CHANGES TO OUR SCOTTISH WIDOWS FUNDS
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Previous objective
To provide long term capital growth mainly through investment in collective investment schemes.
Objective
To provide capital growth through investment in collective investment schemes.
These collective investment schemes will provide exposure to shares. The remainder may provide exposure to a mix of asset classes (including, but not limited to, property assets and fixed interest securities) and absolute return strategies*.
* Absolute return strategies aim to provide positive returns regardless of market conditions.
Previous policy
The Fund aims to provide exposure primarily to equities, which may include UK, overseas or emerging markets. The Fund may also provide exposure to any or all of the following asset classes: bonds (which may include UK Government bonds, index linked securities other Sterling denominated fixed interest securities, covered bonds, high yield bonds and overseas bonds), private equity, hedge funds, commodities, as well as UK or overseas property. The Fund aims to achieve exposure to the different asset classes mainly through investment in regulated and unregulated collective investment schemes which may include up to 100% investment in collective investment schemes managed, advised or operated by companies in the Group.
In addition, the Fund may invest directly or indirectly, at the Investment Adviser's discretion, in transferable securities including warrants, other collective investment schemes, money market instruments, cash, near cash, deposits, permitted derivative contracts and forward contracts.
Use may also be made of stocklending/repos, borrowing, hedging and other techniques permitted by the FCA Rules.
It is intended that derivatives will be used for investment purposes as well as for efficient portfolio management, including hedging of the Fund. The use of derivatives for the purpose of meeting the investment objective of the Fund is not intended to change the risk profile of the Fund.
Non-sterling investments may be hedged back to sterling.
Policy
At least 70% of the Fund will provide exposure to shares. This includes UK and overseas shares and may include emerging markets shares.
A combined maximum of 30% of the Fund may provide exposure to fixed income securities, UK and overseas property and absolute return strategies.
The Fund’s fixed interest exposure may include sterling denominated and overseas high yield bond* funds and sterling denominated and overseas investment grade bond* funds. These may include corporate, government, covered bonds and index-linked bonds.
The Fund may also provide exposure to private equity, commodities and directly or indirectly cash and cash like investments.
The ACD is responsible for determining the percentage of the Fund normally allocated to each asset class based on its medium to long term outlook for that asset class. The ACD may review and change this from time to time based on their view at the time.
The Investment Adviser may make shorter term allocation changes, which vary from the above, allocating more or less to specific asset classes. This is based on their short term view of the asset class.
The ACD is also responsible for selecting the collective investment schemes used by the Fund. These may be actively or passively managed** collective investment schemes which may include up to 100% investment in collective investment schemes managed, advised or operated by companies in the Group.
Derivatives can be used for investment purposes as well as for efficient portfolio management , including hedging** of the Fund. The use of derivatives for the purpose of meeting the investment objective of the Fund is not intended to change the risk profile of the Fund.
Non-sterling investments may be hedged back to sterling. Hedging aims to reduce the effect of fluctuations in the exchange rates between the currency of the asset and the currency of the Fund.
The collective investment schemes in which the Fund invests may use techniques which are not employed by the Fund itself, for example stock lending.
* Credit ratings indicate the likelihood that an issuer will be able to make their payments. Investment grade bonds have achieved or exceeded a minimum credit rating awarded by a credit rating agency. Therefore they are considered lower risk than bonds with a lower credit rating.
Non-investment grade bonds, also known as high yield bonds, have a lower credit rating than investment grade bonds, and so are considered higher risk.
**Active management is where the Investment Adviser seeks to add value by making decisions on which investments to buy, sell or hold depending on, for example company, market or economic factors.
Passive management is where the Investment Adviser aims to match a benchmark and will buy, sell or hold investments depending on the components of that benchmark.
The ACD does not quote a benchmark or outperformance target for the Fund. This is because the asset allocation of the Fund will change over time taking into consideration risk, the ACD’s view of the prospects of each asset class and the changes the Investment Adviser can make to the asset allocation.
Investors may assess the Fund relative to similar funds offered by other investment firms. A number of fund industry bodies and data providers group similar funds together and provide analysis on performance and risk characteristics of the fund group. The Investment Association “Mixed Assets Sectors” group funds with a range of different assets according to their allocation to shares, fixed interest securities and cash. More information on the Investment Association sectors can be found at www.theia.org.
Over the period 30.6.2016 to 17.1.2019 the Fund would have sat within the “Flexible Investment Sector”. Investors may wish to consider the performance of the Fund by looking at the performance of this sector.
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Previous Objective
To provide long term capital growth through investment in a broad portfolio of predominantly North American companies with the emphasis on the USA. The Fund seeks to deliver performance, before deduction of management fees, in excess of the S&P 500 Index (the “Index”) with a similar level of overall volatility, over the long term.
Objective
To provide capital growth through investment in a broad portfolio of shares in North American companies with the emphasis on the USA.
The benchmark index for the Fund is the S&P 500 Index (the “Index”). The Investment Adviser seeks to outperform the Index by 0.75%* per annum on a rolling 3 year basis, before deduction of fees.
Previous policy
To invest predominantly in a portfolio of companies which are part of the Index. This will involve investing in equities and may also include equity-linked securities being depositary receipts, warrants and preference shares.
The Investment Adviser may only take limited positions away from the Index. This means there are limitations on the extent to which the Fund’s investment in various sectors* may differ to the Index. These limited positions can be more than is held in the Index (overweight) or less than is held in the Index (underweight).
Derivatives may be used for efficient portfolio management purposes only.
* A sector is a business area, industry or economy which shares the same characteristics. Company shares are typically grouped into different sectors depending on the company’s business.
Policy
At least 80% of the Fund will be invested in a portfolio of companies which are part of the Index. This will involve investing in shares and may also include equity-linked securities being depositary receipts, warrants and preference shares**.
The Investment Adviser may only take limited positions away from the Index. This means there are limitations on the extent to which the Fund’s investment in various sectors*** may differ to the Index. These limited positions can be more than is held in the Index (overweight) or less than is held in the Index (underweight).
These limitations help to deliver a level of portfolio diversification and risk management. The limitations also help to achieve an appropriate balance between the extent to which the Fund’s composition can diverge from the Index and providing the Investment Adviser with flexibility to seek outperformance relative to the Index. As a result, the Fund’s performance may differ from the Index.
The Fund may also invest in collective investment schemes, including those managed by the ACD and its associates, cash and cash like investments.
Derivatives and stock lending may be used for the purpose of managing the Fund in a way that is designed to reduce risk or cost and/or generate extra income or growth (often referred to as efficient portfolio management).
* Note: there are Share Classes in the Fund where fees exceed the Fund’s outperformance target relative to the Index. For those Share Classes, the Fund will underperform the Index after deduction of fees even if its outperformance target is achieved.
** A preference share usually issues a fixed dividend payment which takes priority over payments of ordinary shares.
*** A sector is a business area, industry or economy which shares the same characteristics. Company shares are typically grouped into different sectors depending on the company’s business.
The S&P 500 Index has been selected as an appropriate benchmark as it provides a representation of the returns of securities in the North American equities market.
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Previous Objective
To provide long term capital growth
Objective
To track the performance of the Asia Pacific (excluding Japan) equity market, as represented by the MSCI Pacific ex- Japan Index (the “Index”), before deduction of fees, by investing in Asia Pacific shares (excluding Japan).
Previous policy
The Fund will invest primarily in Asia Pacific equities (but excluding Japanese equities).
The Fund may also invest in equity-linked securities (excluding Japanese equity-linked securities) being preference shares, rights issues, American Depositary Receipts and Global Depositary Receipts as well as equity linked notes, cash, near cash, deposits, other collective investment schemes and warrants.
Use may also be made of stocklending/repos, borrowing and hedging.
It is not currently intended that derivatives will be used for any purpose other than the efficient portfolio management (including hedging) of the Fund, although derivatives may, subject to the ACD giving not less than 60 days' notice to shareholders, be used in the pursuit of its investment objective in the future as well as for efficient portfolio management (including hedging) which may change the risk profile of the Fund.
Note: The fund’s current benchmark index is the MSCI Pacific ex- Japan Index. The fund will usually invest in equities which are included in the benchmark, however, the fund isn’t limited to investing only within the index. In accordance with the FCA Rules, the ACD may at its discretion replace the current index with such similar index as it may consider appropriate.
Policy
The Fund aims to invest in shares of all of the companies within the Index. This is often referred to as a ‘full replication’ approach.
Where the ACD believes it can provide an advantage to the Fund in managing costs, to achieve a more efficient way of tracking the Index, or where there are exceptional market circumstances, the Fund may include or exclude specific shares and/or other security types which are representative of a share in the Index (such as depositary receipts).
The Fund may also invest in collective investment schemes to gain exposure to the Index.
Derivatives and stock lending may be used for the purpose of managing the Fund in a way that is designed to reduce risk or cost and/or generate extra income or growth (often referred to as efficient portfolio management).
It is not currently intended that derivatives will be used for any purpose other than the efficient portfolio management (including hedging) of the Fund, although derivatives may, subject to the ACD giving not less than 60 days' notice to shareholders, be used in the pursuit of its investment objective in the future as well as for efficient portfolio management (including hedging) which may change the risk profile of the Fund.
Note: In accordance with the FCA Rules, the ACD may at its discretion replace the Index with such similar index as it may consider appropriate.
The MSCI Pacific ex- Japan Index provides a representation of the returns of securities in the Asia Pacific ex-Japan equity market.
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Previous Objective
To provide long term capital growth mainly through investment in collective investment schemes.
Objective
To provide capital growth through investment in collective investment schemes.
These collective investment schemes will provide exposure to shares with the remainder providing exposure to a mix of asset classes (including, but not limited to, fixed interest securities and property assets) and absolute return strategies*.
* Absolute return strategies aim to provide positive returns regardless of market conditions.
Previous policy
The Fund aims to provide exposure to a combination of equities, property and bonds. Equity exposure may include UK, overseas and emerging markets. Property exposure may include UK or overseas property. Bond exposure may include UK Government bonds, index linked securities, other Sterling denominated fixed interest securities, covered bonds, high yield bonds and overseas bonds. The Fund may also provide exposure to any or all of the following asset classes: private equity, hedge funds and commodities. The Fund aims to achieve exposure to the different asset classes mainly through investment in regulated and unregulated collective investment schemes which may include up to 100% investment in collective investment schemes managed, advised or operated by companies in the Group.
In addition the Fund may invest directly or indirectly, at the Investment Adviser's discretion, in transferable securities including warrants, other collective investment schemes, money market instruments, cash, near cash, deposits, permitted derivative contracts and forward contracts.
Use may also be made of stocklending/repos, borrowing, hedging and other techniques permitted by the FCA Rules.
It is intended that derivatives will be used for investment purposes as well as for efficient portfolio management, including hedging of the Fund. The use of derivatives for the purpose of meeting the investment objective of the Fund is not intended to change the risk profile of the Fund.
Non-sterling investments may be hedged back to sterling.
Policy
Between 30% and 65% of the Fund will provide exposure to shares. This may include UK, overseas and emerging market shares.
Between 10% and 40% of the Fund will provide exposure to fixed interest securities. This will include sterling denominated investment grade bond funds which may consist of corporate and UK Government bonds, covered bonds and index-linked bonds. It may also invest in overseas corporate and government bond funds and high yield bond* funds.
A maximum of 25% of the Fund will provide exposure to property. This may include UK and overseas property funds.
The Fund may also provide exposure to absolute return strategies, private equity, commodities and directly or indirectly cash and cash like investments.
The ACD is responsible for determining the percentage of the Fund normally allocated to each asset class based on its medium to long term outlook for that asset class. The ACD may review and change this from time to time based on their view at the time.
The Investment Adviser may make shorter term allocation changes, which vary from the above, allocating more or less to specific asset classes. This is based on their short term view of the asset class.
The ACD is also responsible for selecting the collective investment schemes used by the Fund. These may be actively or passively managed ** collective investment schemes which may include up to 100% investment in collective investment schemes managed, advised or operated by companies in the Group.
Derivatives can be used for investment purposes as well as for efficient portfolio management , including hedging of the Fund. The use of derivatives for the purpose of meeting the investment objective of the Fund is not intended to change the risk profile of the Fund.
Non-sterling investments may be hedged back to sterling. Hedging aims to reduce the effect of fluctuations in the exchange rates between the currency of the asset and the currency of the Fund.
The collective investment schemes in which the Fund invests may use techniques which are not employed by the Fund itself, for example stock lending.
* Credit ratings indicate the likelihood that an issuer will be able to make their payments. Investment grade bonds have achieved or exceeded a minimum credit rating awarded by a credit rating agency. Therefore they are considered lower risk than bonds with a lower credit rating.
Non-investment grade bonds, also known as high yield bonds, have a lower credit rating than investment grade bonds, and so are considered higher risk.
**Active management is where the Investment Adviser seeks to add value by making decisions on which investments to buy, sell or hold depending on, for example company, market or economic factors.
Passive management is where the Investment Adviser aims to match a benchmark and will buy, sell or hold investments depending on the components of that benchmark.
The ACD does not quote a benchmark or outperformance target for the Fund. This is because the asset allocation of the Fund will change over time taking into consideration risk, the ACD’s view of the prospects of each asset class and the changes the Investment Adviser can make to the asset allocation.
Investors may assess the Fund relative to similar funds offered by other investment firms. A number of fund industry bodies and data providers group similar funds together and provide analysis on performance and risk characteristics of the fund group. The Investment Association “Mixed Assets Sectors” group funds with a range of different assets according to their allocation to shares, fixed interest securities and cash. More information on the Investment Association sectors can be found at www.theia.org.
Over the period 30.6.2016 to 17.1.2019 the Fund would have sat within the “Mixed Asset 40-85% Shares Sector”. Investors may wish to consider the performance of the Fund by looking at the performance of this sector which has a broadly similar allocation to shares, fixed interest securities and cash.
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Previous Objective
The Fund aims to provide long term growth by mainly investing in regulated collective investment schemes which are currently and/or which have been managed or operated within the Lloyds Banking Group. The Fund will primarily invest in a balance of fixed interest and equity funds.
Objective
The Fund aims to provide capital growth by investing in regulated collective investment schemes which are currently and/or which have been managed or operated within the Lloyds Banking Group.
These collective investment schemes will provide exposure to shares balanced with fixed interest securities and some exposure to cash.
Previous policy
The Fund will provide exposure to UK and overseas equities, sterling denominated fixed interest securities and overseas bonds. The Fund may also invest in other investments permitted by FCA Rules for this type of scheme that are consistent with the Fund’s objectives.
Non-sterling investments may be hedged back to sterling.
Derivatives may be used for efficient portfolio management purposes only.
Policy
Between 30% and 70% of the Fund will provide exposure to shares. This may include UK, overseas and emerging markets shares.
Between 30% and 70% of the Fund will provide exposure to fixed interest securities. This will include sterling denominated investment grade* bond funds which may consist of corporate and UK government bonds and index-linked bonds. It may also include overseas corporate and government bond funds and high yield bond** funds.
The Fund may invest a small amount in cash and cash like investments.
The ACD is responsible for determining the percentage of the Fund normally allocated to each asset class based on their medium to long term outlook for that asset class. The ACD may review and change this from time to time based on their view at the time.
The Investment Adviser may make shorter term allocation changes, which vary from the above, allocating more or less to specific asset classes. This is based on their short term view of the asset class.
The ACD is also responsible for selecting the collective investment schemes used by the Fund which may be actively or passively managed***.
Non-sterling investments may be hedged back to sterling. Hedging aims to reduce the effect of fluctuations in the exchange rates between the currency of the asset and the currency of the Fund.
The collective investment schemes in which the Fund invests may use techniques which are not employed by the Fund itself, for example stock lending.
Derivatives may be used for the purpose of managing the Fund in a way that is designed to reduce risk or cost (often referred to as efficient portfolio management).
* Credit ratings indicate the likelihood that an issuer will be able to make their payments. Investment grade bonds have achieved or exceeded a minimum credit rating awarded by a credit rating agency. Therefore they are considered lower risk than bonds with a lower credit rating.
** Non-investment grade bonds, also known as high yield bonds, have a lower credit rating than investment grade bonds, and so are considered higher risk.
***Active management is where the Investment Adviser seeks to add value by making decisions on which investments to buy, sell or hold depending on, for example company, market or economic factors. Passive management is where the Investment Adviser aims to match a benchmark and will buy, sell or hold investments depending on the components of that benchmark.
The ACD does not quote a benchmark or outperformance target for the Fund. This is because the asset allocation of the Fund will change over time taking into consideration risk and the ACD’s view of the prospects of each asset class.
Investors may assess the Fund relative to similar funds offered by other investment firms. A number of fund industry bodies and data providers group similar funds together and provide analysis on performance and risk characteristics of the fund group. The Investment Association “Mixed Assets Sectors” group funds with a range of different assets according to their allocation to shares, fixed interest securities and cash. More information on the Investment Association sectors can be found at www.theia.org.
Over the period from 30.09.2015 to 17.01.2019 the Fund would have sat within the “Mixed Investment 20-60% Shares Sector”. Investors may wish to consider the performance of the Fund by looking at the performance of this sector which has a broadly similar allocation to shares, fixed interest securities and cash.
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Previous Objective
To provide long term capital growth by investing mainly in multi-manager regulated collective investment schemes. The Fund will invest in a balance of Fixed Income and Equity funds (up to a maximum of 60% in Equity funds). These investments will be diversified across a number of geographic areas including the United Kingdom and other international markets.
Objective
To provide capital growth by investing in multi-manager regulated collective investment schemes. The Fund will invest in a balance of fixed interest security and equity funds (these are funds which invest in shares.) The Fund can invest up to a maximum of 60% in equity funds and a maximum of 60% in fixed interest security funds. These investments will be diversified across the United Kingdom and a number of international markets.
Previous policy
The Fund will invest mainly in both multi-manager Equity funds and multi-manager Fixed Income funds.
The Equity funds that are selected will aim to provide capital growth by investing primarily in equity securities and will be chosen to provide a broad diversification by country, sector and companies.
The Fixed Income funds that are selected will aim to provide income and capital growth by investing primarily in investment grade bonds issued from a number of international markets and denominated in a variety of currencies. Non-sterling fixed income investments may be hedged back to sterling.
Derivatives may be used for efficient portfolio management purposes only.
Policy
The Fund will invest in both multi-manager equity funds and multi-manager fixed interest security funds.
The Equity funds that are selected will be chosen to provide a broad diversification by country, sector* and companies.
The fixed interest security funds that are selected invest primarily in investment grade* bonds issued from the UK and a number of international markets and denominated in a variety of currencies. Non-sterling fixed interest security investments may be hedged back to sterling***.
The Fund may invest a small amount in cash and cash-like investments.
Russell Investments Limited is responsible for determining the percentage of the Fund normally allocated to each asset class based on its medium to long term outlook for that asset class. Russell Investments Limited may review and change this from time to time based on their view at the time.
The Investment Adviser may make shorter term allocation changes, which vary from the above, allocating more or less to specific asset classes. This is based on their short term view of the asset class.
Russell Investments Limited is responsible for selecting the multi-manager collective investment schemes used by the Fund. These may be actively or passively managed **** and may include those managed by the ACD and its associates.
The collective investment schemes in which the Fund invests may use techniques which are not employed by the Fund itself, for example stock lending.
Derivatives may be used for the purpose of managing the Fund in a way that is designed to reduce risk or cost (often referred to as efficient portfolio management).
* Credit ratings indicate the likelihood that an issuer will be able to make their payments. Investment grade bonds have achieved or exceeded a minimum credit rating awarded by a credit rating agency. Therefore they are considered lower risk than bonds with a lower credit rating.
** A sector is a business area, industry or economy which shares the same characteristics. Company shares are typically grouped into different sectors depending on the company’s business.
*** Hedging aims to reduce the effect of fluctuations in the exchange rates between the currency of the asset and the currency of the Fund.
****Active management is where the Investment Adviser seeks to add value by making decisions on which investments to buy, sell or hold depending on, for example company, market or economic factors.
Passive management is where the Investment Adviser aims to match a benchmark and will buy, sell or hold investments depending on the components of that benchmark.
The ACD does not quote a benchmark or outperformance target for the Fund. This is because the asset allocation of the Fund will change over time taking into consideration risk and the ACD’s view of the prospects of each asset class.
Investors may assess the Fund relative to similar funds offered by other investment firms. A number of fund industry bodies and data providers group similar funds together and provide analysis on performance and risk characteristics of the fund group. The Investment Association “Mixed Assets Sectors” group funds with a range of different assets according to their allocation to shares, fixed interest securities and cash. More information on the Investment Association sectors can be found at https://www.theia.org/industry-data/fund-sectors .
Over the period from 25.04.2013 to 17.01.2019 the Fund would have sat within the “Mixed Investment 40-85% Shares Sector”. Investors may wish to consider the performance of the Fund by looking at the performance of this sector which has a broadly similar allocation to shares, fixed interest securities and cash.
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Previous Objective
To provide a level of income which is compatible with a high level of capital security through investment in financial instruments in which a non-UCITS retail scheme equivalent to a money market scheme (see Note 1) is authorised to invest.
Note 1: Being a scheme which is dedicated to investment in deposits and debentures which are not transferable securities. This type of scheme may also invest in transferable securities but not more than 5% of the scheme property can be invested in warrants, not more than 10% can be invested in appropriate collective investment schemes and the use of derivatives is restricted to efficient portfolio management.
Objective
To provide a return in line with money markets* and with a high level of capital security by investing in short-term money market assets.
The benchmark index for the Fund is the 7 Days Sterling LIBOR (the “Index”). The Fund is actively managed by the Investment Adviser who chooses investments with the aim of outperforming the Index by 0.05% per annum on a rolling 3 year basis, before deduction of fees.
The Fund is a short-term Variable Net Asset Value (VNAV) money market fund, which is a form of qualifying money market fund. It will invest in assets in which a short term VNAV fund is authorised to invest and accordingly its investment objective and policy meets the conditions specified in the definition of qualifying money market fund.
Previous policy
The Fund will invest in short dated gilts, treasury bills and money market instruments such as bank and building society deposits, local authority bonds, local authority deposits, and certificates of deposit.
Policy
The Fund may invest in bank and building society deposits, as well as certificates of deposit.
The Fund may also invest in short dated gilts and treasury bills.
The net asset value of the Fund will fluctuate daily. The Fund’s Share price is calculated in accordance with the Money Market Fund Regulation.
*The money market is where financial institutions and companies access short-term borrowing and lending.
The 7 Days Sterling LIBOR has been selected as an appropriate benchmark as it is a representation of the rate which banks are willing to lend for short-term deposits in the London interbank market.
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Previous Objective
To provide long term capital growth mainly through investment in collective investment schemes.
Objective
To provide capital growth through investment in collective investment schemes.
These collective investment schemes will provide exposure to fixed interest securities with the remainder providing exposure to a mix of asset classes (including, but not limited to, shares and property assets) and absolute return strategies*.
* Absolute return strategies aim to provide positive returns regardless of market conditions.
Previous policy
The Fund aims to provide exposure primarily to bonds and property, which may include UK Government bonds, index linked securities, other Sterling denominated fixed interest securities, covered bonds, high yield bonds, overseas bonds and UK or overseas property. The Fund may also provide exposure to any or all of the following asset classes: equities (which may include UK, overseas and emerging markets), private equity, hedge funds and commodities. The Fund aims to achieve exposure to the different asset classes mainly through investment in regulated and unregulated collective investment schemes which may include up to 100% investment in collective investment schemes managed, advised or operated by companies in the Group.
In addition the Fund may invest directly or indirectly, at the Investment Adviser's discretion, in transferable securities including warrants, other collective investment schemes, money market instruments, cash, near cash, deposits, permitted derivative contracts and forward contracts.
Use may also be made of stocklending, borrowing, hedging and other techniques permitted by the FCA Rules.
It is intended that derivatives will be used for investment purposes as well as for efficient portfolio management, including hedging of the Fund. The use of derivatives for the purpose of meeting the investment objective of the Fund is not intended to change the risk profile of the Fund.
Non-sterling investments may be hedged back to sterling.
Policy
Between 40% and 80% of the Fund will provide exposure to fixed interest securities.
This will include sterling denominated investment grade bond funds which may consist of corporate and UK Government bonds, covered bonds and index-linked bonds. It may also invest in overseas corporate and government bond funds and high yield bond*funds.
A maximum of 25% of the Fund will provide exposure to shares. This may include UK, overseas and emerging market shares.
A maximum of 20% of the Fund will provide exposure to property. This may include UK and overseas property funds.
