The fund aims to provide a combination of capital growth and income, of at least 4-8% per annum above the 3-month LIBOR over any five-year period, after charges are taken. There is no guarantee that the fund will achieve a positive return over any period, and you may not get back the amount you originally invested.
Investment policy and strategy
Core investment: The fund invests in a range of assets, including company shares, bonds, convertibles and currencies from anywhere in the world (including emerging markets). The fund typically invests via derivatives. As a result, it may be required to hold a large amount of cash and bonds. The fund may also invest directly or through other funds.
Other investments: The fund may also invest in other funds, cash or assets that can be turned into cash quickly.
Derivatives: The fund uses derivatives with the aim of achieving investment gains, reducing risks and costs or managing the fund more efficiently.
Using derivatives to invest allows the fund to create ‘leverage’, meaning that it can gain exposure to investments that exceed its value, thus increasing potential returns (or losses) in both rising and falling markets.
Strategy in brief: The fund employs a highly flexible approach to investment. The strategy is based on an unconstrained asset allocation with the freedom to invest in different type of assets. The strategy combines research to work out the ‘fair’ value of assets over the medium to long term with analysis of the economic fundamentals and market’s short-term reactions to events, to identify investment opportunities.
Risks associated with the fund
The value and income from the fund's assets will go down as well as up. This will cause the value of your investment to fall as well as rise. There is no guarantee that the fund will achieve its objective and you may get back less than you originally invested.
The fund may use derivatives to profit from an expected rise or fall in the value of an asset. Should the asset’s value vary in an unexpected way, the fund will incur a loss. The fund’s use of derivatives may be extensive and exceed the value of its assets (leverage). This has the effect of magnifying the size of losses and gains, resulting in greater fluctuations in the value of the fund.
The fund may be highly concentrated at times in a limited number of investments or areas of the market, which could result in large price rises and falls.
The fund can be exposed to different currencies. Movements in currency exchange rates may adversely affect the value of your investment.
Investing in emerging markets involves a greater risk of loss due to greater political, tax, economic, foreign exchange, liquidity and regulatory risks, among other factors. There may be difficulties in buying, selling, safekeeping or valuing investments in such countries.
The hedging process seeks to minimise, but cannot eliminate, the effect of movements in exchange rates on the performance of the hedged share class. Hedging also limits the ability to gain from favourable movements in exchange rates.
In exceptional circumstances where assets cannot be fairly valued, or have to be sold at a large discount to raise cash, we may temporarily suspend the fund in the best interest of all investors.
The fund could lose money if a counterparty with which it does business becomes unwilling or unable to repay money owed to the fund.
Further details of the risks that apply to the fund can be found in the fund's Prospectus.
The fund may invest more than 35% in securities issued by any one or more of the governments listed in the fund prospectus. Such exposure may be combined with the use of derivatives in pursuit of the fund objective. It is currently envisaged that the fund’s exposure to such securities may exceed 35% in the governments of Australia, Austria, Belgium, Canada, Denmark, Finland, France, Germany, Italy, Japan, Netherlands, New Zealand, Singapore, Sweden, Switzerland, UK, USA although these may vary subject only to those listed in the prospectus.
The Fund allows for the extensive use of derivatives
The fund may be very concentrated at times which could result in greater fluctuations in the funds short-term performance.