On behalf of Amanah Mutual Berhad ( the Manager ), we wish to inform that this Master Prospectus is in respect of the following thirteen (13) Funds:

Transcription

1

2 Preface The Unit Holders of AMB Family of Funds Dear Sir/Madam, On behalf of Amanah Mutual Berhad ( the Manager ), we wish to inform that this Master Prospectus is in respect of the following thirteen (13) Funds: (i) AMB Unit Trust Fund (ii) AMB Balanced Trust Fund (iii) AMB Income Trust Fund (iv) AMB Index-Linked Trust Fund (v) AMB Ethical Trust Fund (vi) AMB Value Trust Fund (vii) AMB Enhanced Bond Trust Fund (viii) AMB SmallCap Trust Fund (ix) AMB Lifestyle Trust Fund Today (x) AMB Lifestyle Trust Fund 2009 (xi) AMB Lifestyle Trust Fund 2014 (xii) AMB Dividend Trust Fund (xiii) PNB Structured Investment Fund Unit Holders of the Funds may refer to Chapter 1 : Summary of Key Features of the Funds for a better understanding of the respective Fund s investment objectives, key strategies, asset allocation and profile of investors. You should also be aware of the inherent risks of investing in the AMB Family of Funds which as detailed out in Chapter 2 of the Prospectus. There are fees and charges that will be directly and indirectly incurred by investors when Units of the respective Fund is purchased or redeemed. Further details of these fees and charges are disclosed in Chapter 7 of the Prospectus. All Units of the Fund can be purchased or redeemed at any Maybank Distribution Branches, being AMB s sales distribution channel. A list of Maybank Distribution Branches is found in Chapter 22 of this Prospectus. However, for PNB Structured Investment Fund, you could also purchase or redeem at our office located at 34 th floor, Menara PNB, Jalan Tun Razak, Kuala Lumpur. We recommend potential investors to read and understand the contents of this Prospectus in its entirety before making any investment decision. As always, thanking you for allowing us to be of service to you. Yours faithfully, Amanah Mutual Berhad Aldilla@Zilfalila binti Abdul Halim Chief Executive Officer (i)

3 Responsibility Statement This Prospectus has been reviewed and approved by the Directors of Amanah Mutual Berhad, and they collectively and individually accept full responsibility for the accuracy of the information. Having made all reasonable enquiries, 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 herein false or misleading. Statement of Disclaimer The Securities Commission has approved the issue of, offer for subscription or purchase, or issue an invitation to subscribe for or purchase units of the Fund and a copy of this Prospectus has been registered with the Securities Commission. The approval, and registration of this Prospectus, should not be taken to indicate that the Securities Commission recommends the Fund or assumes responsibility for the correctness of any statement made or opinion or report expressed in this Prospectus. The Securities Commission is not liable for any non-disclosure on the part of the management company responsible for the Fund and takes no responsibility for the contents of this Prospectus. The Securities Commission makes no representation on the accuracy or completeness of this Prospectus, and expressly disclaims any liability whatsoever arising from, or in reliance upon, the whole or any part of the contents of this Prospectus. INVESTORS SHOULD RELY ON THEIR OWN EVALUATION TO ASSESS THE MERITS AND RISKS OF THE INVESTMENT. IN CONSIDERING THE INVESTMENT, INVESTORS WHO ARE IN DOUBT ON THE ACTION TO BE TAKEN SHOULD CONSULT THEIR PROFESSIONAL ADVISORS IMMEDIATELY. Additional Statement No Units will be issued or sold based on this Prospectus later than one (1) year after the date of this Prospectus. Investors are advised to note that recourse for false or misleading statements or acts made in connection with the Prospectus is directly available through Sections 248, 249 and 357 of the Capital Markets and Services Act (ii)

4 Contents Glossary of Terms/Abbreviation... 4 Corporate Information Summary of Key Features of the Funds General Information Fund Information Fees and Charges Information on Transactions Special Benefit Other Information Risk Factor Risks of Investing in Unit Trust Control Of Risk Detailed Information on the Funds AMB Unit Trust Fund.. 30 AMB Balanced Trust Fund 33 AMB Income Trust Fund 36 AMB Index-Linked Trust Fund.. 39 AMB SmallCap Trust Fund 42 AMB Enhanced Bond Trust Fund. 45 AMB Ethical Trust Fund. 49 AMB Value Trust Fund AMB Lifestyle Trust Fund Today.. 58 AMB Lifestyle Trust Fund AMB Lifestyle Trust Fund AMB Dividend Trust Fund. 71 PNB Structured Investment Fund Permitted Investment Investment in Warrants and Options Investment Restrictions Exception and Exclusion Applicable to the Funds Investment Process of the Funds Investment Philosophy of the Funds Investment Process of the Funds Bases of Valuation of Investments Policy on Gearing and Liquid Assets Performance of the Fund 96 AMB Unit Trust Fund. 96 AMB Balanced Trust Fund 97 AMB Income Trust Fund 98 AMB Index-Linked Trust Fund.. 99 AMB SmallCap Trust Fund 100 AMB Enhanced Bond Trust Fund. 101 AMB Ethical Trust Fund. 102 AMB Value Trust Fund AMB Lifestyle Trust Fund Today AMB Lifestyle Trust Fund AMB Lifestyle Trust Fund AMB Dividend Trust Fund. 107 AMB Client Services :

5 6 Historical Financial Highlights of the Fund AMB Unit Trust Fund AMB Balanced Trust Fund AMB Income Trust Fund AMB Index-Linked Trust Fund AMB SmallCap Trust Fund AMB Enhanced Bond Trust Fund AMB Ethical Trust Fund AMB Value Trust Fund AMB Lifestyle Trust Fund Today AMB Lifestyle Trust Fund AMB Lifestyle Trust Fund AMB Dividend Trust Fund Total Annual Expenses incurred by the Funds in the last Financial Year Understanding Fees and Expenses Sales Charge Redemption Fee Management Fee Trustee Fee Custodian Fee Fund s Expenses Transfer of Units Switching Management Expense Ratio (MER) Portfolio Turnover Ratio (PTR) Policy on Brokerage Rebates and Soft Commissions Purchasing and Redeeming of Units Single Pricing Policy Valuation of Units Error in Pricing Purchasing and Redeeming of Units Determination of Prices and Charges Minimum Balance of Investment Cooling-Off Right How to Purchase and Redeem Units of the Fund Where to Purchase and Redeem Invest your EPF Savings Transfer of Units The Flexibility to Switch your Investment Understanding Income Distributions and Reinvestment Plan Distribution Policy What Comprises Income Distribution? How is Income Distributions Calculated? What options do I have in receiving an income distribution? Distribution Reinvestment Plan for the Funds Policy on Unclaimed Monies Communications with Unit Holders Customer Information Service Regular Reports on your Investment Register of Unit Holders Policies Adopted by AMB to Avoid Money Laundering Activities Material Contracts Rights and Liabilities of a Unit Holder Rights of a Unit Holder Liabilities of a Unit Holder AMB Client Services :

6 12 The Management and Administration of the Funds Corporate Profile of the Manager Past Performance of the Manager Profile of the Board of Directors of the Manager Company Secretary Senior Compliance Officer Profile of the Key Management Staff of the Manager The Investment Committee of the Funds managed by the Manager Roles & Responsibilities of the Investment Committee The Ethical Panel of Advisors Roles & Responsibilities of the Ethical Panel of Advisors Profile of Ethical Panel Advisors Profile of the External Investment Managers Permodalan Nasional Berhad (PNB) Mayban Investment Management Sdn Bhd (MIM) UOB-OSK Asset Management Sdn Bhd (UOB-OSKAM) HwangDBS Investment Management Berhad (HwangDBS IM) Duties of The External Investment Managers Designated Investment Managers of the Funds Management Company s Delegates Conflict of Interest Material Litigation and Arbitration The Trustees of the Funds Profile of Universal Trustee (Malaysia) Berhad (UTMB) Trustee s Responsibilty Statement Trustee s Disclosure of Material Litigation & Arbitration Profile of HSBC (Malaysia) Trustee Berhad (HSBC) Trustee s Responsibilty Statement Trustee s Disclosure of Material Litigation & Arbitration Trustee s Delegate Profile of Malaysian Trustees Berhad (MTB) Trustee s Responsibilty Statement Trustee s Disclosure of Material Litigation & Arbitration Trustee s Delegate Profile of AmanahRaya Trustees Berhad (ART) Trustee s Responsibilty Statement Trustee s Disclosure of Material Litigation & Arbitration Duties and Obligations of Trustees Retirement, Removal or Replacement of the Trustee Power of the Trustee to Remove or Replace the Manager Salient Terms of Deed Variations Granted by the SC Related Party Transactions/Conflict of Interest Tax Advisors Letter Consents Documents Available for Inspection Directors Declaration List of Offices Maybank Distribution Branch AMB Client Services :

7 Glossary of Terms / Abbreviation The following words or abbreviations shall have the following meanings in the current Prospectus unless otherwise stated: Act AMB or Manager AMB Family of Funds ASNB AMBUTF AMBBTF AMBITF AMBILTF AMBSCTF AMBEBTF AMBETF AMBVTF AMBLTF Today AMBLTF 2009 AMBLTF 2014 AMBDTF PNB SIF Bursa Malaysia Business Day(s) BAFIA Capital Raised Cooling-off Period Cooling-off Right DBMB Deeds Distribution Branch The Capital Markets and Services Act, 2007 including all amendments thereto and all regulations rules and guidelines issued in connection therewith. Amanah Mutual Berhad (AMB) ( U). All Funds under the management of the Manager. Amanah Saham Nasional Berhad (47457-V), the holding company of the Manager. AMB Unit Trust Fund AMB Balance Trust Fund AMB Income Trust Fund AMB Index-Linked Trust Fund AMB Smallcap Trust Fund AMB Enhanced Bond Trust Fund AMB Ethical Trust Fund AMB Value Trust Fund AMB Lifestyle Trust Fund Today AMB Lifestyle Trust Fund 2009 AMB Lifestyle Trust Fund 2014 AMB Dividend Trust Fund PNB Structured Investment Fund Bursa Malaysia Securities Berhad ( W). A day on which the Bursa Malaysia Securities Berhad is open for trading in Securities. Banking and Financial Institution Act 1989, including all amendments thereto and all regulations, rules and guidelines issued in connection therewith. The total amount of money available for the purchase of investments for the Fund on the Commencement Date and is the total sum of all the Units sold during the Initial Offer Period. The cooling-off period of the Funds is 6 Business Days commencing from the date of purchase i.e. the date on which the Manager receives the application form and the investment amount. The right of a qualified Unit Holder to change his mind and cancel an investment in the Funds within the Cooling-off Period commencing from the date of purchase. Deutsche Bank (Malaysia) Berhad ( W). The Deeds including any supplementary Deeds between the Manager, the Trustees and the Unit Holders for AMBUTF, AMBBTF, AMBITF, AMBILTF, AMBETF, AMBVTF, AMBEBTF, AMBSCTF, AMBLTF Today, AMBLTF 2009, AMBLTF 2014, AMBDTF and PNB SIF. Any branch, outlet or any other premises of the IUTA used as distribution channel for the purpose of marketing and distribution of Units. AMB Client Services :

8 Ethical Panel of Advisors EPF External Investment Manager FMUTM Forward Pricing FBM Emas Index FBM Emas Shariah Index Fund Funds Guidelines HSBC Investment Committee Investment Management Agreement IPOs IUTA or Distributor KLCI KLIBOR LPD MARC The Panel of Advisors appointed by the Manager to AMBETF. Employees Provident Fund. Mayban Investment Management Sdn. Bhd. (MIM) for AMBUTF, AMBBTF, AMBITF, AMBILTF, AMBSCTF and AMEBTF, UOB-OSK Asset Management Sdn. Bhd. (UOB-OSKAM) for AMBETF, AMBVTF, AMBLTF Today, AMBLTF 2009 and AMBLTF 2014, HwangDBS Investment Management Berhad (HwangDBS IM) for AMBDTF and Permodalan Nasional Berhad (PNB) for PNB SIF. The Federation of Malaysian Unit Trust Manager. The NAV per Unit of the Fund used for the purpose of calculating a price is the NAV per Unit as at the next valuation point after an application or a request is received. FTSE Bursa Malaysia Emas Index. FTSE Bursa Malaysia Emas Shariah Index Any of the Funds under the management of the Manager. AMBUTF, AMBBTF, AMBITF, AMBILTF, AMBETF, AMBVTF, AMBEBTF, AMBSCTF, AMBLTF Today, AMBLTF 2009, AMBLTF 2014, AMBDTF, PNB SIF. The Guidelines on Unit Trust Funds and any other relevant guidelines on Unit Trust Funds issued by the Securities Commission as amended, modified or varied by any notes, circular and guidelines issued from time to time by the SC. HSBC (Malaysia) Trustee Berhad (HSBC) ( T) as trustee for AMBILTF, AMBETF, AMBVTF,AMBLTF Today, AMBLTF 2009, AMBLTF 2014 and AMBDTF. The Investment Committee of the Manager primarily responsible for formulating, implementing and monitoring the investment management strategies of the Funds in accordance with the respective investment objectives of the Funds. The agreement setting out the terms and conditions upon which the respective External Investment Manager has been appointed and has agreed to act as the External Investment Manager of the respective Fund. Initial Public Offerings, which are offers by a company to the public to buy its shares before listing on Bursa Malaysia. Maybank and any other Institutional Unit Trust Agent, which is an institution, a corporation or an organisation that is registered with FMUTM in accordance with their guidelines to distribute the Units. Kuala Lumpur Composite Index. Kuala Lumpur Inter-Bank Offered Rates. August 18, 2008, being the latest practicable date for the purposes of ascertaining the information contained in this Prospectus. Malaysia Rating Corporation Berhad ( V). AMB Client Services :

