PRODUCT HIGHLIGHTS SHEET. for AFFIN HWANG AIIMAN GLOBAL SUKUK FUND

Transcription

1 PRODUCT HIGHLIGHTS SHEET for AFFIN HWANG AIIMAN GLOBAL SUKUK FUND RESPONSIBILITY STATEMENT This Product Highlights Sheet has been reviewed and approved by the directors or authorised committee or persons approved by the Board of Affin Hwang Asset Management Berhad and they collectively and individually accept full responsibility for the accuracy of the information. Having made all reasonable inquiries, they confirm to the best of their knowledge and belief, there are no false or misleading statements, or omission of other facts which would make any statement in the Product Highlights Sheet false or misleading. STATEMENT OF DISCLAIMER The Securities Commission Malaysia has authorised the issuance of Affin Hwang Aiiman Global Sukuk ( the Fund ) and a copy of this Product Highlights Sheet has been lodged with the Securities Commission Malaysia. The authorisation of the Fund and lodgement of this Product Highlights Sheet should not be taken to indicate that the Securities Commission Malaysia recommends the Fund or assumes responsibility for the correctness of any statement made or opinion or report expressed in this Product Highlights Sheet. The Securities Commission Malaysia is not liable for any non-disclosure on the part of the Affin Hwang Asset Management Berhad responsible for the Fund and takes no responsibility for the contents of this Product Highlights Sheet. The Securities Commission Malaysia makes no representation on the accuracy or completeness of this Product Highlights Sheet, and expressly disclaims any liability whatsoever arising from, or in reliance upon, the whole or any part of its contents. 1

2 This Product Highlights Sheet only highlights the key features and risks of this Fund. Investors are advised to request, read and understand the Prospectus of the Fund before deciding to invest. 1. What is this product about? PRODUCT HIGHLIGHTS SHEET AFFIN HWANG AIIMAN GLOBAL SUKUK BRIEF INFORMATION ON THE PRODUCT Affin Hwang Aiiman Global Sukuk ( the Fund ) is a Shariah-compliant fixed income unit trust fund that seeks to provide investors with regular income through investments in Shariah-compliant fixed income instruments. 2. Who is this product suitable for? PRODUCT SUITABILITY The Fund is suitable for Investors who seek income through investment in a portfolio of Shariah-compliant fixed income instruments, have a medium to long-term investment horizon, and have a moderate risk tolerance level. 3. What am I investing in? Launch Date 14 December 2015 KEY PRODUCT FEATURES USD Class SGD Class RM Class Initial Offer Price USD SGD RM Initial Offer Period Asset Allocation Performance Benchmark Investment Strategy An Initial Offer Period of not more than twenty one (21) days from the Commencement Date of the Fund. The Initial Offer Period may be shortened by the Manager in the event the Manager determines that it is in the best interest of the Unit Holders. The Fund asset allocation range is as follows:- Asset Class Shariah-compliant fixed income instruments Islamic liquid assets* % of the Fund s NAV Minimum of 70% of the Fund s NAV Maximum of 30% of the Fund s NAV *Islamic liquid assets will include Islamic current deposits and Islamic fixed deposits with Financial Institutions. Dow Jones Sukuk Index To achieve the objective of the Fund, the Manager intends to invest a minimum of 70% of the Fund s NAV in a portfolio of Shariah-compliant fixed income instruments issued and/or offered globally, which consists of investment grade Sukuk and Islamic money market instruments that provide regular income. The Manager will also invest a maximum of 30% of the Fund s NAV in Islamic liquid assets. 2

