GREATLINK GLOBAL EMERGING MARKETS EQUITY FUND (FUND DETAILS)

Transcription

1 Fund Details version 14 (Errors & Omissions excepted) With effect from May 2017 GREATLINK GLOBAL EMERGING MARKETS EQUITY FUND (FUND DETAILS) This ILP Sub-Fund invests all or substantially into the Fidelity Funds - Emerging Markets Fund (SR-ACC-SGD) ( Underlying Fund ) which is managed by FIL Fund Management Limited ( Manager ). The ILP Sub-Fund invests principally in areas experiencing rapid economic growth including countries in Latin America, South East Asia, Africa, Eastern Europe (including Russia) and the Middle East. The Underlying Fund may invest its net assets directly in China A and B Shares. The country of domicile of the Underlying Fund is Luxembourg. FUND FACTS (as at 28 February 2017) Currency Valuation Frequency Fund Manager Management Company of the Underlying Fund Custodian Capital Guaranteed Name of Guarantor Country of Domicile Singapore Dollar Daily FIL Fund Management Limited FIL Investment Management (Luxembourg) S.A. The Bank of New York Mellon No Not applicable Singapore Inception Date 23 January 2013 Fund Management Fee (p.a.) 1.60% (2.00% max) Custodian Fee (p.a.) 0.022% Agency & Services Fees Up to 0.35% of Net Asset Value (Charged at Underlying Fund level, excluding reasonable out-of-pocket expenses) Trustee Fee (p.a.) Fund Structure Fund Size CPFIS Included Risk Category PAST PERFORMANCE (as at 28 February 2017) N.A. Feeder Fund $ million CPFIS-OA Higher Risk Narrowly Focused Annualized Returns (%) 1 year 3 years 5 years 10 years Since Inception GreatLink Global N.A N.A 4.98 Emerging Markets Equity Fund Benchmark** N.A N.A 2.22 ** MSCI Emerging Markets Free Net of Luxembourg Tax Index Source: Morningstar Performance (%) indicated above is on bid bid basis, with all dividends and distributions reinvested, taking into account all charges which would have been payable upon such reinvestment. The performance of the ILP Sub-Fund is not guaranteed and the value of investments and income from them may fall as well as rise. Past performance is not necessarily indicative of future performance. Fees and charges payable through deduction of premiums or cancellation of units are excluded from performance calculation. The Great Eastern Life Assurance Company Limited (Reg. No G) 1/7

2 INVESTMENT APPROACH The Underlying Fund invests principally in areas experiencing rapid economic growth including countries in Latin America, South East Asia, Africa, Eastern Europe (including Russia) and the Middle East. The Underlying Fund may invest its net assets directly in China A and B Shares. The Underlying Fund can directly invest in China A shares through the Qualified Foreign Institutional Investor ( QFII ) quota of FIL Investment Management (Hong Kong) Limited, or through any permissible means available to the Underlying Fund under prevailing laws and regulations (including through the Stock Connect or any other eligible means). The Underlying Fund may invest up to 10% of its net assets directly in China A and B Shares (with aggregate exposure including direct and indirect investments up to 30% of its assets). In selecting securities for the Underlying Fund, several factors are considered in the investment process; for example, consideration may include but is not limited to, a company s financials, including revenue and profit growth, return on capital, cash flows and other financial measures. In addition, company management, industry and economic environment, and other factors may be considered in the investment process. INFORMATION ON THE MANAGER FIL Fund Management Limited (domiciled in Bermuda) has been managing collective investment schemes or discretionary funds in Bermuda since August Its regulatory authority is the Bermuda Monetary Authority. The Singapore Representative, FIL Investment Management (Singapore) Limited (domiciled in Singapore), has managed collective investment schemes or discretionary funds in Singapore since 2003 and is regulated by The Monetary Authority of Singapore. It is a wholly owned subsidiary of FIL Limited, a privately owned investment management company incepted in Bermuda in 1969, and together with its entities, commonly known by their brand name Fidelity International. Fidelity International offers world class investment solutions and retirement expertise. They are a privately owned, independent company, with the commitment and resources to provide the investment expertise, technology and service innovation needed to help clients achieve their financial goals. Fidelity International invests USD $290 billion 1 globally on behalf of clients in Asia-Pacific, Europe, the Middle East, and South America. Their clients range from pension funds, central banks, sovereign wealth funds, large corporates, financial institutions, insurers and wealth managers, to private individuals. For institutional clients, they offer tailored investment solutions design and full-service asset management outsourcing. In addition to asset management, Fidelity International provides investment administration and guidance services for workplace benefit schemes, advisers and individuals in several countries, with USD $85 billion 1 in assets under administration. Established in 1969 as the international arm of Fidelity Investments, which was founded in Boston in 1946, Fidelity International became independent of the US organisation in 1980, and is today owned mainly by management and members of the original founding family Building on active, bottom-up research, Fidelity International creates the competitive advantage that is able to deliver superior returns for their clients. Because markets are only semi-efficient, they act on intelligent insight allowing them to consistently add value for their clients. They