The Fund may also provide exposure to absolute return strategies, private equity, commodities and directly or indirectly cash and cash like investments.
The ACD is responsible for determining the percentage of the Fund normally allocated to each asset class based on its medium to long term outlook for that asset class. The ACD may review and change this from time to time based on their view at the time.
The Investment Adviser may make shorter term allocation changes, which vary from the above, allocating more or less to specific asset classes. This is based on their short term view of the asset class.
The ACD is also responsible for selecting the collective investment schemes used by the Fund. These may be actively or passively managed ** collective investment schemes which may include up to 100% investment in collective investment schemes managed, advised or operated by companies in the Group.
Derivatives can be used for investment purposes as well as for efficient portfolio management, including hedging of the Fund. The use of derivatives for the purpose of meeting the investment objective of the Fund is not intended to change the risk profile of the Fund.
Non-sterling investments may be hedged back to sterling. Hedging aims to reduce the effect of fluctuations in the exchange rates between the currency of the asset and the currency of the Fund.
The collective investment schemes in which the Fund invests may use techniques which are not employed by the Fund itself, for example stock lending.
* Credit ratings indicate the likelihood that an issuer will be able to make their payments. Investment grade bonds have achieved or exceeded a minimum credit rating awarded by a credit rating agency. Therefore they are considered lower risk than bonds with a lower credit rating. Non-investment grade bonds, also known as high yield bonds, have a lower credit rating than investment grade bonds, and so are considered higher risk.
**Active management is where the Investment Adviser seeks to add value by making decisions on which investments to buy, sell or hold depending on, for example company, market or economic factors.
Passive management is where the Investment Adviser aims to match a benchmark and will buy, sell or hold investments depending on the components of that benchmark.
The ACD does not quote a benchmark or outperformance target for the Fund. This is because the asset allocation of the Fund will change over time taking into consideration risk, the ACD’s view of the prospects of each asset class and the changes the fund manager can make to the asset allocation.
Investors may assess the Fund relative to similar funds offered by other investment firms. A number of fund industry bodies and data providers group similar funds together and provide analysis on performance and risk characteristics of the fund group. The Investment Association “Mixed Assets Sectors” group funds with a range of different assets according to their allocation to shares, fixed interest securities and cash. More information on the Investment Association sectors can be found at www.theia.org .
Over the period 30.6.2016 to 17.1.2019 the Fund would have sat within the “Mixed Asset 0-35% Shares Sector”. Investors may wish to consider the performance of the Fund by looking at the performance of this sector which has a broadly similar allocation to equities, fixed interest securities and cash.
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Previous Objective
To provide income and the prospect of capital growth over the long term by investing mainly in multi-manager regulated collective investment schemes. The Fund will invest primarily in Fixed Income funds (at least 80%) while maintaining a low exposure to Equity funds. These investments will be diversified across a number of geographic areas including the United Kingdom and other international markets.
Objective
To provide income and the prospect of capital growth by investing in multi-manager regulated collective investment schemes. The Fund will invest at least 80% in fixed interest security funds while maintaining a low proportion (up to a maximum of 20%) in equity funds (these are funds which invest in shares). These investments will be diversified across the United Kingdom and a number of international markets.
Previous policy
The Fund will invest mainly in both multi-manager Fixed Income funds and multi-manager Equity funds.
The Fixed Income funds that are selected will aim to provide income and capital growth by investing primarily in investment grade bonds issued from a number of international markets and denominated in a variety of currencies. Non-sterling fixed income investments may be hedged back to sterling.
The Equity funds that are selected will aim to provide capital growth by investing primarily in equity securities and will be chosen to provide a broad diversification by country, sector and companies.
Derivatives may be used for efficient portfolio management purposes only.
Policy
The Fund will invest in both multi-manager fixed interest security funds and multi-manager equity funds.
The fixed interest security funds invest primarily in investment grade* bonds issued from the UK and a number of international markets and denominated in a variety of currencies. Non-sterling fixed interest security investments may be hedged back to sterling**.
The equity funds that are selected will be chosen to provide a broad diversification by country, sector*** and companies.
The Fund may invest a small amount in cash and cash-like investments.
Russell Investments Limited is responsible for determining the percentage of the Fund normally allocated to each asset class based on its medium to long term outlook for that asset class. Russell Investments Limited may review and change this from time to time based on their view at the time.
The Investment Adviser may make shorter term allocation changes, which vary from the above, allocating more or less to specific asset classes. This is based on their short term view of the asset class.
Russell Investments Limited is responsible for selecting the multi-manager collective investment schemes used by the Fund. These may be actively or passively managed **** and may include those managed by the ACD and its associates.
The collective investment schemes in which the Fund invests may use techniques which are not employed by the Fund itself, for example stock lending.
Derivatives may be used for the purpose of managing the Fund in a way that is designed to reduce risk or cost (often referred to as efficient portfolio management).
* Credit ratings indicate the likelihood that an issuer will be able to make their payments. Investment grade bonds have achieved or exceeded a minimum credit rating awarded by a credit rating agency. Therefore they are considered lower risk than bonds with a lower credit rating.
**Hedging aims to reduce the effect of fluctuations in the exchange rates between the currency of the asset and the currency of the Fund.
*** A sector is a business area, industry or economy which shares the same characteristics. Company shares are typically grouped into different sectors depending on the company’s business.
****Active management is where the Investment Adviser seeks to add value by making decisions on which investments to buy, sell or hold depending on, for example company, market or economic factors.
Passive management is where the Investment Adviser aims to match a benchmark and will buy, sell or hold investments depending on the components of that benchmark.The ACD does not quote a benchmark or outperformance target for the Fund. This is because the asset allocation of the Fund will change over time taking into consideration risk and the ACD’s view of the prospects of each asset class.
Investors may assess the Fund relative to similar funds offered by other investment firms. A number of fund industry bodies and data providers group similar funds together and provide analysis on performance and risk characteristics of the fund group. The Investment Association “Mixed Assets Sectors” group funds with a range of different assets according to their allocation to shares, fixed interest securities and cash. More information on the Investment Association sectors can be found at
https://www.theia.org/industry-data/fund-sectors .Over the period from 25.04.2013 to 17.01.2019 the Fund would have sat within the “Mixed Investment 0-35% Shares Sector”. Investors may wish to consider the performance of the Fund by looking at the performance of this sector which has a broadly similar allocation to shares, fixed interest securities and cash.
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Previous objective
To provide long term capital growth.
Objective
To provide capital growth by investing in a portfolio of global investment grade corporate bonds.
The benchmark index for the Fund is the Bloomberg Barclays Global Aggregate Corporate Bond Index (the “Index”). The Fund is actively managed by the Investment Adviser who chooses investments with the aim of outperforming the Index by 1% per annum on a rolling 3 year basis, before deduction of fees.
Previous policy
The Fund will invest predominantly in a diversified portfolio of investment grade corporate bonds issued anywhere in the world.
The Fund may also invest in other transferable securities, money market instruments, deposits, cash, near cash, other collective investment schemes and warrants.
Derivatives may be used for investment purposes as well as for efficient portfolio management, including hedging of the Fund. The use of derivatives for the purpose of meeting the investment objective of the Fund is not intended to change the risk profile of the Fund.
Use may also be made of stocklending/repos and hedging. Non sterling investments may be hedged back to sterling.
Policy
At least 80% of the Fund will invest in a diversified portfolio of global investment grade* corporate bonds.
The Fund may also invest in non-investment grade corporate bonds**, government bonds, supranational bonds (these are a type of fixed interest security issued by two or more governmental organisations) and asset backed securities such as securitised loans.
In addition the Fund may invest in collective investment schemes including those managed by the ACD and its associates, cash and cash like investments.
Derivatives and stock lending may be used for the purpose of managing the Fund in a way that is designed to reduce risk (hedging) or cost and/or generate extra income or growth (often referred to as efficient portfolio management).
Derivatives may also be used for investment purposes as well as for efficient portfolio management. The use of derivatives for the purpose of meeting the investment objective of the Fund is not intended to change the risk profile of the Fund.
The Fund’s non-UK investments may be hedged back to Sterling through derivatives to offset the effect of currency exchange rates.
In selecting bonds for the Fund the Investment Adviser may consider the issuers’ credit worthiness, valuation and risks. Regional and global economic factors and monetary policy may also be taken into account.
The ACD limits the extent to which the Fund’s composition can differ relative to the market for corporate bonds (as represented by the Index). These limits help to deliver a level of portfolio diversification and risk management. The limits also help to achieve an appropriate balance between the extent to which the Fund’s composition can diverge from the Index and providing the Investment Adviser with flexibility to seek outperformance relative to the Index. As a result, the Fund’s performance may differ from the Index.
*Credit ratings indicate the likelihood that an issuer will be able to make their payments. Investment grade bonds have achieved or exceeded a minimum credit rating awarded by a credit rating agency. Therefore they are considered lower risk than bonds with a lower credit rating.
**Non-investment grade bonds, also known as high yield bonds, have a lower credit rating than investment grade bonds, and so are considered higher risk.
The Barclays Global Aggregate Corporate Bond Index has been selected as an appropriate benchmark as it provides a representation of the returns of securities in the global investment grade corporate bond market.
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Previous objective
To provide an attractive level of income, whilst having regard to capital value, through investments denominated in the currency of the United Kingdom, predominantly corporate bonds and other fixed interest securities issued principally by companies operating in the United Kingdom or Europe.
Objective
To provide income and the potential for capital growth, through investment in investment grade corporate bonds and other fixed interest securities denominated in Sterling.
The benchmark index for the Fund is the iBOXX Sterling Corporate and Collateralised Index (“the Index”). The Fund is actively managed by the Investment Adviser who chooses investments with the aim of outperforming the Index by 0.5% per annum on a rolling 3 year basis, before deduction of fees.
Previous policy
The Fund will invest in a diversified portfolio of securities which may include, directly or indirectly, secured and unsecured loan stock, government and other public securities, other bonds, convertible securities, preference shares and shares, however the Fund may invest in other types of investment at the discretion of the ACD.
Derivatives may be used for efficient portfolio management purposes only.
Policy
At least 80% of the Fund will invest in a diversified portfolio of Sterling denominated investment grade corporate bonds*.
The Fund may also invest in UK government bonds, Sterling denominated non-investment grade bonds**, covered bonds, supranational bonds (these are a type of fixed interest security issued by two or more governmental organisations) and asset backed securities such as securitised loans.
In addition the Fund may include cash and cash like investments.
In selecting bonds for the Fund the Investment Adviser may consider the issuers’ credit worthiness, valuation and risks. Regional and global economic factors, and monetary policy may also be taken into account.
The ACD limits the extent to which the Fund’s composition can differ relative to the market for corporate bonds (as represented by the Index). These limits help to deliver a level of portfolio diversification and risk management. The limits also help to achieve an appropriate balance between the extent to which the Fund’s composition can diverge from the Index and providing the Investment Adviser with flexibility to seek outperformance relative to the Index. As a result, the Fund’s performance may differ from the Index.
The Fund may also invest in collective investment schemes, including those managed by the ACD and its associates.
Derivatives and stock lending may be used for the purpose of managing the Fund in a way that is designed to reduce risk or cost and/or generate extra income or growth (often referred to as efficient portfolio management).
*Credit ratings indicate the likelihood that an issuer will be able to make their payments. Investment grade bonds have achieved or exceeded a minimum credit rating awarded by a credit rating agency. Therefore they are considered lower risk than bonds with a lower credit rating.
**Non-investment grade bonds, also known as high yield bonds, have a lower credit rating than investment grade bonds, and so are considered higher risk.
The iBOXX Sterling Corporate and Collateralised Index has been selected as an appropriate benchmark as it provides a representation of the returns of securities in the sterling investment grade corporate bond market.
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Previous Objective
To provide a return consistent with the variations in market annuity rates with the aim of reducing annuity conversion risk.
Objective
To provide a return consistent with the variations in market annuity rates with the aim of reducing annuity conversion risk.
The benchmark index for the Fund is the iBoxx Sterling: Non Gilt Over 15 Year index (the “Index”). The Fund is actively managed by the Investment Adviser who chooses investments with the aim of outperforming the Index by 0.25% per annum on a rolling 3 year basis, before deduction of fees.
Previous policy
The Fund will invest predominantly in long dated UK corporate fixed interest securities.
In aiming to reduce the risk of annuity conversions, the fund manager will refer to target duration and credit ratings as part of the fund management strategy. The targets will be identified at the ACD’s discretion and may change in line with market annuity rates and fixed interest yields.
The Fund may also invest in government index linked securities as well as in other transferable securities, cash or near cash instruments, deposits, money market instruments, other collective investment schemes and warrants.
The Fund does not provide any guarantee of the level of pension in retirement or the cost of buying that pension. It may not be effective for those who intend to buy an inflation-linked pension and does not provide protection against changes in the cost of buying a pension that arise from changes in life expectancy.
It is not currently intended that derivatives will be used for any purpose other than the efficient portfolio management (including hedging) of the Fund, although derivatives may, subject to the ACD giving not less than 60 days' notice to shareholders, be used in the pursuit of its investment objective in the future as well as for efficient portfolio management (including hedging) which may change the risk profile of the Fund. Use may also be made of stocklending/repos and hedging.
Policy
At least 80 of the Fund will invest in long dated Sterling denominated investment grade*corporate bonds.
In aiming to reduce the risk of annuity conversions, the Investment Adviser will refer to target duration and credit ratings as part of the fund management strategy. The targets will be identified at the ACD’s discretion and may change in line with market annuity rates and fixed interest yields.
The Fund may also invest in government bonds, In addition the Fund may invest in collective investment schemes, including those managed by the ACD and its associates, cash and cash like investments.
In selecting assets for the Fund the Investment Adviser may consider the issuers’ credit worthiness, valuation and risks. Regional and global economic factors, and monetary policy may also be taken into account.
The ACD limits the extent to which the Fund’s composition can differ relative to the market for corporate bonds (as represented by the Index). These limits help to deliver a level of portfolio diversification and risk management. The limits also help to achieve an appropriate balance between the extent to which the Fund’s composition can diverge from the Index and providing the Investment Adviser with flexibility to seek outperformance relative to the Index. As a result, the Fund’s performance may differ from the Index.
The Fund does not provide any guarantee of the level of pension in retirement or the cost of buying that pension. It may not be effective for those who intend to buy an inflation-linked pension and does not provide protection against changes in the cost of buying a pension that arise from changes in life expectancy.
Derivatives and stock lending may be used for the purpose of managing the Fund in a way that is designed to reduce risk or cost and/or generate extra income or growth (often referred to as efficient portfolio management (EPM)).
It is not currently intended that derivatives will be used for any purpose other than the EPM of the Fund, although derivatives may, subject to the ACD giving not less than 60 days' notice to shareholders, be used for investment purposes in the future as well as for EPM which may change the risk profile of the Fund.
*Credit ratings indicate the likelihood that an issuer will be able to make their payments. Investment grade bonds have achieved or exceeded a minimum credit rating awarded by a credit rating agency. Therefore they are considered lower risk than bonds with a lower credit rating.
The iBoxx Sterling Non-Gilts Index has been selected as an appropriate benchmark as it provides a representation of the returns of securities in the investment grade corporate bond market.
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Previous Objective
To track the performance of the iBoxx Sterling Non-Gilts Index.
Objective
To track the performance of the bond market as represented by the iBoxx Sterling Non-Gilts Index (“the Index”), before deduction of fees, by investing in sterling denominated investment grade corporate bonds.
Previous policy
The Fund will invest predominantly in the securities that make up the constituents of the iBoxx Sterling Non-Gilts Index.
The Fund may also invest in other transferable securities, (including asset backed securities such as securitised loans (Sterling)), cash and near cash, deposits, money market instruments, other collective investment schemes and warrants.
It is not currently intended that derivatives will be used for any purpose other than the efficient portfolio management (including hedging) of the Fund, although derivatives may, subject to the ACD giving not less than 60 days' notice to shareholders, be used in the pursuit of its investment objective in the future as well as for efficient portfolio management (including hedging) which may change the risk profile of the Fund.
Use may also be made of stocklending/repos and hedging.
Policy
The Fund aims to invest in all bonds within the Index. This is often referred to as a ‘full replication’ approach.
The Fund will invest in sterling denominated investment grade corporate bonds *.
The Fund may also include supranational bonds** and asset backed securities such as securitised loans.
The Fund may include or exclude specific bonds and/or other security types which are representative of a bond in the Index (such as depositary receipts).
The Fund may also invest in collective investment schemes, including those managed by the ACD and its associates, to gain exposure to the Index.
UK Government bonds (gilts) may be used for risk management purposes only.
Derivatives and stock lending may be used for the purpose of managing the Fund in a way that is designed to reduce risk or cost and/or generate extra income or growth (often referred to as efficient portfolio management).
It is not currently intended that derivatives will be used for any purpose other than the efficient portfolio management (including hedging) of the Fund, although derivatives may, subject to the ACD giving not less than 60 days' notice to shareholders, be used for investment purposes in the future as well as for efficient portfolio management (including hedging) which may change the risk profile of the Fund.
*Credit ratings indicate the likelihood that an issuer will be able to make their payments. Investment grade bonds have achieved or exceeded a minimum credit rating awarded by a credit rating agency. Therefore they are considered lower risk than bonds with a lower credit rating.
Non-investment grade bonds, also known as high yield bonds, have a lower credit rating than investment grade bonds, and so are considered higher risk.
**A supranational bond is a type of security which is issued by two or more governmental organisations.
The iBoxx Sterling Non-Gilts Index provides a representation of the returns of securities in the investment grade bond market.
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Previous objective
The Fund aims to deliver a total return, primarily through capital growth, in excess of the Bank of England Base Rate over any period of five consecutive years.
Investment in the Fund is at risk. There is no guarantee that the Fund will deliver a total return in excess of the Bank of England Base Rate over the specific, or any, time period.
Objective
The Fund aims to deliver a total return (mostly made up of capital growth but also income), of 2.25% per annum in excess of the Bank of England Base Rate over any period of five consecutive years before deduction of fees.
The Fund provides exposure to a diversified portfolio of investments by investing in collective investment schemes to provide exposure to shares, fixed interest securities, property assets, commodities and absolute return strategies*.
Investment in the Fund is at risk. There is no guarantee that the Fund will deliver a total return in excess of the Bank of England Base Rate over the specific, or any, time period.
Previous policy
The Fund aims to achieve the investment objective by investing through a diversified portfolio of investments.
The Fund will invest (directly or indirectly) in fixed interest securities (which may include government and supranational bonds, corporate bonds, covered bonds, high yield bonds and emerging markets debt), equities (including UK, overseas and emerging markets equities) and cash. The Fund may also gain indirect exposure to other types of asset such as property, private equity, commodities and hedge funds and direct or indirect exposure to absolute return type funds.
The Fund will achieve indirect exposure through investment in units and/or shares of collective investment schemes, companies, or other investment vehicles at the discretion of the ACD.
Where appropriate, in addition, the Fund may also invest directly in transferable securities, depositary receipts, money market instruments, near cash, derivatives and other collective investment schemes. Use may also be made of stocklending/repos, borrowing, hedging and other techniques permitted by FCA.
It is not currently intended that derivatives will be used for any purpose other than efficient portfolio management (including hedging) of the Fund, although derivatives may, subject to the ACD giving not less than 60 days' notice to shareholders, be used in the pursuit of its investment objective in the future as well as for efficient portfolio management (including hedging). If derivatives are used for the purpose of meeting the investment objective of the Fund it is not intended that the use of derivatives would raise the risk profile.Non-sterling investments may be hedged back to sterling.
Subject to the FCA Rules, the Fund’s holdings may vary over time to reflect the investment adviser’s view of the market. The Fund will be managed with the intention of minimising volatility for the level of return targeted.
Policy
Between 25% and 45% of the Fund will provide exposure to shares. This can include UK, overseas and emerging markets shares.
Between 25% and 45% of the Fund will provide exposure to fixed interest securities. This may include sterling denominated investment grade bond** funds which may consist of corporate and UK government bonds, supranational bonds***, covered bonds and index-linked bonds. It may also include overseas corporate and government, emerging market and high yield bond** funds.
A maximum of 15% of the Fund may provide exposure to property. This may include UK and overseas property funds.
The Fund may also provide exposure to absolute return strategies and other types of asset such as private equity, and directly or indirectly in cash and cash like investments.
The ACD, in conjunction with the Investment Adviser, is responsible for determining the percentage of the Fund normally allocated to each asset class based on its medium to long term outlook for that asset class. They may review and change this from time to time based on their view at that time.
The Investment Adviser is responsible for selecting the collective investment schemes used by the Fund. These may be actively or passively managed**** and include those managed by the ACD and its associates.
Derivatives may be used for the purpose of managing the Fund in a way that is designed to reduce risk or cost and/or generate extra income or growth (often referred to as efficient portfolio management).
It is not currently intended that derivatives will be used for any purpose other than efficient portfolio management (including hedging) of the Fund, although derivatives may, subject to the ACD giving not less than 60 days' notice to shareholders, be used in the pursuit of its investment objective in the future as well as for efficient portfolio management (including hedging). If derivatives are used for the purpose of meeting the investment objective of the Fund it is not intended that the use of derivatives would raise the risk profile.
Non-sterling investments may be hedged back to sterling. Hedging aims to reduce the effect of fluctuations in the exchange rates between the currency of the asset and the currency of the Fund.
The Fund will be managed with the intention of minimising volatility for the level of return targeted.
The collective investment schemes in which the Fund invests may use techniques which are not employed by the Fund itself, for example stock lending.
* Absolute return strategies aim to provide positive returns regardless of market conditions.
** Credit ratings indicate the likelihood that an issuer will be able to make their payments. Investment grade bonds have achieved or exceeded a minimum credit rating awarded by a credit rating agency. Therefore they are considered lower risk than bonds with a lower credit rating.
Non-investment grade bonds, also known as high yield bonds, have a lower credit rating than investment grade bonds, and so are considered higher risk.
*** Supranational bonds are a type of fixed interest security issued by two or more governmental organisations.
****Active management is where the Investment Adviser seeks to add value by making decisions on which investments to buy, sell or hold depending on, for example company, market or economic factors.
Passive management is where the Investment Adviser aims to match a benchmark and will buy, sell or hold investments depending on the components of that benchmark.
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Previous objective
To provide a high level of income whilst providing the potential for capital growth over the medium to long term by mainly investing in regulated collective investment schemes which are currently and/or which have been managed or operated within the Lloyds Banking Group.
The Fund will invest in a combination of primarily UK Equity and Fixed Interest funds.
Objective
To provide an income and the potential for capital growth by investing in regulated collective investment schemes which are currently and/or which have been managed or operated within the Lloyds Banking Group.
These collective investment schemes will provide exposure to fixed interest securities, shares and some exposure to cash.
Previous policy
An equity fund may be selected if it has the aim of providing above average levels of income and/or capital growth. The equity funds selected will invest primarily in equities which have a broad diversification by country, sector and company. A Fixed Interest fund may be selected if it has the aim of providing high levels of income. The fixed interest funds selected will invest primarily in government and corporate bonds issued from a number of international markets and denominated in a variety of currencies. The Fund may also invest in other regulated collective investment schemes that are consistent with the Fund's objectives at the discretion of the ACD. Non-sterling fixed interest investments may be hedged back to sterling.
Derivatives may be used for efficient portfolio management purposes only.
Policy
Between 50% and 75% of the Fund will provide exposure to fixed interest securities.
This will include sterling denominated investment grade* bond funds which may consist of corporate and UK government bonds and index-linked bonds. It may also include overseas corporate and government bond funds and high yield bond** funds.
Between 20% and 50% of the Fund will provide exposure to shares. This may include UK, overseas and emerging markets shares.
The Fund may invest a small amount in cash and cash-like investments.
The ACD is responsible for determining the percentage of the Fund normally allocated to each asset class based on their medium to long term outlook for that asset class. The ACD may review and change this from time to time based on their view at the time.
The Investment Adviser may make shorter term allocation changes, which vary from the above, allocating more or less to specific asset classes. This is based on their short term view of the asset class.
The ACD is also responsible for selecting the collective investment schemes used by the Fund which may be actively or passively managed***.
Derivatives may be used for the purpose of managing the Fund in a way that is designed to reduce risk or cost (often referred to as efficient portfolio management).
Non-sterling fixed interest investments may be hedged back to sterling. Hedging aims to reduce the effect of fluctuations in the exchange rates between the currency of the asset and the currency of the Fund.
The collective investment schemes in which the Fund invests may use techniques which are not employed by the Fund itself, for example stock lending.