3 Distribution Policy Subject to the availability of income, the Fund will distribute income on an annual basis after the end of the first financial year of the Fund. Minimum Initial Investment USD5,000 (individual) USD50,000 (institutional) SGD5,000 (individual) SGD50,000 (institutional) RM1,000 Minimum Additional Investment USD1,000 (individual) USD50,000 (institutional) SGD1,000 (individual) SGD50,000 (institutional) RM500 Minimum Units Held 10,000(individual) 100,000 (institutional) 10,000 (individual) 100,000 (institutional) 2, Who am I investing with? Relevant parties information: Note: Please refer to the Fund s Prospectus on further details of the Fund. The Manager Manager Delegate (Fund Management) Manager s Delegate (Fund Valuation & Accounting Function) The Trustee Shariah Adviser Tax Adviser Auditor/Reporting Accountants Solicitor Affin Hwang Asset Management Berhad ( T) Asian Islamic Investment Management Sdn. Bhd. ( T) (AIIMAN) (a member of Affin Holdings Berhad) CIMB Islamic Trustee Berhad CIMB Islamic Trustee Berhad Amanie Advisors Sdn. Bhd. Deloitte Tax Services Sdn. Bhd. PricewaterhouseCoopers Messrs Raja, Darryl & Loh 5. What are the possible outcomes of my investment? Being a fixed income unit trust fund, the Fund seeks to provide investors with regular income through investments in Shariah-compliant fixed income instruments. As such, the performance of the Fund would to a great extent be linked to the price movements of the Shariahcompliant fixed income markets that are investable by the Fund. If the Shariah-compliant fixed income instruments that are investable by the Fund performs well, the Fund may reflect similar performance and likewise. The Fund endeavors to distribute income, if any, on annual basis. Please note that the capital and returns of the Fund are not guaranteed. KEY RISKS 6. What are the key risks associated with this product? General Risks Market risk Market risk arises because of factors that affect the entire market. Factors such as economic growth, political stability and social environment are some examples of conditions that have an impact on businesses, whether positive or negative. It stems from the fact that there are economy-wide perils, or instances of political or social instability which threaten all businesses. Hence, the Fund will be exposed to market uncertainties and no matter how many securities are held, fluctuations in the 3

4 economic, political and social environment will affect the market price of the investments either in a positive or negative way. Fund Manager s risk The performance of a unit trust fund depends on the experience and expertise of the fund manager to generate returns. Lack of any of the above mentioned may adversely affect the performance of the Fund. Performance risk The performance of the Fund depends on the financial instruments that the Fund purchases. If the instruments do not perform within expectation or if there is a default, then, the performance of the Fund will be impacted negatively. The performance of the Fund may also be impacted if the allocation of assets is not properly done. This is where the experience and expertise of the fund managers are important and the risk of the lack of experience and expertise of the fund managers have been highlighted above. On that basis, there is never a guarantee that investing in the Fund will produce the desired investment return or the distribution of income. Inflation risk Inflation risk is the risk of loss in the purchasing power of your investment due to a general increase of consumer prices. Inflation erodes the nominal rate of your return giving you a lower real rate of return. Inflation is thus one of the major risks to you and results in uncertainty over the future value of investments. You are advised to take note that this Fund is not constituted with the objective of matching the inflation rate of Malaysia. The Fund has a specific objective that it seeks to achieve without having regard to the inflation rate. If your investment objective is to match the inflation rate (so as not to lose your purchasing power over time), this Fund may not be suitable for you. Financing risk If you intend to purchase Units of this Fund by means of financed moneys and use those Units as collateral for the financed moneys, you should be aware that if the value of the Units falls below the financed amount, the financier may require you to provide additional forms of collateral. You should also be aware that the cost of financing may rise if the profit rates move up especially if your financing is based on floating profit rates (i.e. not a fixed rate). Thus, the cost of financing may even be higher than any returns that you may eventually make from your investments in this Fund. Risk of non-compliance - This refers to the risk where the Manager does not comply with the applicable rules, laws, regulations or the Deed. Although not every non-compliance will necessarily result in some losses to the Fund, there is always a risk that losses may be suffered by the Fund. For instance, the Manager may be forced to dispose investments of the Fund at a loss to resolve the non-compliance. In order to mitigate this risk, the Manager has imposed stringent internal compliance controls. Operational risk - This risk refers to the possibility of a breakdown in the Manager s internal controls and policies. The breakdown may be a result of human error, system failure or fraud where employees of the Manager collude with one another. This risk may cause monetary loss and/or inconvenience to you. The Manager will regularly review its internal policies and system capability to mitigate this risk. Additionally, the Manager maintains a strict segregation of duties to mitigate instances of fraudulent practices amongst employees of the Manager. Liquidity risk Liquidity risk refers to two scenarios. The first is where an investment cannot be sold due to unavailability of a buyer for that investment. The second scenario exists where the investment, by its nature, is thinly traded. This will have the effect of causing the investment to be sold below its fair value. Specific risks Note: Please refer to section 4.1 of the Prospectus on further detail of each risk. Sukuk investment risk The buying and selling of Sukuk carry a number of risks, the most important being the volatility of the capital markets on which those securities are traded and the general insolvency risk associated with the issuers of Sukuk. Price changes in Sukuk are influenced predominantly by interest rate developments in the capital markets, which in turn are influenced by macro-economic factors. As a result, the Fund s portfolio performance may be affected by significant changes of such factors. In managing Sukuk investment risk, the Manager will actively monitor market developments and may make necessary adjustments to the portfolio should needs arise.the price changes also depend on the term or residual time to maturity of the Sukuk. In general, Sukuk with shorter terms have less price risks than Sukuk with longer terms. 4

