Investor s Guide Clerical Medical Pension Funds

Transcription

1 Investor s Guide Clerical Medical Pension Funds

2 Contents Introduction 1 Clerical Medical funds managed by Aberdeen Asset Management 2 Clerical Medical funds managed by other fund managers 3 Pension funds information 9

3 Introduction Clerical Medical offers a range of pension funds from ready-made investment portfolios to specialist funds to match different investment needs. Our range is grouped into the following categories: Clerical Medical funds managed by Aberdeen Asset Management These Clerical Medical funds are all managed by a subsidiary of Aberdeen Asset Management plc ( Aberdeen ). Aberdeen is one of the world s largest independent asset managers by assets under management. Based in 26 countries, Aberdeen manages assets for both institutional and retail clients with 39 offices around the world. As at 31 December 2016, Aberdeen managed assets of over billion*. Clerical Medical is responsible for defining the funds objectives and determining how the funds should be run. *Source: Aberdeen, April Clerical Medical funds managed by other fund managers These funds are managed by selected and well-established fund managers. Covering a wide range of asset classes, geographical locations, sectors and management styles, these carefully selected fund links provide all the basic building blocks to create bespoke investment portfolios. For the majority of these funds, the fund manager defines the fund s objectives and determines how the fund should be run. In some cases, Clerical Medical defines the fund s objectives and determines how the fund should be run. Availability If you already have a Clerical Medical individual pension you can still add to it, or make changes to how your plan is invested. However, please note that Clerical Medical individual pensions are no longer open to new investors. Some Clerical Medical pension funds are not available for certain products, so please speak to your financial adviser for a definitive list of funds available for your product. Alternatively, please refer to the Clerical Medical Fund availability and prices section at or call us on during the following times: Monday to Friday 8.30am to 6pm. We may record and monitor calls to help us to improve our service. You can also reach us by post at: Clerical Medical PO Box Dalkeith Road Edinburgh EH16 9AS. If you re looking to invest in a new pension, please visit the Scottish Widows website at or contact Scottish Widows on (Monday to Friday 9am 8pm, Saturday 9am 1pm) or by post to Scottish Widows 15 Dalkeith Road Edinburgh EH16 5BU Clerical Medical and Scottish Widows are both part of the Lloyds Banking Group. 1

4 Clerical Medical funds managed by Aberdeen Asset Management These Clerical Medical funds are all managed by a subsidiary of Aberdeen Asset Management plc ( Aberdeen ). The manager Aberdeen look to enable their clients to harness the potential of all global investment markets from developed to emerging markets to achieve their financial goals. With a network of 39 offices and investment centres in 26 countries, they are close to their clients. Equally, their investment managers are always in or near to the territories in which they invest. By conducting their own first-hand company and market research, Aberdeen seek to get a complete picture of financial trends, risks and opportunities from the local level up. Clerical Medical is responsible for defining the funds objectives and determining how the funds should be run. Funds available Adventurous Fund Balanced Fund Balanced Fund of Funds Cash Fund Cautious Fund Corporate Bond Fund Ethical Fund European Fund Far Eastern Fund Gilt & Fixed Interest Fund Global Equity Tracker Fund Halifax Fund International Fixed Income Fund International Growth Fund Japanese Fund Non-Equity Fund North American Fund Retirement Protection Fund Smaller Companies Fund Special Situations Fund UK Equity Income Fund UK Equity Tracker Fund UK Gilt Fund UK Growth Fund UK Index-Linked Gilt Fund UK Property Fund CM UK Smaller Companies Fund* * Formerly known as the CM UBS UK Smaller Companies Fund. ABI classification sector Flexible Investment Mixed Investment 40% 85% Shares Mixed Investment 40% 85% Shares Money Market Mixed Investment 20% 60% Shares Sterling Corporate Bond Global Equities Europe excluding UK Equities Asia Pacific excluding Japan Equities Sterling Fixed Interest Global Equities Money Market Global Fixed Interest Global Equities Japan Equities Mixed Investment 0% 35% Shares North America Equities Sterling Long Bond UK Smaller Companies UK All Companies UK Equity Income UK All Companies UK Gilts UK All Companies UK Index-Linked Gilts UK Direct Property UK Smaller Companies 2

