31, 2021 was $192,461,874.

(B)   The rate shown is the 7-day effective yield as of March 31, 2021.

(C)   This security was purchased with cash collateral held from securities on loan. The total value of such security as of March 31, 2021 was $199,656,233.

ADR — American Depositary Receipt

Cl — Class

As of March 31, 2021, all of the Fund’s investments were considered Level 1 of the fair value hierarchy, in accordance with the authoritative guidance under U.S. GAAP.

For the year ended March 31, 2021, there have been no transfers in or out of Level 3.

The accompanying notes are an integral part of the financial statements.

Schedule of Investments March 31, 2021

KraneShares Bosera MSCI China A Share ETF

		Shares		Value
COMMON STOCK — 99.9%‡
CHINA — 99.9%
Communication Services — 1.6%
Beijing Enlight Media, Cl A		399,159		$	728,819
Beijing Kunlun Tech, Cl A		159,414			576,069
China Film, Cl A		211,621			457,031
China South Publishing & Media Group, Cl A		244,211			390,443
Focus Media Information Technology, Cl A		1,997,232			2,824,836
G-bits Network Technology Xiamen, Cl A		9,608			545,023
Giant Network Group, Cl A		229,487			507,857
Leo Group, Cl A		919,006			411,796
Mango Excellent Media, Cl A		242,020			2,143,846
NanJi E-Commerce, Cl A		333,793			467,021
Oriental Pearl Group, Cl A		464,526			680,378
Perfect World, Cl A		264,901			798,595
Wuhu Sanqi Interactive Entertainment Network Technology Group, Cl A		288,931			967,037
Zhejiang Century Huatong Group, Cl A*		1,014,165			1,102,084
					12,600,835
Consumer Discretionary — 7.9%
BYD, Cl A		247,109			6,195,803
Changzhou Xingyu Automotive Lighting Systems, Cl A		37,301			1,074,482
China Tourism Group Duty Free, Cl A		265,603			12,390,381
Chongqing Changan Automobile, Cl A		606,934			1,312,625
Ecovacs Robotics, Cl A*		63,755			1,326,367
FAW Jiefang Group, Cl A		418,103			695,861
Fuyao Glass Industry Group, Cl A		272,489			1,913,719
Great Wall Motor, Cl A		303,043			1,391,618
Guangdong Xinbao Electrical Appliances Holdings, Cl A		90,800			484,363

The accompanying notes are an integral part of the financial statements.

Schedule of Investments March 31, 2021

KraneShares Bosera MSCI China A Share ETF (continued)

		Shares		Value
COMMON STOCK (continued)
Consumer Discretionary (continued)
Haier Smart Home, Cl A		858,275		$	4,078,677
Hangzhou Robam Appliances, Cl A		128,926			717,609
Huayu Automotive Systems, Cl A		428,879			1,802,139
Jason Furniture Hangzhou, Cl A		85,977			1,055,646
Joyoung, Cl A		104,387			489,861
Kuang-Chi Technologies, Cl A		292,990			902,923
Liaoning Cheng Da, Cl A		208,009			646,422
Midea Group, Cl A		477,939			5,989,899
NavInfo, Cl A		310,179			688,793
Ningbo Joyson Electronic, Cl A		185,875			510,213
Ningbo Tuopu Group, Cl A		143,420			730,958
Offcn Education Technology, Cl A		223,495			959,558
Oppein Home Group, Cl A		54,005			1,297,282
SAIC Motor, Cl A		1,059,767			3,177,104
Shandong Linglong Tyre, Cl A		186,588			1,330,903
Shanghai Jinjiang International Hotels, Cl A		116,000			981,223
Shanghai Yuyuan Tourist Mart Group, Cl A		440,169			719,169
Shenzhen MTC, Cl A		616,000			499,470
Shenzhen Overseas Chinese Town, Cl A		1,115,982			1,733,198
Songcheng Performance Development, Cl A		355,781			1,162,584
Suning.com, Cl A		1,266,059			1,327,575
Suofeiya Home Collection, Cl A		61,884			310,589
TCL Technology Group, Cl A		1,909,200			2,717,784
Wangfujing Group, Cl A		105,637			483,330
Weifu High-Technology Group, Cl A		113,574			409,899
Wuchan Zhongda Group, Cl A		688,830			510,229
Xiamen Intretech, Cl A		51,852			506,334
Zhejiang Semir Garment, Cl A		305,888			472,268
Zhejiang Supor, Cl A		74,265			809,861
					63,806,719
Consumer Staples — 19.3%
Angel Yeast, Cl A		112,010			943,034
Anhui Gujing Distillery, Cl A		52,050			1,667,279
Anhui Kouzi Distillery, Cl A		81,558			770,682
Beijing Dabeinong Technology Group, Cl A		570,700			732,380
Beijing Shunxin Agriculture, Cl A		100,890			721,631
Beijing Yanjing Brewery, Cl A		383,342			428,844
By-health, Cl A		215,198			938,695
C&S Paper, Cl A		178,458			702,822
Chacha Food, Cl A		69,015			515,519
Chongqing Brewery, Cl A		65,688			1,114,189
Chongqing Fuling Zhacai Group, Cl A		107,357			687,385
DaShenLin Pharmaceutical Group, Cl A		89,211			1,141,311
Foshan Haitian Flavouring & Food, Cl A		367,284			8,945,312
Fu Jian Anjoy Foods, Cl A		32,251			1,025,158
Fujian Sunner Development, Cl A		169,133			663,777