5 Credit/default risk - This risk relates to the issuers of Sukuk and Islamic money market instruments. The risk arises when an issuer is unable to service any profit payments or pay the principal amount upon maturity. If such defaults were to occur, the Fund will record significant losses with respect to the NAV and will also be forced to forfeit any coupon entitlements. For Islamic money market instruments, the risk is that the issuers of such instruments may not make timely payment of profit and principal. In the event of any default in the payment of the profit and principal, the value of the Fund may be adversely affected. The management of credit risk is largely accounted for by the Manager s management of issuer-specific risk. This refers to the emphasis on credit analysis conducted to determine the issuer s or the guarantor s ability to service promised payments. High yield Sukuk risk - The Fund may invest in high yield Shariah-compliant fixed income securities which are subject to greater credit risk than investment grade securities. Generally lower rated fixed income securities pay higher yields than higher rated fixed income securities to compensate investors for the reduce creditworthiness or higher risk of default that these fixed income securities carry. Interest rate risk Sukuk and Islamic money market instruments are subject to interest rate fluctuations. Generally, movement in interest rates affects the prices of Sukuk and Islamic money market instruments inversely, for example, when interest rates rise, prices of Sukuk and Islamic money market instruments will fall. The fluctuations of the prices of the Sukuk and Islamic money market instruments will also have an impact on the NAV of the Fund. This risk can largely be eliminated by holding the Sukuk and Islamic money market instruments until their maturity. The Manager also manages interest rate risk by considering each Sukuk s or Islamic money market instruments sensitivity to interest rate changes. When interest rates are expected to increase, the Fund would then likely seek to switch to Sukuk or Islamic money market instruments that are less sensitive to interest rate changes. (Note: Interest rate is a general indicator that will have an impact on the management of the Fund regardless of whether it is a Shariah-compliant fund or otherwise. It does not in any way suggest that this Fund will invest in conventional financial instruments). Currency risk Currency risk is also known as foreign exchange risk where the risk is associated with the Fund s underlying investments which are denominated in different currencies than the Fund s Base Currency, i.e. USD. The impact of the exchange rate movement between USD and the currencies of the underlying investments may result in depreciation or appreciation of the value of the Fund s investments as expressed in USD. Investors should also be aware that currency risk is applicable to Classes which are in different currencies than the Fund s Base Currency, i.e. USD. The impact of the exchange rate movement between the Base Currency of the Fund and the currencies of the respective Classes may result in depreciation or appreciation of the investors holdings as expressed in USD. Reinvestment risk This risk arises when an issuer of Sukuk decides to repay the principal earlier than the intended maturity date or when payment of profit from Islamic money market instruments is reinvested at a profit rate lower than the prevailing profit rate when the investment was initially made, especially during times of declining interest rate environment. As a result, the Fund may experience lower returns due to reinvesting in lower yielding Sukuk. The Manager will mitigate this risk by closely monitoring the interest rate movements and take measures which will not be limited to reduce the Fund s exposure into such investments. Country risk The foreign investment of the Fund may be affected by risks specific to the country which it invests in. Such risks, which include changes in a country s economic fundamentals, social and political stability, currency movements and foreign investment policies, may have an impact on the prices of the Fund s investment in that country. Consequently, it may also affect the Fund s NAV. Political risk Changes in political environment can directly or indirectly impact investments of the Fund. For example, political instability that leads to social unrest could lead to disruption of economic activity which may impact the Fund s investments in that country. A change in government policies could also impact the Fund s investments. For example, a new government may not be pro investment or the existing government may not have the same investment policies in perpetuity. This may cause the Fund having to liquidate investments at a less ideal price or below initial investment price. Political risk is also related to regulatory risk. Regulatory risk The investments of the Fund would be exposed to changes in the laws and regulations in the countries the Fund is invested in. These regulatory changes pose a risk to the Fund as 5