5 Clerical Medical funds managed by other fund managers Please note: These Clerical Medical Funds are provided and administered by Scottish Widows Limited. The manager Fidelity International was founded in Since then, it has remained true to one simple goal: to achieve outstanding investment returns for its clients. This is recognised by numerous awards which reflect the performance of its funds, the quality of its research, its customer service and its technical innovation. Building out from its first offices in Tokyo and London, it now serves individuals, institutions and multinational corporations and their advisers in all major financial centres across Asia Pacific, Europe and the Middle East. It is one of the largest fund management groups in the UK. Assets totalling over 226 billion (as at 31 December 2016) are managed from worldwide locations including London, Bermuda, Milan, Paris, Tokyo. Mumbai, Seoul, Singapore, Melbourne. Sydney, Shanghai, Taipei and Dubai. Source: Fidelity International, April Funds available CM Fidelity American Fund CM Fidelity Defensive Managed Fund CM Fidelity European Fund CM Fidelity Extra Income Fund CM Fidelity MoneyBuilder Growth Fund* CM Fidelity MoneyBuilder Income Fund CM Fidelity Asia Fund** CM Fidelity WealthBuilder Fund CM Fidelity Worldwide Special Situations Fund ABI classification sector North America Equities Mixed Investment 0% 35% Shares Europe excluding UK Equities Sterling Strategic Bond UK All Companies Sterling Corporate Bond Asia Pacific excluding Japan Equities Global Equities Global Equities * formerly known as the CM Fidelity Growth and Income Fund. ** formerly known as the CM Fidelity South East Asia Fund. 3

6 The manager Insight Investment Management (Global) Limited ( Insight ) is one of the UK s largest active managers responsible for 523 billion* in assets under management across fixed income, risk management strategies including liability-driven investment and currency risk management, absolute return and multi-asset capabilities. Based in London, Insight is a specialist asset manager with a global network of operations in the UK, US, Japan and Australia. Its clients include pension funds, corporates, local authorities, insurers, sovereign wealth funds, wealth managers, financial institutions and supra-nationals. At the heart of its investment philosophy is a desire to offer clients innovative yet practical solutions. To achieve this, it combines expertise, strength and depth of knowledge with innovation across a broad range of asset classes and the risk/return spectrum to offer its clients complete flexibility; an essential tool in delivering tailored client solutions. A team-oriented approach is the lynchpin of its business and means that it can draw on the in-house expertise of high calibre professionals at any time. Their investment professionals are specialists in their field meaning they have the right people doing the right jobs for their clients. By working in partnership with clients and their advisers they develop and evolve effective solutions that meet their changing needs. Following this approach, Insight has grown into a leading force in investment management; its business is strong and growing, generating year-on-year growth in assets under management since launch in * As at 31 December Assets under management are represented by the value of cash securities and other economic exposure managed for clients. Source: Insight, 31 December Funds available Absolute Return Fund Dynamic Return Fund Target Return Fund UK Alpha Fund of Funds UK Equity Fund of Funds ABI classification sector Specialist Flexible Investment Specialist UK All Companies UK All Companies Clerical Medical defines this fund s objectives and determines how this fund is run. 4

7 The manager Invesco Perpetual is one of the largest independent investment managers in the UK, managing billion in assets 1 on behalf of consumers and professional investors. Invesco Perpetual s highly-regarded investment management team is focused on finding attractive investment opportunities in all market conditions. Central to their approach is a belief in active fund management; building portfolios based on thorough research and analysis to identify the investment opportunities they consider most likely to provide strong long-term returns. Invesco Perpetual forms part of Invesco Ltd., one of the world s leading independent investment management organisations dedicated to helping investors worldwide achieve their financial ambitions. 1 Total assets managed by Invesco Perpetual s Henley based investment centre as at 31 March Source: Invesco Perpetual, April Funds available CM Invesco Perpetual Corporate Bond Fund CM Invesco Perpetual Distribution Fund CM Invesco Perpetual Global Emerging Markets Fund* CM Invesco Perpetual Global Bond Fund CM Invesco Perpetual Global Smaller Companies Fund CM Invesco Perpetual High Income Fund CM Invesco Perpetual Hong Kong and China Fund CM Invesco Perpetual Monthly Income Plus Fund CM Invesco Perpetual UK Focus Fund** ABI classification sector Sterling Corporate Bond Mixed Investment 20% 60% Shares Global Emerging Markets Equities Global Fixed Interest Global Equities UK Equity Income Global Emerging Markets Equities Sterling High Yield UK All Companies * formerly known as the CM Invesco Perpetual Emerging Countries Fund. ** formerly known as the CM Invesco Perpetual UK Aggressive Fund. 5