* Credit ratings indicate the likelihood that an issuer will be able to make their payments. Investment grade bonds have achieved or exceeded a minimum credit rating awarded by a credit rating agency. Therefore they are considered lower risk than bonds with a lower credit rating.
** Non-investment grade bonds, also known as high yield bonds, have a lower credit rating than investment grade bonds, and so are considered higher risk.
***Active management is where the Investment Adviser seeks to add value by making decisions on which investments to buy, sell or hold depending on, for example company, market or economic factors.
Passive management is where the Investment Adviser aims to match a benchmark and will buy, sell or hold investments depending on the components of that benchmark.The ACD does not quote a benchmark or outperformance target for the Fund. This is because the asset allocation of the Fund will change over time taking into consideration risk and the ACD’s view of the prospects of each asset class.
Investors may assess the Fund relative to similar funds offered by other investment firms. A number of fund industry bodies and data providers group similar funds together and provide analysis on performance and risk characteristics of the fund group. The Investment Association “Mixed Assets Sectors” group funds with a range of different assets according to their allocation to shares, fixed interest securities and cash. More information on the Investment Association sectors can be found at
https://www.theinvestmentassociation.org/fund-sectors .Over the period from 30.09.2015 to 17.01.2019 the Fund would have sat within the “Mixed Investment 20-60% Shares Sector”. Investors may wish to consider the performance of the Fund by looking at the performance of this sector which has a broadly similar allocation to shares, fixed interest securities and cash.
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Previous Objective
To provide long term capital growth through investment predominantly in companies based in developing countries or having a significant proportion of their business activities in one or more of those developing countries. The Fund seeks to deliver performance, before deduction of management fees, in excess of the MSCI Emerging Markets Index (the “Index”) with a similar level of overall volatility, over the long term.
Objective
To provide capital growth through investment in shares of companies in developing countries.
The benchmark index for the Fund is the MSCI Emerging Markets Index (the “Index”). The Investment Adviser seeks to outperform the Index by 0.75%* per annum on a rolling 3 year basis, before deduction of fees.
Previous policy
To invest predominantly in a portfolio of companies which are part of the Index. This will involve investing in equities and may also include equity-linked securities being depositary receipts, warrants and preference shares.
The Investment Adviser may only take limited positions away from the Index. This means there are limitations on the extent to which the Fund’s investment in various sectors* may differ to the Index. These limited positions can be more than is held in the Index (overweight) or less than is held in the Index (underweight).
Derivatives may be used for efficient portfolio management purposes only.
* A sector is a business area, industry or economy which shares the same characteristics. Company shares are typically grouped into different sectors depending on the company’s business.
Policy
At least 80% of the Fund will be invested in a portfolio of companies which are part of the Index.
This will involve investing in shares of companies which are based in developing countries or have a significant proportion of their business activities in one or more of those developing countries and may also include equity-linked securities such as depositary receipts, warrants and preference shares**.
The Investment Adviser may only take limited positions away from the Index. This means there are limitations on the extent to which the Fund’s investment in various sectors*** may differ to the Index. These limited positions can be more than is held in the Index (overweight) or less than is held in the Index (underweight).
These limitations help to deliver a level of portfolio diversification and risk management. The limitations also help to achieve an appropriate balance between the extent to which the Fund’s composition can diverge from the Index and providing the Investment Adviser with flexibility to seek outperformance relative to the Index. As a result, the Fund’s performance may differ from the Index.
The Fund may also invest in collective investment schemes, including those managed by the ACD and its associates, hold cash and cash like investments.
Derivatives and stock lending may be used for the purpose of managing the Fund in a way that is designed to reduce risk or cost and/or generate extra income or growth (often referred to as efficient portfolio management).
* Note: there are Share Classes in the Fund where fees exceed the Fund’s outperformance target relative to the Index. For those Share Classes, the Fund will underperform the Index after deduction of fees even if its outperformance target is achieved.
** A preference share usually issues a fixed dividend payment which takes priority over payments of ordinary shares.
*** A sector is a business area, industry or economy which shares the same characteristics. Company shares are typically grouped into different sectors depending on the company’s business.
The MSCI Emerging Markets Index has been selected as an appropriate benchmark as it provides a representation of the returns of securities across 24 emerging market countries.
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Previous objective
To provide long term capital growth through investment primarily in UK companies that demonstrate a commitment to the protection and preservation of the natural environment.
Objective
To provide capital growth through investment in shares of UK companies that demonstrate a commitment to the protection and preservation of the natural environment.
The benchmark index for the Fund is the FTSE All-Share Index (the “Index”).
The Fund is actively managed by the Investment Adviser who chooses investments with the aim of outperforming the Index by 2% per annum on a rolling 3 year basis before deduction of fees.
Previous policy
The Fund will invest primarily in United Kingdom companies but may also invest in other international companies, that demonstrate a commitment to the protection and preservation of the natural environment. It may include, directly or indirectly, shares, equity backed depository receipts, convertible securities and listed warrants, however the Fund may invest in other types of investment at the discretion of the ACD. The Fund's investment universe is drawn from companies benchmarked against a broad range of environmental criteria.
Derivatives may be used for efficient portfolio management purposes only.
Policy
At least 90% of the Fund will invest in shares of UK companies, which may include some international companies that demonstrate a commitment to the protection and preservation of the natural environment. . The Fund's investment universe is drawn from companies screened against a broad range of environmental criteria.
After screening for environmental criteria the Investment Adviser focuses on the company’s growth prospects, market valuation and specific risks.
The Fund will typically invest in 30 to 50 holdings.
The ACD limits the extent to which the Fund’s composition can differ relative to the market for UK shares (as represented by the Index). These limits help to deliver a level of portfolio diversification and risk management. The limits also help to achieve an appropriate balance between the extent to which the Fund’s composition can diverge from the Index and providing the Investment Adviser with flexibility to seek outperformance relative to the Index. As a result of the limits and screening for environmental criteria, the Fund’s performance may differ substantially from the Index.
The Fund may also invest in collective investment schemes, including those managed by the ACD and its associates, cash and cash like investments.
Derivatives and stock lending may be used for the purpose of managing the Fund in a way that is designed to reduce risk or cost and/or generate extra income or growth (often referred to as efficient portfolio management).
Environmental Criteria
The Fund will avoid investing in companies which the Investment Adviser considers demonstrate a pattern of non-compliance with local environmental regulations or which significantly contribute to environmental problems. Specific negative screens for this category include:
- Nuclear power
- Fines for offences or repetitive breaches of water pollution regulations
- Fines and breaches of air quality regulations
- Breaches of soil or land quality regulations
- Deforestation practises and/or
- Dumping waste (including hazardous waste) in inappropriate areas.
In addition to the negative screens, the Investment Adviser will encourage companies to be included in the portfolio to adopt more responsible practices where they are considered to be lacking or deficient with regard to this for example, by disclosing environmental policies, demonstrating commitment to industry or government codes and standards, implementing pollution prevention or conservation programmes.
Further detail regarding investment philosophy and approach can be found on the Responsible Investment section of the Scottish Widows website.
Subject to the requirements of the FCA Rules and/or the OEIC Regulations, the criteria listed above may be updated from time to time to reflect changing market developments that may have environmental impact as agreed with the ACD and the Investment Adviser.
The FTSE All-Share Index has been selected as an appropriate benchmark as it provides a representation of the returns of securities in the UK equity market. This allows the Investment Adviser to select shares that meet the Fund’s environmental criteria from a diverse range of UK shares.
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Previous objective
To provide long term capital growth through investment primarily in UK companies with ethical attributes and practises.
Objective
To provide capital growth through investment in shares of UK companies with ethical attributes and practises.
The benchmark index for the Fund is the FTSE All-Share Index (the “Index”).
The Fund is actively managed by the Investment Adviser who chooses investments with the aim of outperforming the Index by 2% per annum on a rolling 3 year basis before deduction of fees.
Previous policy
The Fund will invest primarily in UK companies, but may also invest in other international companies, that demonstrate ethical attributes and practices. It may include, directly or indirectly, shares, equity backed depository receipts, convertible securities and listed warrants. However, the Fund may invest in other types of investment at the discretion of the ACD. The Fund’s investment universe is drawn from companies benchmarked against a broad range of ethical criteria.
Derivatives may be used for efficient portfolio management purposes only.
Policy
At least 90% of the Fund will invest in shares of UK companies, which may include some international companies that demonstrate ethical attributes and practices.
The Fund’s investment universe is drawn from companies screened against a broad range of ethical criteria.
The Fund will typically invest in 30 to 50 holdings.
The ACD limits the extent to which the Fund’s composition can differ relative to the market for UK shares (as represented by the Index). These limits help to deliver a level of portfolio diversification and risk management. The limits also help to achieve an appropriate balance between the extent to which the Fund’s composition can diverge from the Index and providing the Investment Adviser with flexibility to seek outperformance relative to the Index. As a result of the limits and screening for ethical criteria, the Fund’s performance may differ substantially from the Index.
The Fund may also invest in collective investment schemes, including those managed by the ACD and its associates, cash and cash like investments.
Derivatives and stock lending may be used for the purpose of managing the Fund in a way that is designed to reduce risk or cost and/or generate extra income or growth (often referred to as efficient portfolio management).
After screening for ethical criteria the Investment Adviser focuses on the company’s growth prospects, market valuation and specific risks.
Ethical Criteria
The focus of the Investment Adviser includes, but is not limited to, corporate governance, the environment and labour/human rights. The Investment Adviser applies negative screening criteria in the areas of:
- The production and/or sale of alcoholic, or tobacco or pornographic products;
- Gambling;
- Animal testing;
- Military and weapons.
If a company’s turnover in any of these areas exceeds 10% (or 5% for pornography), it is automatically excluded from the Fund’s investable universe. The Fund takes this approach with alcohol, tobacco, pornography and gambling on the basis that these four areas contribute largely to social problems and to the breakdown of the family and community as a whole. The military and weapons screens serve the purpose of avoiding activities that destroy human life. The Fund will seek to avoid investing in companies that undertake animal testing for cosmetics and toiletries.
The Investment Adviser engages proactively by challenging investee companies on their compliance with international standards including, but not limited to: corporate governance, environmental risks, labour issues & adherence to human rights standards.
Further information regarding the criteria and investment philosophy can be found on the Responsible Investment section of the Scottish Widows website.
Subject to the requirements of the FCA Rules and/or the OEIC Regulations, the criteria may be updated from time to time to reflect changing market developments that may have an ethical and/or social impact as agreed with the ACD and the Investment Adviser.
The FTSE All-Share Index has been selected as an appropriate benchmark as it provides a representation of the returns of securities in the UK equity market. This allows the Investment Adviser to select shares that meet the Fund’s ethical criteria from a diverse range of UK shares.
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Previous objective
To provide long term capital growth.
Objective
To track the performance of the European equity market, as represented by the MSCI Europe ex UK Index (the “Index”), before deduction of fees, by investing in European shares (excluding the UK).
Previous policy
The Fund will invest primarily in European equities (but excluding UK equities).
The Fund may also invest in equity-linked securities (excluding UK equity-linked securities) being preference shares, rights issues, American Depositary Receipts and Global Depositary Receipts as well as equity linked notes, cash, near cash, deposits, other collective investment schemes and warrants.Use may also be made of stocklending/repos, borrowing and hedging.
It is not currently intended that derivatives will be used for any purpose other than the efficient portfolio management (including hedging) of the Fund, although derivatives may, subject to the ACD giving not less than 60 days' notice to shareholders, be used in the pursuit of its investment objective in the future as well as for efficient portfolio management (including hedging) which may change the risk profile of the fund.
Note: The fund’s current benchmark index is the MSCI Europe ex- UK Index. The fund will usually invest in equities which are included in the benchmark, however, the fund isn’t limited to investing only within the index. In accordance with the FCA rules, the ACD may at its discretion replace the current index with such similar index as it may consider appropriate.
Policy
The Fund aims to invest in shares of all of the companies within the Index. This is often referred to as a ‘full replication’ approach.
Where the ACD believes it can provide an advantage to the Fund in managing costs, to achieve a more efficient way of tracking the Index, or where there are exceptional market circumstances, the Fund may include or exclude specific shares and/or other security types which are representative of a share in the Index (such as depositary receipts).
The Fund may also invest in collective investment schemes to gain exposure to the Index.
Derivatives and stock lending may be used for the purpose of managing the Fund in a way that is designed to reduce risk or cost and/or generate extra income or growth (often referred to as efficient portfolio management).
It is not currently intended that derivatives will be used for any purpose other than the efficient portfolio management (including hedging) of the Fund, although derivatives may, subject to the ACD giving not less than 60 days' notice to shareholders, be used in the pursuit of its investment objective in the future as well as for efficient portfolio management (including hedging) which may change the risk profile of the fund.
Note: In accordance with the FCA Rules, the ACD may at its discretion replace the Index with such similar index as it may consider appropriate.
The MSCI Europe ex UK Index provides a representation of the returns of securities in the Europe ex UK equity market.
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Previous objective
To provide long term capital growth through investment in a broad portfolio of predominantly Continental European companies. The Fund seeks to deliver performance, before deduction of management fees, in excess of the MSCI Europe ex UK Index (the “Index”) with a similar level of overall volatility, over the long term.
Objective
To provide capital growth through investment in a broad portfolio of shares in Continental European companies.
The benchmark index for the Fund is the MSCI Europe ex UK Index (the “Index”). The Investment Adviser seeks to outperform the Index by 0.75%* per annum on a rolling 3 year basis, before deduction of fees.
Previous policy
To invest predominantly in a portfolio of companies which are part of the Index. This will involve investing in equities and may also include equity-linked securities being depositary receipts, warrants and preference shares.
The Investment Adviser may only take limited positions away from the Index. This means there are limitations on the extent to which the Fund’s investment in various sectors* may differ to the Index. These limited positions can be more than is held in the Index (overweight) or less than is held in the Index (underweight).
Derivatives may be used for efficient portfolio management purposes only.
* A sector is a business area, industry or economy which shares the same characteristics. Company shares are typically grouped into different sectors depending on the company’s business.
Policy
At least 80% of the Fund will be invested in a portfolio of companies which are part of the Index. This will involve investing in shares and may also include equity-linked securities being depositary receipts, warrants and preference shares**.
The Investment Adviser may only take limited positions away from the Index. This means there are limitations on the extent to which the Fund’s investment in various sectors*** may differ to the Index. These limited positions can be more than is held in the Index (overweight) or less than is held in the Index (underweight).
These limitations help to deliver a level of portfolio diversification and risk management. The limitations also help to achieve an appropriate balance between the extent to which the Fund’s composition can diverge from the Index and providing the Investment Adviser with flexibility to seek outperformance relative to the Index. As a result, the Fund’s performance may differ from the Index.
The Fund may also invest in collective investment schemes, including those managed by the ACD and its associates, cash and cash like investments.Derivatives and stock lending may be used for the purpose of managing the Fund in a way that is designed to reduce risk or cost and/or generate extra income or growth (often referred to as efficient portfolio management).
* Note: there are Share Classes in the Fund where fees exceed the Fund’s outperformance target relative to the Index. For those Share Classes, the Fund will underperform the Index after deduction of fees even if its outperformance target is achieved.
** A preference share usually issues a fixed dividend payment which takes priority over payments of ordinary shares.
*** A sector is a business area, industry or economy which shares the same characteristics. Company shares are typically grouped into different sectors depending on the company’s business.
The MSCI Europe ex UK Index has been selected as an appropriate benchmark as it provides a representation of the returns of securities in the European equities market, excluding the UK.
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Previous objective
To provide long term capital growth through investment in a broad portfolio of predominantly Continental European companies. The Fund seeks to deliver performance, before deduction of management fees, in excess of the MSCI Europe ex UK Index (the “Index”) with a similar level of overall volatility, over the long term.
Objective
To provide capital growth through investment in a broad portfolio of shares in Continental European companies.
The benchmark index for the Fund is the MSCI Europe ex UK Index (the “Index”). The Investment Adviser seeks to outperform the Index by 0.75%* per annum on a rolling 3 year basis, before deduction of fees.
Previous policy
To invest predominantly in a portfolio of companies which are part of the Index. This will involve investing in equities and may also include equity-linked securities being depositary receipts, warrants and preference shares.
The Investment Adviser may only take limited positions away from the Index. This means there are limitations on the extent to which the Fund’s investment in various sectors* may differ to the Index. These limited positions can be more than is held in the Index (overweight) or less than is held in the Index (underweight).
Derivatives may be used for efficient portfolio management purposes only.
* A sector is a business area, industry or economy which shares the same characteristics. Company shares are typically grouped into different sectors depending on the company’s business.
Policy
At least 80% of the Fund will be invested in a portfolio of companies which are part of the Index. This will involve investing in shares and may also include equity-linked securities being depositary receipts, warrants and preference shares**.
The Investment Adviser may only take limited positions away from the Index. This means there are limitations on the extent to which the Fund’s investment in various sectors*** may differ to the Index. These limited positions can be more than is held in the Index (overweight) or less than is held in the Index (underweight).
These limitations help to deliver a level of portfolio diversification and risk management. The limitations also help to achieve an appropriate balance between the extent to which the Fund’s composition can diverge from the Index and providing the Investment Adviser with flexibility to seek outperformance relative to the Index. As a result, the Fund’s performance may differ from the Index.
The Fund may also invest in collective investment schemes, including those managed by the ACD and its associates, cash and cash like investments.Derivatives and stock lending may be used for the purpose of managing the Fund in a way that is designed to reduce risk or cost and/or generate extra income or growth (often referred to as efficient portfolio management).
* Note: there are Share Classes in the Fund where fees exceed the Fund’s outperformance target relative to the Index. For those Share Classes, the Fund will underperform the Index after deduction of fees even if its outperformance target is achieved.
** A preference share usually issues a fixed dividend payment which takes priority over payments of ordinary shares.
*** A sector is a business area, industry or economy which shares the same characteristics. Company shares are typically grouped into different sectors depending on the company’s business.
The MSCI Europe ex UK Index has been selected as an appropriate benchmark as it provides a representation of the returns of securities in the European equities market, excluding the UK.
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Previous objective
To provide long term capital growth based on the performance of emerging markets equities by tracking the FTSE RAFI Emerging Index.
Objective
To track the performance of emerging markets equities as represented by the FTSE RAFI Emerging Index (the “Index”), before deduction of fees, by investing in emerging markets shares.
Previous policy
The Fund will invest primarily in Emerging Market equities.
The Fund may also invest in equity-linked securities being preference shares, rights issues, American Depositary Receipts and Global Depositary Receipts as well as equity linked notes, cash, near cash, deposits, other collective investment schemes and warrants.
Use may also be made of stocklending/repos, borrowing and hedging.
Investment weightings will be based on fundamental factors rather than market capitalisation (See Note 1).
The ACD may use various indexation or sampling techniques to achieve the objective of tracking the Index. In doing so the ACD may use discretion in deciding which investments are to be included in the portfolio. The number of investments so included may vary.
In accordance with the FCA Rules, the ACD may at its discretion replace the current index with such similar index as it may consider appropriate.
It is not currently intended that derivatives will be used for any purpose other than the efficient portfolio management (including hedging) of the Fund, although derivatives may, subject to the ACD giving not less than 60 days' notice to shareholders, be used in the pursuit of its investment objective in the future as well as for efficient portfolio management (including hedging) which may change the risk profile of the Fund.
Note 1: A fund based on market capitalisation will hold larger positions (larger weighting) in the largest companies. A fundamental index fund is weighted differently. Investment decisions for a fundamental index fund will instead depend on a company’s fundamental financial measures and not just its market value.
Examples of these fundamental factors can include sales, cash flow, book value and dividends.
Policy
The Fund aims to invest in shares of all of the companies within the Index. This is often referred to as a ‘full replication’ approach.
Where the ACD believes it can provide an advantage to the Fund in managing costs, to achieve a more efficient way of tracking the Index, or where there are exceptional market circumstances, the Fund may include or exclude specific shares and/or other security types which are representative of a share in the Index (such as depositary receipts).
The Fund may also invest in collective investment schemes to gain exposure to the Index.
Investment weightings will be based on fundamental factors rather than market capitalisation (See Note 1).
In accordance with the FCA Rules, the ACD may at its discretion replace the Index with such similar index as it may consider appropriate.
Derivatives and stock lending may be used for the purpose of managing the Fund in a way that is designed to reduce risk or cost and/or generate extra income or growth (often referred to as efficient portfolio management).
It is not currently intended that derivatives will be used for any purpose other than the efficient portfolio management (including hedging) of the Fund, although derivatives may, subject to the ACD giving not less than 60 days' notice to shareholders, be used for investment purposes in the future as well as for efficient portfolio management (including hedging) which may change the risk profile of the Fund.
Note 1: Market capitalisation is the total market value of a publicly traded company’s shares. For a market-capitalisation weighted index the weight of each company in the index is driven by the size of that company. This means that the larger the company, the greater the weighting it has in the index A fundamental index is weighted differently. Investment decisions for a fundamental index fund will instead depend on a company’s fundamental financial measures and not just its market value.
Examples of these fundamental factors can include sales, cash flow, book value and dividends.
The FTSE RAFI Emerging Index provides a representation of the returns of securities in emerging markets weighted using fundamental factors.
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Previous objective
To provide long term capital growth based on the performance of the Global Equity Market by tracking the FTSE RAFI Developed 1000 Index.
Objective
To track the performance of the Global Equity Market as represented by the FTSE RAFI Developed 1000 Index (the “Index”), before deduction of fees, by investing in global shares
Previous policy
The Fund will invest primarily in Global equities.
The Fund may also invest in equity-linked securities being preference shares, rights issues, American Depositary Receipts and Global Depositary Receipts as well as equity linked notes, cash, near cash, deposits, other collective investment schemes and warrants.
Use may also be made of stocklending/repos, borrowing and hedging.
Investment weightings will be based on fundamental factors rather than market capitalisation (See Note 1).
The ACD may use various indexation or sampling techniques to achieve the objective of tracking the Index. In doing so the ACD may use discretion in deciding which investments are to be included in the portfolio. The number of investments so included may vary.
In accordance with the FCA Rules, the ACD may at its discretion replace the current index with such similar index as it may consider appropriate.
It is not currently intended that derivatives will be used for any purpose other than the efficient portfolio management (including hedging) of the Fund, although derivatives may, subject to the ACD giving not less than 60 days' notice to shareholders, be used in the pursuit of its investment objective in the future as well as for efficient portfolio management (including hedging) which may change the risk profile of the Fund.
Note 1: A fund based on market capitalisation will hold larger positions (larger weighting) in the largest companies. A fundamental index fund is weighted differently. Investment decisions for a fundamental index fund will instead depend on a company’s fundamental financial measures and not just its market value. Examples of these fundamental factors can include sales, cash flow, book value and dividends.
Policy
The Fund aims to invest in shares of all of the companies within the Index. This is often referred to as a ‘full replication’ approach.
Where the ACD believes it can provide an advantage to the Fund in managing costs, to achieve a more efficient way of tracking the Index, or where there are exceptional market circumstances, the Fund may include or exclude specific shares and/or other security types which are representative of a share in the Index (such as depositary receipts).
The Fund may also invest in collective investment schemes to gain exposure to the Index.
Investment weightings will be based on fundamental factors rather than market capitalisation (See Note 1).
In accordance with the FCA Rules, the ACD may at its discretion replace the Index with such similar index as it may consider appropriate.
Derivatives and stock lending may be used for the purpose of managing the Fund in a way that is designed to reduce risk or cost and/or generate extra income or growth (often referred to as efficient portfolio management).
It is not currently intended that derivatives will be used for any purpose other than the efficient portfolio management (including hedging) of the Fund, although derivatives may, subject to the ACD giving not less than 60 days' notice to shareholders, be used for investment purposes in the future as well as for efficient portfolio management (including hedging) which may change the risk profile of the Fund.
Note 1: Market capitalisation is the total market value of a publicly traded company’s shares. For a market-capitalisation weighted index the weight of each company in the index is driven by the size of that company. This means that the larger the company, the greater the weighting it has in the index. A fundamental index is weighted differently. Investment decisions for a fundamental index fund will instead depend on a company’s fundamental financial measures and not just its market value. Examples of these fundamental factors can include sales, cash flow, book value and dividends.
The FTSE RAFI Developed 1000 Index provides a representation of the returns of securities in the global equity market weighted using fundamental factors.
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Previous objective
To provide long term capital growth based on the performance of the UK Equity Market by tracking the FTSE RAFI UK 300 Index.