6 it may materially impact the investments of the Fund. In an effort to manage and mitigate such risk, the Manager seeks to continuously keep abreast of regulatory developments (for example, by closely monitoring announcements on regulators website and mainstream medias) in that country. The Manager may dispose its investments in that particular country should the regulatory changes adversely impact the Unit Holders interest or diminish returns to the Fund. Emerging market risk Investing in emerging markets subjects the Fund to a higher level of market risk than investments in a developed country. This is due to, amongst other things, greater market volatility, lower trading volume, political and economic instability, settlement risk, greater risk of market shut down and more governmental limitations on foreign investment than those typically found in developed markets. The Manager will attempt to mitigate all these risks through its active asset allocation management and diversification, in addition to its continuous bottom up and top down research and analysis. Reclassification of Shariah-status risk This risk refers to the risk that the currently held Shariahcompliant securities by the Fund may be reclassified as Shariah noncompliant by the Shariah Adviser, or the Shariah Boards of the relevant Islamic indices or other relevant Shariah advisers. If this occurs, then the value of the Fund may be adversely affected and the Manager will take the necessary steps to dispose of such securities in accordance with the advice from the Shariah Adviser. Shariah compliance risk - As the Fund can only invest in Shariah-compliant securities, there is always a risk that losses may be suffered by the Fund when Manager is forced to dispose investments to rectify any Shariah non-compliance. This risk is mitigated through the appointment of a Shariah Adviser for the Fund, who will be responsible to ensure that the Fund is managed and administered in accordance with Shariah requirements. Note: Please refer to section 4.2 of the Prospectus on further detail of each risk. It is important to note that events affecting the investments cannot always be foreseen. Therefore, it is not always possible to protect investments against all risks. The various asset classes generally exhibit different levels of risk. The investments of the Fund carry risk and you are recommended to read the whole Prospectus to assess the risk of the Fund. If necessary, you should consult your professional adviser(s) for a better understanding of the risks. 7. What are the fees and charges involved? FEES & CHARGES There are fees and charges involved and you are advised to consider them before contributing to the Fund. What will I be charged by the Manager? Sales charge per Unit Repurchase charge Switching fee Transfer fee Up to 2.0% NAV per Unit Nil Nil RM5.00 per transfer What are the key ongoing fees charged to the Fund? Management fee Trustee fee Up to 1.20% per annum of NAV. Up to 0.06% per annum of NAV (excluding foreign custodian fees and charges). 6

7 ALL FEES, CHARGES AND EXPENSES ARE EXCLUSIVE OF GOODS AND SERVICES TAX. FROM 1 APRIL 2015 ONWARDS, WE, THE TRUSTEE AND/OR OTHER SERVICE PROVIDERS WILL CHARGE GOODS AND SERVICES TAX AT THE RATE OF 6% ON THE ABOVEMENTIONED FEES, CHARGES AND EXPENSES IN ACCORDANCE WITH THE GOODS AND SERVICES TAX ACT How often are valuations available? VALUATIONS AND EXITING FROM INVESTMENT The Fund will be valued on every Business Day and you may obtain NAV and prices of the Fund from our customer service via our toll free number or to customercare@affinhwangam.com. 9. How can I exit from this investment and what are the risks and costs involved? You may request to redeem investments in the Fund at any point in time by simply completing the repurchase application form and returning it to the Manager on any Business Day from 9.00 a.m. to 3.30 p.m. Payments will be made to you within 10 days from the day the repurchase request is received by the Manager for RM Class and within 14 days of receipt of the repurchase request is received by the Manager for Class(es) other than RM Class, provided that all documentations are completed and verifiable. CONTACT INFORMATION 10. Who should I contact for further information or to lodge a complaint? 1. For internal dispute resolution, you may contact our customer service personnel: (a) via phone to : (b) via fax to : (c) via toll free no. : (d) via to : customercare@affinhwangam.com (e) via letter : Affin Hwang Asset Management Berhad Suite 11-01, 11th Floor Menara Keck Seng 203, Jalan Bukit Bintang Kuala Lumpur Complaints should be made in writing with the following information: (a) particulars of the complainant which include name, correspondence address, contact number, address (if any) and other relevant information; (b) circumstances of the non-compliance or improper conduct; (c) parties alleged to be involved in the improper conduct; and (d) other supporting documentary evidence (if any). 2. If you are dissatisfied with the outcome of the internal dispute resolution process, please refer your dispute to the the following regulatory bodies, details of which are as follows: Federation of Investment Managers Malaysia (FiMM): (a) via to : legalcomp@fimm.com.my (b) via online complaint form : (c) via letter to : Complaints Bureau Legal, Secretarial & Regulatory Affairs Federation of Investment Managers Malaysia , 6th Floor Wisma Tune, No. 19, Lorong Dungun Damansara Heights, OR 7