8 The manager Newton Investment Management Limited (Newton) is one of BNY Mellon Investment Management s specialist asset managers. BNY Mellon Investment Management is the global investment management arm of BNY Mellon, one of the world s major financial services groups. BNY Mellon Investment Management s multi-boutique model encompasses the investment skills of a number of world class specialist investment managers in its UK range, including Newton, Standish, The Boston Company, Walter Scott and Insight Investment. With over $1.6 trillion in assets under management (as of 31 December 2016), BNY Mellon Investment Management holds a number of market leading positions globally. Newton is one of the pioneers of global thematic investing and this philosophy has been fundamental in the delivery of compelling performance in rising and falling markets. The firm terms its investment approach as active stock and bond selection within a global framework. This approach involves the skills of active fund management on a daily basis and recognises that no one market in the world operates independently from activities and developments in others around the world. Source: The Bank of New York Mellon Corporation, April Funds available CM Boston Company US Opportunities Fund* CM Newton Balanced Fund CM Newton Continental European Fund CM Newton Global Equity Fund** CM Newton Global Income Fund*** CM Newton UK Income Fund**** CM Newton International Bond Fund CM Newton Managed Fund CM Newton Phoenix Fund CM Newton UK Equity Fund***** ABI classification sector North America Equities Mixed Investment 40% 85% Shares Europe excluding UK Equities Global Equities Global Equities UK Equity Income Global Fixed Interest Flexible Investment Mixed Investment 20% 60% Shares UK All Companies * formerly known as the BNY Mellon American Fund. ** formerly known as the CM Newton International Growth Fund. *** formerly known as the CM Newton Global Higher Income Fund. **** formerly known as the CM Newton Higher Income Fund. ***** formerly known as the CM Newton Income Fund. 6

9 The manager At Schroders, asset management is their business and their goals are completely aligned with those of their clients the creation of long-term value. They manage billion ( billion/us$490.7 billion) on behalf of institutional and retail investors, financial institutions and high net worth clients from around the world, invested in a broad range of asset classes across equities, fixed income, multi-asset and alternatives. They employ over 4100 talented people worldwide operating from 41 offices in 27 different countries across Europe, the Americas, Asia and the Middle East, close to the markets in which they invest and close to their clients. Schroders has developed under stable ownership for over 200 years and long-term thinking governs their approach to investing, building client relationships and growing their business. Source: Schroders, all data as at 31 December Funds available CM Schroder Corporate Bond Fund CM Schroder European Alpha Plus Fund CM Schroder Gilt & Fixed Interest Fund CM Schroder QEP Global Core Fund* CM Schroder Global Equity Fund CM Schroder Global Cities Real Estate Fund** CM Schroder Income Fund CM Schroder Managed Balanced Fund CM Schroder Monthly High Income Fund CM Schroder Tokyo Fund CM Schroder UK Mid 250 Fund CM Schroder UK Smaller Companies Fund CM Schroder US Mid Cap Fund*** ABI classification sector Sterling Corporate Bond Europe excluding UK Equities UK Gilts Global Equities Global Equities Global Property UK Equity Income Mixed Investment 40% 85% Shares Sterling High Yield Japan Equities UK All Companies UK Smaller Companies North America Equities * formerly known as the CM Schroder Global Climate Change Fund. ** formerly known as the CM Schroder Global Securities Real Estate Fund. *** formerly known as the CM Schroder US Small & Mid Cap Fund. 7

10 The manager UBS Asset Management is a large-scale asset manager with a presence in 22 countries. It offers investment capabilities and investment styles across all major traditional and alternative asset classes to institutions, wholesale intermediaries and wealth management clients. Their global capabilities include equity, fixed income, currency, hedge funds, real estate, infrastructure and private equity investment capabilities that can also be combined into customised solutions and multi asset strategies. UBS is a leading fund house in Europe, the third-largest international asset manager in Asia, the largest mutual fund manager in Switzerland and one of the largest fund of hedge funds and real estate investment managers in the world. Source: UBS Asset Management, April Funds available CM UBS Global Allocation Fund CM UBS Global Growth Fund CM UBS UK Opportunities Fund* CM UBS US Equity Fund ABI classification sector Mixed Investment 40% 85% Shares Global Equities UK All Companies North America Equities * formerly known as the CM UBS UK Growth Fund. The manager Veritas is a UK based boutique manager of Asian and Global Equity funds. Veritas opened for business in 2003 remaining an independent owner managed partnership ever since. Their focus is on protecting and growing the real value of clients capital. The partnership now manages 15 billion (as at 31 March 2017) across their pooled funds and segregated institutional accounts. They believe their partnership ownership structure coupled with partners investing their own capital in Veritas own funds alongside those of their clients, on the same commercial terms, allow members of the partnership to align interests directly with those of their clients. Source: Veritas, April Funds available CM Veritas Asian Fund* ABI classification sector Asia Pacific excluding Japan Equities * formerly known as the CM Newton Oriental Fund. 8