Objective
To track the performance of the UK Equity Market as represented by the FTSE RAFI UK 300 Index (the “Index”), before deduction of fees, by investing in UK shares.
Previous policy
The Fund will invest primarily in UK equities.
The Fund may also invest in equity-linked securities being preference shares, rights issues, American Depositary Receipts and Global Depositary Receipts as well as equity linked notes, cash, near cash, deposits, other collective investment schemes and warrants.
Use may also be made of stocklending/repos, borrowing and hedging.
Investment weightings will be based on fundamental factors rather than market capitalisation (See Note 1).
The ACD may use various indexation or sampling techniques to achieve the objective of tracking the Index. In doing so the ACD may use discretion in deciding which investments are to be included in the portfolio. The number of investments so included may vary.
In accordance with the FCA Rules, the ACD may at its discretion replace the current index with such similar index as it may consider appropriate.
It is not currently intended that derivatives will be used for any purpose other than the efficient portfolio management (including hedging) of the Fund, although derivatives may, subject to the ACD giving not less than 60 days' notice to shareholders, be used in the pursuit of its investment objective in the future as well as for efficient portfolio management (including hedging) which may change the risk profile of the Fund.
Note 1: A fund based on market capitalisation will hold larger positions (larger weighting) in the largest companies. A fundamental index fund is weighted differently. Investment decisions for a fundamental index fund will instead depend on a company’s fundamental financial measures and not just its market value. Examples of these fundamental factors can include sales, cash flow, book value and dividends.
Policy
The Fund aims to invest in shares of all of the companies within the Index. This is often referred to as a ‘full replication’ approach.
Where the ACD believes it can provide an advantage to the Fund in managing costs, to achieve a more efficient way of tracking the Index, or where there are exceptional market circumstances, the Fund may include or exclude specific shares and/or other security types which are representative of a share in the Index (such as depositary receipts).
The Fund may also invest in collective investment schemes to gain exposure to the Index.
Investment weightings will be based on fundamental factors rather than market capitalisation (See Note 1).
In accordance with the FCA Rules, the ACD may at its discretion replace the Index with such similar index as it may consider appropriate.Derivatives and stock lending may be used for the purpose of managing the Fund in a way that is designed to reduce risk or cost and/or generate extra income or growth (often referred to as efficient portfolio management).
It is not currently intended that derivatives will be used for any purpose other than the efficient portfolio management (including hedging) of the Fund, although derivatives may, subject to the ACD giving not less than 60 days' notice to shareholders, be used for investment purposes in the future as well as for efficient portfolio management (including hedging) which may change the risk profile of the Fund.
Note 1: Market capitalisation is the total market value of a publicly traded company’s shares. For a market-capitalisation weighted index the weight of each company in the index is driven by the size of that company. This means that the larger the company, the greater the weighting it has in the index. A fundamental index is weighted differently. Investment decisions for a fundamental index fund will instead depend on a company’s fundamental financial measures and not just its market value. Examples of these fundamental factors can include sales, cash flow, book value and dividends.
The FTSE RAFI UK 300 Index provides a representation of the returns of securities in the UK equity market weighted using fundamental factors.
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Previous objective
To provide long term capital growth based on the performance of low volatility emerging market equities by tracking the FTSE RAFI Emerging Low Volatility Index. (See Note 1.)
Objective
To track the performance of low volatility emerging market equities as represented by the FTSE RAFI Emerging Low Volatility Index (the “Index”), before deduction of fees, by investing in emerging markets shares. (See Note 1.)
Previous policy
The Fund will invest primarily in low volatility emerging market equities. (See Note 1.)
The Fund may also invest in equity-linked securities being preference shares, rights issues, American Depositary Receipts and Global Depositary Receipts.
In addition the Fund may invest in equity linked notes, cash, near cash, deposits, other collective investment schemes and warrants.
Use may also be made of stocklending/repos, borrowing and hedging.
Investment weightings will be based on fundamental factors and low volatility characteristics rather than market capitalisation (See Notes below).
The ACD may use various indexation or sampling techniques to achieve the objective of tracking the Index and in doing so may use discretion in deciding which investments are to be included in the portfolio. The number of investments included may vary.
In accordance with the FCA Rules, the ACD may at its discretion replace the current index with such similar index, or replacement index, as it may consider appropriate.
It is not currently intended that derivatives will be used for any purpose other than the efficient portfolio management (including hedging) of the Fund, although derivatives may, subject to the ACD giving not less than 60 days' notice to shareholders, be used in the pursuit of its investment objective in the future as well as for efficient portfolio management (including hedging) which may change the risk profile of the Fund.
Note 1: The Fund will target stocks which have historically exhibited lower levels of volatility relative to the broader market (i.e. indices which are not low volatility). The term "low volatility" should be viewed in a relative context (i.e. compared to an equivalent equity index constructed on a market capitalisation basis), rather than an absolute basis. The ACD cannot guarantee that the Fund will be less volatile than an equivalent market capitalisation index or fundamental index, particularly over shorter time periods.
Note 2: A fund based on market capitalisation will hold larger positions (larger weighting) in the largest companies. A fundamental index fund is weighted differently. Investment decisions for a fundamental index fund will instead depend on a company's fundamental financial measures and not just its market value. Examples of these fundamental factors can include sales, cash flow, book value and dividends.
Policy
The Fund aims to invest in shares of all of the companies within the Index. This is often referred to as a ‘full replication’ approach.
Where the ACD believes it can provide an advantage to the Fund in managing costs, to achieve a more efficient way of tracking the Index, or where there are exceptional market circumstances, the Fund may include or exclude specific shares and/or other security types which are representative of a share in the Index (such as depositary receipts).
The Fund may also invest in collective investment schemes to gain exposure to the Index.
Investment weightings will be based on fundamental factors and low volatility characteristics rather than market capitalisation (See Notes below).
In accordance with the FCA Rules, the ACD may at its discretion replace the Index with such similar index, or replacement index, as it may consider appropriate.
Derivatives and stock lending may be used for the purpose of managing the Fund in a way that is designed to reduce risk or cost and/or generate extra income or growth (often referred to as efficient portfolio management).
It is not currently intended that derivatives will be used for any purpose other than the efficient portfolio management (including hedging) of the Fund, although derivatives may, subject to the ACD giving not less than 60 days' notice to shareholders, be used for investment purposes in the future as well as for efficient portfolio management (including hedging) which may change the risk profile of the Fund.
Note 1: The Index targets stocks which have historically exhibited lower levels of volatility relative to the broader market (i.e. indices which are not low volatility). The term "low volatility" should be viewed in a relative context (i.e. compared to an equivalent equity index constructed on a market capitalisation basis), rather than an absolute basis. The ACD cannot guarantee that the Fund will be less volatile than an equivalent market capitalisation index or fundamental index, particularly over shorter time periods.
Note 2: Market capitalisation is the total market value of a publicly traded company’s shares. For a market-capitalisation weighted index the weight of each company in the index is driven by the size of that company. This means that the larger the company, the greater the weighting it has in the index. A fundamental index is weighted differently. Investment decisions for a fundamental index fund will instead depend on a company's fundamental financial measures and not just its market value. Examples of these fundamental factors can include sales, cash flow, book value and dividends.
The FTSE RAFI Emerging Low Volatility Index provides a representation of the returns of low volatility securities in emerging markets weighted using fundamental factors.
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Previous objective
To provide long term capital growth based on the performance of low volatility global equities by tracking the FTSE RAFI Developed Low Volatility Index. (See Note 1.)
Objective
To track the performance of low volatility global equities as represented by the FTSE RAFI Developed Low Volatility Index (the “Index”), before deduction of fees, by investing in global shares. (See Note 1.)
Previous policy
The Fund will invest primarily in low volatility global equities. (See Note 1.)
The Fund may also invest in equity-linked securities being preference shares, rights issues, American Depositary Receipts and Global Depositary Receipts.
In addition the Fund may invest in equity linked notes, cash, near cash, deposits, other collective investment schemes and warrants.
Use may also be made of stocklending/repos, borrowing and hedging.
Investment weightings will be based on fundamental factors and low volatility characteristics rather than market capitalisation (See Notes below).
The ACD may use various indexation or sampling techniques to achieve the objective of tracking the Index and in doing so may use discretion in deciding which investments are to be included in the portfolio. The number of investments so included may vary.
In accordance with the FCA Rules, the ACD may at its discretion replace the current index with such similar index, or replacement index, as it may consider appropriate.
It is not currently intended that derivatives will be used for any purpose other than the efficient portfolio management (including hedging) of the Fund, although derivatives may, subject to the ACD giving not less than 60 days' notice to shareholders, be used in the pursuit of its investment objective in the future as well as for efficient portfolio management (including hedging) which may change the risk profile of the Fund.
Note 1: The Fund will target stocks which have historically exhibited lower levels of volatility relative to the broader market (i.e. indices which are not low volatility). The term "low volatility" should be viewed in a relative context (i.e. compared to an equivalent equity index constructed on a market capitalisation basis), rather than an absolute basis. The ACD cannot guarantee that the Fund will be less volatile than an equivalent market capitalisation index or fundamental index, particularly over shorter time periods.
Note 2: A fund based on market capitalisation will hold larger positions (larger weighting) in the largest companies. A fundamental index fund is weighted differently. Investment decisions for a fundamental index fund will instead depend on a company's fundamental financial measures and not just its market value. Examples of these fundamental factors can include sales, cash flow, book value and dividends.
Policy
The Fund aims to invest in shares of all of the companies within the Index. This is often referred to as a ‘full replication’ approach.
Where the ACD believes it can provide an advantage to the Fund in managing costs, to achieve a more efficient way of tracking the Index, or where there are exceptional market circumstances, the Fund may include or exclude specific shares and/or other security types which are representative of a share in the Index (such as depositary receipts).
The Fund may also invest in collective investment schemes to gain exposure to the Index.
Investment weightings will be based on fundamental factors and low volatility characteristics rather than market capitalisation (See Notes below).
In accordance with the FCA Rules, the ACD may at its discretion replace the Index with such similar index, or replacement index, as it may consider appropriate.
Derivatives and stock lending may be used for the purpose of managing the Fund in a way that is designed to reduce risk or cost and/or generate extra income or growth (often referred to as efficient portfolio management).
It is not currently intended that derivatives will be used for any purpose other than the efficient portfolio management (including hedging) of the Fund, although derivatives may, subject to the ACD giving not less than 60 days' notice to shareholders, be used for investment purposes in the future as well as for efficient portfolio management (including hedging) which may change the risk profile of the Fund.
Note 1: The Index targets stocks which have historically exhibited lower levels of volatility relative to the broader market (i.e. indices which are not low volatility). The term "low volatility" should be viewed in a relative context (i.e. compared to an equivalent equity index constructed on a market capitalisation basis), rather than an absolute basis. The ACD cannot guarantee that the Fund will be less volatile than an equivalent market capitalisation index or fundamental index, particularly over shorter time periods.
Note 2: A Market capitalisation is the total market value of a publicly traded company’s shares. For a market-capitalisation weighted index the weight of each company in the index is driven by the size of that company. This means that the larger the company, the greater the weighting it has in the index. A fundamental index is weighted differently. Investment decisions for a fundamental index fund will instead depend on a company's fundamental financial measures and not just its market value. Examples of these fundamental factors can include sales, cash flow, book value and dividends.
The FTSE RAFI Developed Low Volatility Index provides a representation of the returns of low volatility securities in the global equity market weighted using fundamental factors.
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Previous objective
To provide long term capital growth based on the performance of low volatility UK equities by tracking the FTSE RAFI UK Low Volatility Index (See Note 1).
Objective
To track the performance of low volatility UK equities as represented by the FTSE RAFI UK Low Volatility Index (the “Index”), before deduction of fees, by investing in UK shares (See Note 1).
Previous policy
The Fund will invest primarily in low volatility UK equities. (See Note 1.)
The Fund may also invest in equity-linked securities being preference shares, rights issues, American Depositary Receipts and Global Depositary Receipts.
In addition the Fund may invest in equity linked notes, cash, near cash, deposits, other collective investment schemes and warrants.
Use may also be made of stocklending/repos, borrowing and hedging.
Investment weightings will be based on fundamental factors and low volatility characteristics rather than market capitalisation (See Notes below).
The ACD may use various indexation or sampling techniques to achieve the objective of tracking the Index and in doing so may use discretion in deciding which investments are to be included in the portfolio. The number of investments so included may vary.
In accordance with the FCA Rules, the ACD may at its discretion replace the current Index with such similar index, or replacement index, as it may consider appropriate.
It is not currently intended that derivatives will be used for any purpose other than the efficient portfolio management (including hedging) of the Fund, although derivatives may, subject to the ACD giving not less than 60 days' notice to shareholders, be used in the pursuit of its investment objective in the future as well as for efficient portfolio management (including hedging) which may change the risk profile of the Fund.
Note 1: The Fund will target stocks which have historically exhibited lower levels of volatility relative to the broader market (i.e. indices which are not low volatility). The term "low volatility" should be viewed in a relative context (i.e. compared to an equivalent equity index constructed on a market capitalisation basis), rather than an absolute basis. The ACD cannot guarantee that the Fund will be less volatile than an equivalent market capitalisation index or fundamental index, particularly over shorter time periods.
Note 2: A fund based on market capitalisation will hold larger positions (larger weighting) in the largest companies. A fundamental index fund is weighted differently. Investment decisions for a fundamental index fund will instead depend on a company's fundamental financial measures and not just its market value. Examples of these fundamental factors can include sales, cash flow, book value and dividends.
Policy
The Fund aims to invest in shares of all of the companies within the Index. This is often referred to as a ‘full replication’ approach.
Where the ACD believes it can provide an advantage to the Fund in managing costs, to achieve a more efficient way of tracking the Index, or where there are exceptional market circumstances, the Fund may include or exclude specific shares and/or other security types which are representative of a share in the Index (such as depositary receipts).
The Fund may also invest in collective investment schemes to gain exposure to the Index.
Investment weightings will be based on fundamental factors and low volatility characteristics rather than market capitalisation (See Notes below).
In accordance with the FCA Rules, the ACD may at its discretion replace the Index with such similar index, or replacement index, as it may consider appropriate.Derivatives and stock lending may be used for the purpose of managing the Fund in a way that is designed to reduce risk or cost and/or generate extra income or growth (often referred to as efficient portfolio management).
It is not currently intended that derivatives will be used for any purpose other than the efficient portfolio management (including hedging) of the Fund, although derivatives may, subject to the ACD giving not less than 60 days' notice to shareholders, be used for investment purposes in the future as well as for efficient portfolio management (including hedging) which may change the risk profile of the Fund.
Note 1: The Index targets stocks which have historically exhibited lower levels of volatility relative to the broader market (i.e. indices which are not low volatility). The term "low volatility" should be viewed in a relative context (i.e. compared to an equivalent equity index constructed on a market capitalisation basis), rather than an absolute basis. The ACD cannot guarantee that the Fund will be less volatile than an equivalent market capitalisation index or fundamental index, particularly over shorter time periods.
Note 2: Market capitalisation is the total market value of a publicly traded company’s shares. For a market-capitalisation weighted index the weight of each company in the index is driven by the size of that company. This means that the larger the company, the greater the weighting it has in the index. A fundamental index is weighted differently. Investment decisions for a fundamental index fund will instead depend on a company's fundamental financial measures and not just its market value. Examples of these fundamental factors can include sales, cash flow, book value and dividends.
The FTSE RAFI UK Low Volatility Index provides a representation of the returns of low volatility securities in the UK equity market weighted using fundamental factors.
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Previous objective
To provide an income, whilst having regard to capital value, through investment primarily in UK Government Securities.
Objective
To provide income and the potential for capital growth, through investment in UK Government bonds (gilts).
The benchmark index for the Fund is the FTSE Actuaries UK Conventional Gilts All Stocks Index (“the Index”). The Fund is actively managed by the Investment Adviser who chooses investments with the aim of outperforming the Index by 0.5% per annum on a rolling 3 year basis, before deduction of fees.
Previous policy
The Fund will invest primarily in a portfolio of UK Government and other fixed interest securities. However, the Fund may invest in other types of investment at the discretion of the ACD. These investments may include loan stock, overseas and non-UK government bonds.
Derivatives may be used for efficient portfolio management purposes only.
Policy At least 80% of the Fund will invest in a portfolio of UK Government bonds (gilts). The Fund may also invest in index-linked government bonds, investment grade corporate bonds* and supranational bonds (these are a type of security issued by two or more governmental organisations).
In selecting assets for the Fund the Investment Adviser will focus on bonds which it believes collectively will outperform the Index and may consider economic factors and monetary policy.
The ACD limits the extent to which the Fund’s composition can differ relative to the market for government bonds (as represented by the Index). These limits help to deliver a level of portfolio diversification and risk management. The limits also help to achieve an appropriate balance between the extent to which the Fund’s composition can diverge from the Index and providing the Investment Adviser with flexibility to seek outperformance relative to the Index. As a result, the Fund’s performance may differ from the Index.
The Fund may also invest in collective investment schemes, including those managed by the ACD and its associates, hold cash and cash like investments.
Derivatives and stock lending may be used for the purpose of managing the Fund in a way that is designed to reduce risk or cost and/or generate extra income or growth (often referred to as efficient portfolio management).
*Credit ratings indicate the likelihood that an issuer will be able to make their payments. Investment grade bonds have achieved or exceeded a minimum credit rating awarded by a credit rating agency. Therefore they are considered lower risk than bonds with a lower credit rating.
The FTSE Actuaries UK Conventional Gilts All Stocks Index has been selected as an appropriate benchmark as it provides a representation of the returns of securities in the government bond (gilt) market.
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Previous objective
To provide long term capital growth through investment in a broad portfolio of predominantly companies worldwide, including the UK. The Fund seeks to deliver performance, before deduction of management fees, in excess of a blended return of the MSCI World Index and the MSCI Emerging Markets Index (the “Indices”) with a similar level of overall volatility, over the long term.
Objective
To provide capital growth through investment in a broad portfolio, investing in shares of companies across the world, including the UK.
The benchmark index for the Fund is the MSCI All Country World (MSCI ACWI) Index (the “Index”). The Fund seeks to outperform the Index by 0.75%*on a rolling 3 year basis, before deduction of fees.
Previous policy
To invest predominantly in a portfolio of companies which are part of the Indices. Of the two Indices, the fund will invest almost exclusively in companies that are part of the MSCI World Index. This will involve investing in equities and may also include equity-linked securities being depositary receipts, warrants and preference shares.
The Investment Adviser may only take limited positions away from the Indices. This means there are limitations on the extent to which the Fund’s investment in various sectors* may differ to the Indices. These limited positions can be more than is held in the Indices (overweight) or less than is held in the Indices (underweight).
Derivatives may be used for efficient portfolio management purposes only.
* A sector is a business area, industry or economy which shares the same characteristics. Company shares are typically grouped into different sectors depending on the company’s business.
Policy
At least 80% of the Fund will be invested in a portfolio of companies which are part of the Index. This will involve investing in shares and may also include equity-linked securities, such as depositary receipts, warrants and preference shares**.
The ACD instructs the Investment Adviser on the proportion of the Fund’s investments to be allocated to companies in the Index. At least 90% will be invested in companies that are part of the in developed markets, and not more than 10% in companies that are in emerging markets. The allocation may differ slightly on a day to day basis through market movements or Investment Adviser discretion.
The Investment Adviser may only take limited positions away from the Index. This means there are limitations on the extent to which the Fund’s investment in various sectors*** may differ to the Index. These limited positions can be more than is held in the Index (overweight) or less than is held in the Index (underweight).
These limitations help to deliver a level of portfolio diversification and risk management. The limitations also help to achieve an appropriate balance between the extent to which the Fund’s composition can diverge from the Index and providing the Investment Adviser with flexibility to seek outperformance relative to the Index. Because the Fund is limited in the extent to which it can diverge from the Index it means the difference between the Fund’s performance and that of the Index is likely to be smaller than that of funds with greater flexibility.
The Fund may also invest in collective investment schemes, including those managed by the ACD and its associates, cash and cash like investments.
Derivatives and stock lending may be used for the purpose of managing the Fund in a way that is designed to reduce risk or cost and/or generate extra income or growth (often referred to as efficient portfolio management).
* Note: there are Share Classes in the Fund where fees exceed the Fund’s outperformance target relative to the Index. For those Share Classes, the Fund will underperform the Index after deduction of fees even if its outperformance target is achieved.
** A preference share usually issues a fixed dividend payment which takes priority over payments of ordinary shares.
*** A sector is a business area, industry or economy which shares the same characteristics. Company shares are typically grouped into different sectors depending on the company’s business.
The MSCI All Country World (MSCI ACWI) Index has been selected as an appropriate benchmark as it provides a representation of the returns of securities in the equities market worldwide.
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Previous objective
To provide long term capital growth through investment in a select portfolio of primarily equities worldwide, including the UK.
Objective
To provide capital growth through investment in a select portfolio, typically 50 to 90 holdings, of global shares, including the UK.
The benchmark index for the Fund is the MSCI ACWI Index (the “Index”). The Fund is actively managed by the Investment Adviser who chooses investments with the aim of outperforming the Index by 3% per annum on a rolling 3 year basis, before deduction of fees.
Previous policy
The Fund will invest in a select portfolio of global securities which shall be predominantly equities and may include preference shares, American depository receipts, global and other equity backed depository receipts and warrants in any geographic area and any economic sector. The Fund will focus on a limited number of holdings (typically between 50 and 90).
Derivatives may be used for efficient portfolio management purposes only.
Policy
At least 80% of the Fund will be invested in a portfolio of companies which are part of the Index. This will involve investing in shares and may also include equity-linked securities, such as depositary receipts, warrants and preference shares**.
The ACD instructs the Investment Adviser on the proportion of the Fund’s investments to be allocated to companies in the Index. At least 90% will be invested in companies that are part of the in developed markets, and not more than 10% in companies that are in emerging markets. The allocation may differ slightly on a day to day basis through market movements or Investment Adviser discretion.
The Investment Adviser may only take limited positions away from the Index. This means there are limitations on the extent to which the Fund’s investment in various sectors*** may differ to the Index. These limited positions can be more than is held in the Index (overweight) or less than is held in the Index (underweight).
These limitations help to deliver a level of portfolio diversification and risk management. The limitations also help to achieve an appropriate balance between the extent to which the Fund’s composition can diverge from the Index and providing the Investment Adviser with flexibility to seek outperformance relative to the Index. Because the Fund is limited in the extent to which it can diverge from the Index it means the difference between the Fund’s performance and that of the Index is likely to be smaller than that of funds with greater flexibility.
The Fund may also invest in collective investment schemes, including those managed by the ACD and its associates, cash and cash like investments.
Derivatives and stock lending may be used for the purpose of managing the Fund in a way that is designed to reduce risk or cost and/or generate extra income or growth (often referred to as efficient portfolio management).
* Note: there are Share Classes in the Fund where fees exceed the Fund’s outperformance target relative to the Index. For those Share Classes, the Fund will underperform the Index after deduction of fees even if its outperformance target is achieved.
** A preference share usually issues a fixed dividend payment which takes priority over payments of ordinary shares.
*** A sector is a business area, industry or economy which shares the same characteristics. Company shares are typically grouped into different sectors depending on the company’s business.
The MSCI All Country World (MSCI ACWI) Index has been selected as an appropriate benchmark as it provides a representation of the returns of securities in the equities market worldwide.
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Previous objective
To provide a positive return over 3 year rolling periods independent of market conditions.
Capital in the Fund is at risk and there is no guarantee that the Fund will deliver a positive return over that specific, or any, time period.
Objective
To provide a positive return over 3 year rolling periods, before deduction of fees, independent of market conditions.
Capital in the Fund is at risk and there is no guarantee that the Fund will deliver a positive return over that specific, or any, time period.
Previous policy
The Fund will invest primarily in derivative instruments, which may include futures, options, swaps, forward currency contracts, and contracts for difference.
The investment manager will operate a tactical asset allocation policy. As a result, the Fund's exposures to asset classes and markets will vary over time at the investment manager’s discretion.
All or a substantial proportion of the physical (non-derivative) assets of the Fund may at any time consist of cash, near cash, deposits and/or money market instruments when the active risk exposure is achieved through derivatives.
Tactical, active long and short positions may be taken through the use of derivatives in a range of asset classes.
Exposure to equities and equity-linked securities will be taken at regional levels as well as in specific countries.
Bond exposure may include government and supranational bonds, investment and non-investment grade corporate bonds, index-linked bonds, covered bonds and emerging markets government debt.