9 Management Expense Ratio or MER Expenses The ratio of the sum of the fees and the recovered expenses of the Fund to the average value of the Fund calculated on a daily basis, i.e.: Fees of the Fund recovered expenses of the Fund x 100 Average value of the Fund calculated on a daily basis Where: Fees = All ongoing fees deducted/deductible directly from the Fund in respect of the period covered by the management expense ratio expressed, as a fixed amount calculated on a daily basis. This would include the annual management fee, the annual trustee fee and any other fees deducted/deductible direct from the Fund; Recovered = All expenses recovered from /charged to the Fund as a result of the expenses incurred by the operation of the Fund, expressed as a fixed amount. This should not include expenses that would otherwise be incurred by an individual investor (e.g. brokerage, taxes and levies);and Average Value of The Fund = The NAV of the Fund, including net value income less expenses on an accrued basis, in respect of the period covered by the management expense ratio, calculated on a daily basis. Maturity Date Maybank MESDAQ Net Asset Value / NAV of the Fund Net Asset Value / NAV per Unit Non-Trustee Stock Portfolio Turnover Ratio or PTR The respective Maturity Date of the Funds (where applicable) was stated in the Deeds and as set out in Section 1.2 of this Prospectus. Malayan Banking Berhad (3813-K). Malaysian Exchange for Securities Dealings and Automated Quotation. The NAV of the Fund 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. The NAV of the Fund divided by the number of Units in Circulation, at the valuation point. Securities of the kind not permissible, as referred to in Section 5 of the Trustee Act 1949 (Act 208). The ratio of the average sum of the acquisitions and disposals of the Fund for the year to the average value of the Fund for the year calculated on a daily basis, i.e.: [Total acquisitions of the Fund Total disposals of the Fund Average value of the Fund for the for the for the year year] / 2 year calculated on a daily basis PNB PHNB Permodalan Nasional Berhad (38218-X), the ultimate holding company of the Manager. Pelaburan Hartanah Nasional Berhad ( W), being the manager of PNB REIT. AMB Client Services :

10 PNB REIT Properties Purchasing of Units Redeeming of Units REIT REITs Guidelines RAM RM SC Structured Products Trustees Trustee" Unit Holder(s) Units Units in Circulation PNB Real Estate Investment Trust, a private and unlisted REIT. The properties that PNB REIT has acquired, namely, Menara PNB, PNB Darby Park, PNB Damansara, Menara Tun Ismail Mohamed Ali, Wisma KPMG, Menara Pelangi/Plaza Pelangi and Pelangi Leisure Mall. The buying of Units by Unit Holders in a Fund is calculated at NAV per Unit. The redeeming of Units by Unit Holders in a Fund is calculated at NAV per Unit. Real Estate Investment Trust. The Guidelines on Real Estate Investment Trusts issued by the SC as may be amended from time to time. Rating Agency of Malaysia Holdings Berhad ( U). Ringgit Malaysia. Securities Commission. Structured products which have been issued in accordance with such relevant regulatory requirements as may be imposed by the Securities Commission and Bank Negara Malaysia. Universal Trustee (Malaysia) Berhad (UTMB) (17540-D) as trustee for AMBUTF, AMBBTF and AMBITF; HSBC (Malaysia) Trustee Berhad (HSBC) ( T) as trustee for AMBILTF, AMBETF, AMBVTF, AMBLTF Today, AMBLTF 2009, AMBLTF 2014 and AMBDTF; Malaysian Trustees Berhad (MTB) (21666-V) as trustee for AMBSCTF and AMBEBTF; and AmanahRaya Trustees Berhad ( T) as trustee for PNB SIF. Any of the Trustees. A person or persons registered as holder(s) of a Unit or Units of the Funds and whose name appears in the Register of Unit Holders. Units of any Fund. A Unit of the Fund created and fully paid. Definitions or meanings of words not otherwise expressed above shall follow the meaning or interpretation as ascribed in the Guidelines on Unit Trust Funds issued by the SC and any other relevant laws governing unit trust funds. AMB Client Services :

11 Corporate Information MANAGER Amanah Mutual Berhad ( U) Registered Office 4th Floor, Balai PNB 201-A, Jalan Tun Razak Kuala Lumpur Telephone : Facsimile : Principal Office 34th Floor, Menara PNB 201-A, Jalan Tun Razak Kuala Lumpur Telephone : Facsimile : / AMB Client Services : ambcare@pnb.com.my Website : http// BOARD OF DIRECTORS Tun Dato Seri Ahmad Sarji bin Abdul Hamid Chairman (Non-Executive/Non-Independent Director) Tan Sri Dato Hamad Kama Piah bin Che Othman (Non-Executive/Non-Independent Director) Tan Sri Dato' Dr. Wan Mohd. Zahid bin Mohd. Noordin (Non-Executive/Independent Director) Tan Sri Dato' Md. Desa bin Pachi (Non-Executive/Independent Director) Encik Idris bin Kechot (Non-Executive/Non-Independent Director) ETHICAL PANEL OF ADVISORS Dato' Kamilia binti Ibrahim Chairman Encik Sreesanthan Eliathamby Encik Spencer Lee Tien Chye AUDIT COMMITTEE OF PNB Tan Sri Dato' Dr. Wan Mohd. Zahid bin Mohd. Noordin (Independent member) Tan Sri Dato' Md Desa bin Pachi (Independent member) Datuk Burhanuddin Bin Ahmad Tajuddin (Independent member) COMPLIANCE COMMITTEE OF PNB Tan Sri Dato' Hamad Kama Piah bin Che Othman (Non-Independent member) Tan Sri Dato' Dr. Wan Mohd. Zahid bin Mohd. Noordin (Independent member) Datuk Burhanuddin Bin Ahmad Tajuddin (Independent member) Encik Paisol bin Ahmad (Independent member) INVESTMENT COMMITTEE MEMBERS Tun Dato Seri Ahmad Sarji bin Abdul Hamid Chairman (Non-Executive/Non-Independent member) Tan Sri Dato' Hamad Kama Piah bin Che Othman (Non-Independent member) COMPANY SECRETARY Puan Adibah Khairiah binti Daud (MIA 13755) 4th Floor, Balai PNB 201-A, Jalan Tun Razak Kuala Lumpur Tan Sri Dato' Dr. Wan Mohd. Zahid bin Mohd. Noordin (Independent member) Tan Sri Dato' Md. Desa bin Pachi (Independent member) AMB Client Services :

12 EXTERNAL INVESTMENT MANAGERS Permodalan Nasional Berhad (38218-X) 4th Floor, Balai PNB 201-A, Jalan Tun Razak Kuala Lumpur Telephone : Website : Mayban Investment Management Sdn Bhd ( M) Level 13, MaybanLife Tower Dataran Maybank No.1, Jalan Maarof Kuala Lumpur Telephone : Facsimile : UOB-OSK Asset Management Sdn Bhd ( X) Level 13, Menara UOB Jalan Raja Laut Kuala Lumpur Telephone: Facsimile : HwangDBS Investment Management Berhad ( T) Suite 12-03, 12th Floor, Menara Keck Seng, 203, Jalan Bukit Bintang, Kuala Lumpur Telephone : Facsimile : / Toll free line : hdbsim@hdbs.com.my Website : TRUSTEES Registered and Business Office: Universal Trustee (Malaysia) Berhad (17540-D) No. 1, 3rd Floor Jalan Ampang Kuala Lumpur Telephone: Facsimile : / Address: info@utmb.com.my Website : Registered and Business Office: Malaysian Trustees Berhad (21666-V) Level 2, Menara Prudential No.10, Jalan Sultan Ismail Kuala Lumpur Telephone: Facsimile : Address: mtb@mytrustees.com.my Malaysian Trustees Berhad s Delegate Mayban Custody & Services 3rd Floor Menara Maybank 100 Jalan Tun Perak Kuala Lumpur Telephone: Facsimile : Registered and Business Office: HSBC (Malaysia) Trustee Berhad ( T) Suite 901, 9th Floor, Wisma Hamzah-Kwong Hing, No 1, Leboh Ampang, Kuala Lumpur. Telephone: (General Line) Facsimile : HSBC (Malaysia) Trustee Berhad s Delegate The Hongkong And Shanghai Banking Corporation Limited (As Custodian) and assets held through: HSBC Nominees (Tempatan) Sdn Bhd ( D) No 2 Leboh Ampang Kuala Lumpur Telephone : (603) Facsimile : (603) HSBC Institutional Trust Services (Asia) Limited 6th Floor, Tower One HSBC Centre No 1 Sham Mong Road Kowloon, Hong Kong Telephone : (852) Facsimile : (852) Registered and Business Office: AmanahRaya Trustees Berhad ( T) Tingkat 4, Wisma TAS No. 21, Jalan Melaka 50100, Kuala Lumpur Telephone : (603) Facsimile : (603) Website : AUDITOR Messrs. Ernst & Young Chartered Accountants Level 23A Menara Milenium Jalan Damanlela Pusat Bandar Damansara Kuala Lumpur AMB Client Services :

13 TAX ADVISORS PricewaterhouseCoopers Taxation Services Sdn Bhd (AMBUTF, AMBITF and AMBBTF) 11th Floor Wisma Sime Darby Jalan Raja Laut Kuala Lumpur Ernst & Young Tax Consultants Sdn Bhd (AMBILTF, AMBETF, AMBVTF, AMBEBTF, AMBSCTF, AMBLTF TODAY, AMBLTF 2009, AMBLTF 2014, AMBDTF, PNB SIF) Level 23A Menara Milenium Jalan Damanlela Pusat Bandar Damansara Kuala Lumpur PRINCIPAL BANKER Malayan Banking Berhad (3813-K) Kuala Lumpur Main Office 100 Jalan Tun Perak Kuala Lumpur SOLICITORS Messrs. Othman Hashim & Co Suite Menara MAA No. 12, Jalan Dewan Bahasa Kuala Lumpur Messrs. Zainal Abidin & Co. Suite , 18th Floor Plaza Permata, Jalan Kampar Off Jalan Tun Razak Kuala Lumpur. FEDERATION OF MALAYSIAN UNIT TRUST MANAGERS , 7th Floor, PNB Damansara, 19, Lorong Dungun, Damansara Heights, Kuala Lumpur. Telephone: Facsimile : Address: info@fmutm.com.my AMB Client Services :

14 1 Summary of Key Features of the Funds This section is only a summary of the salient information about the Fund. Investors should read understand the whole Prospectus before making investment decisions. 1.1 General Information FUND AMBUTF TRUSTEE Universal Trustee (Malaysia) Berhad (17540-D) EXTERNAL INVESTMENT MANAGER Mayban Investment Management Sdn Bhd ( M) LAUNCH DATE FINANCIAL YEAR END UNITS IN CIRCULATION AS AT LPD March 26, 1992 June ,826,837 AMBBTF Universal Trustee (Malaysia) Berhad (17540-D) Mayban Investment Management Sdn Bhd ( M) September 19, 1994 September ,724,885 AMBITF Universal Trustee (Malaysia) Berhad (17540-D) Mayban Investment Management Sdn Bhd ( M) June 19, 1996 June ,225,187 AMBILTF HSBC (Malaysia) Trustee Berhad ( T) Mayban Investment Management Sdn Bhd ( M) May 16, 2002 October 31 22,779,000 AMBSCTF Malaysian Trustees Berhad (21666-V) Mayban Investment Management Sdn Bhd ( M) March 3, 2004 July ,051,500 AMBEBTF Malaysian Trustees Berhad (21666-V) Mayban Investment Management Sdn Bhd ( M) May 27, 2003 March 31 76,817,300 AMBETF HSBC (Malaysia) Trustee Berhad ( T) UOB-OSK Asset Management Sdn Bhd ( X) January 7, 2003 August 31 19,508,600 AMBVTF HSBC (Malaysia) Trustee Berhad ( T) UOB-OSK Asset Management Sdn Bhd ( X) January 7, 2003 August 31 18,173,700 AMBLTF Today HSBC (Malaysia) Trustee Berhad ( T) UOB-OSK Asset Management Sdn Bhd ( X) November 25, 2004 September 30 24,595,000 AMBLTF 2009 HSBC (Malaysia) Trustee Berhad ( T) UOB-OSK Asset Management Sdn Bhd ( X) November 25, 2004 September 30 14,395,000 AMBLTF 2014 HSBC (Malaysia) Trustee Berhad ( T) UOB-OSK Asset Management Sdn Bhd ( X) November 25, 2004 September 30 4,300,000 AMBDTF HSBC (Malaysia) Trustee Berhad ( T) HwangDBS Investment Management Berhad ( T) June 6, 2006 April 30 57,980,000 PNB SIF AmanahRaya Trustees Berhad ( T) Permodalan Nasional Berhad (38218-X) May 12, 2008 July 31 2,447,850,000 AMB Client Services :

15 1.2 Fund Information FEATURES AMBUTF AMBBTF Category of Fund Equity Fund Balanced Fund Type of Fund Growth Fund Growth and Income Fund Objective of the Fund Investment Strategy Asset Allocations To achieve a steady long-term income (over 5 years) and capital growth through a diversified portfolio of equity investments in larger capitalized stocks (prime focus on main board and liquid stocks). (Refer to page 30 for details of investment objective of the Fund). The Fund invests primarily in blue chip and high growth stocks that can increase the potential for better long-term returns. (Refer to page 31 for details of investment strategy of the Fund). Min 40% Max 90% in equities Min 10% in liquid asset (Refer to page 32 for details of asset allocation of the Fund) To provide a balance between income and long-term (over 5 years) capital appreciation. (Refer to page 33 for details of investment objective of the Fund). The Fund invests in a wide variety of assets, balancing its investment across potentially high yielding share investments aiming to increase long term returns. (Refer to page 35 for details of investment strategy of the Fund) Min 20% Max 60% in equities Min 20% Max 60% in fixed income securities Min 10% in liquid assets (Refer to page 35 for details of asset allocation of the Fund) Benchmark KLCI. 60% KLCI. 40% 12-month fixed deposit rate. Principal risks of investing in the Fund Investor Profile Distribution Policy The principal risks of investing in the Fund are as follows: Stock market risk Individual stock risk Liquidity risk (Refer to page 31 for details of potential risks associated with the Fund) The Fund is suitable for all investors whose primary interest is in investments for the long term and capital growth of their investment. It is for those who are seeking investment in larger blue chips and growth stocks. Income (if any) is expected to be distributed annually at the Manager s discretion. The principal risks of investing in the Fund are as follows: Stock or bond market risk Individual stock risk Credit/ default risk Interest rate risk Liquidity risk (Refer to page 34 for details of potential risk associated with the Fund) The Fund is suitable for all investors who are seeking a fully managed and balanced portfolio of investments and who have an investment horizon of 5 years or more. Income (if any) is expected to be distributed annually at the Manager s discretion. Approved Fund size 1.5 billion Units 1.15 billion Units AMB Client Services :