11 Pension funds information The Clerical Medical unit-linked pension funds aim to provide long-term growth in the price of units. This is generated by a combination of capital growth as well as income that is added to the fund. A proportion of each unit-linked fund may be held in cash to provide liquidity or while awaiting suitable investments. The Clerical Medical unit-linked funds can invest in other unitlinked funds or in collective investment schemes (for example open-ended investment companies (OEICs) or unit trusts) to achieve exposure to meet the stated fund aims. Some funds may use derivatives (contracts which have a value linked to the price of another asset) to help reduce risk or reduce cost, or to help generate extra capital or income. This is normally referred to as Efficient Portfolio Management (EPM). It is not intended that this will cause the risk profile of these funds to change, but using derivatives might not achieve the described outcomes and may result in greater fluctuations in the values of these funds. The funds may engage in securities lending. This is where a fund lends out some of its assets with an agreement that the borrower will return them after a limited period. The borrower pays a fee which is added to the fund after the costs associated with the lending have been deducted. The fund receives other assets and possibly a cash payment as security during the lending period for the assets lent. There is a risk that the borrower may be unable to return the fund s assets and if this happens, the other assets would be sold. If the sale proceeds and any other payments due to the fund were not enough to replace the assets lent, the fund would go down in value. The individual aims and risks of the Clerical Medical pension funds that are currently available to existing Clerical Medical pension plan holders are shown on pages There are charges associated with investing in the funds. The charges can be different for different funds and can change. For details of the charges, please contact your financial adviser or Clerical Medical using the contact details on page 1. Full terms and conditions, including relevant administration details, are available on request from Clerical Medical. Charges, terms and limits may change. The value of an investment is not guaranteed and can go up and down depending on investment performance (and currency exchange rates where a fund invests overseas) and could fall below the amount(s) paid in. There may be restrictions on the amount you can invest in certain funds. Please contact us for details of any restrictions that apply. We may change the selection of funds that we make available. We reserve the right to delay a request to sell your units in certain circumstances. The period of delay will not be more than six months if the units to be cancelled include units which relate to a fund which holds directly or indirectly assets in the form of real or heritable property. It will not be more than one month in all other cases. This may happen in exceptional circumstances where, for example, there is an unusually high demand for units to be cashed in. For more details please see the relevant Policy Provisions for your investment with us. ABI sector information ABI sectors are designed by the Association of British Insurers. They aim to group funds with similar characteristics and can help investors compare funds. However, they are not designed to reflect the risk level of funds. The Mixed Investment Shares sectors reflect the maximum and minimum amount of a fund that can be invested in shares. Please note that fund managers may often invest at or near the maximum amount in shares. Funds in the Mixed Investment Shares sectors can hold a range of other investments in addition to shares (for example bonds, property and cash) and may use a range of different investment strategies. The Mixed Investment Shares sectors group together funds that are broadly similar (on the basis of their shares content) for comparison purposes. To give fund managers flexibility, the criteria for each sector overlap. So funds may sometimes meet the requirements for more than one sector. UK shares are investments in companies quoted on the UK stock market. Overseas shares are investments in companies quoted on non-uk stock markets. 9

12 Where any of the following general risks apply to a fund, they will be indicated beside the aims of the fund shown in the next section. Any specific risks associated with a fund will also be shown here. L FI FIG This fund uses derivatives and forward transactions for specific investment purposes, as well as for hedging and other efficient portfolio management purposes. Their use may lead to higher volatility. This fund uses derivatives and forward transactions for specific investment purposes, as well as for hedging and other efficient portfolio management purposes. It s not intended that the use of derivatives in this way will cause the fund to have high volatility or otherwise cause its existing risk profile to change. This fund invests in emerging markets so might invest in stockmarkets which are generally less well regulated than those in the UK. This may result in a greater risk that the value of the units might go down. The investments in these markets might also be bought and sold infrequently therefore resulting in large changes in their prices. This fund invests in company shares (often referred to as equities ). Investing in company shares generally has the potential for higher capital growth over the longer term than investing in say, corporate bonds and other fixed interest securities. However there might be considerable fluctuations in equity prices and there is a greater risk that the value of the investment will fall. Some of the securities in which this fund invests might default or their credit rating might fall. The value of those investments will usually fall should an issuer default or receive a reduced credit rating. Fluctuations in interest rates are likely to affect the value of the securities held by the fund. If long-term interest rates rise, the value of the units is likely to fall and vice versa. This fund may invest more than 35% in government or public securities issued by a single issuer. There could be a risk, for example, that they can t repay the amount borrowed. If they don t repay, the value of the fund will fall. HY PR PY PYS SC SP This fund invests in high yielding fixed interest securities, which carry an increased risk of default and, for which, there is a higher risk that the issuer s credit rating may fall. The value of these investments will usually fall should an issuer default or receive a reduced credit rating or should the likelihood of these events increase. Exchange rate changes might cause the value of any overseas investment to go up or down. Your investment in this fund is at risk. There is no guarantee that the fund will deliver positive returns over the specific, or any, time period. This fund invests in property and land. This can be difficult to sell, so it may not be possible to cash in the investment when you want to. We may have to delay acting on your instructions to sell the investment. The value of property is generally a matter of a valuer s opinion rather than fact and values can go up or down. Property transactions tend to be larger and more complex than for other asset classes. As a result the proportion of cash held while awaiting suitable investment opportunities could be greater than for other funds. Property is a less liquid asset than other assets such as fixed interest securities or equities and values could be affected if properties need to be sold in a short timescale. Property valuation is generally a matter of judgement by an independent valuer rather than fact and values can go up or down. This fund invests in smaller companies whose shares tend to be bought and sold less frequently than larger companies. There may be large changes in the prices of their shares and their value could fall by large amounts. The price variations of smaller companies might be greater than those of large companies. This fund has a select portfolio, which has a limited number of stocks. By investing in a select portfolio there might be greater fluctuations in the value of the units than with a wider portfolio. 10