Bond exposure will be achieved primarily through index-based derivative instruments and government bond future contracts, as well as select physical (non-derivative) holdings.
Commodity exposure will be achieved through index-based commodity derivative instruments and exchange-traded funds in sectors including agriculture, precious metals, industrial metals and energy.
Currency exposure will be linked to positions in the underlying markets.
Over-the-counter (OTC) instruments such as index-based total return swaps may be used for property and commodities exposures. Credit default swaps may be used to achieve broad credit exposures.
The fund may also invest in transferable securities, other collective investment schemes, warrants and money market instruments including cash, near cash and deposits. Derivatives may also be used for efficient portfolio management purposes.
Policy
The Fund will invest primarily in derivative instruments, which may include futures, options, swaps, forward currency contracts, and contracts for difference.
The investment manager will operate a tactical asset allocation policy. As a result, the Fund's exposures to asset classes and markets will vary over time at the investment manager’s discretion. All or a substantial proportion of the physical (non-derivative) assets of the Fund may at any time consist of cash and cash like investments when the active risk exposure is achieved through derivatives.
Tactical, active long and short* positions may be taken through the use of derivatives in a range of asset classes.
Exposure to shares and equity-linked securities will be taken at regional levels as well as in specific countries.
Bond exposure may include government and supranational bonds (a type of fixed interest security issued by two or more governmental organisations), investment and non-investment grade corporate bonds**, index-linked bonds, covered bonds and emerging markets government debt. Bond exposure will be achieved primarily through index-based derivative instruments and government bond future contracts, as well as select physical (non-derivative) holdings.
Commodity exposure will be achieved through index-based commodity derivative instruments and exchange-traded funds in sectors including agriculture, precious metals, industrial metals and energy.
Currency exposure will be linked to positions in the underlying markets.Over-the-counter (OTC) instruments such as index-based total return swaps may be used for property and commodities exposures. Credit default swaps may be used to achieve broad credit exposures.
The fund may also invest in transferable securities, other collective investment schemes (which may include investment in collective investment schemes managed, advised or operated by companies in the Group), and warrants. Derivatives may also be used for efficient portfolio management purposes.
* Long exposure to an asset means the Sub-fund could benefit if that asset rises in value. Short exposure to an asset means the Sub-fund could benefit if that asset falls in value.
** Credit ratings indicate the likelihood that an issuer will be able to make their payments. Investment grade bonds have achieved or exceeded a minimum credit rating awarded by a credit rating agency. Therefore they are considered lower risk than bonds with a lower credit rating.
Non-investment grade bonds, also known as high yield bonds, have a lower credit rating than investment grade bonds, and so are considered higher risk.The ACD does not quote a benchmark or outperformance target for the Fund. This is because the asset allocation of the Fund will change over time taking into consideration risk, the ACD’s view of the prospects of each asset class and the changes the Investment Adviser can make to the asset allocation.
Investors may assess the Fund relative to similar funds offered by other investment firms. A number of fund industry bodies and data providers group similar funds together and provide analysis on performance and risk characteristics of the fund group. The Investment Association “Mixed Assets Sectors” group funds with a range of different assets according to their allocation to shares, fixed interest securities and cash. More information on the Investment Association sectors can be found at https://www.theia.org/industry-data/fund-sectors .
Over the period 30.8.2016 to 28.1.2019 the Fund would have sat within the “Flexible Investment Sector”. Investors may wish to consider the performance of the Fund by looking at the performance of this sector.
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Previous objective
To provide a high level of income through investments denominated in euros or any currency of the United Kingdom or the United States of America, predominantly corporate bonds, government bonds, other public securities and other fixed interest securities issued principally by companies operating in the United States of America, the United Kingdom or Europe.
Objective
To provide a high level of income and the potential for capital growth, through investment in non-investment grade corporate bonds*and other fixed interest securities.
The benchmark index for the Fund is the Bloomberg Barclays Global High Yield Index hedged back to Sterling (“the Index”).The Fund is actively managed by the Investment Adviser who chooses investments with the aim of outperforming the Index by 1.5% per annum on a rolling 3 year basis, before deduction of fees.
Previous policy
The Fund will invest in a portfolio of investments in which a UCITS scheme equivalent to a securities scheme (see Note 1) is authorised to invest. The majority of the Fund will be invested in non-investment grade securities, including corporate bonds and other investment securities. The Fund may also invest in secured and unsecured loan stock, government and other public securities, other bonds, convertible securities, preference shares, shares and other instruments creating or acknowledging indebtedness. In addition, the ACD reserves the right to exercise full powers of the Fund in relation to borrowing and efficient portfolio management as and when it considers that the circumstances which then exist make it appropriate to do so. In particular, currency may be hedged into sterling.
Note 1: Being a scheme which is dedicated to investment in transferable securities and which can invest not more than 10% in value of the scheme property in unapproved securities, not more than 5% in warrants and not more than 10% in other collective investment schemes. The use of derivatives for this scheme type is restricted to efficient portfolio management.
Policy
At least 80% of the Fund will invest in non-investment grade corporate bonds* denominated in Euros, Sterling or US Dollars.
The Fund may also invest in government bonds, supranational bonds (these are a type of security issued by two or more governmental organisations), investment grade corporate bonds*, covered bonds and asset backed securities such as securitised loans denominated in Euros, Sterling or US Dollars. Additionally the Fund may invest in cash and cash like investments.
The Fund’s investments will be predominately held in, or hedged back to, Sterling. Hedging involves the use of derivatives to offset the effect of currency exchange rates.
In selecting bonds for the Fund the Investment Adviser will focus on the issuers’ credit worthiness, valuation and risks. Regional and global economic factors and monetary policy may also be taken into account.
The ACD limits the extent to which the Fund’s composition can differ relative to the market for high yield bonds (as represented by the Index). These limits help to deliver a level of portfolio diversification and risk management. The limits also help to achieve an appropriate balance between the extent to which the Fund’s composition can diverge from the Index and providing the Investment Adviser with flexibility to seek outperformance relative to the Index. As a result, the Fund’s performance may differ from the Index.
The Fund may also invest in collective investment schemes, including those managed by the ACD and its associates.
Derivatives and stock lending may be used for the purpose of managing the Fund in a way that is designed to reduce risk or cost and/or generate extra income or growth (often referred to as efficient portfolio management).
*Credit ratings indicate the likelihood that an issuer will be able to make their payments. Investment grade bonds have achieved or exceeded a minimum credit rating awarded by a credit rating agency. Therefore they are considered lower risk than bonds with a lower credit rating.
Non-investment grade bonds, also known as high yield bonds, have a lower credit rating than investment grade bonds, and so are considered higher risk.The Bloomberg Barclays Global High Yield Index hedged back to Sterling Index has been selected as an appropriate benchmark as it provides a representation of the returns of securities in the high yield bond market.
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Previous objective
To provide a high and regular income whilst providing some potential for capital growth over the medium to long term through investment predominantly in the United Kingdom but also in Europe.
Objective
To provide a regular quarterly income whilst providing some potential for capital growth through investment in the UK.
The benchmark for the Fund is a blended return of the FTSE All Share Index and the iBOXX Sterling Corporate and Collateralised Index (the “Benchmark”). 75% of the Benchmark will consist of the FTSE All Share Index and 25% of the iBOXX Sterling Corporate and Collateralised Index.
The Fund is actively managed by the Investment Adviser who chooses investments with the aim of outperforming the Benchmark on a rolling 3 year basis, before deduction of fees. In addition the Investment Adviser chooses investments which, collectively, aim to deliver performance in excess of 110% of the dividend yield* of the FTSE All Share Index each year before deduction of fees.
* The dividend yield is calculated by dividing the annual dividend paid in respect of a security by its share price.
Previous policy
The Fund will invest in a diversified portfolio of UK and European securities which may include, directly or indirectly, high yielding equities, Gilt-edged securities, corporate bonds, convertible stocks, preference shares and warrants, however the Fund may invest in other types of investment at the discretion of the ACD.
Derivatives may be used for efficient portfolio management purposes only.
Policy
At least 80% of the Fund will invest in a diversified portfolio of UK shares and fixed interest securities. It may also invest in Europe.
The portion in shares may include high yielding equities as well as convertible stocks, preference shares* and warrants.
The fixed interest portion will consist of investment grade bonds** and may also include government bonds, high yield bonds, supranational bonds***and asset backed securities such as securitised loans.
The ACD limits the extent to which the Fund’s composition can differ relative to the market for shares and bonds (as represented by the Benchmark). These limits help to deliver a level of portfolio diversification and risk management. The limits also help to achieve an appropriate balance between the extent to which the Fund’s composition can diverge from the Benchmark and providing the Investment Adviser with flexibility to seek outperformance relative to the Benchmark. As a result, the Fund’s performance may differ from the Benchmark.
Derivatives and stock lending may be used for the purpose of managing the Fund in a way that is designed to reduce risk or cost and/or generate extra income or growth (often referred to as efficient portfolio management).
* A preference share usually issues a fixed dividend payment which takes priority over payments of ordinary shares.
**Credit ratings indicate the likelihood that an issuer will be able to make their payments. Investment grade bonds have achieved or exceeded a minimum credit rating awarded by a credit rating agency. Therefore they are considered lower risk than bonds with a lower credit rating.
Non-investment grade bonds, also known as high yield bonds, have a lower credit rating than investment grade bonds, and so are considered higher risk.
***A supranational bond is a type of fixed interest security which is issued by two or more governmental organisations.
The FTSE All-Share Index has been selected as an appropriate benchmark as it provides a representation of the returns of shares in the UK equity market.
The iBOXX Sterling Corporate and Collateralised Index has been selected as an appropriate benchmark as it provides a representation of the returns of securities in the sterling investment grade corporate bond market.
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Previous objective
To provide a high level of income and also capital growth by investing in any geographic area excluding South East Asia (not including Japan) in investments in which a securities scheme (see Note below) is authorised to invest.
Objective
To provide an income and also capital growth by investing in global fixed interest and index-linked securities.
The benchmark index for the Fund is the JPM Global Government Bond Index (the “Index”). The Fund is actively managed by the Investment Adviser who chooses investments with the aim of outperforming the Index by 0.5% per annum on a rolling 3 year basis, before deduction of fees.
Previous policy
The portfolio may be comprised of investments in which a UCITS scheme equivalent to a securities scheme (see Note below) is authorised to invest, including loan stock, bonds and other instruments creating or acknowledging indebtedness, but the ACD intends to place investment emphasis on Government and other fixed interest securities.
Note: Being a scheme which is dedicated to investment in transferable securities and which can invest not more than 10% in value of the scheme property in unapproved securities, not more than 5% in warrants and not more than 10% in other collective investment schemes. The use of derivatives for this type of scheme is restricted to efficient portfolio management.
Derivatives may be used for efficient portfolio management purposes only.
Policy
The Fund will invest in fixed interest and index linked securities from global markets excluding South East Asia*. At least 50% of the securities will be in Sterling and non-Sterling investment grade** government bonds.
The Fund may also invest in Sterling and non-Sterling investment grade corporate bonds and index-linked government bonds and non-investment grade*** bonds, cash including cash-like investments, asset backed securities such as securitised loans and covered bonds. The Fund may also invest in collective investment schemes, including those managed by the ACD and its associates.
In selecting bonds for the Fund the Investment Adviser may consider the issuers’ credit worthiness, valuation and risks. Regional and global economic factors and monetary policy may also be taken into account.
The ACD limits the extent to which the Fund’s composition can differ relative to the market for international bonds (as represented by the Index). These limits help to deliver a level of portfolio diversification and risk management. The limits also help to achieve an appropriate balance between the extent to which the Fund’s composition can diverge from the Index and providing the Investment Adviser with flexibility to seek outperformance relative to the Index. As a result, the Fund’s performance may differ from the Index.
Derivatives and stock lending may be used for the purpose of managing the Fund in a way that is designed to reduce risk or cost and/or generate extra income or growth (often referred to as efficient portfolio management).
* The Fund will not invest in South East Asian countries, including, but not limited to: Cambodia; Indonesia; Laos; Malaysia; the Philippines; Singapore; Thailand; Vietnam.
**Credit ratings indicate the likelihood that an issuer will be able to make their payments. Investment grade bonds have achieved or exceeded a minimum credit rating awarded by a credit rating agency. Therefore, they are considered lower risk than bonds with a lower credit rating.
***Non-investment grade bonds, also known as high yield bonds, have a lower credit rating than investment grade bonds, and so are considered higher risk.
The JPM Global Government Bond Index has been selected as an appropriate benchmark as it provides a representation of the returns of securities in the global government bond market.
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Previous objective
To provide a total return based on the performance of a number of underlying international equity indices (as determined by the ACD from time to time), in proportions determined by reference to the country and regional weightings contained in the FTSE All-World ex UK Index (or such other published benchmark as the ACD considers appropriate from time to time) by investing in a portfolio primarily consisting of derivative instruments.
Objective
To track the performance of the FTSE All-World ex UK Index (the “Index”), before deduction of fees, through derivative contracts which look to replicate the performance of shares from the Index.
Previous policy
The Fund will invest in a portfolio of derivatives instruments.
The Fund will normally invest in a combination of derivatives such as financial futures, currency forwards, warrants and other financial instruments (when permitted), cash or near cash instruments (including those in foreign currencies) and some other investments (particularly equities and units in other collective investment schemes).
Various sampling techniques will be used to track the underlying country and regional equity markets. It is intended that the majority of derivatives used will be exchange traded but there may also be off-exchange derivatives.
The ACD aims to run all positions on a fully covered basis but there may be periods when a proportion is uncovered (in accordance with the FCA Rules). The types of assets which will underline the derivatives contracts will be cash, near cash and transferable securities.
Policy The Fund aims to replicate the characteristics and performance of the Index through various sampling techniques, by entering into a number and combination of derivative contracts based on underlying international indices across the country and regional weightings within the Index.
The Fund will normally enter into derivative contracts such as financial futures & currency forwards to meet the objective. Cash and near cash deposits and transferable securities are held individually or together by the Fund as cover to the financial exposures from the derivative contracts. The ACD aims to run all positions on a fully covered basis meaning the value of these assets are at least equal to the value of the exposures from the derivative contracts. Any periods when a proportion is uncovered is within the limits permitted by the FCA Rules.
It is intended the majority of the derivative contracts will be exchange traded but there may also be off-exchange derivatives contracts.
The Fund may also gain exposure to the Index through the use of collective investment schemes, including those managed by the ACD and its associates.
The FTSE All-World ex UK Index has been selected as an appropriate benchmark as it provides a representation of the returns of shares in the international equity ex-UK market.
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Previous objective
To provide long term capital growth.
Objective
To track the performance of the Japanese equity market, as represented by the MSCI Japan Index (the “Index”), before deduction of fees, by investing in Japanese shares.
Previous policy
The Fund will invest primarily in Japanese equities.
The Fund may also invest in equity-linked securities being preference shares, rights issues, American Depositary Receipts and Global Depositary Receipts as well as equity linked notes, cash, near cash, deposits, other collective investment schemes and warrants.
Use may also be made of stocklending/repos, borrowing and hedging.
It is not currently intended that derivatives will be used for any purpose other than the efficient portfolio management (including hedging) of the Fund, although derivatives may, subject to the ACD giving not less than 60 days' notice to shareholders, be used in the pursuit of its investment objective in the future as well as for efficient portfolio management (including hedging) which may change the risk profile of the Fund.
Note: The fund’s current benchmark index is the MSCI Japan Index. The fund will usually invest in equities which are included in the benchmark, however, the fund isn’t limited to investing only within the index. In accordance with the FCA Rules, the ACD may at its discretion replace the current index with such similar index as it may consider appropriate.
Policy
The Fund aims to invest in shares of all of the companies within the Index. This is often referred to as a ‘full replication’ approach.
Where the ACD believes it can provide an advantage to the Fund in managing costs, to achieve a more efficient way of tracking the Index, or where there are exceptional market circumstances, the Fund may include or exclude specific shares and/or other security types which are representative of a share in the Index (such as depositary receipts).
The Fund may also invest in collective investment schemes to gain exposure to the Index.
Derivatives and stock lending may be used for the purpose of managing the Fund in a way that is designed to reduce risk or cost and/or generate extra income or growth (often referred to as efficient portfolio management).
It is not currently intended that derivatives will be used for any purpose other than the efficient portfolio management (including hedging) of the Fund, although derivatives may, subject to the ACD giving not less than 60 days' notice to shareholders, be used in the pursuit of its investment objective in the future as well as for efficient portfolio management (including hedging) which may change the risk profile of the Fund.
Note: In accordance with the FCA Rules, the ACD may at its discretion replace the Index with such similar index as it may consider appropriate.
The MSCI Japan Index provides a representation of the returns of securities in the Japanese equity market.
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Previous objective
To provide long term capital growth through investment in a broad portfolio of predominantly Japanese companies. The Fund seeks to deliver performance, before deduction of management fees, in excess of the MSCI Japan Index (the “Index”) with a similar level of overall volatility, over the long term.
Objective
To provide capital growth through investment in a broad portfolio of shares in Japanese companies.
The benchmark index for the Fund is the MSCI Japan Index (the “Index”). The Investment Adviser seeks to outperform the Index by 0.75%* per annum on a rolling 3 year basis, before deduction of fees.
Previous policy
To invest predominantly in a portfolio of companies which are part of the Index and this will involve investing in equities.
The Investment Adviser may only take limited positions away from the Index. This means there are limitations on the extent to which the Fund’s investment in various sectors* may differ to the Index. These limited positions can be more than is held in the Index (overweight) or less than is held in the Index (underweight).
Derivatives may be used for efficient portfolio management purposes only.
* A sector is a business area, industry or economy which shares the same characteristics. Company shares are typically grouped into different sectors depending on the company’s business.
Policy
At least 80% of the Fund will be invested in a portfolio of companies which are part of the Index and this will involve investing in shares.
The Investment Adviser may only take limited positions away from the Index. This means there are limitations on the extent to which the Fund’s investment in various sectors** may differ to the Index. These limited positions can be more than is held in the Index (overweight) or less than is held in the Index (underweight).
These limitations help to deliver a level of portfolio diversification and risk management. The limitations also help to achieve an appropriate balance between the extent to which the Fund’s composition can diverge from the Index and providing the Investment Adviser with flexibility to seek outperformance relative to the Index. As a result, the Fund’s performance may differ from the Index.
The Fund may also invest in collective investment schemes, including those managed by the ACD and its associates, cash and cash like investments.
Derivatives and stock lending may be used for the purpose of managing the Fund in a way that is designed to reduce risk or cost and/or generate extra income or growth (often referred to as efficient portfolio management).
* Note: there are Share Classes in the Fund where fees exceed the Fund’s outperformance target relative to the Index. For those Share Classes, the Fund will underperform the Index after deduction of fees even if its outperformance target is achieved.
** A sector is a business area, industry or economy which shares the same characteristics. Company shares are typically grouped into different sectors depending on the company’s business.
The MSCI Japan Index has been selected as an appropriate benchmark as it provides a representation of the returns of securities in the Japanese equities market.
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Previous objective
To provide long term capital growth from a balanced portfolio of investments in the listed securities of companies based in Latin America or having a significant proportion of their business activities in one or more countries in Latin America.
Objective
To provide capital growth through investment in shares of companies in Latin America.
The benchmark index for the Fund is the MSCI Emerging Markets Latin America Index (the “Index”). The Fund is actively managed by the Investment Adviser who chooses investments with the aim of outperforming the Index by 2% per annum on a rolling 3 year basis, before deduction of fees.
Previous policy
It is intended that the purpose of the Fund be achieved by active investment management, to take advantage of changing economic conditions, of a portfolio of investments which may include shares, American depository receipts, Latin American bonds, global and other equity backed depository receipts, convertible securities and listed warrants, listed on any eligible securities market.
Derivatives may be used for efficient portfolio management purposes only.
Policy
At least 80% of the Fund will be invested in Latin American shares. This may include shares of companies which are based in Latin American countries or have a significant proportion of their business activities in one or more of those countries.
The Fund may also include depository receipts and listed warrants.
In selecting assets for the Fund, the Investment Adviser focuses on the company’s growth prospects, market valuation and risks and looks to take advantage of changing economic conditions.
The ACD limits the extent to which the Fund’s composition can differ relative to the market for Latin American shares (as represented by the Index). These limits help to deliver a level of portfolio diversification and risk management. The limits also help to achieve an appropriate balance between the extent to which the Fund’s composition can diverge from the Index and providing the Investment Adviser with flexibility to seek outperformance relative to the Index. As a result, the Fund’s performance may differ substantially from the Index.
A small proportion of the Fund may be invested in Latin American bonds (including convertibles), cash and cash like investments. The Fund may also invest in collective investment schemes, including those managed by the ACD and its associates.
Derivatives and stock lending may be used for the purpose of managing the Fund in a way that is designed to reduce risk or cost and/or generate extra income or growth (often referred to as efficient portfolio management).
The MSCI Emerging Markets Latin America Index has been selected as an appropriate benchmark as it provides a representation of the returns of securities across 5 emerging market countries in Latin America.
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Previous objective
The Sub-fund aims to achieve a combination of income and capital growth by mainly investing in a portfolio of collective investment schemes to achieve broad exposure to diversified investments, including equities and fixed interest securities. Property exposure will also be achieved via exposure to collective investment schemes. The Sub-fund will typically have a higher exposure to lower risk assets, such as fixed interest securities.
Where appropriate the Sub-fund may also invest directly or indirectly in equities and fixed interest securities and other transferable securities (including closed end Sub-funds), depositary receipts, money market instruments, cash, near cash, deposits, derivatives and other regulated collective investment schemes. Use may also be made of unregulated collective investment schemes, stocklending/repos, borrowing and hedging.
The portfolio will normally be fully invested however the ACD may at its discretion invest all or part of the assets of the Sub-fund in cash, deposits, and/or money market instruments in the interests of efficient fund management.
It is not currently intended that derivatives will be used for any purpose other than hedging where it is appropriate to do so and the efficient portfolio management of the Sub-fund. Although derivatives may, subject to the ACD obtaining and maintaining the requisite permissions from the FCA under the Financial Services and Markets Act 2000 and on giving not less than 60 days' notice to shareholders in the Sub-fund, be used in pursuit of its investment objective as well as hedging in the future. If derivatives are used for the purpose of meeting the investment objective of the Sub-fund as well as hedging it is not intended that the use of derivatives would raise the risk profile.
Objective
The Sub-fund aims to achieve capital growth by investing in a portfolio of collective investment schemes to achieve exposure to a wide range of investments, consisting of UK and Global fixed interest securities, shares and property assets, with some exposure to absolute return strategies *.
* Absolute return strategies aim to provide positive returns regardless of market conditions.
Previous policy
N/A
Policy
Between 50% and 70% of the Sub-fund will provide exposure to fixed interest securities. This will include UK and overseas investment grade corporate bond funds and also government bond funds. It may also include a small exposure to high yield** corporate bond funds and emerging market bond funds.
Between 15% and 35% of the Sub-fund will provide exposure to shares. This may consist of UK, overseas and emerging markets shares.
A maximum of 20% of the Sub-fund will provide exposure to property. This may include UK and overseas property funds.
The Sub-fund may also provide exposure to absolute return strategies.
The Sub-fund will normally be fully invested in the above asset classes however the ACD may invest a small part of the Sub-fund’s assets of the in cash and cash like investments in the interests of efficient fund management.
The ACD is responsible for determining the percentage of the Sub-fund normally allocated to each asset class based on its medium to long term outlook for that asset class. The ACD may review and change this from time to time based on their view at the time.
The ACD is also responsible for selecting the collective investment schemes used by the Sub-fund. These may be actively or passively managed *** and include those managed by Scottish Widows Unit Trust Managers (SWUTM) and its associates.
Derivatives may be used for the purpose of managing the Sub-fund in a way that is designed to reduce risk or cost and/or generate extra income or growth (often referred to as efficient portfolio management).
It is not currently intended that derivatives will be used for any purpose other than the efficient portfolio management (including hedging) of the Sub-fund. Although derivatives may, subject to the ACD giving not less than 60 days' notice to shareholders, be used for investment purposes in the future as well as for efficient portfolio management (including hedging). If derivatives are used for the purpose of meeting the investment objective of the Sub-fund it is not intended that their use would raise the risk profile.
Non-sterling investments may be hedged back to sterling. Hedging aims to reduce the effect of fluctuations in the exchange rates between the currency of the asset and the currency of the Sub-fund.
The collective investment schemes in which the Sub-fund invests may use techniques which are not employed by the Sub-fund itself, for example stock lending or hedging.