16 FEATURES AMBITF AMBILTF Category of Fund Bond Fund Equity Fund Type of Fund Income Fund Index Fund Objective of the Fund To maximise returns over the medium term (over two years) and at the same time offer stability of capital and regular income. (Refer to page 36 for details of investment objective of the Fund). To achieve an investment result that tracks the performance of the benchmark KLCI. (Refer to page 39 for details of investment objective of the Fund). Investment Strategy The Fund s investment strategy is to create a prudent mix in its portfolio to comply with its investment objective and to provide professional assessment of investment prospects by its External Investment Manager in line with the economic outlook. (Refer to page 37 for details of investment strategy of the Fund) The Fund s policy is to remain fully invested at all times to minimize the tracking error. (Refer to page 40 for details of investment strategy of the Fund) Asset Allocations Min 40% Max 90% in fixed income securities Up to 60% in cash and money market (Refer to page 38 for details of asset allocation of the Fund) Benchmark 12-month fixed deposit rate. KLCI. 90.0% to 99.5% in equities 0.5% to 10.0% in liquid assets The percentage is based on portfolio valuation. (Refer to page 41 for details of asset allocation of the Fund) Principal risks of investing in the Fund Investor Profile Distribution Policy The principal risks of investing in the Fund are as follows: Bond market risk Credit / default risk Interest rate risk Liquidity risk (Refer to page 36 for details of potential risks associated with the Fund) The Fund is suitable for investors seeking a medium to long-term investment with regular interest income and some potential for moderate capital growth. Income (if any) is expected to be distributed annually at the Manager s discretion. The principal risks of investing in the Fund are as follows: Stock market risk Individual stock risk Liquidity risk (Refer to page 39 for details of potential risks associated with the Fund) The Fund is suitable for investors who: - Desire returns that are consistent with the performance of the KLCI. Have a medium to high-risk tolerance It is not the main objective of the Fund to distribute income as the main focus of the Fund is to secure capital growth in line with the performance of the KLCI. Any distribution declared (if any) is at the Manager s discretion. Approved Fund Size 600 million Units 400 million Units AMB Client Services :

17 FEATURES AMBSCTF AMBEBTF Category of Fund Equity Fund Bond Fund Type of Fund Growth Fund Income and Growth Fund Objective of the Fund Investment Strategy To achieve medium to long-term capital growth by primarily investing into securities of small and medium sized companies, listed on the Bursa Malaysia s Main Board, Second Board, MESDAQ and/or any other board as approved by the SC with market capitalisation of not more than RM750 million which have the potential for capital appreciation over the medium to long term (2 to 5 years). (Refer to page 42 for details of investment objective of the Fund) The Fund invests primarily in selected small and medium sized companies listed on the Main Board and Second Board of the Bursa Malaysia (including Bursa Malaysia MESDAQ) with market capitalization of not more than RM750 million which have the potential for capital appreciation over the medium to long term. Criteria for selection include companies that operate in the high growth sector, which are expected to register high earnings per share growth and have sound management. (Refer to page 44 for details of investment strategy of the Fund) To provide a stable income stream and an opportunity for capital appreciation over the medium to long-term horizon. (Refer to page 45 for details of investment objective of the Fund) The Fund seeks to achieve its objective through a policy of diversified investment in convertible debt securities, redeemable debt securities, government backed bonds/ securities, rated private debt securities, money market instruments and equities. (Refer to page 47 for details of investment strategy of the Fund) Asset Allocations Min 40% Max 95% in stocks and shares of small and medium cap companies. Min 5% Max 60% in liquid assets and shortterm money market investments. (Refer to page 44 for details of asset allocation of the Fund) Min 85% in fixed income securities and money market. Min 15% in IPOs. If no good quality IPOs, are available then the Fund will have all its assets in fixed income securities and money market. (Refer to page 47 for details of asset allocation of the Fund) Benchmark FBM Emas Index. 3-month fixed deposit rate. Principal risks ofinvesting in the Fund Investor Profile Distribution Policy The principal risks of investing in the Fund are Stock market risk, Individual stock risk and Liquidity risk. (Refer to page 43 for details of potential risks associated with the Fund) The Fund is suitable for investors who: Are seeking long term capital growth through investment in small to medium sized companies. Are willing to accept higher level of risk in order to obtain higher growth of their capital. Have a medium to long-term investment horizon. It is not the main objective of the Fund to distribute income as the main focus of the Fund is to secure capital growth in line with the performance of the KLCI. Any distribution declared (if any) is at the Manager s discretion. The principal risks of investing in the Fund are Stock/ bond market risk, Individual stock risk, IPO risk, Interest rate risk, Credit / default risk and Liquidity risk. (Refer to page 46 for details of potential risks associated with the Fund) The Fund is suitable for investors who: Prefer a conservative investment approach but are willing to exploit opportunities presented in the capital markets. Possess an investment horizon in excess of 5 years. Income (if any) is expected to be distributed annually at the Manager s discretion. Approved Fund Size 600 million Units 500 million Units AMB Client Services :

18 FEATURES AMBETF AMBVTF Category of Equity Fund Equity Fund Fund Type of Fund Income and Capital Growth Fund Capital Growth Fund Objective of the Fund Investment Strategy To provide investors with income and capital growth for medium to long term through investments that comply with ethical principles as defined in this Fund. (Refer to page 49 for details of investment objective of the Fund) The Fund seeks to maximize total returns by providing investors with capital appreciation, while reducing risk through diversified investments mainly in equities listed in the Bursa Malaysia that comply with ethical principles as defined in this Fund. (Refer to page 52 for details of investment strategy of the Fund) To provide investors with capital growth through investments into securities that are trading at a discount to their intrinsic values, while maximize the risk in the medium to long term. (Refer to page 54 for details of investment objective of the Fund) The Fund seeks to maximize total returns by providing investors with capital appreciation while reducing risk through diversified investments, mainly in equities listed in the Bursa Malaysia. (Refer to page 56 for details of investment strategy of the Fund) Asset Allocations Benchmark Principal risks of investing in the Fund Investor Profile Distribution Policy Min 50% in equities and/ or bonds Max 90% to 98% in equities and/ or bonds 2% to 10% in short term money market instruments. (Refer to page 53 for details of asset allocation of the Fund) FBM Emas Shariah Index and Finance Indices on an 80:20 basis ratio respectively. The principal risks of investing in the Fund are as follows: Stock market risk Individual stock risk Interest rate risk Credit/ default risk Liquidity risk (Refer to page 50 for details of potential risks associated with the Fund) The Fund is suitable for investors who: Desire income and capital returns from the equity markets. Would like to channel their resources to companies that demonstrate socially responsible practices relating to the environment and community. Income (if any) is expected to be distributed annually at the Manager s discretion Min 50% in equities and/ or bonds Max 90% to 98% in equities and/ or debt instruments. 2% to 10% in cash/money market instruments (Refer to page 57 for details of asset allocation of the Fund) KLCI. The principal risks of investing in the Fund are as follows: Stock market risk Individual stock risk Interest rate risk Credit / default risk Liquidity risk (Refer to page 55 for details of potential risks associated with the Fund) The Fund is suitable for investors who: Are willing to accept risks for returns presented by the stock market. Want to capitalize on the value investment approach when investing in equity markets. Have an investment horizon in excess of 5 years. It is not the main objective of the Fund to distribute income as the main focus of the Fund is to secure capital growth in line with the performance of the KLCI. Any distribution declared (if any) is at the Manager s discretion. Approved Fund Size 300 million Units 300 million Units AMB Client Services :

19 FEATURES AMBLTF Today AMBLTF 2009 AMBLTF 2014 Category of Fund Bond Fund Balanced Fund Balanced Fund Type of Fund Income Fund Growth Fund Growth Fund Objective of the Fund To seek regular income stream and moderate capital growth through investments into Fixed Income securities and dividend yielding equities. (Refer to page 58 for details of investment objective of the Fund) To provide capital growth for investors through a well-diversified balanced portfolio that is specially catered for a 5 year investment period. The Fund,over its investment period, shall progressively adopt more defensive investment strategies as the Fund approaches closer to maturity. (Refer to page 61 for details of investment objective of the Fund) To provide capital growth for investors through a welldiversified balanced portfolio that is specially catered for a 10 year investment period. The Fund, over its investment period, shall progressively adopt more defensive investment strategies as the Fund approaches closer to maturity. (Refer to page 66 for details of investment objective of the Fund) Investment strategy To achieve its investment objective of a regular income stream, the Fund will allocate at least 80% of its assets into the Malaysian Fixed Income markets with the balance in dividend yielding equities to enhance the returns for the portfolio. To reduce the volatility of our equity investments, we may diversify by investing in both the local and Asian markets. The equity portion can and will be reduced to zero point in times of market uncertainties. Futures may also be employed from time to time to hedge the portfolio. In formulating the investment strategy, the Managers will consider the following to determine the portion of investment to be in foreign markets (within permitted amounts): (a) Comparison of economic outlook of Asian economies against the Malaysian economy to determine the growth prospects and economic cycles. (b) Assess country, political and social risks. (c) Determine liquidity flows in all the Asian countries. (d) Identify risks or attractions specific to countries/region. (e) Assess currency risks. (Refer to page 60 for details of investment strategy of the Fund) To achieve its investment objectives, the Funds will invest in Malaysian equities and fixed income securities where appropriate. Foreign equities may be included to further diversify the Funds. In formulating the investment strategy, the Managers will consider the following to determine the portion of asset class to be in foreign investments (within permitted amounts):- (a) Comparison of economic outlook of Asian economies against the Malaysian economy to determine the growth prospects and economic cycles for each country. (b) Assess country, political and social risks. (c) Determine liquidity flows in all the Asian countries. (d) Identify risks or attractions specific to countries/region. (e) Assess currency risks. (Refer to page 63 for AMBLTF 2009 & page 68 for AMBLTF 2014 for details of investments strategy of the Funds) AMB Client Services :

20 FEATURES AMBLTF TODAY AMBLTF 2009 AMBLTF 2014 Asset Allocation 0% - 20% in equities 80% -100% in bonds and money market/cash. (Refer to page 60 for details of asset allocation of the Fund.) Benchmark (80% x 12-month fixed deposit rate) + (20% x % change in FBM Emas Index) Principal risks of investing in the Fund Investor Profile Distribution Policy Approved Fund Size Targeted Asset Allocation (TAA) TAA 1 29% - 34% in equities 66% - 71% in bonds and money market TAA 2 22% - 27% in equities 73% - 78% in bonds and money market (Refer to page 65 for details of asset allocation of the Fund.) TAA 1 (34% x % change in FBM Emas Index) + (66% x % fixed deposit return) TAA 2 (27% x % change in FBM Emas Index) + (73% x % fixed deposit return) TAA 1 41% - 46% in equities 54% - 59% in bonds and money market TAA 2 35% - 40% in equities 60% - 65% in bonds and money market TAA 3 29% - 34% in equities 66% - 71% in bonds and money market TAA 4 22% - 27% in equities 73% - 78% in bonds and money market (Refer to page 70 for details of asset allocation of the Fund.) TAA 1 (46% x % change in FBM Emas Index) + (54% x %fixed deposit return) TAA 2 (40% x % change in FBM Emas Index) + (60% x %fixed deposit return) TAA 3 (34% x % change in FBM Emas Index) + (66% x %fixed deposit return) TAA 4 (27% x % change in FBM Emas Index) + (73% x %fixed deposit return) The principal risks of investing are stock/bond market risk, credit/default risk, liquidity risk, individual stock risk, currency risk, country risk, interest rate risk. (Refer to page 59 for AMBLTF Today, page 62 for AMBLTF 2009 and page 67 for AMBLTF 2014 for more details of potential risks associated with the Funds. The Fund is suitable for investors who:- Seek a defensive investment solution that comprises fixed income instruments and a minor portion of equity. Seek returns from a professionally managed Fund that is well diversified across various asset classes. Income (if any) is expected to be distributed annually at the Manager s discretion. The Fund is suitable for investors who: - Seek an investment solution for a period of 5 years or more. Seek returns from professionally managed Fund that is well diversified across various asset classes. Desire to have a Fund that would automatically become more defensive over time. Income (if any) is expected to be distributed annually at the Manager s discretion. The Fund is suitable for investors who: - Seek an investment solution for a period of 10 years or more. Seek returns from a professionally managed Fund that is well diversified across various asset classes. Desire to have a Fund that would automatically become more defensive over time. Income (if any) is expected to be distributed annually at the Manager s discretion. 250 million Units 250 million Units 250 million Units Tenure N/A 5 years 10 years Maturity Date N/A December 22, 2009 December 22, 2014 AMB Client Services :

21 Features AMB Dividend Trust Fund Category of Fund Type of Fund Objective of the Fund Investment Strategy Equity Fund Income and Growth Fund To provide investors with a regular income stream and to attain medium-to-long-term capital appreciation through investing in high (and potentially high) dividend yielding equities (including foreign equities). (Refer to page 71 for details of investment objective of the Fund) The Fund will invest primarily in high dividend yielding stocks both in Malaysia and in Asian ex-japan markets (the latter being subject to a maximum of 30% of the Fund s size). The selection of appropriate equities will be driven by the External Investment Manager s internal screening process whereby emphasis will be placed on sustainability of dividends, price-to-earnings ratios, gearing levels, historical volatility as well as liquidity. Where in the opinion of the External Investment Manager a defensive strategy is appropriate, up to 30% of the Fund may be invested in Malaysian fixed income instruments. For fixed income securities, the Fund will mainly invest in fixed income securities carrying a minimum credit rating of AA3/P1 (RAM or equivalent) to provide investors with a regular stream of income, while minimizing principal volatility. The Fund s equities investment will range from a minimum of 70% to a maximum of 99.8%. Up to 30% of the Fund may be invested in Malaysian fixed income securities should a defensive strategy be appropriate. (Refer to page 73 for details of investment strategy of the Fund) Asset Allocations Benchmark Principal Risks of Investing in the Fund 70% % in equities 0.20% - 30% in fixed income securities and cash Up to 30% of the Fund size may be invested overseas and the External Investment Manager may choose to invest solely in the domestic market. (Refer to page 74 for details of asset allocation of the Fund) A weighted average of the KLCI performance and current Maybank 12-month fixed deposit rate on a 70:30 basis. Potential risks associated with securities and instruments invested by AMBDTF: Market risk Liquidity risk Inflation risk Stock risk Interest rate risk Credit/default risk Specific and peculiar risks when investing in the Fund: Individual stock risk Compliance risk Currency risk Country risk (Refer to page 72 for details of potential risks associated with the Fund) Investor Profile Distribution Policy The Fund is suitable for investors with the following profile:- Conservative and prefers receiving regular and steady income in the form of distributions. Moderate risk appetite. The first distribution, if any, shall be made on the relevant distribution date at the end of the second financial year. Subsequently, distribution, if any, shall be made semiannually or annually at the discretion of the Manager. Approved Fund Size 800 million Units AMB Client Services :