have one of the largest global research capabilities with over 400 investment professionals and research staff around the world. They are committed to proprietary insights: Their portfolio managers have access to in-house research, which is unavailable to others, on 90% of their fund holdings. Their analysts carry out their research on the ground - visiting the shop floor, speaking to customers, competitors, suppliers, and independent experts to form conviction. Over the course of a year, their portfolio managers and analysts attend more than 16,000 company meetings - or one every 10 minutes on average. Their analysts work together across asset classes, e.g. combining insights from equity and credit research, to form a 360 view on the health and prospects of companies. In addition, their analysts commission ~250 bespoke surveys or reports a year to understand the market potential of companies product and service innovations. The Great Eastern Life Assurance Company Limited (Reg. No G) 2/7

3 Their industry-leading technology platform gives their investment professionals mobile access to all research and reporting in one place. This includes risk monitoring, unique modelling and forecasting tools. Portfolio Managers are also able to initiate trades anytime from anywhere for execution by their 24-7 global trading team. This is how Fidelity International finds growth opportunities or income streams that have not been priced in by the market- allowing them to consistently add value for their clients. Fidelity International s portfolio managers are compensated on their long-term performance so that client and manager time horizons and interests are aligned. The same is true for their management, whose shareholdings are for the duration of their careers with the company. 1 Source: Fidelity International as at30 September 2016 Investors should note that the past performance of the Manager is not necessarily indicative of the future performance of the Manager. SOFT DOLLAR COMMISSIONS OR ARRANGEMENTS The Manager and any of its Connected Persons* may effect transactions by or through the agency of another person with whom the Manager and any of its Connected Persons have an arrangement under which that party will from time to time provide to or procure for the Manager and any of its Connected Persons goods, services or other benefits (such as research and advisory services), the nature of which is such that their provision can reasonably be expected to benefit the Underlying Fund as a whole and may contribute to an improvement in the performance of the Underlying Fund or of the Manager or any of its Connected Persons in providing services to the Underlying Fund and for which no direct payment is made but instead the Manager and any of its Connected Persons undertake to place business with that party. For the avoidance of doubt, such goods and services do not include travel, accommodation, entertainment, general administrative goods or services, general office equipment or premises, membership fees, employee salaries or direct money payments. The Manager and any Connected Person shall not retain the benefit of any cash commission rebate (being repayment of a cash commission made by a broker or dealer to the Manager and/or any Connected Person) paid or payable from any such broker or dealer in respect of any business placed with such broker or dealer by the Manager or any Connected Person for or on behalf the Underlying Fund. Any such cash commission rebate from any such broker or dealer will be held by the Manager and any Connected Person for the account of the Underlying Fund. Brokerage rates will not be excessive of customary brokerage rates. All transactions will be done with best execution. * Connected Persons means (a) any person beneficially owning, directly or indirectly, 20% or more of the ordinary share capital of that company or able to exercise, directly or indirectly, 20% or more of the total votes in that company; (b) any person controlled by a person who meets one or both of the requirements set out in a) above; (c) any company 20% or more of whose ordinary share capital is beneficially owned, directly or indirectly, by any investment adviser, Manager or Share Distributor taken together; and any company 20% or more of the total votes in which can be exercised, directly or indirectly by such investment adviser, Manager or Share Distributor taken together; and (d) any director or officer of any investment adviser or Manager or Share Distributor or of any Connected Person of that company, as defined in a), b) or c) above. CONFLICTS OF INTEREST Except as described in the Underlying Fund s latest Singapore Prospectus and/or the Luxembourg Prospectus, no commissions, discounts, brokerage or other special terms have been granted by the Underlying Fund in relation to units issued or to be issued by the Underlying Fund; on any issue or sale of units a Distributor (including the General Distributor) may, out of its own funds or out of the sales charges, if any, pay commissions on applications received through brokers and other professional agents or grant discounts. The Underlying Fund, together with other funds advised or managed by the Manager, may place orders for the purchase or sale of securities in which the Underlying Fund may invest with affiliates of the Manager and other Connected Persons, provided that, among other conditions, they can reasonably be expected to execute the transaction on terms as favourable as could be expected to be obtained from other brokers, qualified to execute the transaction and at commission rates comparable to those which would have been charged by such other brokers. Orders are allocated on a pro-rata basis between different funds investing in the same assets when there is insufficient supply. Subject to the receipt of best execution, the Underlying Fund may take into account the sale of units by brokers and The Great Eastern Life Assurance Company Limited (Reg. No G) 3/7