** Credit ratings indicate the likelihood that an issuer will be able to make their payments. Investment grade bonds have achieved or exceeded a minimum credit rating awarded by a credit rating agency. Therefore they are considered lower risk than bonds with a lower credit rating.
Non-investment grade bonds, also known as high yield bonds, have a lower credit rating than investment grade bonds, and so are considered higher risk.
***Active management is where the Investment Adviser seeks to add value by making decisions on which investments to buy, sell or hold depending on, for example company, market or economic factors.
Passive management is where the Investment Adviser aims to match a benchmark and will buy, sell or hold investments depending on the components of that benchmark.The ACD does not quote a benchmark or outperformance target for the Sub-fund. This is because the asset allocation of the Sub-fund will change over time taking into consideration risk and the ACD’s view of the prospects of each asset class.
Investors may assess the Sub-fund relative to similar funds offered by other investment firms. A number of fund industry bodies and data providers group similar funds together and provide analysis on performance and risk characteristics of the fund group. The Investment Association “Mixed Assets Sectors” group funds with a range of different assets according to their allocation to shares, fixed interest securities and cash. More information on the Investment Association sectors can be found at https://www.theia.org/industry-data/fund-sectors .
Over the period from 12.2.2018 to 28.2.19 the Sub-fund would have sat within the “Mixed Investment 0-35% Shares Sector”. Investors may wish to consider the performance of the Sub-fund by looking at the performance of this sector which has a broadly similar allocation to shares, fixed interest securities and cash.
-
Previous objective
The Sub-fund aims to achieve a combination of income and capital growth by mainly investing in a portfolio of collective investment schemes to achieve broad exposure to diversified investments, including equities and fixed interest securities. Property exposure will also be achieved via exposure to collective investment schemes. The Sub-fund will typically take a diversified approach to lower and higher risk assets.
Where appropriate the Sub-fund may also invest directly or indirectly in transferable securities (including closed end funds), depositary receipts, money market instruments, cash, near cash, deposits, derivatives and other regulated collective investment schemes. Use may also be made of unregulated collective investment schemes, stocklending/repos, borrowing and hedging.
The portfolio will normally be fully invested however the ACD may at its discretion invest all or part of the assets of the Sub-fund in cash, deposits, and/or money market instruments in the interests of efficient fund management.
It is not currently intended that derivatives will be used for any purpose other than hedging where it is appropriate to do so and the efficient portfolio management of the Sub-fund. Although derivatives may, subject to the ACD obtaining and maintaining the requisite permissions from the FCA under the Financial Services and Markets Act 2000 and on giving not less than 60 days' notice to shareholders in the Sub-fund, be used in pursuit of its investment objective as well as hedging in the future. If derivatives are used for the purpose of meeting the investment objective of the Sub-fund as well as hedging it is not intended that the use of derivatives would raise the risk profile.
Objective
The Sub-fund aims to achieve capital growth by investing in a portfolio of collective investment schemes to achieve exposure to a wide range of investments, consisting of UK and Global shares and fixed interest securities, with the remainder in property assets and some exposure to absolute return strategies*.
* Absolute return strategies aim to provide positive returns regardless of market conditions.
Previous policy
N/A
Policy
Between 40% and 60% of the Sub-fund will provide exposure to shares. This may consist of UK, overseas and emerging markets shares.
Between 25% and 45% of the Sub-fund will provide exposure to fixed interest securities. This will include UK and overseas investment grade corporate bond funds and also government bond funds. It may also include a small exposure to high yield** corporate bond funds and emerging market bond funds.
A maximum of 20% of the Sub-fund will provide exposure to property. This may include UK and overseas property funds.
The Sub-fund may also provide exposure to absolute return strategies.
The Sub-fund will normally be fully invested in the above asset classes however the ACD may invest a small part of the Sub-fund’s assets in cash and cash like investments in the interests of efficient fund management.
The ACD is responsible for determining the percentage of the Sub-fund normally allocated to each asset class based on its medium to long term outlook for that asset class. The ACD may review and change this from time to time based on their view at the time.
The ACD is also responsible for selecting the collective investment schemes used by the Sub-fund. These may be actively or passively managed*** and include those managed by Scottish Widows Unit Trust Managers (SWUTM) and its associates.
Derivatives may be used for the purpose of managing the Sub-fund in a way that is designed to reduce risk or cost and/or generate extra income or growth (often referred to as efficient portfolio management).
It is not currently intended that derivatives will be used for any purpose other than the efficient portfolio management (including hedging) of the Sub-fund. Although derivatives may, subject to the ACD giving not less than 60 days' notice to shareholders, be used for investment purposes in the future as well as for efficient portfolio management (including hedging). If derivatives are used for the purpose of meeting the investment objective of the Sub-fund it is not intended that their use would raise the risk profile.
Non-sterling investments may be hedged back to sterling. Hedging aims to reduce the effect of fluctuations in the exchange rates between the currency of the asset and the currency of the Sub-fund.
The collective investment schemes in which the Sub-fund invests may use techniques which are not employed by the Sub-fund itself, for example stock lending or hedging.
** Credit ratings indicate the likelihood that an issuer will be able to make their payments. Investment grade bonds have achieved or exceeded a minimum credit rating awarded by a credit rating agency. Therefore they are considered lower risk than bonds with a lower credit rating.
Non-investment grade bonds, also known as high yield bonds, have a lower credit rating than investment grade bonds, and so are considered higher risk.
***Active management is where the Investment Adviser seeks to add value by making decisions on which investments to buy, sell or hold depending on, for example company, market or economic factors.
Passive management is where the Investment Adviser aims to match a benchmark and will buy, sell or hold investments depending on the components of that benchmark.
The ACD does not quote a benchmark or outperformance target for the Sub-fund. This is because the asset allocation of the Sub-fund will change over time taking into consideration risk and the ACD’s view of the prospects of each asset class.
Investors may assess the Sub-fund relative to similar funds offered by other investment firms. A number of fund industry bodies and data providers group similar funds together and provide analysis on performance and risk characteristics of the fund group. The Investment Association “Mixed Assets Sectors” group funds with a range of different assets according to their allocation to shares, fixed interest securities and cash. More information on the Investment Association sectors can be found at https://www.theia.org/industry-data/fund-sectors .
Over the period from 12.2.2018 to 28.2.19 the Sub-fund would have sat within the “Mixed Investment 20-60% Shares Sector”. Investors may wish to consider the performance of the Sub-fund by looking at the performance of this sector which has a broadly similar allocation to shares, fixed interest securities and cash.
-
Previous Objective
The Sub-fund aims to achieve a combination of income and capital growth by mainly investing in a portfolio of collective investment schemes to achieve broad exposure to diversified investments, including equities and fixed interest securities. Property exposure will also be achieved via exposure to collective investment schemes. The Sub-fund will typically have high exposure to assets providing potential for growth, such as equities.
Where appropriate the Sub-fund may also invest directly or indirectly in transferable securities (including closed end funds), depositary receipts, money market instruments, cash, near cash, deposits, derivatives and other regulated collective investment schemes. Use may also be made of unregulated collective investment schemes, stocklending/repos, borrowing and hedging.
The portfolio will normally be fully invested however the ACD may at its discretion invest all or part of the assets of the Sub-fund in cash, deposits, and/or money market instruments in the interests of efficient fund management.
It is not currently intended that derivatives will be used for any purpose other than hedging where it is appropriate to do so and the efficient portfolio management of the Sub-fund. Although derivatives may, subject to the ACD obtaining and maintaining the requisite permissions from the FCA under the Financial Services and Markets Act 2000 and on giving not less than 60 days' notice to shareholders in the Sub-fund, be used in pursuit of its investment objective as well as hedging in the future. If derivatives are used for the purpose of meeting the investment objective of the Sub-fund as well as hedging it is not intended that the use of derivatives would raise the risk profile.
Objective
The Sub-fund aims to achieve capital growth by investing in a portfolio of collective investment schemes to achieve exposure to a wide range of investments, consisting of UK and Global shares, plus fixed interest securities and property assets with some exposure to absolute return strategies*.
* Absolute return strategies aim to provide positive returns regardless of market conditions.
Previous policy
N/A
Policy
Between 65% and 85% of the Sub-fund will provide exposure to shares. This may consist of UK, overseas and emerging markets shares.
A maximum of 25% of the Sub-fund will provide exposure to fixed interest securities. This may include UK and overseas, including emerging market, government bond funds, together with investment grade and high yield** corporate bond funds.
A maximum of 15% of the Sub-fund will provide exposure to The property. This may include UK and overseas property funds.
The Sub-fund may also provide exposure to absolute return strategies.
The Sub-fund will normally be fully invested in the above asset classes however the ACD may invest a small part of the Sub-fund’s assets in cash and cash like investments in the interests of efficient fund management.
The ACD is responsible for determining the percentage of the Sub-fund normally allocated to each asset class based on its medium to long term outlook for that asset class. The ACD may review and change this from time to time based on their view at the time.
The ACD is also responsible for selecting the collective investment schemes used by the Sub-fund. These may be actively or passively managed*** and include those managed by Scottish Widows Unit Trust Managers (SWUTM) and its associates.
Derivatives may be used for the purpose of managing the Sub-fund in a way that is designed to reduce risk or cost and/or generate extra income or growth (often referred to as efficient portfolio management).
It is not currently intended that derivatives will be used for any purpose other than the efficient portfolio management (including hedging) of the Sub-fund. Although derivatives may, subject to the ACD giving not less than 60 days' notice to shareholders, be used for investment purposes in the future as well as for efficient portfolio management (including hedging). If derivatives are used for the purpose of meeting the investment objective of the Sub-fund it is not intended that their use would raise the risk profile.
Non-sterling investments may be hedged back to sterling. Hedging aims to reduce the effect of fluctuations in the exchange rates between the currency of the asset and the currency of the Sub-fund.
The collective investment schemes in which the Sub-fund invests may use techniques which are not employed by the Sub-fund itself, for example stock lending or hedging.
** Credit ratings indicate the likelihood that an issuer will be able to make their payments. Investment grade bonds have achieved or exceeded a minimum credit rating awarded by a credit rating agency. Therefore they are considered lower risk than bonds with a lower credit rating.
Non-investment grade bonds, also known as high yield bonds, have a lower credit rating than investment grade bonds, and so are considered higher risk.
***Active management is where the Investment Adviser seeks to add value by making decisions on which investments to buy, sell or hold depending on, for example company, market or economic factors.
Passive management is where the Investment Adviser aims to match a benchmark and will buy, sell or hold investments depending on the components of that benchmark.
The ACD does not quote a benchmark or outperformance target for the Sub-fund. This is because the asset allocation of the Sub-fund will change over time taking into consideration risk and the ACD’s view of the prospects of each asset class.
Investors may assess the Sub-fund relative to similar funds offered by other investment firms. A number of fund industry bodies and data providers group similar funds together and provide analysis on performance and risk characteristics of the fund group. The Investment Association “Mixed Assets Sectors” group funds with a range of different assets according to their allocation to shares, fixed interest securities and cash. More information on the Investment Association sectors can be found at https://www.theia.org/industry-data/fund-sectors .
Over the period from 12.2.2018 to 28.2.19 the Sub-fund would have sat within the “Mixed Investment 40-85% Shares Sector”. Investors may wish to consider the performance of the Sub-fund by looking at the performance of this sector which has a broadly similar allocation to shares, fixed interest securities and cash.
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Previous objective
The Fund aims to provide a high level of income by mainly investing in regulated collective investment schemes which are currently and/or which have been managed or operated within the Lloyds Banking Group. The Fund will primarily invest in fixed interest funds.
Objective
The Fund aims to provide an income with some potential for capital growth by investing in regulated collective investment schemes which are currently and/or which have been managed or operated within the Lloyds Banking Group.
These collective investment schemes will provide exposure to fixed interest securities, some exposure to shares and a small exposure to cash.
Previous policy
This Fund will principally invest in funds which invest in UK government bonds and other sterling denominated fixed interest securities, to a lesser extent in overseas bonds and to a limited extent in UK equities. The Fund may also invest in other investments permitted by FCA Rules for this type of scheme that are consistent with the Fund’s objectives. Non-sterling investment may be hedged back to sterling.
Derivatives may be used for efficient portfolio management purposes only.
Policy
At least 65% of the Fund will provide exposure to fixed interest securities. This will include sterling denominated investment grade* bonds funds which may consist of corporate and UK government bonds and index-linked bonds. It may also include overseas corporate and government bond funds and high yield bond** funds.
A maximum of 35% of the Fund will provide exposure to shares. This may include UK, overseas and emerging markets shares.
The Fund may invest a small amount in cash and cash-like investments.
The ACD is responsible for determining the percentage of the Fund normally allocated to each asset class based on their medium to long term outlook for that asset class. The ACD may review and change this from time to time based on their view at the time.
The Investment Adviser may make shorter term allocation changes, which vary from the above, allocating more or less to specific asset classes. This is based on their short term view of the asset class.
The ACD is also responsible for selecting the collective investment schemes used by the Fund. These may be actively or passively managed collective investment schemes***.
Derivatives may be used for the purpose of managing the Fund in a way that is designed to reduce risk or cost (often referred to as efficient portfolio management).
Non-sterling investment may be hedged back to sterling. Hedging aims to reduce the effect of fluctuations in the exchange rates between the currency of the asset and the currency of the Fund.
The collective investment schemes in which the Fund invests may use techniques which are not employed by the Fund itself, for example stock lending.
* Credit ratings indicate the likelihood that an issuer will be able to make their payments. Investment grade bonds have achieved or exceeded a minimum credit rating awarded by a credit rating agency. Therefore they are considered lower risk than bonds with a lower credit rating.
** Non-investment grade bonds, also known as high yield bonds, have a lower credit rating than investment grade bonds, and so are considered higher risk.
***Active management is where the Investment Adviser seeks to add value by making decisions on which investments to buy, sell or hold depending on, for example company, market or economic factors.
Passive management is where the Investment Adviser aims to match a benchmark and will buy, sell or hold investments depending on the components of that benchmark.The ACD does not quote a benchmark or outperformance target for the Fund. This is because the asset allocation of the Fund will change over time taking into consideration risk and the ACD’s view of the prospects of each asset class.
Investors may assess the Fund relative to similar funds offered by other investment firms. A number of fund industry bodies and data providers group similar funds together and provide analysis on performance and risk characteristics of the fund group. The Investment Association “Mixed Assets Sectors” group funds with a range of different assets according to their allocation to shares, fixed interest securities and cash. More information on the Investment Association sectors can be found at https://www.theia.org/industry-data/fund-sectors
Over the period from 30.09.2015to 17.01.2019 the Fund would have sat within the “Mixed Investment 0-35% Shares Sector”. Investors may wish to consider the performance of the Fund by looking at the performance of this sector which has a broadly similar allocation to shares, fixed interest securities and cash.
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Previous objective
The Fund aims to provide a high level of income with some potential for growth by mainly investing in regulated collective investment schemes which are currently and/or which have been managed or operated within the Lloyds Banking Group. The Fund will primarily invest in fixed interest funds, with some exposure to equity funds.
Objective
The Fund aims to provide an income with some potential for capital growth by investing in regulated collective investment schemes which are currently and/or which have been managed or operated within the Lloyds Banking Group.
These collective investment schemes will provide exposure to fixed interest securities, with some exposure to shares and a small exposure to cash.
Previous policy
This Fund will principally invest in funds which invest in UK government bonds and other sterling denominated fixed interest securities and to a lesser extent in overseas bonds and UK equities. The Fund may also invest in other investments permitted by FCA Rules for this type of scheme that are consistent with the Fund’s objectives. Non-sterling investment may be hedged back to sterling.
Derivatives may be used for efficient portfolio management purposes only.
Policy
At least 65% of the Fund will provide exposure to fixed interest securities.
This fixed interest exposure will include sterling denominated investment grade* bond funds which may consist of corporate and UK government bonds and index-linked bonds. It may also include overseas corporate and government bond funds and high yield bond** funds.
A maximum of 35% of the Fund will provide exposure to shares. This may include UK, overseas and emerging markets shares.
The Fund may invest a small amount in cash and cash-like investments.
The ACD is responsible for determining the percentage of the Fund normally allocated to each asset class based on their medium to long term outlook for that asset class. The ACD may review and change this from time to time based on their view at the time.
The Investment Adviser may make shorter term allocation changes, which vary from the above, allocating more or less to specific asset classes. This is based on their short term view of the asset class.
The ACD is also responsible for selecting the collective investment schemes used by the Fund. These may be actively or passively managed collective investment schemes***.
Derivatives may be used for the purpose of managing the Fund in a way that is designed to reduce risk or cost (often referred to as efficient portfolio management).
Non-sterling investment may be hedged back to sterling. Hedging aims to reduce the effect of fluctuations in the exchange rates between the currency of the asset and the currency of the Fund.
The collective investment schemes in which the Fund invests may use techniques which are not employed by the Fund itself, for example stock lending.
* Credit ratings indicate the likelihood that an issuer will be able to make their payments. Investment grade bonds have achieved or exceeded a minimum credit rating awarded by a credit rating agency. Therefore they are considered lower risk than bonds with a lower credit rating.
** Non-investment grade bonds, also known as high yield bonds, have a lower credit rating than investment grade bonds, and so are considered higher risk.
***Active management is where the Investment Adviser seeks to add value by making decisions on which investments to buy, sell or hold depending on, for example company, market or economic factors.
Passive management is where the Investment Adviser aims to match a benchmark and will buy, sell or hold investments depending on the components of that benchmark.
The ACD does not quote a benchmark or outperformance target for the Fund. This is because the asset allocation of the Fund will change over time taking into consideration risk and the ACD’s view of the prospects of each asset class.
Investors may assess the Fund relative to similar funds offered by other investment firms. A number of fund industry bodies and data providers group similar funds together and provide analysis on performance and risk characteristics of the fund group. The Investment Association “Mixed Assets Sectors” group funds with a range of different assets according to their allocation to shares, fixed interest securities and cash. More information on the Investment Association sectors can be found at https://www.theia.org/industry-data/fund-sectors
Over the period from 30.09.2015 to 17.01.2019 the Fund would have sat within the “Mixed Investment 0-35% Shares Sector”. Investors may wish to consider the performance of the Fund by looking at the performance of this sector which has a broadly similar allocation to shares, fixed interest securities and cash.
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Previous objective
To provide long term capital growth by investing mainly in multi-manager regulated collective investment schemes. The Fund will invest primarily in Equity funds (at least 80%) while maintaining a low exposure to Fixed Income funds. These investments will be diversified across a number of geographic areas including the United Kingdom and other international markets.
Objective
To provide capital growth by investing in multi-manager regulated collective investment schemes. The Fund will invest at least 80% in equity funds (these are funds which invest in shares) while maintaining a low exposure (up to a maximum of 20%) to fixed interest security funds. These investments will be diversified across the United Kingdom and a number of international markets.
Previous policy
The Fund will invest mainly in both multi-manager Equity funds and multi-manager Fixed Income funds.
The Equity funds that are selected will aim to provide capital growth by investing primarily in equity securities and will be chosen to provide a broad diversification by country, sector and companies.
The Fixed Income funds that are selected will aim to provide income and capital growth by investing primarily in investment grade bonds issued from a number of international markets and denominated in a variety of currencies. Non-sterling fixed income investments may be hedged back to sterling.
Derivatives may be used for efficient portfolio management purposes only.
Policy
The Fund will invest in both multi-manager equity funds and multi-managed fixed interest security funds.
The equity funds that are selected will be chosen to provide a broad diversification by country, sector* and companies.
The fixed interest security funds that are selected invest primarily in investment grade** bonds issued from the UK and a number of international markets and denominated in a variety of currencies. Non-sterling fixed interest security investments may be hedged back to sterling***.
The Fund may invest a small amount in cash and cash-like investments.
Russell Investments Limited is responsible for determining the percentage of the Fund normally allocated to each asset class based on its medium to long term outlook for that asset class. Russell Investments Limited may review and change this from time to time based on their view at the time.
The Investment Adviser may make shorter term allocation changes, which vary from the above, allocating more or less to specific asset classes. This is based on their short term view of the asset class.
Russell Investments Limited is responsible for selecting the multi-manager collective investment schemes used by the Fund. These may be actively or passively managed **** and may include those managed by the ACD and its associates.
The collective investment schemes in which the Fund invests may use techniques which are not employed by the Fund itself, for example stock lending.
Derivatives may be used for the purpose of managing the Fund in a way that is designed to reduce risk or cost (often referred to as efficient portfolio management).
* A sector is a business area, industry or economy which shares the same characteristics. Company shares are typically grouped into different sectors depending on the company’s business.
** Credit ratings indicate the likelihood that an issuer will be able to make their payments. Investment grade bonds have achieved or exceeded a minimum credit rating awarded by a credit rating agency. Therefore they are considered lower risk than bonds with a lower credit rating.
*** Hedging aims to reduce the effect of fluctuations in the exchange rates between the currency of the asset and the currency of the Fund.
****Active management is where the Investment Adviser seeks to add value by making decisions on which investments to buy, sell or hold depending on, for example company, market or economic factors.
Passive management is where the Investment Adviser aims to match a benchmark and will buy, sell or hold investments depending on the components of that benchmark.
The ACD does not quote a benchmark or outperformance target for the Fund. This is because the asset allocation of the Fund will change over time taking into consideration risk and the ACD’s view of the prospects of each asset class.
Investors may assess the Fund relative to similar funds offered by other investment firms. A number of fund industry bodies and data providers group similar funds together and provide analysis on performance and risk characteristics of the fund group. The Investment Association “Mixed Assets Sectors” group funds with a range of different assets according to their allocation to shares, fixed interest securities and cash. More information on the Investment Association sectors can be found at https://www.theia.org/industry-data/fund-sectors
Over the period from 25.04.2013 to 17.01.2019 the Fund would have sat within the “Flexible Investment Sector”. Investors may wish to consider the performance of the Fund by looking at the performance of this sector.
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Previous objective
To provide long term capital growth through investment in a broad portfolio of predominantly Asian and Australasian companies, excluding Japan. The Fund seeks to deliver performance, before deduction of management fees, in excess of the MSCI AC Asia Pacific ex Japan (the “Index”) with a similar level of overall volatility, over the long term.
Objective
To provide capital growth through investment in a broad portfolio of shares in Asian and Australasian companies, excluding Japan.
The benchmark index for the Fund is the MSCI AC Asia Pacific ex Japan Index (the “Index”). The Investment Adviser seeks to outperform the Index by 0.75%* per annum on a rolling 3 year basis, before deduction of fees.
Previous policy
To invest predominantly in a portfolio of companies which are part of the Index. This will involve investing in equities and may also include equity-linked securities being depositary receipts.
The Investment Adviser may only take limited positions away from the Index. This means there are limitations on the extent to which the Fund’s investment in various sectors* may differ to the Index. These limited positions can be more than is held in the Index (overweight) or less than is held in the Index (underweight).
Derivatives may be used for efficient portfolio management purposes only.
* A sector is a business area, industry or economy which shares the same characteristics. Company shares are typically grouped into different sectors depending on the company’s business.
Policy
At least 80% of the Fund will be invested in a portfolio of companies which are part of the Index. This will involve investing in shares and may also include equity-linked securities being depositary receipts.
The Investment Adviser may only take limited positions away from the Index. This means there are limitations on the extent to which the Fund’s investment in various sectors** may differ to the Index. These limited positions can be more than is held in the Index (overweight) or less than is held in the Index (underweight).
These limitations help to deliver a level of portfolio diversification and risk management. The limitations also help to achieve an appropriate balance between the extent to which the Fund’s composition can diverge from the Index and providing the Investment Adviser with flexibility to seek outperformance relative to the Index. As a result, the Fund’s performance may differ from the Index.
The Fund may also invest in collective investment schemes, including those managed by the ACD and its associates, cash and cash like investments.
Derivatives and stock lending may be used for the purpose of managing the Fund in a way that is designed to reduce risk or cost and/or generate extra income or growth (often referred to as efficient portfolio management)
* Note: there are Share Classes in the Fund where fees exceed the Fund’s outperformance target relative to the Index. For those Share Classes, the Fund will underperform the Index after deduction of fees even if its outperformance target is achieved.
** A sector is a business area, industry or economy which shares the same characteristics. Company shares are typically grouped into different sectors depending on the company’s business.
The MSCI AC Asia Pacific ex Japan Index has been selected as an appropriate benchmark as it provides a representation of the returns of securities in the Asia Pacific equities market, excluding Japan.
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Previous objective
To provide long term capital growth mainly through investment in collective investment schemes.