22 Features PNB Structured Investment Fund Category of Fund Type of Fund Objective of the Fund Investment Strategy Mixed Assets Income and Growth Fund The Fund seeks to provide investment opportunities that generate reasonable returns and growth over the tenure of the Fund while endeavouring to provide capital protection to Unit Holders. (Refer to page 75 for details of the investment objective of the Fund) To achieve this objective, the Fund will be investing in RM denominated Structured Products, PNB REIT, cash equivalent instruments and any other investments permitted by the Deed. The Structured Products are principal protected upon maturity. The Fund will also be investing in Units of PNB REIT which offer potential regular income and upside potential through exposure in properties. PNB REIT has principal protection features whereby its Properties have a buy-back option from the respective vendors to repurchase the Properties at the highest price offered by third party purchasers and subject to the REITs Guidelines. The Fund will also be investing in cash equivalent instruments to meet its liquidity requirements. (Refer to page 75 for details of the investment strategy of the Fund) Asset Allocations Up to 80% in Structured Products Up to 50% in PNB REIT Min 2% in cash and money market instruments for liquidity purposes (Refer to page 76 for details of the asset allocation of the Fund) Benchmark Principal Risks of Investing in the Fund Investor Profile Distribution Policy 12-month Maybank fixed deposit rate. Potential risks associated with securities and instruments invested by PNB SIF: Market risk Credit/counterparty risk Funding risk Liquidity risk Operational risk Currency risk Legal risk Prepayment/commitment risk Individual asset risk Early redemption risk Borrowing risk Credit/default risk (Refer to page 77 for details of potential risks associated with the Fund) The Fund is suitable for investors with the following profile:- Seek capital protection Wish to participate in the potential upside of global equities, interest rates Have low risk tolerance Have a medium-term investment horizon The Fund will distribute earnings from its income, if any, to Unit Holders at the discretion of the Manager, subject to approval from the Trustee. Approved Fund Size 3 billion Units Tenure 5 years Commencement Date July 7, 2008 Maturity Date of the Fund July 5, 2013 AMB Client Services :

23 1.3 Fees and Charges This table describes the fees and charges that you may directly incur when you purchase or redeem Units of the Funds. FUNDS Maximum Sales Charge Redemption Charge Switching Transfer EPF Service (% of NAV per Unit) (% of NAV per Unit) Fees Fees Charge AMBUTF 7% Nil There is an Investors AMBBTF 7% Nil administrative investing under AMBITF 2% Nil fee of RM25 the EPF AMBILTF 5% Nil per transaction. An Member s AMBETF 7% Nil administrative Investment AMBVTF 7% Nil Units switched fee of RM3 Scheme will be AMBEBTF 2% Nil are transacted will be levied a service from the Funds AMBSCTF 7% Nil charged for charge of up to NAV per Unit. AMBLTF Today 2% Nil each 3% of NAV per AMBLTF % Nil transaction. unit as regulated by EPF. AMBLTF % Nil AMBDTF 6% Nil PNB SIF 1.5% 2.5% - 1st year 2.0% - 2nd year 1.5% - 3rd year 1.0% - 4th year 0.5% - 5th year Nil On Maturity Date (Refer to section 7.8 on page 119 for more details). Nil (Refer to section 7.7 on page 119 for more details). Investing under the EPF Members Investment Scheme is not allowed for PNB SIF and AMBDTF. The Manager at its discretion may allow for lower sales charge to specific groups, as deemed fit by the Manager under specific circumstances on a case to case basis. This table describes the fees and charges that you may indirectly incur when you invest in the Funds. FUNDS AMBUTF ANNUAL MANAGEMENT FEE 1.00% to 1.50% per annum of NAV of the Fund (before deducting annual management fee and Trustee fee for the day) calculated on a daily basis. (Refer to section 7.3 on page 118 for more details) ANNUAL TRUSTEE FEE As per the rate mentioned in section 7.4 on page 118 on the NAV of the Fund (before deducting annual management fee and Trustee fee for the day), calculated on a daily basis. CUSTODIAN FEE 0.035% per annum of the value of the stock and shares portfolio subject to a minimum of RM40,000 per annum and a maximum of RM120,000 per annum. (Refer to section 7.5 on page 119 for more details) AMBBTF 0.75% to 1.50% per annum of NAV of the Fund (before deducting annual management fee and Trustee fee for the day) calculated on a daily basis. (Refer to section 7.3 on page 118 for more details) As per the rate mentioned in section 7.4 on page 118 the NAV of the Fund (before deducting annual management fee and Trustee fee for the day), calculated on a daily basis % per annum of the value of the stock and shares portfolio subject to a minimum of RM60,000 per annum and a maximum of RM150,000 per annum. (Refer to section 7.5 on page 119 for more details) AMBITF 1.00% to 1.50% per annum of NAV of the Fund (before deducting annual management fee and Trustee fee for the day) calculated on a daily basis. (Refer to section 7.3 page on 118 for more details) 0.035% per annum on the NAV of the Fund (before deducting annual management fee and Trustee fee for the day), calculated on a daily basis up to a maximum value of RM100 million and thereafter at a rate of 0.01% per annum. (Refer to section 7.4 on page 118 for more details) N/A There are fees and charges involved and investors are advised to consider the fees and charges before investing in the Funds AMB Client Services :

24 FUNDS AMBILTF AMBETF AMBVTF AMBEBTF AMBSCTF ANNUAL MANAGEMENT FEE 1.00% per annum of NAV of the Fund (before deducting annual management fee and Trustee fee for the day) calculated on a daily basis. (Refer to section 7.3 on page 118 for more details) 1.50% per annum of NAV of the Fund (before deducting annual management fee and Trustee fee for the day) calculated on a daily basis. (Refer to section 7.3 on page 118 for more details) 1.50% per annum of NAV of the Fund (before deducting annual management fee and Trustee fee for the day) calculated on a daily basis. (Refer to section 7.3 on page 118 for more details) The Fund shall generally comprise of bond instruments thereby its base annual management fee is the standard 1.0% per annum. Bond Portion 1.0% per annum of the NAV of the Fund, (before deducting annual management fee and Trustee fee for the day) calculated on a daily basis. (Refer to section 7.3 on page 118 for more details) Equity Portion *1.75% per annum of the NAV of the Fund, (before deducting annual management fee and Trustee fee for the day) calculated on a daily basis. *The portion of the portfolio that is channeled to IPOs is levied an additional charge of 0.75% on top of 1.0% to cover the in depth IPO research expenses. (Refer to section 7.3 on page 118 for more details) 1.50% per annum of NAV of the Fund (before deducting annual management fee and Trustee fee for the day) calculated on a daily basis. (Refer to section 7.3 on page 118 for more details) ANNUAL TRUSTEE FEE 0.08% per annum of the NAV of the Fund (before deducting annual management fee and Trustee fee for the day), subject to a minimum of RM18,000 per annum calculated on a daily basis. (Refer to section 7.4 on page 119 for more details) 0.08% per annum of the NAV of the Fund (before deducting annual management fee and Trustee fee for the day), subject to a minimum of RM18,000 per annum calculated on a daily basis. (Refer to section 7.4 on page 119 for more details) 0.08% per annum of the NAV of the Fund (before deducting annual management fee and Trustee fee for the day), subject to a minimum of RM18,000 per annum calculated on a daily basis. (Refer to section 7.4 on page 119 for more details) 0.07% per annum of the NAV of the Fund (before deducting annual management fee and Trustee fee for the day), subject to a minimum of RM18,000 per annum calculated on a daily basis. (Refer to section 7.4 on page 119 for more details) 0.07% per annum of the NAV of the Fund (before deducting annual management fee and Trustee fee for the day), subject to a minimum of RM18,000 per annum calculated on a daily basis. (Refer to section 7.4 on page 119 for more details) There are fees and charges involved and investors are advised to consider the fees and charges before investing in the Funds AMB Client Services :

25 FUNDS AMBLTF Today AMBLTF 2009 AMBLTF 2014 ANNUAL MANAGEMENT FEE 1.00 to 1.10% per annum of NAV of the Fund (before deducting annual management fee and Trustee fee for the day) calculated on a daily basis. Bond Portion 1.0% per annum of the NAV of the Fund, (before deducting annual management fee and Trustee fee for the day) calculated on a daily basis. Equity Portion 1.5% per annum of the NAV of the Fund, (before deducting annual management fee and Trustee fee for the day) calculated on a daily basis. (Refer to section 7.3 on page 118 for more details) 1.10% to 1.17% per annum of NAV of the Fund (before deducting annual management fee and Trustee fee for the day) calculated on a daily basis. Bond Portion 1.0% per annum of the NAV of the Fund, (before deducting annual management fee and Trustee fee for the day) calculated on a daily basis. Equity Portion 1.5% per annum of the NAV of the Fund, (before deducting annual management fee and Trustee fee for the day), calculated on a daily basis. (Refer to section 7.3 on page 118 for more details) 1.10% to 1.23% per annum of NAV of the Fund (before deducting annual management fee and Trustee fee for the day) calculated on a daily basis. Bond Portion 1.0% per annum of the NAV of the Fund, (before deducting annual management fee and Trustee fee for the day) calculated on a daily basis. Equity Portion 1.5% per annum of the NAV of the Fund, (before deducting annual management fee and Trustee fee for the day) calculated on a daily basis. (Refer to section 7.3 on page 118 for more details) ANNUAL TRUSTEE FEE If the Fund is invested locally only, the rate is 0.07% per annum (including local custodian fee) of the NAV of the Fund (before deducting annual management fee and Trustee fee for the day) calculated on a daily basis, subject to a minimum fee of RM18,000 per annum. OR If the Fund is invested locally and abroad, the rates are 0.07% per annum on the local NAV of the Fund (including local custodian fee) and 0.07% per annum on the foreign NAV of the Fund (excluding foreign custodian fee, before deducting annual management fee and Trustee fee for the day), calculated on a daily basis, subject to a minimum fee of RM18,000 per annum. (Refer to section 7.4 on page 119 for more details) If the Fund is invested locally only, the rate is 0.07% per annum (including local custodian fee) of the NAV of the Fund (before deducting annual management fee and Trustee fee for the day) calculated on a daily basis, subject to a minimum fee of RM18,000 per annum. OR If the Fund is invested locally and abroad, the rates are 0.07% per annum on the local NAV of the Fund (including local custodian fee) and 0.07% per annum on the foreign NAV of the Fund (excluding foreign custodian fee), (before deducting annual management fee and Trustee fee for the day), calculated on a daily basis, subject to a minimum fee of RM18,000 per annum. (Refer to section 7.4 on page 119 for more details) If the Fund is invested locally only, the rate is 0.07% per annum (including local custodian fee) on NAV of the Fund, (before deducting annual management fee and Trustee fee for the day), calculated on a daily basis, subject to a minimum fee of RM18,000 per annum. OR If the Fund is invested locally and abroad, the rates are 0.07% per annum on the local NAV of the Fund (including local custodian fee) and 0.07% per annum on the foreign NAV of the Fund (excluding foreign custodian fee), (before deducting annual management fee and Trustee fee for the day), calculated on a daily basis, subject to a minimum fee of RM18,000 per annum. (Refer to section 7.4 on page 119 for more details) There are fees and charges involved and investors are advised to consider the fees and charges before investing in the Funds AMB Client Services :

26 FUNDS AMBDTF PNB SIF ANNUAL MANAGEMENT FEE 1.50% per annum of NAV of the Fund (before deducting annual management fee and Trustee fee for the day) calculated on a daily basis. (Refer to section 7.3 on page 118 for more details) Up to 1.0% of the NAV of the Fund (before deducting management fees and trustee fees for the day) calculated and accrued on a daily basis. (Refer to section 7.3 on page 118 for more details) ANNUAL TRUSTEE FEE If the Fund is invested locally only, the rate is 0.07% per annum (including local custodian fee) on NAV of the Fund, (before deducting annual management fee and Trustee fee for the day), calculated on a daily basis, subject to a minimum fee of RM18,000 per annum. OR If the Fund is invested locally and abroad, the rates are 0.07% per annum on the local NAV of the Fund (including local custodian fee) and 0.07% per annum on the foreign NAV of the Fund (excluding foreign custodian fee), (before deducting annual management fee and Trustee fee for the day), calculated on a daily basis, subject to a minimum fee of RM18,000 per annum. (Refer to section 7.4 on page 119 for more details) Up to 0.08% of the NAV of the Fund (before deducting management fees and trustee fees for the day) subject to a minimum of RM18,000 per annum, calculated and accrued on a daily basis. (Refer to section 7.4 on page 119 for more details) This table describes other expenses that you may indirectly incur when you invest in the Funds. Expenses Other Annual Operating Expenses the auditor s fees, tax agents fee and other relevant professional fees; the costs of printing & distribution of annual and interim reports, tax vouchers and warrants. cost of modification of the Deeds other than those for the benefits of the Manager and/or Trustee; and other notices to Unit Holders as well as expenses that are directly related and necessary for the administration of the Fund as set out in the Deed. These costs have been factored into the quoted NAV per Unit as they are related and necessary to the business of the Funds. There are fees and charges involved and investors are advised to consider the fees and charges before investing in the Funds. AMB Client Services :