4 dealers when selecting them for the execution of transactions. Foreign exchange transactions for investors of the Underlying Fund may be effected on an arm s length basis by or through FIL Group companies from which a benefit may be derived by such companies. Further details are set out in the Underlying Fund s Luxembourg Prospectus, in particular, under Part IV (4. Administration Details, Charges and Expenses) of the Luxembourg Prospectus. For the Underlying Fund s Singapore Prospectus dated March 2017 and subsequent supplements to the Prospectus and/or Luxembourg Prospectus, please refer to RISKS General Risks The following statements are intended to inform investors of the uncertainties and risks associated with investments and transactions in transferable securities and other financial instruments. Although care is taken to understand and manage these risks, the Underlying Fund and accordingly the investors in the Underlying Fund will ultimately bear the risks associated with the investments of the Underlying Fund. (a) Legal and Tax Risks In some jurisdictions the interpretation and implementation of laws and regulations and the enforcement of shareholders rights under such laws and regulations may involve significant uncertainties. Further, there may be differences between accounting and auditing standards, reporting practices and disclosure requirements and those generally accepted internationally. The Underlying Fund may be subject to withholding and other taxes. Tax law and regulations of any country are constantly changing, and they may be changed with retrospective effect. The interpretation and applicability of the tax law and regulations by tax authorities in some jurisdictions are not as consistent and transparent as those of more developed nations, and may vary from region to region. Investors should be aware that foreign exchange inflows and outflows for the Brazilian market are subject to IOF tax (Tax on Financial Operations) as detailed in the Brazilian Presidential Decree no /10 and as amended from time to time. The application of the IOF tax will reduce the net asset value per unit. (b) Fluctuations in Value Risk The investments of the Underlying Fund are subject to market fluctuations and other risks inherent in investing in securities and other financial instruments. There can be no assurance that any appreciation in value of investments will occur, and the capital value of the original investment is not guaranteed. The value of investments and the income from them may go down as well as up, and the investor may not get back the original amount invested. There is no assurance that the investment objective of the Underlying Fund will actually be achieved. (c) Foreign Currency Risk The Underlying Fund s total return and balance sheet may be significantly affected by foreign exchange rate movements if the Underlying Fund s assets and income are denominated in currencies other than the base currency of the Underlying Fund and this means that currency movements may significantly affect the value of a Underlying Fund s unit price. The three principal areas of foreign currency risk are where movements in exchange rates affect the value of investments, short term timing differences or income received. The Underlying Fund may, or may not, hedge these risks using either spot or forward foreign exchange contracts and the associated risks are explained below in the section on Financial Derivative Instruments. Investors should be aware of the fact that the Chinese Renminbi (RMB) is subject to a managed floating exchange rate based on market supply and demand with reference to a basket of currencies. Currently, the RMB is traded in two markets: one in Mainland China, and one outside Mainland China (primarily in Hong Kong). The RMB traded in Mainland China is not freely convertible and is subject to exchange controls and certain requirements by the government of Mainland China. The RMB traded outside Mainland China, on the other hand, is freely tradable. Whilst the RMB is traded freely outside Mainland China, the RMB spot, forward foreign exchange contracts and related instruments reflect the structural complexities of this evolving market. Accordingly, the Underlying Fund may be exposed to greater foreign exchange risks. In addition, there may be liquidity risks associated with RMB products, especially if such investments do not have an active secondary market and their prices are subject to significant bid and offer spread. The Manager will nevertheless seek to invest the assets of the Underlying Fund in such a manner which will enable them to meet their obligations to redeem their units. The Great Eastern Life Assurance Company Limited (Reg. No G) 4/7