13 This section lists each fund within its ABI sector. For more information about ABI sectors, please see p9. Asia Pacific excluding Japan Equities sector Far Eastern Fund To achieve long-term capital growth by investing predominantly in a portfolio of companies which are part of the MSCI AC Asia Pacific ex Japan Index (the Index ). The Fund seeks to deliver performance, before deduction of management fees, in excess of the Index with a similar level of overall volatility, over the long term. The Fund 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). L 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, for example travel and leisure or telecommunications. CM Fidelity Asia Fund* The Fund aims to provide long-term capital growth from a portfolio primarily comprised of equities listed on the stock exchanges throughout the Asian region, excluding Japan. Investment will be primarily in directly held transferable securities. CM Veritas Asian Fund** To achieve capital growth by investing in the Asian and Pacific markets, excluding Japan. * formerly known as the CM Fidelity South East Asia Fund. ** formerly known as the CM Newton Oriental Fund. European excluding UK Equities sector European Fund The fund invests via the Halifax European OEIC Fund. The European OEIC Fund aim is: To achieve long-term capital growth by investing predominantly in a portfolio of companies which are part of the MSCI Europe ex UK Index (the Index ). The Fund seeks to deliver performance, before deduction of management fees, in excess of the Index with a similar level of overall volatility, over the long term. The Fund 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). 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, for example travel and leisure or telecommunications. CM Fidelity European Fund To achieve long-term capital growth from a portfolio primarily made up of the shares of Continental European companies. CM Newton Continental European Fund To achieve capital growth from a carefully selected portfolio of Continental European equities. SC SP CM Schroder European Alpha Plus Fund The fund aims to achieve capital growth through investment in European countries excluding the UK. SP 11

14 Flexible Investment sector Adventurous Fund The fund aims to achieve long-term capital growth by gaining exposure almost exclusively to UK and overseas equities, but with some flexibility to gain a minority exposure to commercial property and fixed interest stocks. FI PYS Dynamic Return Fund The fund aims to achieve long-term capital growth through gaining exposure to a diversified range of asset classes. L FI HY PYS CM Newton Managed Fund To maximise the total return from income and capital growth from a portfolio of UK, EU and international securities. FI Global Emerging Markets Equities sector CM Invesco Perpetual Global Emerging Markets Fund* To achieve capital growth primarily through a portfolio of shares in companies established and/or operating in countries where, in the opinion of the ACD, there is an emerging market. CM Invesco Perpetual Hong Kong and China Fund To achieve capital growth through a portfolio of investments with an exposure to the economies of Hong Kong and China. * formerly known as the CM Invesco Perpetual Emerging Countries Fund. 12

15 Global Equities sector Ethical Fund The fund aims to achieve long-term capital growth by investing in companies whose activities are considered ethical, both in terms of their primary activities as well as in the means of achieving them. Global Equity Tracker Fund To achieve long-term capital growth by investing in a diversified international portfolio of equity or equity related securities traded on the major stock markets of the world. The Fund has an emphasis on companies with a large capitalisation, although the portfolio may also include selected shares of medium and small companies where significant growth potential has been identified. SC International Growth Fund To achieve long-term capital growth by investing predominantly in a portfolio of companies which are part of the MSCI World Index or the MSCI Emerging Markets Index (the Indices ). The Fund seeks to deliver performance, before deduction of management fees, in excess of a blended return of the Indices, with a similar level of overall volatility, over the long term. Of the two Indices, the fund will invest almost exclusively in companies that are part of the MSCI World Index. The Fund may only take limited positions away from these Indices. 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). 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, for example travel and leisure or telecommunications. CM Fidelity WealthBuilder Fund The fund is managed with the aim of providing long-term capital growth from a portfolio of Fidelity s OEIC sub-funds which are themselves invested across a broad range of world financial markets. FI HY CM Fidelity Worldwide Special Situations Fund The fund is managed with the aim of achieving long-term capital growth by investing in an actively managed portfolio primarily of UK & International equities. SC CM Invesco Perpetual Global Smaller Companies Fund The Fund aims to achieve capital growth through a portfolio of investments in international securities. The fund intends to invest mainly in shares of smaller companies, which are quoted on the world s stock markets. SC CM Newton Global Equity Fund* CM Newton Global Income Fund** To achieve capital growth from a portfolio of international securities. The objective of the fund is to achieve increasing annual distributions together with longterm capital growth from investing predominantly in global securities. The Fund may also invest in collective investment schemes. FI SC CM Schroder QEP Global Core Fund*** Schroder describe their fund s aim as follows: the Fund s investment objective is to achieve the optimum overall return of capital and income in sterling terms through flexible global investment management. The Fund will invest internationally in equities quoted on recognised stock exchanges. The Fund may also invest in a wide range of investments including transferable securities, collective investment schemes, warrants and money market instruments. SC CM Schroder Global Equity Fund To achieve a high total return by investing principally in equities listed on stock markets around the world. CM UBS Global Growth Fund To achieve long-term growth though active management of a diversified portfolio invested in global equities other than UK equities. SC * formerly known as the CM Newton International Growth Fund. ** formerly known as the CM Newton Global Higher Income Fund. *** formerly known as the CM Schroder Global Climate Change Fund. 13