27 1.4 Information on Transactions Minimum Initial Investment Minimum Subsequent Investment Purchasing of Units Application for Units for AMBUTF, AMBBTF, AMBITF and AMBEBTF; must be for a minimum of RM1,000. Application for Units for AMBILTF, AMBETF, AMBVTF, AMBSCTF, AMBLTF Today, AMBLTF 2009, AMBLTF 2014 and AMBDTF, must be for a minimum of RM500. Application for Units for PNB SIF, must be a minimum of 10,000 Units for individual and 50,000 Units for non-individual. (Refer to section 8.6 on page 123 for more details) Subsequent additional investments can be made at a minimum of RM100 for AMBUTF, AMBBTF, AMBITF, AMBILTF, AMBETF, AMBVTF, AMBSCTF, AMBLTF Today, AMBLTF 2009, AMBLTF 2014 and AMBDTF, RM500 for AMBEBTF and for PNB SIF, 1,000 Units for individual and 5,000 Units for non-individual. The investment amount payable by the Unit Holders for the purchase of a Unit is calculated at NAV per Unit. In addition to the investment amount, a sales charge will also be imposed to the Unit Holders. For PNB SIF, only Units repurchased by the Manager may be resold based on the NAV per Unit at that point in time. (Refer to section 8.4 on page 121 for more details) For investors investing under the EPF Member s Investment Scheme, a service charge of up to 3% of NAV per unit is levied as regulated by EPF. The NAV per Unit is computed on Forward Pricing basis and published daily in major newspapers. The Manager has taken necessary procedures to ensure accuracy of information of pricing sent to the Bernama and the respective newspapers. However, the Manager would not be held liable for the errors or omission of the printed information on the prices of its Funds in the newspapers. (Refer to section 8.5 on page 122 for more details) Redeeming of Units The redemption amount payable to the Unit Holders for the redemption of a Unit is calculated at NAV per Unit. The NAV per Unit is computed on a Forward Pricing basis and published daily in major newspapers (Refer to section 8.5 on page 122 for more details). Cooling-off Period Cooling-off Right Redemption Period Frequency of Redemption Redemption Fee Switching This is within 6 Business Days commencing from the date of purchase i.e. the date on which the Manager receives the application form and the investment amount. (Refer to section 8.7, page 123 for more details) The Cooling-off Right is only given to a qualified Unit Holder who is investing in any AMB Family of Funds for the first time. The Manager will pay the redemption proceeds to Unit Holders within 10 days upon receipt of the request to redeem. There is no restriction on the frequency of redemption. There is no fee applicable on redemption for the Funds except for PNB SIF. For more details on the redemption charge of PNB SIF, please refer to section 7.2 on page 117. This facility enables Unit Holders to convert Units of one Fund to units of other Funds managed by the Manager with conditions as stipulated in the section 7.8 and section 119. The minimum investment that can be switched per transaction is 1,000 Units. An administrative fee of RM25 will be charged per transaction. (Please refer to section 7.8 on page 119 and section 8.12 on page 125 for more details). Please note that switching facility is not available for PNB SIF and Unitholders who invest under the EPF Members Investment Scheme are not allowed to switch to AMBDTF. AMB Client Services :

28 Minimum Redemption amount AMBUTF, AMBBTF, AMBITF, AMBILTF, AMBETF, AMBVTF, AMBEBTF and AMBSCTF There is no minimum redemption amount imposed on a Unit Holder. However, for partial redemption, the minimum balance of Units remaining in the account must always be 100 Units. (Refer to section 8.6 on page 123 for more details) AMBLTF Today, AMBLTF 2009, AMBLTF 2014 and AMBDTF There is no minimum redemption amount imposed on a Unit Holders. However, for partial redemption, the minimum balance of Units remaining in the account must always be 1,000 Units. (Refer to section 8.6 on page 123 for more details) PNB SIF There is no minimum redemption amount imposed on a Unit Holders. However, for partial redemption, the minimum balance of Units remaining in the account must always be 10,000 Units. (Refer to section 8.6 on page 123 for more details) Minimum Holdings to Maintain Accounts The minimum balance of Units remaining in the account must always be 100 Units. The minimum balance of Units remaining in the account must always be 1,000 Units. The minimum balance of Units remaining in the account must always be 10,000 Units. (Both individual and nonindividual) Transfer Of Units A Unit Holder may fully or partially transfer his Units in afund to another Unit Holder. However, for partial transfer, the minimum balance of Units remaining in the account must always be 100 Units. An administrative fee of RM3 will be charged for each transfer. (Refer to section 8.11 on page 125 for more details) A Unit Holder may fully or partially transfer his Units in a Fund to another Unit Holder. However for partial transfer, the minimum balance of Units remaining in the account must always be 1,000 Units. An administrative fee of RM3 will be charged for each transfer. (Refer to section 8.11 on page 125 for more details) A Unit Holder may fully or partially transfer his Units in the Fund to any person in accordance with the Deed. However, for partially transfer, the minimum balance of Units remaininig in the account must always be 10,000 Units. An administrative fee of RM3 will be charged for each transfer. (Refer to section 8.11 on page 125 for more details) Note: The Manager will ensure that the prices forwarded to the press for publication are accurate. However, the Manager cannot be held liable for any error in prices finally published in the press. Investors may contact any Distribution Branch to further confirm the Unit prices. AMB Client Services :

29 1.5 Special Benefit Free Insurance Protection Coverage For AMBUTF and AMBBTF Eligible Unit Holders aged between 18 and 69 years with a minimum investment of 10,000 Units of AMBUTF and AMBBTF will be given free Group Personal Accident (GPA) insurance with Total Permanent Disability (TPA). This coverage provides accident protection up to a maximum of RM10,000 per Unit Holder of either Funds. (Refer to Chapter 3 for more details) Free Insurance Protection Coverage For AMBETF, AMBVTF and AMBSCTF Eligible Unit Holders of AMBETF, AMBVTF and AMBSCTF will be given free Personal Accident (PA) Insurance coverage. Unit Holders holding a minimum of 2,000 Units and above will automatically be covered under the PA insurance coverage.the sum covered would be RM0.50 for every Unit held subject to a minimum investment of 2,000 Units and maximum coverage of RM200,000. (Refer to Chapter 3 for more details.) Free Insurance Protection Coverage for AMBLTF 2009 and AMBLTF 2014 Eligible Unit Holders of AMBLTF 2009 and AMBLTF 2014 will be given free standard GPA coverage. Unit Holders holding a minimum amount of 2,000 Units and above will automatically be covered under the standard GPA insurance for accidental death and TPD. The sum insured would be RM0.50 for every Unit held subject to a minimum investment of 2,000 Units and maximum coverage of RM150,000. (Refer to Chapter 3 for more details). Free Insurance Protection Coverage for AMBDTF Eligible Unit Holders of AMBDTF will be given free GPA coverage. Unit Holders holding a minimum amount of 4,000 Units and above will automatically be covered under the GPA iinsurance for accidental death and TPD. The sum insured would be RM0.25 for every Unit held subject to a minimum investment of 4,000 Units and maximum coverage of RM200,000. (Refer to Chapter 3 for more details). Option to Investors of AMBLTF 2009 and AMBLTF 2014 at Maturity These Funds are open-ended with fixed lifespan of 5 and 10 years respectively from the commencement date of the Funds and maturing on the 5th and 10th anniversary respectively. At maturity, the Unit Holders are given an option to redeem their entire investment or to reinvest into AMBLTF Today at Net Asset Value. Free Insurance Protection Coverage for PNB SIF Eligible Unit Holders aged between with a minimum investment of 10,000 Units at any point of time in PNB SIF will be given free GPA Takaful insurance. The sum insured would be RM1.00 for every Unit held subject to a maximum coverage of RM100,000 per Unit Holder of the Fund. The terms and conditions of the free insurance scheme as administered by the Manager shall apply. Please contact the Manager on the terms and conditions of the free insurance scheme. 1.6 Other Information Unit Holders may refer to the following Deeds and its Supplemental Deeds for more specific information of the Funds, which are available at the principal office of the Manager. 1. Deed in relation to AMBUTF dated March 6, First Supplemental Deed in relation to AMBUTF dated August 23, Second Supplemental Deed in relation to AMBUTF dated April 16, Third Supplemental Deed in relation to AMBUTF dated June 7, Fourth Supplemental Deed in relation to AMBUTF dated March 23, Fifth Supplemental Deed in relation to AMBUTF dated February 8, Sixth Supplemental Deed in relation to AMBUTF dated January 30, Seventh Supplemental Deed in relation to AMBUTF dated September 12, Eighth Supplemental Deed in relation to AMBUTF dated May 26, Deed in relation to AMBBTF dated September 14, First Supplemental Deed in relation to AMBBTF dated April 16, Second Supplemental Deed in relation to AMBBTF dated March 23, Third Supplemental Deed in relation to AMBBTF dated May 28, Fourth Supplemental Deed in relation to AMBBTF dated February 8, Fifth Supplemental Deed in relation to AMBBTF dated September 12, Sixth Supplemental Deed in relation to AMBBTF dated May 26, AMB Client Services :

30 3. Deed in relation to AMBITF dated May 15, First Supplemental Deed in relation to AMBITF dated April 16, Second Supplemental Deed in relation to AMBITF dated August 18, Third Supplemental Deed in relation to AMBITF dated March 23, Fourth Supplemental Deed in relation to AMBITF dated February 13, Fifth Supplemental Deed in relation to AMBITF dated February 8, Sixth Supplemental Deed in relation to AMBITF dated September 12, Seventh Supplemental Deed in relation to AMBITF dated May 26, Deed in relation to AMBILTF dated April 8, Deed in relation to AMBSCTF dated February 11, First Supplemental Deed in relation to AMBSCTF dated May 26, Deed in relation to AMBEBTF dated May 7, First Supplemental Deed in relation to AMBEBTF dated May 26, Deed in relation to AMBETF dated December 4, Deed in relation to AMBVTF dated December 4, Deed in relation to AMBLTF Today dated October 28, First Supplemental Deed in relation to AMBLTF Today dated May 26, Deed in relation to AMBLTF 2009 dated October 28, First Supplemental Deed in relation to AMBLTF 2009 dated May 26, Deed in relation to AMBLTF 2014 dated October 28, First Supplemental Deed in relation to AMBLTF 2014 dated May 26, Deed in relation to AMBDTF dated May 2, Deed in relation to PNB SIF dated March 7, Prospective Unit Holders should read and understand the contents of this Prospectus and if necessary, consult your professional advisor. Unit prices and distributions payable, if any, may go down as well as up. For information concerning certain risk factors which should be considered by prospective investors see risk factors commencing on page 28. Past performance of the Funds are not an indication of its future performance. There are fees and charges involved and investors are advised to consider the fees and charges before investing in the Funds. AMB Client Services :

31 2 Risk Factors 2.1 Risks of Investing in Unit Trusts All investments carry some form of risk. It is important to note that when you invest you should be prepared to accept a degree of risk, as most investments are affected by ever changing market conditions, some of which impact positively and some negatively. Therefore, no matter how experienced a fund manager may be, certain factors, which will affect the value of investments, may be beyond their control. So, the value of your investments may go down as well as up. One should consider the following when investing in a unit trust fund: - Stock or Bond Market Risk For a unit trust that has stocks or bonds in its portfolio, fluctuations in the market performance due to factors such as fluctuation in interest rates, changes in economic climate, political and social environment that will affect the stock or bond market as a whole, will also affect the value of investment either in a positive or negative way. Individual Stock Risk The performance of a fund that invests in stocks is affected by every individual stock that the said fund has invested in. The volatility of prices in each stock will affect the fund s value daily. Compliance Risk This is the risk that the manager and others associated with the scheme will not follow the rules set out in the scheme s constitution and internal policies, or the law that governs the scheme, or will act fraudulently or dishonestly. However, this risk is greatly reduced via stringent internal controls and constant cross-departmental checking employed by the manager. In addition, a yearly or any unscheduled internal audit exercise will be conducted to check any compliance matters that might have been inadvertently overlooked by compliance department. The presence of the trustee whose duty is to ensure that the fund s investment mandate is complied with will further add to the reduction of such risks. Inflation Risk Ideally the purpose of any investment is to secure returns that are greater than the inflation rate. While a fund will constantly seek to maximise returns and exceed inflation rate, it may occasionally experience losses, which result in returns that will not keep pace with inflation in the short run. Liquidity Risk The various securities that are purchased by a fund may encounter liquidity risk. Liquidity risk relates to the fund s ability to quickly and easily trade, at a reasonable price, in and out of positions. Should a fund comprise a security that has become temporarily or permanently illiquid or difficult to sell, the fund manager may need to sell the security at a discount to its fair value, which eventually affects the fund s value. Management Risk Performance of the fund depends on the experience, expertise, knowledge and investment techniques of the fund manager. Poor management of a fund can cause considerable losses to the fund, which in turn may affect the capital invested. Institutional Risk The risk that the institution, which operates the fund, will collapse. Returns Not Guaranteed As a result of market risks, the manager is unable to guarantee the distribution payout to unit holders or the investment returns of the fund. However, the manager will take reasonable steps to ensure that this risk is minimized through a prudent investment approach, which is centred on fundamental stocks and market analysis. Loan Financing Risk Investors who take end-financing loans to purchase units in a unit trust fund must be prepared to accept gearing risks as the prices of the units can go down as well as up. The investor may be required to top up the difference in the event the unit price goes below the margin of advance. Interest Rate Risk Fixed income securities and bonds are particularly sensitive to movements in interest rates. When interest rates rise, the value of fixed income securities and bond prices fall and vice versa, thus affecting the net asset value of the fund. The general interest rate of the country may affect the value of the investment even if the fund (e.g. syariah fund) does not invest in interest bearing instruments. AMB Client Services :

32 Credit/Default Risk Credit risk refers to the possibility that the issuer of a fixed income security or bond may not be able to make interest payments or repay the principal in a timely manner. This will translate to losses that will reduce the value of a fund. Currency Risk Currency risk is also known as foreign exchange risk. It is risk associated with investments that are denominated in foreign currencies. When the foreign currencies fluctuate in an unfavorable movement against Ringgit Malaysia, the investments will face currency losses in addition to the capital gains/losses. This willl lead to a lower net asset value of the fund. Country Risk The foreign investments of the Fund may be affected by risks specific to the country, which it invests in. Such risks include changes in a country s economic fundamentals, social and political stability, currency movements and foreign policies etc. These may have an adverse impact on the prices of securities of listed companies. Force Majeure Risk The risk of exposure to force majeure events, where events are not within the control of Manager. This includes terrorist attacks, politically instability, natural disasters and spread of disease where risks are generally unforeseen and may have direct impact on the business. 2.2 Control of Risk The External Investment Manager will take reasonable steps to ensure that the above potential risks are managed by:- (a) (b) actively monitoring the Fund s asset allocation to ensure minimum impact from any adverse market movements. They will ensure that the equities and fixed income securities are carefully selected through site visits, fundamental analysis and portfolio diversification. In the case of fixed income securities, the External Investment Manager will also focus on the credit quality of the fixed income securities, which must be of good investment grade of at least BBB rating or equivalent by RAM, MARC or any other similar rating establishment. investing the Fund over a wide range of equities and fixed income securities of different companies which provides diversification across a number of sectors and industries, minimising the risk not only of any single company s securities becoming worthless, but also of all holdings suffering uniformly adverse business conditions. The External Investment Manager will seek to reduce all these risks associated with the Fund by virtue of its experience, the analytical process and by structuring a broadly diversified investment pool. Others When deemed appropriate and for the benefit of the Fund, the External Investment Manager may take temporary defensive positions in dealing with adverse market, economic, political and other conditions, that maybe inconsistent with the Fund s principal strategy. Please refer to Chapter 3 : Detailed Information on the Funds for information on fund specific risks and risk management. AMB Client Services :