5 (d) Liquidity Risk In normal market conditions the Underlying Fund s assets comprise mainly realisable investments which can be readily sold. The Underlying Fund s main liability is the redemption of any units that investors wish to sell. In general the Underlying Fund manages its investments, including cash, such that it can meet its liabilities. Investments held may need to be sold if insufficient cash is available to finance such redemptions. If the size of the disposals is sufficiently large, or the market is illiquid, then there is a risk that either the investments might not be sold or the price at which they are sold may adversely affect the Net Asset Value of the Underlying Fund. There is no secondary market for the ILP Sub-Fund. All redemption requests should be made to The Great Eastern Life Assurance Company Limited or its distribution representatives. Specific Risks (a) Equities Risk For the Underlying Fund which invests in stocks, the value of those stocks may fluctuate, sometimes dramatically, in response to the activities and results of individual companies or because of general market and economic conditions or other events. Currency exchange rate movements will also cause changes in value when the currency of the investment is other than the base currency of the Underlying Fund holding that investment. (b) Emerging Markets including Russia The Underlying Fund invests, in part or in whole, in emerging market securities. The price of these securities may be more volatile than those of securities in more developed markets. As a result there may be a greater risk of price fluctuation or of the suspension of redemptions in the Underlying Fund, compared to funds investing in more mature markets. This volatility may stem from political and economic factors and be exacerbated by legal, trading liquidity, settlement, transfer of securities and currency factors. Some emerging market countries have relatively prosperous economies but may be sensitive to world commodity prices and/or volatile inflation rates. Others are especially vulnerable to economic conditions. Although care is taken to understand and manage these risks, the Underlying Fund and accordingly the investors in the Underlying Fund will ultimately bear the risks associated with investing in these markets. The Underlying Fund may invest a portion of its net assets in Russia. It is understood that under current Luxembourg regulations a Underlying Fund may invest not more than 10% of its net assets in unlisted securities not dealt on a regulated market. Some investments in Russian securities may be considered as falling within such limit. There are specific risks linked to investing in Russia. Investors should be aware that the Russian market presents specific risks in relation to the settlement and safekeeping of securities as well as regarding the registration of assets where registrars are not always subject to effective government or other supervision. Russian securities are not on physical deposit with the depositary of the Underlying Fund (the Depositary ) or its local agents in Russia. Therefore, neither the Depositary nor its local agents in Russia can be considered to be performing a physical safekeeping or custody function in accordance with recognised international standards. The Depositary s liability only extends to its own negligence and/or wilful default and to negligence and wilful misconduct of its local agents in Russia and does not extend to losses due to the liquidation, bankruptcy, negligence and wilful default of any registrar. In the event of such losses, the Underlying Fund will have to pursue its rights against the issuer and/or the appointed registrar of the securities. Some, or all, of the risks attributed to investing in Russia may also apply in other emerging markets. (c) Financial Derivatives Instruments Risks The Underlying Fund may use various Financial Derivative Instruments to reduce risks or costs or to generate additional capital or income in order to meet the investment objectives of the Underlying Fund. Investors may wish to consult their independent financial adviser about the suitability of the Underlying Fund for their investment needs bearing in mind its powers with regard to the use of derivatives. While the judicious use of derivative instruments by experienced investment advisers such as the Manager can be beneficial, derivative instruments also involve risks different from, and, in certain cases, greater than, the risks associated with more traditional investments. The use of derivatives may give rise to a form of leverage, which may cause the Net Asset Value of the Underlying Fund to be more volatile and/or change by greater amounts than if they had not been leveraged. This is because leverage tends to exaggerate the effect of any increase or decrease in the value of the Underlying Fund s portfolio securities and other instruments. The further information on various important risk factors (e.g. market risk, liquidity risk, counterparty credit risk, settlement risk, fund management risk, commodities risks etc) and issues concerning the use of derivative instruments, please refer to section 23 of the Underlying Fund s Singapore Prospectus. The Great Eastern Life Assurance Company Limited (Reg. No G) 5/7

6 (d) QFII Risks Under the prevailing regulations in the People s Republic of China ( PRC ), foreign investors can invest in China A Shares or onshore China fixed income securities through institutions that have obtained QFII status in the PRC. The current QFII regulations impose strict restrictions (including rules on investment restrictions, minimum investment holding period as well as remittance and repatriation of principal and profits) on China A Share investment or onshore China fixed income securities. The Underlying Fund may not be able to freely repatriate principal and profits from China and there may be potential lock-up periods imposed for repatriation. The restrictions on or the delays in the repatriation of principal and profits may have an unfavorable impact on the Underlying Fund. In extreme circumstances, the Underlying Fund may incur losses due to limited investment opportunities, or may not be able to fully implement or pursue their investment objectives or strategy, due to QFII investment restrictions, illiquidity of the China A Shares or onshore China fixed income securities market, and/or delay or disruption in execution of trades or in settlement of trades. The Underlying Fund will be exposed to any fluctuation in the exchange rate between the reference currency of the Underlying Fund