16 Global Fixed Interest sector International Fixed Income Fund The fund aims to maximise total returns by investing in a global portfolio of interest bearing securities. FI FIG HY CM Invesco Perpetual Global Bond Fund Invesco Perpetual describe their fund s aim as follows: The fund aims to achieve a combination of income and capital growth over the medium to long term by investing primarily in debt securities and currencies globally. Debt securities include government bonds, as well as securities issued by supranational bodies, local authorities, national public bodies and corporate issuers. The Fund may also invest in high yield, unrated, convertible, sub-investment grade debt securities. Financial derivative instruments can be used for investment purposes and for efficient portfolio management. FI FIG Please note: the Clerical Medical unit-linked funds aim to provide long term growth in the price of the units. Any income generated will not be distributed but added to the fund value. CM Newton International Bond Fund The fund aims to maximise the total return from the income and capital growth in the world bond markets through investment predominantly in Government and other public securities. The fund may also invest in deposits, derivative instruments and collective investment schemes. FI FIG Global Property sector CM Schroder Global Cities Real Estate Fund* The fund s investment objective is to provide a total return primarily through investment in real estate investment trusts, equity and debt securities of other types of property companies worldwide. SP * formerly known as the CM Schroder Global Securities Real Estate Fund. Japan Equities sector Japanese Fund To achieve long-term capital growth by investing predominantly in a portfolio of companies which are part of the MSCI Japan Index (the Index ). The Fund seeks to deliver performance, before deduction of management fees, in excess of the Index with a similar level of overall volatility, over the long term. The Fund 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). 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, for example travel and leisure or telecommunications. L CM Schroder Tokyo Fund To achieve capital growth by investing in Japanese equities. Mixed Investment 0% 35% Shares sector Non-Equity Fund The fund aims to provide a long-term total return by gaining exposure almost exclusively to a range of commercial property, fixed interest and index-linked stocks. FI PYS CM Fidelity Defensive Managed Fund To achieve capital growth through investment in a wide range of Fidelity investment funds. Primarily invested in a combination of UK corporate and government bonds and other fixed income and money market securities, preference shares and convertibles. FI HY 14

17 Mixed Investment 20% 60% Shares sector Cautious Fund The fund aims to achieve long-term capital growth by gaining exposure to UK equities, commercial property and fixed interest stocks. The Fund will normally operate a broadly equal weighting between the equity and non-equity classes with flexibility to move over and under-weight positions in any asset class to meet market circumstances. FI PYS CM Invesco Perpetual Distribution Fund Invesco Perpetual describe their fund s aim as follows: The fund aims to achieve a combination of income and capital growth over the medium to long term by investing primarily in corporate and government debt securities globally (which may be unrated or subinvestment grade) and equities. Financial derivative instruments can be used for investment purposes and for efficient portfolio management. FI HY Please note: the Clerical Medical unit-linked funds aim to provide long term growth in the price of the units. Any income generated will not be distributed but added to the fund value. CM Newton Phoenix Fund To achieve long-term capital growth from a balanced portfolio in a range of international markets. FI HY Mixed Investment 40% 85% Shares sector Balanced Fund The fund aims to achieve long-term capital growth by gaining exposure predominantly to UK and overseas equities, with flexibility to gain a minority exposure to commercial property and fixed interest stocks. FI PYS Balanced Fund of Funds The objective of the fund is to achieve capital growth. The policy of the fund is to gain exposure to one or more of the following asset classes: fixed income, cash, near cash and deposits, equities, property, collective investment schemes which have as their objective an absolute or target return, structured products or any other geographic or economic sectors of the world. Exposure to these asset classes will generally be achieved through investment in collective investment schemes, but may be achieved by direct investment, except in the case of property. The fund may also invest in other transferable securities, money market instruments and derivatives. FI HY PYS CM Newton Balanced Fund To achieve a balance between capital growth and income from a portfolio of UK and international securities. FI HY SC CM Schroder Managed Balanced Fund To achieve capital growth through a balanced exposure to international equities and bonds, by investing primarily in authorised unit trusts managed by Schroders. FI CM UBS Global Allocation Fund To achieve long-term capital growth through the active management of a diversified portfolio invested in domestic and international equities, bonds and cash. FI FIG HY 15