33 3 Detailed Information on the Funds 3.1 Introduction The key distinguishing features of the 13 Funds are shown below in order to assist investors in making an informed judgement of the distinctive features of each Fund in relation to their personal investment and financial goals. Type of Fund Growth Fund Category of Fund Equity Fund AMB Unit Trust Fund Investment Philosophy AMBUTF is an equity fund that consists of a diversified portfolio of blue chip and high growth stocks listed on the Bursa Malaysia. By investing in a diversified portfolio of blue chip and high growth stocks in Malaysia, AMBUTF provides a better spread of investments than could be achieved by investors with a small amount of money to invest. Investment Objective The primary objective of AMBUTF is to achieve a steady long-term income (over 5 years) and capital growth through a diversified portfolio of equity investments in larger capitalised stocks (prime focus on main board and liquid stocks). Any material changes to the investment objective of the Fund would require Unit Holders approval. Approved Fund Size of AMBUTF The approved fund size for AMBUTF is 1.5 billion Units. Investor Profile AMBUTF is particularly suited to investors who are seeking a diversified portfolio of equity investment. Our investment team aims to maintain a portfolio of stocks, listed on the Bursa Malaysia, which have a strong potential for growth. AMBUTF is appropriate for investors who are attracted to the share market by the prospect of capital gains and dividends but are discouraged by the need to be kept informed of market developments and constant monitoring of their investments. The Fund is suited to an investor who has an investment horizon of 5 years or more. Benefits for Investors Shares historically provided returns superior to other investment instruments over the long term. The volatility of returns associated with this type of investment is reduced by diversifying the Fund s investments across a variety of companies operating in different industries. Specific Benefits of Investing in AMBUTF Free Insurance Protection Coverage for AMBUTF Eligible Unit Holders of AMBUTF will be given free GPA and TPD insurance coverage. Unit Holders holding a minimum of 10,000 Units and above will automatically be covered under the GPA and TPD insurance coverage. Coverage ceases automatically if the number of Units held is reduced to less than 10,000 Units. Eligible Unit Holders must be aged between 18 and 69 years old. The GPA coverage ceases automatically when you attain the age of 70 years old. Only eligible principal Unit Holders will be covered under the GPA insurance coverage. Regular Savings Plan You have the opportunity to invest on a fixed monthly basis through standing instruction. This plan makes regular savings easy and allows you to arrange transfers from your bank account to AMBUTF. Affordability Investors can invest with just RM1,000 as initial investment and subsequent investments can be made with a minimum of RM100. AMB Client Services :

34 Accessibility Investors can easily access any Distribution Branch to perform any enquiry or transaction. EPF Members Investment Scheme The Manager is a unit trust management company under the EPF Members Investment Scheme. You may withdraw a portion of your EPF savings to invest in AMBUTF, which may provide you the opportunity to reap capital growth, thus increasing the value of your EPF Account 1 Retirement Savings subject to rules and regulations of the EPF Members Investment Scheme from time to time. Potential Risks Associated with AMBUTF Stock Market Risk This is fluctuation in the market performance due to factors such as fluctuation in interest rates, and changes in economic climate, political and social environments that will affect the stock market as a whole. Individual Stock Risk AMBUTF is subject to the volatility of prices in the share market. The volatility of prices in each stock will affect the Fund s value daily. The performance of individual stocks, which make up the portfolio, will fluctuate according to changes in the market value of the investments. The fluctuations can be significant in the short-term. This accounts for the market risk when investing in this Fund. However, this impact is minimised through the investment process of portfolio diversification by our External Investment Manager. Liquidity Risk Liquidity risk relates to the Fund s ability to quickly and easily trade, at a reasonable price, into and out of positions. Investment Approach Under normal circumstances, the Fund will endeavour to be fully invested in Malaysian equities, unless the equity market outlook is less attractive. Control of Risk The External Investment Manager will take reasonable steps to ensure that the above potential risks are managed by: (a) (b) actively monitoring the Fund s asset allocation to ensure minimum impact from any adverse market movements. They will ensure that the equities and fixed income securities are carefully selected through site visits, fundamental analysis and portfolio diversification. In the case of fixed income securities, the External Investment Manager will also focus on the credit quality of the fixed income securities, which must be of good investment grade of at least BBB rating or equivalent by RAM, MARC or any other similar rating establishment. investing the Fund over a wide range of equities and fixed income securities of different companies which provides diversification across a number of sectors and industries, minimising the risk not only of any single company s securities becoming worthless, but also of all holdings suffering uniformly adverse business conditions. The External Investment Manager will seek to reduce all these risks associated with the Fund by virtue of its experience, the analytical process and by structuring a broadly diversified investment pool. Others When deemed appropriate and for the benefit of the Fund, the External Investment Manager may take temporary defensive positions in dealing with adverse market, economic, political and other conditions, that maybe inconsistent with the Fund s principal strategy. Investment Strategy/Investment Mechanism AMBUTF invests primarily in blue chips and high growth stocks that can increase the potential for better long-term returns by focusing on corporations with the following characteristics: Industry leader, good earnings track record, potential strong growth and strength of management. AMBUTF invests largely in companies with market capitalisation of more than RM700 million. In times of actual or anticipated stock market weakness, the equity portfolio may be reduced accordingly. There are, however, no restrictions on the proportions that can be held in fixed income investments. The Fund s fixed income investments comprise short term private debt securities and money market instruments to achieve a prudent mix in the portfolio and also to provide a steady income stream. The asset allocation between the various investment assets referred to above and the decision to invest, sell or trade is based on the decision of the External Investment Manager who will adopt an active fund management approach. AMB Client Services :

35 Policy and Strategy on Listed and Unlisted Securities AMBUTF s policy and strategy is to concentrate on quality listed equities that can increase the potential for better long-term returns, by focusing on securing capital growth for Unit Holders, with income considered incidental to the investment process. The capital growth is achieved through a diversified portfolio of equity investment in larger capitalised stocks with prime focus on main board and liquid stocks. The investment process for unlisted securities is similar to the process used for the listed securities. Decision will be made after thorough assessment on the companies, using in-house fundamental research supported by external research and companies prospectuses. The main focus would be on companies, which are industry leaders, with good earnings track record, potential strong growth based on good medium to long-term earnings visibility, quality management as well as good corporate governance. The process also involves constant monitoring of the current investment to ensure that it complies with the objectives of the Fund. The External Investment Manager may invest up to 10% of the Net Asset Value of the Fund in securities that are not traded in or under the rules of an eligible market. Asset Allocation Min 40% max 90% in equities Min 10% in liquid assets The equity allocation may be reduced to below the minimum levels indicated at the discretion of the Manager only during exceptional circumstances. Exceptional circumstances would include situations: i) Where there is an expected sharp downturn in the equity market; ii) When there is insufficient liquidity in equity for the Fund to transact efficiently; and/ or iii) When there is redemption affecting the liquidity position of the Fund. Benchmark The performance of AMBUTF will be benchmarked against the KLCI return, which is obtainable from Bursa Malaysia. AMB Client Services :

36 Type of Fund Growth and Income Fund Category of Fund Balanced Fund AMB Balanced Trust Fund Investment Philosophy AMBBTF aims to provide the investor with a broad exposure to different asset classes including shares with less fluctuation in value and fixed income securities. This is a growth and income Fund that pursues steady income and long-term growth through diversified investment in equities, bonds, convertibles, warrants and short-term money market instruments. Investment Objective The objective of AMBBTF is to provide a balance between income and long-term (over 5 years) capital appreciation. Any material changes to the investment objective of the Fund would require Unit Holders approval. Approved Fund Size of AMBBTF The approved fund size of AMBBTF is 1.15 billion Units. Investors Profile AMBBTF is appropriate for investors who are seeking a fully managed balanced portfolio of investments with an investment horizon of 5 years or more. AMBBTF aims to provide investors with a combination of income and capital gains over the medium to long term. Benefits for Investors Diversification When structuring an investment portfolio, diversification is one of the main tools used to reduce investment risk and enhance returns. Diversification should be within investment sectors (investing in a diverse range of shares) as well as across a variety of investment instruments (for example shares, fixed income securities and short-term money market instruments). In this manner, investors can usually access a broader range of securities than they could have by investing on their own. Such a diversified portfolio reduces risks, as should some investments drop in value there may be increases in value of other investments thus mitigating the downside risk. Because of the diversified nature of AMBBTF, risks associated with a downturn in a particular investment are reduced. Specific Benefits of Investing in AMBBTF Free Insurance Protection Coverage for AMBBTF Eligible Unit Holders of AMBBTF will be given free GPA and TPD insurance coverage. Unit Holders holding a minimum of 10,000 Units and above will automatically be covered under the GPA and TPD insurance coverage. Coverage ceases automatically if the number of Units held is reduced to less than 10,000 Units. Eligible Unit Holders must be aged between 18 and 69 years old. The GPA coverage ceases automatically when you attain the age of 70 years old. Only eligible principal Unit Holders will be covered under the GPA insurance coverage. Regular Savings Plan You have the opportunity to invest on a fixed monthly basis through standing instruction. This plan makes regular savings easy and allows you to arrange transfers from your bank account to AMBBTF. Affordability Investors can invest with just RM1,000 as initial investment and subsequent investments can be made with a minimum of RM100. Accessibility Investors can easily access any Distribution Branch to perform any enquiry or transaction. AMB Client Services :

37 EPF Members Investment Scheme The Manager is a unit trust management company under the EPF Members Investment Scheme. You may withdraw a portion of your EPF savings to invest in AMBBTF, which may provide you the opportunity to reap capital growth, thus increasing the value of your EPF Account 1 Retirement Savings subject to rules and regulations of the EPF Members Investment Scheme from time to time. Potential Risks Associated with AMBBTF Stock or Bond Market Risk This is fluctuation in the market performance due to factors such as fluctuation in interest rates, and changes in economic climate, political and social environments that will affect the stock or bond market as a whole. They will also affect the value of investment either in a positive or negative way. Individual Stock Risk AMBBTF is subject to the volatility of prices in the share market. The volatility of prices in each stock will affect the Fund s value daily. The performance of individual stocks, which make up the portfolio, will fluctuate according to changes in the market value of the investments. The fluctuations can be significant in the short-term. This accounts for the market risk when investing in this Fund. However, this impact is minimised through the investment process of portfolio diversification by our External Investment Manager. Credit/Default Risk AMBBTF invests in fixed income securities, so its portfolio is subject to credit risk. This is the risk that the issuer of the security may default and not be able to make timely principal and interest payments on the security. The lower-rated corporate debt securities will normally have greater risk of defaults. Interest Rate Risk Fixed income securities are particularly sensitive to movements in interest rates. When interest rates rise, the value of fixed income securities falls and vice versa, thus affecting the NAV of the Fund. Liquidity Risk Liquidity risk relates to the Fund s ability to quickly and easily trade, at a reasonable price, into and out of positions. To reduce the overall risk exposure, our External Investment Manager adopts an investment strategy by diversifying the investments into different asset classes. By investing in different market segments and by staggering the maturity dates of fixed income securities, the overall portfolio risk is significantly reduced. Investment Approach The Fund endeavours to create a prudent mix of primarily equities and fixed income securities which is in line with the Fund s objective. Control of Risk The External Investment Manager will take reasonable steps to ensure that the above potential risks are managed by: (a) (b) actively monitoring the Fund s asset allocation to ensure minimum impact from any adverse market movements. They will ensure that the equities and fixed income securities are carefully selected through site visits, fundamental analysis and portfolio diversification. In the case of fixed income securities, The External Investment Manager will also focus on the credit quality of the fixed income securities, which must be of good investment grade of at least BBB rating or equivalent by RAM, MARC or any other similar rating establishment. investing the Fund over a wide range of equities and fixed income securities of different companies which provides diversification across a number of sectors and industries, minimising the risk not only of any single company s securities becoming worthless, but also of all holdings suffering uniformly adverse business conditions. The External Investment Manager will seek to reduce all these risks associated with the Fund by virtue of its experience, the analytical process and by structuring a broadly diversified investment pool. Others When deemed appropriate and for the benefit of the Fund, the External Investment Manager may take temporary defensive positions in dealing withadverse market, economic, political and other conditions, that maybe inconsistent with the Fund s principal strategy. AMB Client Services :

38 Investment Strategy/Investment Mechanism Equities AMBBTF invests in potentially high yielding blue-chip stocks, aiming to increase long-term returns by focusing on corporations with good earnings track records, sound management and strong growth potential. Fixed Income AMBBTF invests in a variety of fixed interest investments. They range from investments in high quality, short-term government and corporate debt securities and money market instruments to longer-dated government and corporate bonds. AMBBTF balances its investments between potentially high yielding share investments and lower risk fixed interest investments. Specific investments are chosen, mainly those that offer good potential for income and growth. The External Investment Manager will change the Fund s asset allocation mix depending on the prevailing economic conditions and market outlook for both equity and bonds. This strategy aims to reduce risk and achieve consistency of returns. Policy and Strategy on Listed and Unlisted Securities AMBBTF would focus on attaining a balance between long-term income and capital growth. It would invest partly in equities and partly in fixed income securities. AMBBTF s strategy provides a careful selection of quality listed equities and listed/unlisted bonds, carrying at least BBB rating by RAM or an equivalent rating by MARC. The investment process for unlisted securities is similar to the process used for the listed securities. Decisions will be made after thorough assessment of the companies, using in-house fundamental research supported by external research and companies prospectuses. Investment in securities involves an analysis of the general economic and market conditions. With an approach that considers the risk return tradeoff, AMBBTF focuses on securities that would deliver favorable return in light of the risks. AMBBTF aims to increase long term returns on stocks by focusing on corporations with good earnings track record, sound management and having reasonable growth potential. The Fund invests in a variety of fixed income instruments, ranging from high quality, short-term government and corporate debt securities and money market instruments to longer dated government and corporate bonds. It considers obligations with a more favorable or improving credit or industry outlook that provide the potential for capital appreciation. Asset Allocation Min 20% max 60% in equities Min 20% max 60% in fixed income securities Min 10% in liquid assets The equity and fixed income allocation may be reduced to below the minimum levels indicated at the discretion of the Manager only during exceptional circumstances. Exceptional circumstances would include situations: i) Where there is an expected sharp downturn in the equity market; ii) When there is high risk of capital loss on fixed income instruments due to interest rate fluctuations; iii) When there is insufficient liquidity in either equity or fixed income instruments for the Fund to transact efficiently; and/or iv) When there is redemption affecting the liquidity position of the Fund. Benchmark The performance of AMBBTF will be benchmarked against the KLCI return, which is based on 60% of the performance of the KLCI and 40% of the 12-month fixed deposit rate. These are obtainable from Bursa Malaysia and from commercial banks respectively. AMB Client Services :