Objective
To provide capital growth through investment in collective investment schemes.
These collective investment schemes will provide exposure to shares, with the remainder providing exposure to a mix of asset classes (including, but not limited to, property assets and fixed interest securities) and absolute return strategies*.
* Absolute return strategies aim to provide positive returns regardless of market conditions.
Previous policy
The Fund aims to provide exposure mainly to equities, which may include UK, overseas or emerging markets. The Fund may also provide some exposure to property and bonds, which may include UK or overseas property, UK Government bonds, index linked securities, other Sterling denominated fixed interest securities, covered bonds, high yield bonds and overseas bonds. The Fund may also provide exposure to any or all of the following asset classes: private equity, hedge funds and commodities. The Fund aims to achieve exposure to the different asset classes mainly through investment in regulated and unregulated collective investment schemes which may include up to 100% investment in collective investment schemes managed, advised or operated by companies in the Group.
In addition the Fund may invest directly or indirectly, at the Investment Adviser's discretion, in transferable securities including warrants, other collective investment schemes, money market instruments, cash, near cash, deposits, permitted derivative contracts and forward contracts.
Use may also be made of stocklending/repos, borrowing, hedging and other techniques permitted by the FCA Rules.
It is intended that derivatives will be used for investment purposes as well as for efficient portfolio management, including hedging of the Fund. The use of derivatives for the purpose of meeting the investment objective of the Fund is not intended to change the risk profile of the Fund.
Non-sterling investments may be hedged back to sterling.
Policy
At least 50% of the Fund will provide exposure to shares. This may include UK, overseas and emerging market shares.
A maximum of 25% of the Fund will provide exposure to property. This may include UK and overseas property funds.
A maximum of 25% of the Fund will provide exposure to fixed interest securities. This may include sterling denominated and overseas high yield bond* funds and sterling denominated and overseas investment grade bond* funds. These may include corporate, government, covered bonds and index-linked bonds.
The Fund may also provide exposure to absolute return strategies, private equity, commodities and directly or indirectly cash and cash like investments.
The ACD is responsible for determining the percentage of the Fund normally allocated to each asset class based on its medium to long term outlook for that asset class. The ACD may review and change this from time to time based on their view at the time.
The Investment Adviser may make shorter term allocation changes, which vary from the above, allocating more or less to specific asset classes. This is based on their short term view of the asset class.
The ACD is also responsible for selecting the collective investment schemes used by the Fund. These may be actively or passively managed ** collective investment schemes which may include up to 100% investment in collective investment schemes managed, advised or operated by companies in the Group.
Derivatives can be used for investment purposes as well as for efficient portfolio management, including hedging of the Fund. The use of derivatives for the purpose of meeting the investment objective of the Fund is not intended to change the risk profile of the Fund.
Non-sterling investments may be hedged back to sterling. Hedging aims to reduce the effect of fluctuations in the exchange rates between the currency of the asset and the currency of the Fund.
The collective investment schemes in which the Fund invests may use techniques which are not employed by the Fund itself, for example stock lending.
* Credit ratings indicate the likelihood that an issuer will be able to make their payments. Investment grade bonds have achieved or exceeded a minimum credit rating awarded by a credit rating agency. Therefore they are considered lower risk than bonds with a lower credit rating.
Non-investment grade bonds, also known as high yield bonds, have a lower credit rating than investment grade bonds, and so are considered higher risk.
**Active management is where the Investment Adviser seeks to add value by making decisions on which investments to buy, sell or hold depending on, for example company, market or economic factors.
Passive management is where the Investment Adviser aims to match a benchmark and will buy, sell or hold investments depending on the components of that benchmark.The ACD does not quote a benchmark or outperformance target for the Fund. This is because the asset allocation of the Fund will change over time taking into consideration risk, the ACD’s view of the prospects of each asset class and the changes the Investment Adviser can make to the asset allocation.
Investors may assess the Fund relative to similar funds offered by other investment firms. A number of fund industry bodies and data providers group similar funds together and provide analysis on performance and risk characteristics of the fund group. The Investment Association “Mixed Assets Sectors” group funds with a range of different assets according to their allocation to shares, fixed interest securities and cash. More information on the Investment Association sectors can be found at www.theia.org/industry-data/fund-sectors .
Over the period 30.6.2016 to 17.1.2019 the Fund would have sat within the “Mixed Asset 40-85% Shares Sector”. Investors may wish to consider the performance of the Fund by looking at the performance of this sector which has a broadly similar allocation to shares, fixed interest securities and cash.
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Previous objective
To provide long term capital growth by investing mainly in multi-manager regulated collective investment schemes. The Fund will invest mainly in Equity funds (up to a maximum of 85%) while maintaining a moderate exposure to Fixed Income funds. These investments will be diversified across a number of geographic areas including the United Kingdom and other international markets.
Objective
To provide capital growth by investing in multi-manager regulated collective investment schemes. The Fund will invest up to a maximum of 85% in equity funds (these are funds which invest in shares) while maintaining a moderate exposure (up to a maximum of 40%) to fixed interest security funds. These investments will be diversified across the United Kingdom and a number of international markets.
Previous policy
The Fund will invest mainly in both multi-manager Equity funds and multi-manager Fixed Income funds.
The Equity funds that are selected will aim to provide capital growth by investing primarily in equity securities and will be chosen to provide a broad diversification by country, sector and companies.
The Fixed Income funds that are selected will aim to provide income and capital growth by investing primarily in investment grade bonds issued from a number of international markets and denominated in a variety of currencies. Non-sterling fixed income investments may be hedged back to sterling.
Derivatives may be used for efficient portfolio management purposes only.
Policy
The Fund will invest in both multi-manager equity funds and multi-manager fixed interest security funds.
The equity funds that are selected will be chosen to provide a broad diversification by country, sector* and companies.
The fixed interest security funds that are selected invest primarily in investment grade** bonds issued from the UK and a number of international markets and denominated in a variety of currencies. Non-sterling fixed interest security investments may be hedged back to sterling***.
The Fund may invest a small amount in cash and cash-like investments.
Russell Investments Limited is responsible for determining the percentage of the Fund normally allocated to each asset class based on its medium to long term outlook for that asset class. Russell Investments Limited may review and change this from time to time based on their view at the time.
The Investment Adviser may make shorter term allocation changes, which vary from the above, allocating more or less to specific asset classes. This is based on their short term view of the asset class.
Russell Investments Limited is responsible for selecting the multi-manager collective investment schemes used by the Fund. These may be actively or passively managed **** and may include those managed by the ACD and its associates.
The collective investment schemes in which the Fund invests may use techniques which are not employed by the Fund itself, for example stock lending.
Derivatives may be used for the purpose of managing the Fund in a way that is designed to reduce risk or cost (often referred to as efficient portfolio management).
* Credit ratings indicate the likelihood that an issuer will be able to make their payments. Investment grade bonds have achieved or exceeded a minimum credit rating awarded by a credit rating agency. Therefore they are considered lower risk than bonds with a lower credit rating.
** A sector is a business area, industry or economy which shares the same characteristics. Company shares are typically grouped into different sectors depending on the company’s business.
***Hedging aims to reduce the effect of fluctuations in the exchange rates between the currency of the asset and the currency of the Fund.
****Active management is where the Investment Adviser seeks to add value by making decisions on which investments to buy, sell or hold depending on, for example company, market or economic factors.
Passive management is where the Investment Adviser aims to match a benchmark and will buy, sell or hold investments depending on the components of that benchmark.
The ACD does not quote a benchmark or outperformance target for the Fund. This is because the asset allocation of the Fund will change over time taking into consideration risk and the ACD’s view of the prospects of each asset class.
Investors may assess the Fund relative to similar funds offered by other investment firms. A number of fund industry bodies and data providers group similar funds together and provide analysis on performance and risk characteristics of the fund group. The Investment Association “Mixed Assets Sectors” group funds with a range of different assets according to their allocation to shares, fixed interest securities and cash. More information on the Investment Association sectors can be found at www.theia.org/industry-data/fund-sectors.
Over the period from 25.04.2013 to 17.01.2019 the Fund would have sat within the “Mixed Investment 40-85% Shares Sector”. Investors may wish to consider the performance of the Fund by looking at the performance of this sector which has a broadly similar allocation to shares, fixed interest securities and cash.
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Previous Objective
To provide a long term return based on the combination of capital growth and income.
The Sub-fund will invest predominantly in commercial properties. Exposure to commercial properties may be obtained either directly or indirectly through transferable securities and other collective investment schemes. Such direct or indirect property exposure will be predominantly in the UK but the Sub-fund may also hold a proportion overseas.
In addition the Sub-fund may invest in cash, near cash, deposits, money market instruments, other non real estate collective investment schemes and warrants.
Use may also be made of stocklending/repos, borrowing and hedging.
It is not currently intended that derivatives will be used for any purpose other than the efficient portfolio management (including hedging) of the Sub-fund, although derivatives may, subject to the ACS Manager giving not less than 60 days notice to Unitholders, be used for investment purposes.
Investment in an overseas immovable may be made through an intermediate holding vehicle or series of intermediate holding vehicles.
Objective
To provide a return based on a combination of capital growth and income, by investing in UK commercial scale properties.
The benchmark index for the Fund is the MSCI UK Quarterly Property Index (the “Index”). The Fund is actively managed by the Investment Adviser who chooses investments with the aim of outperforming the Index by 0.5% per annum on a rolling 3 year basis, before deduction of fees.
Previous policy
N/A
Policy
At least 70% of the Sub-fund will invest directly in commercial scale properties in the UK market, aiming to achieve capital growth via property development and market appreciation, in addition to earning income via leasing of its property assets.
The Sub-fund will invest in a diversified range of commercial scale property including: office buildings, shopping centres, retail units, industrial units, warehouses, land and other property types of suitable commercial scale. At least 70% of the property investment will be obtained directly but a small proportion may be invested indirectly through property shares and collective investment schemes (including those managed by the ACD and its associates). At least 80% of the direct or indirect property exposure will be in the UK but the Sub-fund may also hold a small proportion overseas.
In selecting properties for inclusion in the Sub-fund, the Investment Adviser will consider individual property characteristics such as yield potential, location and valuation in addition to ensuring the Sub-fund is reasonably diversified across different locations, property types and tenant type.
Due to the nature of property assets the Sub-fund may hold a portion of its assets in cash and in cash-like investments, and/or exchange traded property-related shares to assist in meeting the liquidity requirements of the Sub-fund.
The ACD is responsible for determining the percentage of the Fund normally invested directly and indirectly in property and in cash or cash-like investments based on its long term outlook for property.
The Investment Adviser may make shorter term allocation changes, which vary from the above, by allocating more or less to these asset classes. This is based on their short term view for property.
The ACD limits the extent to which the Fund’s allocation across property assets (direct & indirect property, property shares) as well as across property sectors (retail, office, industrial, other) can differ relative to the market for UK properties (as represented by the Index).
Derivatives may be used for the purpose of managing the Fund in a way that is designed to reduce risk or cost and/or generate extra income or growth (often referred to as efficient portfolio management).
It is not currently intended that derivatives will be used for any purpose other than the efficient portfolio management (including hedging) of the Sub-fund, although derivatives may, subject to the ACS Manager giving not less than 60 days’ notice to Unitholders, be used for investment purposes.
Investment in an overseas immovable may be made through an intermediate holding vehicle or series of intermediate holding vehicles.
The MSCI UK Quarterly Property Index has been selected as an appropriate benchmark as it measures total returns of directly held standing property investments from one valuation to the next.
KIID (PDF, 99KB)
Prospectus (Online version not available)
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Previous objective
To provide a long term return based on the combination of capital growth and income.
The Sub-fund will invest predominantly in commercial properties. Exposure to commercial properties may be obtained either directly or indirectly through transferable securities and other collective investment schemes. Such direct or indirect property exposure will be predominantly in the UK but the Sub-fund may also hold a proportion overseas.
In addition the Sub-fund may invest in cash, near cash, deposits, money market instruments, other non real estate collective investment schemes and warrants.
Use may also be made of stocklending/repos, borrowing and hedging.
It is not currently intended that derivatives will be used for any purpose other than the efficient portfolio management (including hedging) of the Sub-fund, although derivatives may, subject to the ACS Manager giving not less than 60 days notice to Unitholders, be used for investment purposes.
Investment in an overseas immovable may be made through an intermediate holding vehicle or series of intermediate holding vehicles.
Objective
To provide a return based on a combination of capital growth and income, by investing in UK commercial scale properties.
The benchmark index for the Fund is the MSCI UK Quarterly Large Life & Pensions Index (the “Index”). The Fund is actively managed by the Investment Adviser who chooses investments with the aim of outperforming the Index by 0.5% per annum on a rolling 3 year basis, before deduction of fees.Previous policy
N/A
Policy
At least 90% of the Sub-fund will invest directly in commercial scale properties in the UK market, aiming to achieve capital growth via property development and market appreciation, in addition to earning income via leasing of its property assets.
The Sub-fund will invest in a diversified range of commercial scale property including: office buildings, shopping centres, retail units, industrial units, warehouses, land and other property types of suitable commercial scale.
At least 90% of the property investment will be obtained directly but a small proportion may be invested indirectly through property shares and other collective investment schemes (including those managed by the ACD and its associates). At least 80% of the direct or indirect property exposure will be in the UK but the Sub-fund may also hold a small proportion overseas.In selecting properties for inclusion in the Sub-fund, the Investment Adviser will consider individual property characteristics such as yield potential, location and valuation in addition to ensuring the Sub-fund is reasonably diversified across different locations, property types and tenant type.
Due to the nature of property assets the Sub-fund may hold a portion of its assets in cash, and in cash-like investments, and/or exchange traded property-related shares to assist in meeting the liquidity requirements of the Sub-fund.
The ACD is responsible for determining the percentage of the Fund normally invested directly and indirectly in property and in cash or cash-like investments based on its long term outlook for property.
The Investment Adviser may make shorter term allocation changes, which vary from the above, by allocating more or less to these asset classes. This is based on their short term view for property.
The ACD limits the extent to which the Fund’s allocation across property assets (direct & indirect property, property shares) as well as across property sectors (retail, office, industrial, other) can differ relative to the market for UK properties (as represented by the Index).
Derivatives may be used for the purpose of managing the Fund in a way that is designed to reduce risk or cost and/or generate extra income or growth (often referred to as efficient portfolio management).
It is not currently intended that derivatives will be used for any purpose other than the efficient portfolio management (including hedging) of the Sub-fund, although derivatives may, subject to the ACS Manager giving not less than 60 days’ notice to Unitholders, be used for investment purposes.
Investment in an overseas immovable may be made through an intermediate holding vehicle or series of intermediate holding vehicles.
The MSCI UK Quarterly Large Life & Pensions has been selected as an appropriate benchmark as it measures total returns of directly held property investments from one valuation to the next.
KIID (PDF, 98KB)
Prospectus (Online version not available)
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Previous objective
To provide long term capital growth from opportunities around the world by mainly investing in regulated collective investment schemes which are currently and/or which have been managed or operated within the Lloyds Banking Group. The Fund will invest in primarily Equity funds.
Objective
To provide capital growth through investment in regulated collective investment schemes which are currently and/or which have been managed or operated within the Lloyds Banking Group.
These collective investment schemes will provide exposure to shares with some exposure to fixed interest securities.
Previous policy
The Fund will primarily invest in Equity funds. The Equity funds selected will aim to provide capital growth by investing primarily in equities which have a broad diversification by country, sector and company. The Fund may also invest in other regulated collective investment schemes that are consistent with the Fund's objective at the discretion of the ACD.
Derivatives may be used for efficient portfolio management purposes only.
Policy
At least 70% of the Fund will provide exposure to shares. This may include UK, overseas and emerging markets shares.
A maximum of 30% of the Fund will provide exposure to fixed interest securities. This may include sterling denominated and overseas investment grade* corporate bond, government bond, index-linked bond and high yield bond** funds.
The Fund may also invest a small amount in cash and cash like investments.
The ACD is responsible for determining the percentage of the Fund normally allocated to each asset class based on their medium to long term outlook for that asset class. The ACD may review and change this from time to time based on their view at the time.
The Investment Adviser may make shorter term allocation changes, which vary from the above, allocating more or less to specific asset classes. This is based on their short term view of the asset class.
The ACD is also responsible for selecting the collective investment schemes used by the Fund which may be actively or passively managed***.
The collective investment schemes in which the Fund invests may use techniques which are not employed by the Fund itself, for example stock lending.
Derivatives may be used for the purpose of managing the Fund in a way that is designed to reduce risk or cost (often referred to as efficient portfolio management).
* Credit ratings indicate the likelihood that an issuer will be able to make their payments. Investment grade bonds have achieved or exceeded a minimum credit rating awarded by a credit rating agency. Therefore they are considered lower risk than bonds with a lower credit rating.
** Non-investment grade bonds, also known as high yield bonds, have a lower credit rating than investment grade bonds, and so are considered higher risk.
***Active management is where the Investment Adviser seeks to add value by making decisions on which investments to buy, sell or hold depending on, for example company, market or economic factors.
Passive management is where the Investment Adviser aims to match a benchmark and will buy, sell or hold investments depending on the components of that benchmark.
The ACD does not quote a benchmark or outperformance target for the Fund. This is because the asset allocation of the Fund will change over time taking into consideration risk and the ACD’s view of the prospects of each asset class.
Investors may assess the Fund relative to similar funds offered by other investment firms. A number of fund industry bodies and data providers group similar funds together and provide analysis on performance and risk characteristics of the fund group. The Investment Association “Mixed Assets Sectors” group funds with a range of different assets according to their allocation to shares, fixed interest securities and cash. More information on the Investment Association sectors can be found at www.theia.org/industry-data/fund-sectors .
Over the period from 30.09.2015 to 17.01.2019 the Fund would have sat within the “Flexible Investment Sector”. Investors may wish to consider the performance of the Fund by looking at the performance of this sector.
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Previous objective
To provide long term capital growth through investment in a balanced portfolio of mainly regulated collective investment schemes which are currently and/or which have been managed or operated within the Lloyds Banking Group investing in UK equities, overseas equities and fixed interest securities.
Objective
To provide capital growth through investment in regulated collective investment schemes which are currently and/or which have been managed or operated within the Lloyds Banking Group.
These collective investment schemes will provide exposure to shares and some exposure to fixed interest securities.
Previous policy
The Equity funds selected will aim to provide capital growth by investing primarily in equities which have a broad diversification by country, sector and company. The Fixed Interest funds selected will aim to provide diversification to the portfolio by investing primarily in government bonds issued from a number of international markets and denominated in a variety of currencies. The Fund may also invest in other regulated collective investment schemes that are consistent with the Fund's objective at the discretion of the ACD. Non-sterling fixed income investments may be hedged back to sterling.
Derivatives may be used for efficient portfolio management purposes only.
Policy
At least 60% of the Fund will provide exposure to shares. This may include UK, overseas and emerging markets shares.
A maximum of 40% of the Fund will provide exposure to fixed interest securities. This will include sterling denominated investment grade* bond funds which may consists of corporate and UK government bonds and index-linked bonds. It may also include overseas corporate and government bond funds and high yield bonds** funds.
The Fund may also invest a small amount in cash and cash like investments.
The ACD is responsible for determining the percentage of the Fund normally allocated to each asset class based on their medium to long term outlook for that asset class. The ACD may review and change this from time to time based on their view at the time.
The Investment Adviser may make shorter term allocation changes, which vary from the above, allocating more or less to specific asset classes. This is based on their short term view of the asset class.
The ACD is also responsible for selecting the collective investment schemes used by the Fund which may be actively or passively managed***.
Non-sterling fixed income investments may be hedged back to sterling. Hedging aims to reduce the effect of fluctuations in the exchange rates between the currency of the asset and the currency of the Fund.
The collective investment schemes in which the Fund invests may use techniques which are not employed by the Fund itself, for example stock lending.
Derivatives may be used for the purpose of managing the Fund in a way that is designed to reduce risk or cost (often referred to as efficient portfolio management).
* Credit ratings indicate the likelihood that an issuer will be able to make their payments. Investment grade bonds have achieved or exceeded a minimum credit rating awarded by a credit rating agency. Therefore they are considered lower risk than bonds with a lower credit rating.
** Non-investment grade bonds, also known as high yield bonds, have a lower credit rating than investment grade bonds, and so are considered higher risk.
***Active management is where the Investment Adviser seeks to add value by making decisions on which investments to buy, sell or hold depending on, for example company, market or economic factors.
Passive management is where the Investment Adviser aims to match a benchmark and will buy, sell or hold investments depending on the components of that benchmark.
The ACD does not quote a benchmark or outperformance target for the Fund. This is because the asset allocation of the Fund will change over time taking into consideration risk and the ACD’s view of the prospects of each asset class.
Investors may assess the Fund relative to similar funds offered by other investment firms. A number of fund industry bodies and data providers group similar funds together and provide analysis on performance and risk characteristics of the fund group. The Investment Association “Mixed Assets Sectors” group funds with a range of different assets according to their allocation to shares, fixed interest securities and cash. More information on the Investment Association sectors can be found at www.theia.org/industry-data/fund-sectors .
Over the period from 30.09.2015 to 17.01.2019 the Fund would have sat within the “Mixed Investment 40-85% Shares Sector”. Investors may wish to consider the performance of the Fund by looking at the performance of this sector which has a broadly similar allocation to shares, fixed interest securities and cash.
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Previous objective
To provide an income through investment primarily in UK and European fixed income securities.
Objective
To provide income with some potential for capital growth, through investment in a diversified portfolio of fixed interest securities.
The benchmark for the Fund is a blended return of the iBOXX Sterling Corporate and Collateralised Index and Bloomberg Barclays Pan European High Yield Index ex Financials (Issuer Constrained) Index (the “Benchmark”). 70% of the Benchmark will consist of the iBOXX Sterling Corporate and Collateralised Index and 30% of the Bloomberg Barclays Pan European High Yield Index ex Financials (Issuer Constrained) Index.
The Fund is actively managed by the Investment Adviser who chooses investments with the aim of outperforming the Benchmark by 0.75% per annum on a rolling 3 year basis, before deduction of fees.
Previous policy
The Fund will invest in a portfolio of investment grade and non-investment grade fixed income securities. The Fund may also invest in government and/or non-European corporate bonds. Where securities are non- sterling denominated, it is intended that they will be hedged back into sterling. Returns will mostly be derived from income whilst preserving capital with limited potential for capital gains.
Derivatives may be used for efficient portfolio management purposes only.
Policy
At least 60% of the Fund will invest in investment grade corporate bonds* denominated in Sterling or Euros. The Fund may also invest in corporate bonds denominated in other currencies, government bonds, non-investment grade corporate bonds**, covered bonds, supranational bonds (these are a type of security issued by two or more governmental organisations), asset backed securities such as securitised loans, cash and cash like investments.
Where the Fund’s investments are non-Sterling denominated they will be hedged back to Sterling. Hedging involves the use of the derivatives to offset the effect of currency exchange rates.
At least 60% will be invested in bonds which are part of the iBOXX Sterling Corporate and Collateralised Index and not more than 40% which are part of the Bloomberg Barclays Pan European High Yield Index ex Financials Index.
In selecting assets for the Fund the Investment Adviser may consider the issuers’ credit worthiness, valuation and risks. Regional and global economic factors and monetary policy may also be taken into account.
The ACD limits the extent to which the Fund’s composition can differ relative to the market for bonds (as represented by the Benchmark). These limits help to deliver a level of portfolio diversification and risk management. The limits also help to achieve an appropriate balance between the extent to which the Fund’s composition can diverge from the Benchmark and providing the Investment Adviser with flexibility to seek outperformance relative to the Benchmark. As a result, the Fund’s performance may differ from the Benchmark.
The Fund may also invest in collective investment schemes, including those managed by the ACD and its associates.
Derivatives and stock lending may be used for the purpose of managing the Fund in a way that is designed to reduce risk or cost and/or generate extra income or growth (often referred to as efficient portfolio management).
*Credit ratings indicate the likelihood that an issuer will be able to make their payments. Investment grade bonds have achieved or exceeded a minimum credit rating awarded by a credit rating agency. Therefore they are considered lower risk than bonds with a lower credit rating.
**Non-investment grade bonds, also known as high yield bonds, have a lower credit rating than investment grade bonds, and so are considered higher risk.
The iBOXX Sterling Corporate and Collateralised Index has been selected as an appropriate benchmark as it provides a representation of the returns of securities in the sterling investment grade corporate bond market.