18 Money Market sector Cash Fund The fund aims to provide long-term growth consistent with high levels of capital security by investing mainly in short-term securities. Specific risks The fund can invest in highquality, mostly short-term debt instruments such as fixed deposits, certificates of deposit, commercial paper and floating rate notes. It carries a relatively modest risk to capital. Halifax Fund The fund invests in deposits within the Lloyds Banking Group. The rate of return varies in line with changes in interest rates which, together with the annual management charge, is reflected in the unit price. If interest rates fall below the level of the annual management charge the unit price will fall. The unit price will also fall if the bank holding the deposits becomes insolvent. North America Equities sector North American Fund To achieve long-term capital growth by investing predominantly in a portfolio of companies which are part of the S&P 500 Index (the Index ). The Fund seeks to deliver performance, before deduction of management fees, in excess of the Index with a similar level of overall volatility, over the long term. The Fund 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). 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, for example travel and leisure or telecommunications. CM Boston Company US Opportunities Fund* To achieve capital growth from a portfolio of US equities. SC CM Fidelity American Fund To achieve long-term capital growth through a portfolio composed primarily of US equities. CM Schroder US Mid Cap Fund** The fund s investment objective is to provide capital growth and income primarily through investment in equity securities of medium-sized US companies. Investment will be in directly held transferable securities. The Fund may also invest in collective investment schemes, warrants and money market instruments. SC CM UBS US Equity Fund To achieve long-term growth through active management of a diversified portfolio primarily invested in US equities. * formerly known as the CM BNY Mellon American Fund, and before that as CM Newton American Fund. ** formerly known as the CM Schroder US Small & Mid Cap Fund. 16

19 Specialist sector Absolute Return Fund Target Return Fund The fund aims to deliver attractive, positive absolute returns over rolling 12 month periods in all market conditions. The fund aims to deliver positive returns on an annual basis with the prospect of longterm capital growth commensurate with returns from equities but with a lower volatility. FI Specific risks PR This fund uses derivatives and forward transactions for specific investment purposes, as well as for hedging and other efficient portfolio management purposes. It s not intended that the use of derivatives will cause the risk profile of the fund to change. L FI HY PR PYS Sterling Corporate Bond sector Corporate Bond Fund The fund aims to provide an above average income from a diversified portfolio of interest bearing securities. FI HY CM Fidelity MoneyBuilder Income Fund To achieve an attractive level of income from a portfolio primarily invested in GBPdenominated fixed-interest securities. FI FIG HY CM Invesco Perpetual Corporate Bond Fund Invesco Perpetual describe their fund s aim as follows: The fund aims to achieve a combination of income and capital growth over the medium to long term by investing primarily in investment grade corporate debt securities. The fund may also invest in government, unrated and sub-investment grade debt securities. Financial derivative instruments can be used for investment purposes and for efficient portfolio management. FI FIG HY Please note: the Clerical Medical unit-linked funds aim to provide long term growth in the price of the units. Any income generated will not be distributed but added to the fund value. CM Schroder Corporate Bond Fund To achieve an optimum level of interest (or yield) with the lowest possible level of risk by investing in bonds and other fixed interest securities, primarily those issued by UK companies and the British Government. FI HY 17

20 Sterling Fixed Interest sector Gilt & Fixed Interest Fund To provide long-term growth by investing in a range of fixed-interest assets. FI FIG HY Sterling High Yield sector CM Invesco Perpetual Monthly Income Plus Fund Invesco Perpetual describe their fund s aim as follows: The fund aims to achieve a high level of income together with capital growth over the medium to long term by investing primarily in corporate and government high yielding debt securities globally (which may be unrated or sub-investment grade), and equities. Financial derivative instruments can be used for investment purposes and for efficient portfolio management. FI HY Please note: the Clerical Medical unit-linked funds aim to provide long term growth in the price of the units. Any income generated will not be distributed but added to the fund value. CM Schroder Monthly High Income Fund To provide a high level of income, which is distributed monthly by investing in a diverse portfolio of bonds. FI HY Sterling Long Bond sector Retirement Protection Fund To broadly match the performance of those UK gilt edged stocks which influence market yields for pension annuity rates by investing totally in long-dated stocks. FI FIG Sterling Strategic Bond sector CM Fidelity Extra Income Fund To achieve a relatively high level of income from a portfolio invested in a combination of UK corporate and government bonds and other fixed income and money market securities, preference shares and convertibles. FI FIG HY 18