39 Type of Fund Income Fund Category of Fund Bond Fund AMB Income Trust Fund Investment Philosophy AMBITF is an income-oriented fund, which invests primarily in a portfolio of fixed income securities. It is structured to earn income on a regular basis and to achieve capital appreciation through interest rate fluctuations. The Unit price will change to reflect movements in the value of the Fund s assets. Investment Objective The primary objective of AMBITF is to maximise returns over the medium term (over 2 years) and at the same time offer stability of capital and regular income. Any material changes to the investment objective of the Fund would require Unit Holders approval. Approved Fund Size of AMBITF The approved fund size of AMBITF is 600 million Units. Investors Profile Fixed income investments are an essential part of any diversified investment portfolio. AMBITF is an appropriate investment vehicle for investors looking for a medium to long-term investment with regular interest income and some potential for moderate capital growth. The Fund is suited to investors who have an investment horizon of 3 to 5 years. Benefits for Investors Generally, returns from fixed income investments are lower than shares over the medium to longer term. Because income streams from fixed income securities are generally secure, income as a proportion of AMBITF s total return is usually high, especially when interest rates are high. Specific Benefits of Investing in AMBITF Regular Savings Plan You have the opportunity to invest on a fixed monthly basis through standing instruction. This plan makes regular savings easy and allows you to arrange transfers from your bank account to AMBITF. Affordability Investors can invest with just RM1,000 as initial investment and subsequent investments can be made with a minimum of RM100. Accessibility Investors can easily access any Distribution Branch to perform any enquiry or transaction. EPF Members Investment Scheme The Manager is a unit trust management company under the EPF Members Investment Scheme. You may withdraw a portion of your EPF savings to invest in AMBITF, which may provide you the opportunity to reap capital growth, thus increasing the value of your EPF Account 1 Retirement Savings subject to rules and regulations of the EPF Members Investment Scheme from time to time. Potential Risks Associated with AMBITF Bond Market Risk This is fluctuation in the market performance due to factors such as fluctuation in interest rates, and changes in economic climate, political and social environments that will affect the bond market as a whole. They will also affect the value of investment either in a positive or negative way. AMB Client Services :

40 Credit/Default Risk AMBITF invests in fixed income securities, thus its portfolio is subject to credit risk. This is the risk that the issuer of the security may default and not be able to make timely principal and interest payments on the security. The lowerrated corporate debt securities will normally have greater risk of defaults. Interest Rate Risk Fixed income securities are particularly sensitive to movements in interest rates. When interest rates rise, the value of fixed income securities falls and vice versa, thus affecting the NAV of the Fund. Liquidity Risk Liquidity risks relates to the Fund s ability to quickly and easily trade, at a reasonable price, into and out of positions. To reduce the overall risk exposure, our External Investment Manager adopts an investment strategy by diversifying the investments into different assets classes. By investing in different market segments and by staggering the maturity dates of fixed income securities, the overall portfolio risk is significantly reduced. Control of Risk The External Investment Manager will take reasonable steps to ensure that the above potential risks are managed by: (a) (b) actively monitoring the Fund s asset allocation to ensure minimum impact from any adverse market movements. They will ensure that the equities and fixed income securities are carefully selected through site visits, fundamental analysis and portfolio diversification. In the case of fixed income securities, The External Investment Manager will also focus on the credit quality of the fixed income securities, which must be of good investment grade of at least BBB rating or equivalent by RAM, MARC or any other similar rating establishment. investing the Fund over a wide range of equities and fixed income securities of different companies which provides diversification across a number of sectors and industries, minimising the risk not only of any single company s securities becoming worthless, but also of all holdings suffering uniformly adverse business conditions. The External Investment Manager will seek to reduce all these risks associated with the Fund by virtue of its experience, the analytical process and by structuring a broadly diversified investment pool. Others When deemed appropriate and for the benefit of the Fund, the External Investment Manager may take temporary defensive positions in dealing with adverse market, economic, political and other conditions, that maybe inconsistent with the Fund s principal strategy. Investment Policy/Approach The Fund invests in fixed income securities and money market instruments to meet its objectives of providing a steady stream of interest income and potential long-term capital gains. Its fixed income securities investments comprise government bonds, private debt securities, which are rated BBB or higher by RAM and MARC, and money market instruments, which will ensure a regular income yield to AMBITF. Investment Strategy/Investment Mechanism AMBITF s investment strategy is to create a prudent mix in its portfolio to meet its investment objective and to provide professional assessment of investment prospects by its External Investment Manager in line with the economic outlook. Longer term fixed income securities such as bonds are also attractive because the rate of interest payable is generally higher than that available from cash or short-term deposits. Long term bonds (5 years to 10 years) will form the core holdings of the portfolio due to its higher returns and thus will be held for a considerable period of time. The size of this core holdings may vary from time to time to accommodate changing market conditions, but is generally expected to be around 60-75% of the portfolio. The portfolio also will consists of short term bonds (1month to 1year duration) which will provide liquidity for redemptions as well as opportunity for the External Investment Manager to make tactical switch in view of changing interest rate and market conditions. The asset allocation between the longer and shorter-term maturities of the fixed income securities are subject to change, depending on the prevailing economic and market conditions. In addition investment consideration will also be given on securities that are undervalued relative to their ratings, potential credit upgrade candidates, and situational issues with potential for improvement in the credit quality. Furthermore movements in the yield curve may uncover further opportunities. The External Investment Manager will also seek to diversify the portfolio across the sectors and issuers (to reduce sector and credit risk) and across duration (to reduce price risk). AMB Client Services :

41 Policy and Strategy on Listed and Unlisted Securities AMBITF is to concentrate on investing in quality listed/unlisted debt securities, which provide good yields, for the medium to long-term period. The portfolio aims at preserving the principle investment whilst achieving returns better than the prevailing fixed deposit interest rates on an annualized basis, at an acceptable level of risk. The portfolio shall invest in investment grade debt securities that are deemed to be fundamentally sound. In addition, the portfolio also concentrates on securities that have attractive yields and trading opportunities. The investment process for unlisted securities is similar to the process used for listed securities. Decisions will be made after thorough assessment on companies, using in-house fundamental research supported by external research and companies prospectuses. Investments shall be made in fixed income securities with minimum credit ratings of P2 or MARC2 for short term papers or A3/A- for long term papers by RAM or MARC. The External Investment Manager shall undertake to conduct a thorough and rigorous credit assessment of potential investments and constant monitoring of current investments. A filtration process is employed for securities selection to ensure superior selection that compliments the objective of the portfolio. The filtration processes include debt rating, financial ratio analysis, management quality assessment and structure of a particular instrument. Asset Allocation Min 40% max 90% in fixed income securities Up to 60% in cash and money market The fixed income allocation may be reduced to below the minimum levels indicated at the discretion of the Manager only during exceptional circumstances. Exceptional circumstances would include situations: i) When there is high risk of capital loss on fixed income instruments due to interest rate fluctuations; ii) When there is insufficient liquidity in fixed income instruments for the Fund to transact efficiently; and/or iii) When there is redemption affecting the liquidity position of the Fund. Benchmark The performance of AMBITF will be benchmarked against 12-month fixed deposit rate from commercial banks, which is a commonly used industry practice. AMB Client Services :

42 Type of Fund Index Fund Category of Fund Equity Fund AMB Index-Linked Trust Fund Investment Philosophy AMBILTF is an open-ended indexed Fund that invests in the KLCI component stocks that will closely mirror the KLCI movements. Investment Objective To achieve an investment result that tracks the performance of the KLCI s benchmark. Any material changes to the investment objective of the Fund would require Unit Holders approval. Approved Fund Size of AMBILTF The approved fund size for AMBILTF is 400 million Units. Investors Profile The Fund is expected to appeal to individuals or institutions which desire returns that are consistent with the performance of the KLCI. As such, investors of this Fund are expected to possess a moderate to high-risk tolerance and have an investment horizon exceeding 5 years to withstand the business cycles capital markets are exposed to. Benefits for Investors The Fund is an affordable avenue for investors to have an indirect participation in the Malaysian equity markets through ownership of component stocks that make up the KLCI. As the Fund s investment results closely correspond to the KLCI, investors are capable of gauging their investment performance with relative ease. Since AMBILTF adopts a passive management philosophy, the fees levied for managing the Fund are lower when compared to an actively managed fund. This allows the AMBILTF to be both an attractive and economical equity investment alternative. Specific Benefits of Investing in AMBILTF Regular Savings Plan You have the opportunity to invest on a fixed monthly basis through standing instruction. This plan makes regular savings easy and allows you to arrange transfers from your bank account to AMBILTF. Affordability Investors can invest with just RM500 as initial investment and subsequent investments can be made with a minimum of RM100. Accessibility Investors can easily access any Distribution Branch to perform any enquiry or transaction. EPF Members Investment Scheme The Manager is a unit trust management company under the EPF Members Investment Scheme. You may withdraw a portion of your EPF savings to invest in AMBILTF, which may provide you the opportunity to reap capital growth, thus increasing the value of your EPF Account 1 Retirement Savings subject to rules and regulations of the EPF Members Investment Scheme from time to time. Potential Risks Associated with AMBILTF Due to the Fund s passive management philosophy, investors should understand that while it is possible to obtain returns during a market upturn, it is equally likely that losses can be incurred during its downturn. This is due to the Fund s high concentration of investments in the equity markets. Stock Market Risk This is fluctuation in the market performance due to factors such as fluctuation in interest rates, and changes in economic climate, political and social environments that will affect the stock market as a whole. Individual Stock Risk AMBILTF is subject to the volatility of price in the share market. The volatility of prices in each stock will affect the Fund s value daily. The performance of individual stocks, which make up the portfolio, will fluctuate according to changes in the market value of the investments. The fluctuations can be significant in the short-term. This accounts for AMB Client Services :

43 the market risk when investing in this Fund. However, this impact is minimised through the investment process of portfolio diversification by our External Investment Manager. Liquidity Risk Liquidity risk relates to the Fund s ability to quickly and easily trade, at a reasonable price, into and out of positions. Control of Risk The External Investment Manager will take reasonable steps to ensure that the above potential risks are managed by: (a) (b) actively monitoring the Fund s asset allocation to ensure minimum impact from any adverse market movements. They will ensure that the equities and fixed income securities are carefully selected through site visits, fundamental analysis and portfolio diversification. In the case of fixed income securities, The External Investment Manager will also focus on the credit quality of the fixed income securities, which must be of good investment grade of at least BBB rating or equivalent by RAM, MARC or any other similar rating establishment. investing the Fund over a wide range of equities and fixed income securities of different companies which provides diversification across a number of sectors and industries, minimising the risk not only of any single company s securities becoming worthless, but also of all holdings suffering uniformly adverse business conditions. The External Investment Manager will seek to reduce all these risks associated with the Fund by virtue of its experience, the analytical process and by structuring a broadly diversified investment pool. Others When deemed appropriate and for the benefit of the Fund, the External Investment Manager may take temporary defensive positions in dealing withadverse market, economic, political and other conditions, that maybe inconsistent with the Fund s principal strategy. Investment Policy/Approach The Fund invests primarily in securities listed on the Bursa Malaysia, which will enable it to track the movement of the KLCI. As such, investments consist of the KLCI component stocks that will closely mirror the KLCI s performance. The investment horizon is medium term with an aim to benefit from capital appreciation as the Malaysian economy recovers. The NAV of the Fund will therefore, fluctuate with the KLCI. Investment Strategy/Investment Mechanism It is the Fund s policy to remain fully invested at all times. The Fund under normal circumstances will be up to 99.5% invested. However, there are periods when the Fund needs to liquidate its holding of equities to meet redemption by Unit Holders. The heavy investment in equities is to ensure that the performance of the Fund reflects or mirrors that of the index as closely as possible. The underlying index The Fund is designed to track or replicate the performance of the underlying KLCI. Excluding the cash portion, the Fund focuses on 8 sectors, namely trading/services, finance, consumer products, industrial products, plantation, construction, technology and infrastructure project companies. The Fund s investment strategy and how the representative sample is constituted. Unlike the traditional way of investing in all of the component stocks, the Fund solely invests in a representative sample of the underlying component stocks of the KLCI. At any one time, the parameter of equity investment exposure stands at 90% to 99.5% of the Fund with the balance in cash. The representative sample consists of only 40 stocks compared to 100 stocks in the underlying KLCI. The weightings of the representative sample are derived by increasing the weightings of the representative sample stocks proportionately with the reduced numbers of the adjusted component stocks. Circumstances that lead to tracking error and strategies to minimise the error. Tracking error happens when the replicating portfolio does not perfectly match the performance of the underlying index (KLCI). Transaction costs and fewer numbers of stocks in the portfolio (compared to investment in all of the component stocks) are the constant factors that lead to the tracking error. The former is manageable as the Fund has lower trading costs given its passive characteristics. As for the latter, tracking error happens when price of the sample stocks fluctuates sharper than the KLCI. However, tracking error is minimised when balancing of the Fund is undertaken to ensure close tracking of the Fund to the KLCI. Policy on re-balancing the portfolio. Rebalancing of the portfolio will only be carried out when there is huge withdrawal or injection or when the tracking error is off track. AMB Client Services :