and the Renminbi in respect of such investments. Renminbi is not freely convertible and is subject to policies of exchange controls and repatriation restrictions. There is no assurance that Renminbi will not be subject to devaluation or revaluation or that shortages in the availability of foreign currency will not develop. (e) China Assets Risks Investments in Renminbi by the Underlying Fund in China A Shares or onshore China fixed income securities and other permissible securities denominated in Renminbi may be made through any permissible means pursuant to any prevailing regulations, including through the QFII quota, the Shanghai-Hong Kong Stock Connect Program ( Stock Connet ) and any other eligible means. The uncertainty and change of the laws and regulations in China may adversely impact the Underlying Fund. The QFII policy and regulation are also subject to change with potential retrospective effect. (f) Stock Connect Risks The Underlying Fund may invest and have direct access to certain eligible China A shares via the Stock Connect. The Stock Connect is a securities trading and clearing linked program developed by Hong Kong Exchanges and Clearing Limited, Shanghai Stock Exchange ( SSE ) and China Securities Depository and Clearing Corporation Limited, with an aim to achieve mutual stock market access between the PRC and Hong Kong. The Stock Connect comprises a Northbound Trading Link (for investment in China A shares) by which the Underlying Fund may be able to place orders to trade eligible shares listed on SSE. Under the Stock Connect, overseas investors (including the Underlying Fund) may be allowed, subject to rules and regulations issued / amended from time to time, to trade China A shares listed on the SSE through the Northbound Trading Link. Further information about the Stock Connect is available online at the website : The ability to trade through Stock Connect in a timely manner may be affected by quota limitations and PRC regulatory restrictions. A suspension in trading through Stock Connect will adversely affect the ability to access the PRC market. Differences in trading days in the PRC and Hong Kong markets also lead to the risks of price fluctuations in the shares when Stock Connect is not trading. Trading through Stock Connect is subject to other risks, including clearing and settlement risks (e.g. if the PRC clearing house defaults on its obligation, the Sub-Fund may suffer delays and/or inability to recover losses), restrictions on selling imposed by front-end monitoring, nominee arrangements in holding China A shares and regulatory risk. Please refer to the Risk Factors section of the Fidelity Luxembourg Prospectus for further information on the risk factors. For Underlying Fund s Prospectus dated March 2017 and subsequent supplements to the Prospectus, please refer to The ILP Sub-Fund is also subject to the usual counterparty risks, such that the ability of the ILP Sub-Fund to make payments may depend upon the due performance by the other parties, namely the Manager and/or the Custodian (as the case may be). In the event of insolvency of the Manager, the investments are held by the Trustee (where applicable) on behalf of investors and are not affected by the Manager s insolvency. In the event of insolvency of the Custodian, as the ILP Sub-Fund s non-cash investments are maintained and held separately from those of the Custodian s assets, noncash investments should normally not be affected by the Custodian s insolvency. In relation to cash investments, there could be a risk that the ILP Sub-Fund s investments (insofar as it is in the form of cash) may be affected in the event of The Great Eastern Life Assurance Company Limited (Reg. No G) 6/7

7 the Custodian s insolvency. The above should not be considered to be an exhaustive list of the risks which potential investors should consider before investing into the particular ILP Sub-Fund. Potential investors should be aware that an investment in the particular ILP Sub-Fund may be exposed to other risks of an exceptional nature from time to time. EXPENSE RATIO Expense ratio is calculated in accordance with the Investment Management Association (IMAS) of Singapore s guidelines on the disclosure of expense ratios. The expense ratio for the period 1 January 2016 to 31 December 2016 is 1.71%. The following expenses (where applicable) as set out in the IMAS Guidelines (as may be updated from time to time) are excluded from the calculation of the expense ratio: (a) brokerage and other transaction costs associated with the purchase and sales of investments (such as registrar charges and remittance fees); (b) interest expenses; (c) performance fee; (d) foreign exchange gains and losses of the ILP Sub-Fund, whether realised or unrealised; (e) front-end loads, back-end loads and other costs arising on the purchase or sale of a foreign exchange unit trust or mutual fund; (f) tax deducted at source or arising from income received, including withholding tax; and (g) dividends and other distributions paid to investors. TURNOVER RATIO Turnover ratio means a ratio calculated based on the lesser of purchases or sales expressed as a percentage over 'average net asset value'. Where 'average net asset value' means the net asset value for each day averaged over, as far as possible, the same period used for calculating the expense ratio. Fund Turnover Ratio for the period 1 January 2016 to 31 December 2016 GreatLink Global Emerging Markets Equity Fund 95.59% Underlying Fund* 95.59% * Ratio is derived from the Underlying Fund. The turnover ratio of the Underlying Fund is computed for period 1 May 2015 to 30 April The ratio for period 1 January 2016 to 31 December 2016 is not available. The Great Eastern Life Assurance Company Limited (Reg. No G) 7/7