8 Securities Industry Dispute Resolution Corporation (SIDREC): (a) via phone to : (b) via fax to : (c) via to : info@sidrec.com.my (d) via letter to : Securities Industry Dispute Resolution Center (SIDREC) Unit A-9-1 Level 9, Tower A Menara UOA Bangsar No. 5, Jalan Bangsar Utama Kuala Lumpur 3. You can also direct your complaint to the SC even if you have initiated a dispute resolution process with SIDREC. To make a complaint, please contact the SC s Investor Affairs & Complaints Department: (a) via phone to the Aduan Hotline at : (b) via fax to : (c) via to : aduan@seccom.com.my (d) via online complaint form available at (e) via letter to : Investor Affairs & Complaints Department Securities Commission Malaysia No 3 Persiaran Bukit Kiara Bukit Kiara Kuala Lumpur APPENDIX : GLOSSARY Base Currency Business Day Bursa Malaysia Class(es) Commencement Date Deed(s) the Fund the Manager NAV Means the currency in which the Fund is denominated i.e. US Dollar (USD). means a day on which Bursa Malaysia is open for trading; Means the stock exchange managed and operated by the Bursa Malaysia Securities Berhad including such other name as it may be amended from time to time. Means any class of Units representing similar interests in the assets of the Fund although a class of Units of the Fund may have different features from another class of Units of the same Fund. Means the date on which sales of Units of the Fund is first made. The Commencement Date is also the launch date of the Fund. Refers to the deed dated 31 July 2015 entered into between the Manager and the Trustee and including any amendments and variations thereto. Refers to Affin Hwang Aiiman Global Sukuk. Refers to Affin Hwang Asset Management Berhad ( T) means the value of the Fund which is determined by deducting the value of all the Fund s liabilities from the value of all the Fund s assets, at the valuation point. For the purpose of computing the annual management fee and annual trustee fee, the NAV of the Fund should be inclusive of the management fee and trustee fee for the relevant day; NAV per Unit Prospectus RM Means the Net Asset Value of the Fund at a particular valuation point divided by the total number of Units in Circulation at that valuation point; where the Fund has more than one Class, there shall be a Net Asset Value per Unit for each Class; the Net Asset Value per Unit of a Class at a particular valuation point shall be the Net Asset Value of the Fund attributable to that Class divided by the number of Units in circulation of that Class at the same valuation point. Means the prospectus of the Fund including any supplementary or replacement prospectus, as the case may be. Means Ringgit Malaysia, the lawful currency of Malaysia. 8

9 RM Class SACSC SC Shariah Sukuk Unit or Units Units in Circulation Unit Holder USD USD Class Represents a Class issued by the Fund which is denominated in Ringgit Malaysia (RM). Shariah Advisory Council of the Securities Commission Malaysia. Securities Commission Malaysia. means Islamic law, originating from the Qur`an (the holy book of Islam), and its practices and explanations rendered by the prophet Muhammad (pbuh) and ijtihad of ulamak (personal effort by qualified Shariah scholars to determine the true ruling of the divine law on matters whose revelations are not explicit); Means a document or certificate, documenting undivided pro-rated ownership or investment in assets in accordance with Shariah principles and concepts. means an undivided share in the beneficial interest and/or right in the Fund and a measurement of the interest and/or right of a Unit Holder in the Fund and means a Unit of the Fund(s) and if the Fund has more than one class of Units, it means a Unit issued for each class of Units. means Units created and fully paid and which have not been cancelled. It is also the total number of Units issued at a particular valuation point; means the person for the time being who, in full compliance to the relevant laws and under the Deed, is registered pursuant to the Deed as a holder of Units of the Fund, including jointholder. Means United States Dollar, the lawful currency of United States of America. Represents a Class issued by the Fund which is denominated in United States Dollar (USD). 9