The Bloomberg Barclays Pan European High Yield Index ex Financials Index has been selected as an appropriate benchmark as it provides a representation of non-investment grade European corporate bonds. It excludes financial institutions and emerging market bonds.
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Previous objective
To provide a return based on the performance of the UK Equity Market as represented by the FTSE All Share Index (or such other similar index as the ACD shall consider to be appropriate) by investment in a portfolio which will primarily consist of equities.
Objective
To track the performance of the UK Equity Market as represented by the FTSE All-Share Index (the “Index”), before deduction of fees, by investing in UK shares.
Previous policy
The objective of the Fund is to be achieved by investing in a portfolio of equities, bonds, and other investments in which a UCITS scheme equivalent to a securities scheme (see Note 1) is authorised to invest. The ACD will normally use various sampling techniques to achieve the objective of tracking the FTSE All Share Index. In so doing, the ACD may use discretion in deciding which investments are to be included in the portfolio.
If the said Index is replaced by a successor index using (in the opinion of the ACD) the same or a substantially similar formula for (and method of) calculating the said Index then the ACD shall be entitled to determine (at its entire discretion) that such successor index will be from the date of such determination substituted for the FTSE All Share Index for the purposes of the investment objective and policy of the Fund.
Note 1: Being a scheme which is dedicated to investment in transferable securities and which can invest not more than 10% in value of the scheme property in unapproved securities, not more than 5% in warrants and not more than 10% in other collective investment schemes. The use of derivatives for this scheme type is restricted to efficient portfolio management.
Policy
The Fund aims to invest in shares of all of the companies within the Index. This is often referred to as a ‘full replication’ approach.
Where the ACD believes it can provide an advantage to the Fund in managing costs, to achieve a more efficient way of tracking the Index, or where there are exceptional market circumstances, the Fund may include or exclude specific shares and/or other security types which are representative of a share in the Index (such as depositary receipts).
The Fund may also invest in collective investment schemes to gain exposure to the Index.
If the Index is replaced by a successor index which the ACD believes uses the same or a substantially similar formula and method of calculation then the ACD shall be entitled to adopt the successor index for the purposes of the investment objective and policy of the Fund.
Derivatives and stock lending may be used for the purpose of managing the Fund in a way that is designed to reduce risk or cost and/or generate extra income or growth (often referred to as efficient portfolio management).
The FTSE All Share Index provides a representation of the returns of securities in the UK equity market.
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Previous objective
To provide an above average income together with capital growth over the longer term. The Fund will invest predominantly in a portfolio of UK securities. The Fund seeks to deliver performance, before deduction of management fees, in excess of the FTSE All Share Index (the “Index”) with a similar level of overall volatility, over the long term.
Draft Objective
To provide income together with capital growth by investing in shares of UK companies.
Investments are selected by the Investment Adviser which, collectively, aim to deliver an income of 110% of the dividend yield* of the FTSE All-Share Index (the “Index”) on a rolling 3 year basis, before deduction of fees, and outperform the Index on a rolling 3 year basis, before deduction of fees.
Previous policy
To invest predominantly in a portfolio of companies which are part of the Index.
The Investment Adviser identifies companies that are forecast to provide higher than average dividend yields* and to achieve long term capital growth. The Fund seeks to hold more in these companies in comparison to the Index. Therefore, while the Fund will hold a large number of securities in common with the Index, the weighting of any one security may be significantly different to the Index.
The Fund is limited in the extent to which it can hold more (overweight) or less (underweight) in sectors** relative to the Index, but it aims to be overweight in sectors which are expected to provide a higher than average dividend yield.
Derivatives may be used for efficient portfolio management purposes only.
* The dividend yield is calculated by dividing the annual dividend paid in respect of a security by its share price.
** A sector is a business area, industry or economy which shares the same characteristics. Company shares are typically grouped into different sectors depending on the company’s business.
Policy
At least 80% of the Fund will be invested in a portfolio of companies which are part of the Index.
This will involve investing in shares and may also include preference shares**. The majority of these companies are those which are incorporated, or domiciled, or have a significant part of their business in the UK.
The Investment Adviser identifies companies that are forecast to provide higher than average dividend yields* and to achieve capital growth. The Fund seeks to hold more in these companies in comparison to the Index. Therefore, while the Fund will hold a large number of shares in common with the Index, the weighting of any one share may be significantly different to the Index.
The Fund is limited in the extent to which it can hold more (overweight) or less (underweight) in sectors*** relative to the Index, but it aims to be overweight in sectors which are expected to provide a higher than average dividend yield.
These limitations help to deliver a level of portfolio diversification and risk management. The limitations also help to achieve an appropriate balance between the extent to which the Fund’s composition can diverge from the Index and providing the Investment Adviser with flexibility to seek outperformance relative to the Index. As a result, the Fund’s performance may differ from the Index.
The Fund may also invest in collective investment schemes, including those managed by the ACD and its associates, hold cash and cash like investments.
Derivatives and stock lending may be used for the purpose of managing the Fund in a way that is designed to reduce risk or cost and/or generate extra income or growth (often referred to as efficient portfolio management).
* The dividend yield is calculated by dividing the annual dividend paid in respect of a security by its share price.
** A preference share usually issues a fixed dividend payment which takes priority over payments of ordinary shares.
*** A sector is a business area, industry or economy which shares the same characteristics. Company shares are typically grouped into different sectors depending on the company’s business.
The FTSE All-Share Index has been selected as an appropriate benchmark as it provides a representation of the returns of securities in the UK equity market.
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Previous objective
To provide a total return based on the performance of the gilt market as represented by the FTSE Actuaries UK Conventional Gilts All Stocks Index(or such similar index as the ACD shall consider appropriate) by investment in a portfolio which will primarily consist of UK Government Gilts.
Objective
To track the performance of the UK gilt market as represented by the FTSE Actuaries UK Conventional Gilts All Stocks Index (the “Index”), before deduction of fees, by investing in UK Government bonds (gilts).
Previous policy
The objective of the Fund is to be achieved by investing in a portfolio of UK Government Gilts, other Sterling Loan Stocks and other investments in which a UCITS scheme equivalent to a securities scheme (see Note 1) is authorised to invest. The ACD will normally use a range of recognised indexation techniques to achieve the aim of tracking the FTSE Actuaries UK Conventional Gilts All Stocks Index. In so doing, the ACD may use discretion in deciding which investments included in the said index are to be included in the portfolio. The number of investments so included may vary and this may result in only a small number of such investments being included in the portfolio. The ACD reserves the right to exercise the full powers of the Fund in relation to borrowing and efficient portfolio management as and when it considers that the circumstances which then exist make it appropriate to do so.
If the said Index is replaced by a successor index using (in the opinion of the ACD) the same or a substantially similar formula for (and method of) calculating the said Index then the ACD shall be entitled to determine (at its entire discretion) that such successor index will be from the date of such determination substituted for the FTSE Actuaries UK Conventional Gilts All Stocks Index for the purposes of the investment objective and policy of the Fund.
Note 1: Being a scheme which is dedicated to investment in transferable securities and which can invest not more than 10% in value of the scheme property in unapproved securities, not more than 5% in warrants and not more than 10% in other collective investment schemes. The use of derivatives for this scheme type is restricted to efficient portfolio management.
Policy
The Fund aims to invest in all of the stocks within the Index. This is often referred to as a ‘full replication’ approach.
Where the ACD believes it can provide an advantage to the Fund in managing costs, to achieve a more efficient way of tracking the Index, or where there are exceptional market circumstances, the Fund may include or exclude specific stocks and/or other security types which are representative of a stock in the Index (such as depositary receipts). The Fund may include sterling supranational bonds. These are a type of fixed interest security issued by two or more governmental organisations.
In addition the Fund may invest in collective investment schemes to gain exposure to the Index.
If the Index is replaced by a successor index which the ACD believes uses the same or a substantially similar formula and method of calculation then the ACD shall be entitled to adopt the successor index for the purposes of the investment objective and policy of the Fund.
Derivatives and stock lending may be used for the purpose of managing the Fund in a way that is designed to reduce risk or cost and/or generate extra income or growth (often referred to as efficient portfolio management).
The FTSE Actuaries UK Conventional Gilts All Stocks Index provides a representation of the returns of securities in the UK government bond (gilt) market.
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Previous objective
To provide long term capital growth through investment in a broad portfolio of predominantly UK companies. The Fund seeks to deliver performance, before deduction of management fees, in excess of the FTSE All Share Index (the “Index”) with a similar level of overall volatility, over the long term.
Objective
To provide capital growth through investment in a broad portfolio of shares of UK companies.
The benchmark index for the Fund is the FTSE All-Share Index (the “Index”). The Investment Adviser seeks to outperform the Index by 0.75%* per annum on a rolling 3 year basis, before deduction of fees.
Previous policy
To invest predominantly in a portfolio of companies which are part of the Index. This will involve investing in equities and may also include equity-linked securities being depositary receipts, warrants and preference shares.
The Investment Adviser may only take limited positions away from the Index. This means there are limitations on the extent to which the Fund’s investment in various sectors* may differ to the Index. These limited positions can be more than is held in the Index (overweight) or less than is held in the Index (underweight).
Derivatives may be used for efficient portfolio management purposes only.
* A sector is a business area, industry or economy which shares the same characteristics. Company shares are typically grouped into different sectors depending on the company’s business.
Policy
At least 80% of the Fund will be invested in a portfolio of companies which are part of the Index. This will involve investing in shares and may also include preference shares**.
The majority of these companies are those which are incorporated, or domiciled, or have a significant part of their business in the UK.
The Investment Adviser may only take limited positions away from the Index. This means there are limitations on the extent to which the Fund’s investment in various sectors*** may differ to the Index. These limited positions can be more than is held in the Index (overweight) or less than is held in the Index (underweight).
These limitations help to deliver a level of portfolio diversification and risk management. The limitations also help to achieve an appropriate balance between the extent to which the Fund’s composition can diverge from the Index and providing the Investment Adviser with flexibility to seek outperformance relative to the Index. As a result, the Fund’s performance may differ from the Index.
The Fund may also invest in collective investment schemes, including those managed by the ACD and its associates, hold cash and cash like investments.
Derivatives and stock lending may be used for the purpose of managing the Fund in a way that is designed to reduce risk or cost and/or generate extra income or growth (often referred to as efficient portfolio management).
* Note: there are Share Classes in the Fund where fees exceed the Fund’s outperformance target relative to the Index. For those Share Classes, the Fund will underperform the Index after deduction of fees even if its outperformance target is achieved.
** A preference share usually issues a fixed dividend payment which takes priority over payments of ordinary shares.
*** A sector is a business area, industry or economy which shares the same characteristics. Company shares are typically grouped into different sectors depending on the company’s business.
The FTSE All-Share Index has been selected as an appropriate benchmark as it provides a representation of the returns of securities in the UK equity market.
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Previous objective
The Fund aims to maximise returns based on a combination of income and capital
Objective
The Fund aims to provide income and capital growth by investing in UK government Index-Linked bonds (gilts).
The benchmark index for the Fund is the FTSE Actuaries Government Securities UK Index Linked TR All Stocks (the “Index”). The Fund is actively managed by the Investment Adviser who chooses investments with the aim of outperforming the Index by 0.25% per annum on a rolling 3 year basis, before deduction of fees.
Previous policy
The Fund will invest predominantly in index-linked interest bearing securities issued by the UK government.
The Fund may also invest in other types of index-linked securities, including those issued by other governments as well as in other transferable securities, money market instruments, deposits, cash, near cash, other collective investment schemes and warrants.
It is not currently intended that derivatives will be used for any purpose other than the efficient portfolio management (including hedging) of the Fund, although derivatives may, subject to the ACD giving not less than 60 days' notice to shareholders, be used in the pursuit of its investment objective in the future as well as for efficient portfolio management (including hedging) which may change the risk profile of the Fund.
Use may also be made of stocklending/repos and hedging. Nonsterling investments may be hedged back to sterling.
Policy
At least 80% of the Fund will invest in UK government Index-Linked bonds. The Fund may also invest in other types of index-linked bonds, including those issued by other governments as well as supranational bonds (these are a type of fixed interest bonds issued by two or more governmental organisations) and investment grade* corporate bonds.
In addition the Fund may invest in collective investment schemes, including those managed by the ACD and its associates, cash and cash like investments.
In selecting bonds for the Fund the Investment Adviser may consider the issuers’ credit worthiness, valuation and risks. Regional and global economic factors, and monetary policy may also be taken into account.
The ACD limits the extent to which the Fund’s composition can differ relative to the market for government bonds (as represented by the Index). These limits help to deliver a level of portfolio diversification and risk management. The limits also help to achieve an appropriate balance between the extent to which the Fund’s composition can diverge from the Index and providing the Investment Adviser with flexibility to seek outperformance relative to the Index. As a result, the Fund’s performance may differ from the Index.
The Fund’s non-UK investments may be hedged back to Sterling. This involves the use of derivatives to offset the effect of currency exchange rates.
Derivatives and stock lending may be used for the purpose of managing the Fund in a way that is designed to reduce risk or cost and/or generate extra income or growth (often referred to as efficient portfolio management (EPM)).
It is not currently intended that derivatives will be used for any purpose other than the EPM , although derivatives may, subject to the ACD giving not less than 60 days' notice to shareholders, be used for investment purposes in the future as well as EPM which may change the risk profile of the Fund.
*Credit ratings indicate the likelihood that an issuer will be able to make their payments. Investment grade bonds have achieved or exceeded a minimum credit rating awarded by a credit rating agency. Therefore they are considered lower risk than bonds with a lower credit rating.
The FTSE Actuaries Government Securities UK Index Linked TR All Stocks Index has been selected as an appropriate benchmark as it provides a representation of the returns of securities in the UK government securities market.
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Previous objective
To provide a total return based on the performance of the gilt market as represented by the FTSE Actuaries UK Index-Linked All Stocks Index(or such similar index as the ACD shall consider appropriate) by investment in a portfolio which will primarily consist of UK Index- Linked government gilts.
Objective
To track the performance of the UK index-linked gilt market as represented by the FTSE Actuaries UK Index-Linked Gilts All Stocks Index (the “Index”) , before deduction of fees, by investing in UK Government Index- Linked bonds (gilts).
Previous policy
The investment objective of the Fund is to be achieved by investing in a portfolio of UK Index-Linked government gilts, other Sterling Loan Stocks and other investments in which a UCITS scheme equivalent to a securities scheme (see Note 1) is authorised to invest. The ACD will normally use a range of recognised indexation techniques to achieve the objective of tracking the FTSE Actuaries UK Index-Linked All Stocks Index. In so doing, the ACD may use discretion in deciding which investments included in the said index are to be included in the portfolio. The number of investments so included may vary and this may result in only a small number of such investments being included in the portfolio. The ACD reserves the right to exercise the full powers of the Fund in relation to borrowing and efficient portfolio management as and when it considers that the circumstances which then exist make it appropriate to do so.
If the said Index is replaced by a successor index using (in the opinion of the ACD) the same or a substantially similar formula for (and method of) calculating the said Index then the ACD shall be entitled to determine (at its entire discretion) that such successor index will be from the date of such determination substituted for the FTSE Actuaries UK Index-Linked All Stocks Index for the purposes of the investment objective and policy of the Fund.
Note 1: Being a scheme which is dedicated to investment in transferable securities and which can invest not more than 10% in value of the scheme property in unapproved securities, not more than 5% in warrants and not more than10% in other collective investment schemes. The use of derivatives for this scheme type is restricted to efficient portfolio management.
Policy
The Fund aims to invest in all of the stocks within the Index. This is often referred to as a ‘full replication’ approach.
Where the ACD believes it can provide an advantage to the Fund in managing costs, to achieve a more efficient way of tracking the Index, or where there are exceptional market circumstances, the Fund may include or exclude specific stocks and/or other security types which are representative of a stock in the Index (such as depositary receipts). The Fund may include sterling supranational bonds. These are a type of fixed interest security issued by two or more governmental organisations.
In addition the Fund may invest in collective investment schemes to gain exposure to the Index.
If the Index is replaced by a successor index which the ACD believes uses the same or a substantially similar formula and method of calculation then the ACD shall be entitled to adopt the successor index for the purposes of the investment objective and policy of the Fund.
Derivatives and stock lending may be used for the purpose of managing the Fund in a way that is designed to reduce risk or cost and/or generate extra income or growth (often referred to as efficient portfolio management).
The FTSE Actuaries UK Index-Linked Gilts All Stocks Index provides a representation of the returns of securities in the UK government index-linked bond (gilt) market.
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Previous objective
To provide long term capital growth through investment in a select portfolio of primarily UK equities.
Objective
To provide capital growth through investment in a select portfolio, typically 30 to 50 holdings, of UK shares.
The benchmark index for the Fund is the FTSE All-Share Index (the “Index”).
The Fund is actively managed by the Investment Adviser who chooses investments with the aim of outperforming the Index by 2.5% per annum on a rolling 3 year basis, before deduction of fees.
Previous policy
The Fund will invest in a select portfolio of primarily UK securities which will predominantly include shares and convertibles, however the Fund may invest in other types of investment at the discretion of the ACD. The Fund will focus on a limited number of holdings (typically between 30 and 50).
Derivatives may be used for efficient portfolio management purposes only.
Policy
At least 80% of the Fund will invest in a select portfolio of UK shares. The majority of these companies are those which are incorporated, or domiciled, or have a significant part of their business in the UK.
In choosing individual UK shares the Investment Adviser focuses on the company’s growth prospects, market valuation and risks.
The ACD limits the extent to which the Fund’s composition can differ relative to the market for UK shares (as represented by the Index). These limits help to deliver a level of portfolio diversification and risk management. The limits also help to achieve an appropriate balance between the extent to which the Fund’s composition can diverge from the Index and providing the Investment Adviser with flexibility to seek outperformance relative to the Index. As a result, the Fund’s performance may differ substantially from the Index.
A small proportion of the Fund may be invested in fixed interest securities (including convertibles).
The Fund may also invest in collective investment schemes, including those managed by the ACD and its associates, cash and cash like investments.
Derivatives and stock lending may be used for the purpose of managing the Fund in a way that is designed to reduce risk or cost and/or generate extra income or growth (often referred to as efficient portfolio management).
The FTSE All-Share Index has been selected as an appropriate benchmark as it provides a representation of the returns of securities in the UK equity market.
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Previous objective
To provide long term capital growth through investment in a broad portfolio of primarily UK smaller companies securities.
Objective
To provide capital growth through investment in a portfolio of UK smaller companies’ shares.
The benchmark index for the Fund is the Numis Smaller Companies excluding Investment Trusts Index (the “Index”). The Fund is actively managed by the Investment Adviser who chooses investments with the aim of outperforming the Index by 2% per annum on a rolling 3 year basis, before deduction of fees.
Previous policy
The Fund will invest in a diversified portfolio of primarily UK smaller company securities which may include, directly or indirectly, convertible securities, and as appropriate, warrants and traded options. Investments will mainly be in UK companies which, at the time of initial investment, are constituents of the Numis Smaller Companies excluding Investment Trusts Index (or such similar index as the ACD shall consider appropriate).
Derivatives may be use d for efficient portfolio management purposes only.
Policy
At least 80% of the Fund will be invested in a diversified portfolio of UK smaller company shares.
The Fund may also include, directly or indirectly, warrants and traded options. In addition, a small proportion of the Fund may be invested in fixed interest securities (including convertibles), cash and cash like investments.
Investments will be in UK companies which, at the time of initial investment, are constituents of the Index. The majority of these companies are those which are incorporated, or domiciled, or have a significant part of their business in the UK.
The Index covers UK smaller companies as represented by the bottom 10% of the main UK fully listed equity market by way of market capitalisation (being the total value of shares that a company has issued based on the current share price) excluding Investment Trusts.
In selecting individual shares the Investment Adviser focuses on the company’s growth prospects, market valuation and company specific risks.
The Fund will have between 40 and 90 holdings.
The ACD limits the extent to which the Fund’s composition can differ relative to the market for smaller companies shares (as represented by the Index). These limits help to deliver a level of portfolio diversification and risk management. The limits also help to achieve an appropriate balance between the extent to which the Fund’s composition can diverge from the Index and providing the Investment Adviser with flexibility to seek outperformance relative to the Index. As a result, the Fund’s performance may differ substantially from the Index.
The Fund may also invest in collective investment schemes, including those managed by the ACD and its associates.
Derivatives and stock lending may be used for the purpose of managing the Fund in a way that is designed to reduce risk or cost and/or generate extra income or growth (often referred to as efficient portfolio management).
The Numis Smaller Companies excluding Investment Trusts Index has been selected as an appropriate benchmark as it provides a representation of the returns of smaller UK listed companies by value.
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Previous objective
To track the capital performance of the UK Equity Market as represented by the FTSE-100 Index (or such similar index as the ACD shall consider appropriate) by investing in UK investments.
Objective
To track the performance of the UK Equity Market as represented by the FTSE100 Index (the “Index”), before deduction of fees, by investing in UK shares.
Previous policy
The Fund will invest in a portfolio that is normally comprised of all the shares of the FTSE-100 Index. Where appropriate, the ACD may also use sampling techniques and derivatives to achieve the objective of tracking the Index. The ACD may use discretion regarding the inclusion of stocks entering or exiting the Index within the Fund.
If the said Index is replaced by a successor index using (in the opinion of the ACD) the same or a substantially similar formula for (and method of) calculating the said Index then the ACD shall be entitled to determine (at its entire discretion) that such successor index will be from the date of such determination substituted for the FTSE-100 Index for the purposes of the investment objective and policy of the Fund.
Derivatives may be used for efficient portfolio management purposes only.
Policy
The Fund aims to invest in shares of all of the companies within the Index. This is often referred to as a ‘full replication’ approach.
Where the ACD believes it can provide an advantage to the Fund in managing costs, to achieve a more efficient way of tracking the Index, or where there are exceptional market circumstances, the Fund may include or exclude specific shares and/or other security types which are representative of a share in the Index (such as depositary receipts).
The Fund may also invest in collective investment schemes to gain exposure to the Index.
If the Index is replaced by a successor index which the ACD believes uses the same or a substantially similar formula and method of calculation, then the ACD shall be entitled to adopt the successor index for the purposes of the investment objective and policy of the Fund.
Derivatives and stock lending may be used for the purpose of managing the Fund in a way that is designed to reduce risk or cost and/or generate extra income or growth (often referred to as efficient portfolio management).
The FTSE 100 Index provides a representation of the returns of securities in the UK equity market.
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Previous objective
To provide long term capital growth.
Objective
To track the performance of the US equity market, as represented by the S&P 500 Index (the “Index”), before deduction of fees, by investing in US shares.
Previous policy
The Fund will invest primarily in US equities.
The Fund may also invest in equity-linked securities being preference shares, rights issues, American Depositary Receipts and Global Depositary Receipts as well as equity linked notes, cash, near cash, deposits, other collective investment schemes and warrants.
Use may also be made of stocklending/repos, borrowing and hedging.
It is not currently intended that derivatives will be used for any purpose other than the efficient portfolio management (including hedging) of the Fund, although derivatives may, subject to the ACD giving not less than 60 days' notice to shareholders, be used in the pursuit of its investment objective in the future as well as for efficient portfolio management (including hedging) which may change the risk profile of the Fund.
Note: The fund’s current benchmark index is the S&P500 Index. The fund will usually invest in equities which are included in the benchmark, however, the fund isn’t limited to investing only within the index. In accordance with the FCA Rules, the ACD may at its discretion replace the current index with such similar index as it may consider appropriate.
Policy
The Fund aims to invest in shares of all of the companies within the Index. This is often referred to as a ‘full replication’ approach.
Where the ACD believes it can provide an advantage to the Fund in managing costs, to achieve a more efficient way of tracking the Index, or where there are exceptional market circumstances, the Fund may include or exclude specific shares and/or other security types which are representative of a share in the Index (such as depositary receipts).
The Fund may also invest in collective investment schemes to gain exposure to the Index.
Derivatives and stock lending may be used for the purpose of managing the Fund in a way that is designed to reduce risk or cost and/or generate extra income or growth (often referred to as efficient portfolio management).
It is not currently intended that derivatives will be used for any purpose other than the efficient portfolio management (including hedging) of the Fund, although derivatives may, subject to the ACD giving not less than 60 days' notice to shareholders, be used in the pursuit of its investment objective in the future as well as for efficient portfolio management (including hedging) which may change the risk profile of the Fund.
Note: In accordance with the FCA Rules, the ACD may at its discretion replace the Index with such similar index as it may consider appropriate.
The S&P 500 Index provides a representation of the returns of securities in the US equity market.