21 UK All Companies sector Special Situations Fund The fund aims to provide capital growth by active investment in UK companies with above average potential for growth. SC UK Alpha Fund of Funds To produce capital growth by investing predominantly in units or shares of collective investment schemes which invest predominantly in UK equities. The fund may also invest directly in UK equities. UK Equity Fund of Funds To achieve long-term capital growth by investing predominantly in units of collective investment schemes which invest in any sector of the UK economy. The fund may also invest directly in securities in such sectors. UK Equity Tracker Fund To achieve long-term capital growth by investing in a representative sample of UK equities and for these assets to match the total return performance of the FTSE All-Share Index. UK Growth Fund To achieve long-term capital growth by investing predominantly in a portfolio of companies which are part of the FTSE All Share Index (the Index ). The Fund seeks to deliver performance, before deduction of management fees, in excess of the Index with a similar level of overall volatility, over the long term. The Fund 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). 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, for example travel and leisure or telecommunications. CM Fidelity MoneyBuilder Growth Fund* To achieve a combination of income and long-term capital growth from a portfolio primarily made up of shares of UK companies. CM Invesco Perpetual UK Focus Fund** To achieve long-term capital growth through a portfolio of primarily UK securities. SP SC CM Newton UK Equity Fund*** To achieve capital growth and provide income from a portfolio of predominantly UK equities. SC CM Schroder UK Mid 250 Fund To achieve long-term capital growth by investing in the medium-sized companies listed on the FTSE Mid 250 Index. CM UBS UK Opportunities Fund**** To achieve long-term growth through active management of a diversified portfolio invested primarily in UK equities. SC * formerly known as the CM Fidelity Growth and Income Fund. ** formerly known as the CM Invesco Perpetual UK Aggressive Fund. *** formerly known as the CM Newton Income Fund. **** formerly known as the CM UBS UK Growth Fund. 19

22 UK Direct Property sector UK Property Fund The fund aims to achieve long-term capital growth by investing mainly in UK commercial properties. PY UK Equity Income sector UK Equity Income Fund CM Invesco Perpetual High Income Fund To provide above average income, along with potential long term capital growth by investing predominantly in a portfolio of companies which are part of the FTSE All Share Index (the Index ). The Fund seeks to deliver performance, before deduction of management fees, in excess of the Index with a similar level of overall volatility, over the long term. Companies will be selected which have the potential 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 invest in a large number of companies in common with the Index, the amount held in any one company 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 hold more in sectors which are expected to provide a higher than average dividend yield. The dividend yield is calculated by dividing the annual dividend paid in respect of a share 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, for example travel and leisure or telecommunications. To achieve a high level of income, together with capital growth by primarily investing in companies listed in the UK. FI HY CM Newton UK Income Fund* To achieve increasing distribution on a calendar year basis with long-term capital growth. SP CM Schroder Income Fund To provide a growing income by investing primarily in UK equities. SP * formerly known as the CM Newton Higher Income Fund. UK Gilts sector UK Gilt Fund The fund aims to maximise total returns by investing primarily in interest bearing securities issued by the UK government with flexibility to gain exposure to a minority holding in other fixed interest stocks. FI FIG CM Schroder Gilt & Fixed Interest Fund The fund aims to achieve a high level of income with the potential for capital growth, from investment in a diversified portfolio of sterling denominated fixed interest securities. FI FIG 20

23 UK Index-Linked Gilts sector UK Index-Linked Gilt Fund The fund aims to maximise total returns by investing primarily in index-linked interest bearing securities issued by the UK government with flexibility to gain exposure to a minority holding in other fixed interest stocks. FI FIG UK Smaller Companies sector Smaller Companies Fund The fund aims to achieve long-term capital growth through investing mainly in smaller companies, principally in the UK. SC CM Schroder UK Smaller Companies Fund To achieve a long-term capital growth through a portfolio of UK smaller companies. SC CM UK Smaller Companies Fund* To achieve long-term capital growth through the active management of a diversified portfolio invested primarily in the equities of UK smaller companies. SC * This fund was formerly known as the CM UBS UK Smaller Companies Fund. UBS closed their UBS UK Smaller Companies fund on 29th August As a result this CM fund is now invested wholly in an alternative underlying fund, the Scottish Widows UK Smaller Companies Fund. The aims, specific risks and charges of the CM UK Smaller Companies Fund were unaffected by this change. 21