44 Weightings of the top 10 component stocks of the underlying index as at LPD 1. Sime Darby Bhd 6.77% 2. Tenaga Nasional Berhad 6.24% 3. Malayan Banking Berhad 6.16% 4. Public Bank Bhd 6.04% 5. MISC Bhd 5.57% 6. IOI Corporation Bhd 4.97% 7. CIMB Bank Bhd 4.37% 8. TM International Bhd 4.00% 9. Genting Berhad 3.57% 10. Petronas Gas Berhad 3.32% Weightings of the top 10 component stocks in the representative sample as at LPD (Based on NAV) 1. Sime Darby Bhd 8.31% 2. Tenaga Nasional Berhad 6.83% 3. Malayan Banking Berhad 5.75% 4. Public Bank Bhd 7.17% 5. MISC Bhd 6.47% 6. IOI Corporation Bhd 5.42% 7. CIMB Bank Bhd 5.06% 8. TM International Bhd 4.79% 9. Genting Berhad 5.49% 10. Petronas Gas Berhad 4.15% There is no guarantee or assurance of exact or identical replication at any time of the performance of the KLCI. The index composition may change and component securities of the underlying index may be delisted. Policy and Strategy on Listed and Unlisted Securities AMBILTF invests primarily in securities listed on the Bursa Malaysia, which will enable it to track the movement of the KLCI. As such investments consist of the KLCI component stocks that will closely mirror the KLCI s performance. The investment horizon is medium term with the view to benefit from capital appreciation as the Malaysian economy recovers. The NAV of the Fund will therefore fluctuate with the KLCI. It is the Fund s policy to remain fully invested at all times to minimise the tracking error. The Fund under normal circumstances will be up to 99.5% invested. However, there are periods when the Fund needs to liquidate its holding of equities to meet redemption by Unit Holders. The heavy investment in equities is to ensure that the performance of the Fund reflects or mirrors that of the index as closely as possible. The investment process for unlisted securities is similar to the process used for the listed securities. Decisions will be made after thorough assessment on the companies, using in-house fundamental research supported by external research and companies prospectuses. Asset Allocation 90.0% to 99.5% in equities 0.5% to 10.0% in liquid assets This investment portfolio enables the reduction in tracking error for the AMBILTF. Any excess in liquidity should be regularized within a period of 1 month. However, the minimum level of liquid assets to be maintained may be reviewed from time to time with the approval of the Investment Committee upon consultation with the Trustee. The equity allocation may be reduced to below the minimum levels indicated at the discretion of the Manager only during exceptional circumstances. Exceptional circumstances would include situations: i) Where there is an expected sharp downturn in the equity market; ii) When there insufficient liquidity in equity for the Fund to transact efficiently; and/or iii) When there is redemption affecting the liquidity position of the Fund. Benchmark The performance of AMBILTF will be benchmarked against the KLCI return. The latest index information and other news of the index may be obtained at Bursa Malaysia. AMB Client Services :

45 AMB SmallCap Trust Fund Type of Fund Growth Fund Category of Fund Equity Fund (Small Cap) Investment Philosophy AMBSCTF will invest in a diversified portfolio of stocks, in companies which operate in high growth sectors, hence have the potential to register high growth in earnings per share. A systematic and in-depth fundamental analysis is applied for the selection of stocks and the monitoring thereafter. Investment Objective To achieve medium to long-term capital growth by primarily investing into securities of small and medium sized companies listed on the Bursa Malaysia s Main Board, Second Board, MESDAQ and or any other board as approved by the SC with market capitalisation of not more than RM750 million which have the potential for capital appreciation over the medium to long term. Any material changes to the investment objective of the Fund would require Unit Holder s approval. Approved Fund Size of AMBSCTF The approved fund size for AMBSCTF is 600 million Units. Investors Profile The Fund is suitable for investors with the following profile: - Seeking long term capital growth through investment in small to medium sized companies; Willing to accept higher level of risk in order to obtain higher growth of their capital; and Possessing a medium to long-term investment horizon. Benefits for Investors AMBSCTF offers a higher potential for capital growth relative to the underlying market given its low base and strong growth potential. The specific risks associated with the Fund can be reduced and mitigated through effective sectors and stocks diversification. Specific Benefits of Investing in AMBSCTF Free Insurance Protection Coverage for AMBSCTF Eligible Unit Holders (natural persons) of AMBSCTF will be given free GPA insurance coverage. Unit Holders holding a minimum of 2,000 Units and above will automatically be covered under the GPA insurance coverage. The sum covered would be RM0.50 for every Unit held subject to a minimum investment of 2,000 Units and maximum coverage of RM200,000. The GPA insurance coverage covers: (i) Death due to accidental causes only; (ii) TPD due to accidental causes; and (iii) Funeral expenses as follows: Units Funeral Expenses 2,000 to 49,999 RM1,000 50,000 and above RM2,000 While the policy is in force, the amount of coverage shall be based on the amount of Units held at the time of accident which led to claim. Eligible Unit Holders must be aged between 18 and 69 years old. The GPA coverage ceases automatically when you attain the age of 70 years old. Eligible principal Unit Holder and jointholder(s) will be covered under the GPA insurance coverage but the sum covered will be shared equally. AMB Client Services :

46 Regular Savings Plan You have the opportunity to invest on a fixed monthly basis through standing instruction. This plan makes regular savings easy and allows you to arrange transfers from your bank account to AMBSCTF. Affordability Investors can invest with just RM500 as initial investment and subsequent investments can be made with a minimum of RM100. Accessibility Investors can easily access any Distribution Branch to perform any enquiry or transaction. EPF Members Investment Scheme The Manager is a unit trust management company under the EPF Members Investment Scheme. You may withdraw a portion of your EPF savings to invest in AMBSCTF, which may provide you the opportunity to reap capital growth, thus increasing the value of your EPF Account 1 Retirement Savings subject to rules and regulations of the EPF Members Investment Scheme from time to time. Potential Risks Associated with AMBSCTF While attempts are made to reduce risks encountered by the portfolio, investors should be advised that the following risks are inherent in such investments: - Stock Market Risk This is fluctuation in the market performance due to factors such as fluctuation in interest rates, and changes in economic climate, political and social environments that will affect the stock market as a whole. The stocks of small cap companies may be traded less actively than those of larger cap companies. As a result small cap stocks tend to fluctuate relatively more in reaction to a volatile market. Small cap companies may have limited financial resources compared to larger cap companies, which tend to make them more vulnerable to market and economic downturns. Individual Stock Risk AMBSCTF is subject to the volatility of price in the share market. The volatility of prices in each stock will affect the Fund s value daily. The performance of individual stocks, which make up the portfolio, will fluctuate according to changes in the market value of the investments. The fluctuations can be significant in the short-term. This accounts for the market risk when investing in this Fund. However, this impact is minimised through the investment process of portfolio diversification by our External Investment Manager. Liquidity Risk Liquidity risk relates to the Fund s ability to quickly and easily trade, at a reasonable price, into and out of positions. Control of Risk The External Investment Manager will take reasonable steps to ensure that the above potential risks are managed by: (a) (b) actively monitoring the Fund s asset allocation to ensure minimum impact from any adverse market movements. They will ensure that the equities and fixed income securities are carefully selected through site visits, fundamental analysis and portfolio diversification. In the case of fixed income securities, The External Investment Manager will also focus on the credit quality of the fixed income securities, which must be of good investment grade of at least BBB rating or equivalent by RAM, MARC or any other similar rating establishment. investing the Fund over a wide range of equities and fixed income securities of different companies which provides diversification across a number of sectors and industries, minimising the risk not only of any single company s securities becoming worthless, but also of all holdings suffering uniformly adverse business conditions. The External Investment Manager will seek to reduce all these risks associated with the Fund by virtue of its experience, the analytical process and by structuring a broadly diversified investment pool. Others When deemed appropriate and for the benefit of the Fund, the External Investment Manager may take temporary defensive positions in dealing with adverse market, economic, political and other conditions, that maybe inconsistent with the Fund s principal strategy. AMB Client Services :

47 Investment Strategy/Investment Mechanism The Fund invests primarily in selected small and medium sized companies listed on the Main Board and Second Board of the Bursa Malaysia (including MESDAQ) with market capitalization of not more than RM750 million which have the potential for capital appreciation over the medium to long term. Criteria for selection include companies with sound management which operate in the high growth sector, and/or those expected to register high earnings per share growth. The Fund may also invest in companies with market capitalization exceeding RM750 million in order to increase the benefit of diversification and enhance the stability of the Fund. Emphasis is given to companies with reasonably good earnings, growth prospects in the medium to longer term horizon, quality management and good corporate governance. The Fund employs an active investment strategy and periodical review of the asset allocation is made in response to changes in economic fundamentals, interest rates and stock market conditions. In equity investment, to seek outperformance caused by market inefficiencies by identifying undervalued investments whose potentials are yet to be realized. Investment Policies and Restrictions (Unlisted Securities) The Fund is allowed to invest in securities of companies which have obtained approval from the relevant authorities for listing on either the Main Board or Second Board of Bursa Malaysia (including MESDAQ). The market capitalisations of the companies are calculated by multiplying the offer price and the enlarged share capital. The Fund may consider investment in unlisted equities. However, investment in unlisted equities is limited to a maximum of 10% of the Net Asset Value of the Fund. The investment process of unlisted securities is similar to the process used for listed securities. Asset Allocation Min 40% Max 95% in stocks and shares of small and medium cap companies. Min 5% Max 60% in liquid assets and short-term money market investments. The equity allocation may be reduced to below the minimum levels indicated at the discretion of the Manager only during exceptional circumstances. Exceptional circumstances would include situations: i) Where there is an expected sharp downturn in the equity market; ii) When there is insufficient liquidity in equity for the Fund to transact efficiently; and/ or iii) When there is redemption affecting the liquidity position of the Fund. Benchmark The performance of AMBSCTF will be benchmarked against the FBM Emas Index, which is obtainable at Bursa Malaysia. AMB Client Services :

48 Type of Fund Income and Growth Fund Category of Fund Bond Fund AMB Enhanced Bond Trust Fund Investment Philosophy AMBEBTF will invest in fixed income securities with a view to the enhancement of the returns on the Fund through selective participation in IPOs. Investment Objective The investment objective of AMBEBTF is to provide a stable income stream and an opportunity for capital appreciation over the medium to long term horizon. Any material changes to the investment objective of the Fund would require Unit Holders approval. Approved Fund Size of AMBEBTF The approved fund size of AMBEBTF is 500 million Units. Investors Profile The Fund is suitable for investors with the following profile: - Seeking a conservative investment approach but willing to exploit opportunities presented in the capital markets; and Possessing an investment horizon in excess of 5 years. Benefits for Investors Access to investment The Fund seeks to achieve its objective through a policy of diversified investment in convertible debt securities, redeemable debt securities, government backed bonds/securities, rated private debt securities, money market instruments and equities/ipos. Given the asset mix, the Fund is designed to provide investors with affordable access to a portfolio of fixed income securities with an equity exposure to improve yields. The Fund is primarily suited to investors who prefer more stable investment returns than those provided by equity funds and those who are conservative with a need to receive steady income. Initial and subsequent outlay Only a small initial outlay and subsequent investment is required to build a well-diversified bond portfolio as compared to investing in the aforesaid instruments directly. Other Benefits Additionally, the Fund seeks to enhance the returns of the portfolio through participation in IPOs. Participation in IPOs offers investors the opportunity to experience the rewards of owning fast-growing innovative companies before they become household names. In subscribing to IPOs, which have been the subject of comprehensive research and analysis, investors will have the opportunity to benefit, from the full growth potential of such companies. The Fund also provides investors with the opportunity to invest in a diverse selection of IPOs that may not otherwise be accessible to individuals. Due to intense demand for a limited number of shares of certain hot issues, individual investors acting alone may have difficulty in obtaining shares of IPOs at the offer price. A hot issue is any newly issued security, which is usually over-subscribed at the time of its offering and trades in the aftermarket at a price in excess of its offer price. By virtue of its size and institutional nature, the Fund may have greater access to IPOs at the offer price. However, there is no assurance that the Fund will be able to obtain allocations of hot issues. Investments may be made in both large and small capitalisation companies. Specific Benefits of Investing in AMBEBTF Regular Savings Plan You have the opportunity to invest on a fixed monthly basis through standing instruction. This plan makes regular savings easy and allows you to arrange transfers from your bank account to invest in AMBEBTF. AMB Client Services :

49 Affordability Investors can invest with just RM1,000 as initial investment and subsequent investments can be made with a minimum of RM500. Accessibility Investors can easily access any Distribution Branch to perform any enquiry or transaction. EPF Members Investment Scheme The Manager is a unit trust management company under the EPF Members Investment Scheme. You may withdraw a portion of your EPF savings to invest in AMBEBTF, which may provide you the opportunity to reap capital growth, thus increasing the value of your EPF Account 1 Retirement Savings subject to rules and regulations of the EPF Members Investment Scheme from time to time. Potential Risks Associated with AMBEBTF While attempts are being made to reduce risks encountered by the portfolio, investors should be advised that the following risks are inherent in such investments: - Stock/ Bond Market Risk These are risks that affect the entire market as a whole. It is possible that at times the entire market may decline, and no matter how well diversified the portfolio is, the entire portfolio of investment will also decline. Individual Stock Risk This risk refers to the individual risk of the respective companies issuing the securities. Specific risks include but are not limited to changes in consumer tastes and demand, legal suits, competitive operating environments, changing industry conditions and management omissions and errors. This risk can be minimised through investing in a wide range of companies in different sectors, which thus function independently from one another. IPO Risk This risk could be in the form of under-subscription of IPO shares, a delay in or abortion of the listing due to poor market conditions and listing approval not granted by the Bursa Malaysia. Additionally, given that there is no prior market for the IPO shares, there is also no assurance that the issue or offer price will correspond to the price at which the IPO shares will trade upon or subsequent to the listing. Interest Rate Risks Bonds are particularly sensitive to movements in interest rates. Prices of bonds move inversely to interest rate movements. Therefore, as interest rates rise, the prices of bonds decrease and vice versa. Furthermore, bonds with longer maturity and lower yield coupon rates are more susceptible to interest rate movements. Credit/Default Risk Bonds are subject to credit / default risk in the event that the issuers of the instruments encounter financial difficulties, which may decrease their credit worthiness. This in turn may lead to a default in the payment of principal and interest. Liquidity Risk Liquidity refers to the ease of converting an investment into cash without incurring an overly significant loss in value. Control of Risk The External Investment Manager will take reasonable steps to ensure that the above potential risks are managed by: a) actively monitoring the Fund s asset allocation to ensure minimum impact from any adverse market movements. They will ensure that the fixed income securities and equities are carefully selected through company visits, fundamental analysis and portfolio diversification. In the case of fixed income securities, The External Investment Manager will also focus on the credit quality of the fixed income securities, which must be of good investment grade of at least BBB rating or equivalent by RAM, MARC or any other similar rating establishment. b) investing the Fund over a wide range of fixed income securities and equities of different companies which provides diversification across a number of sectors and industries, minimising the risk not only of any single company s securities becoming worthless, but also of all holdings suffering uniformly adverse business conditions. c) lengthening or shortening the Fund s average maturity period of the fixed income investments (within the Fund s objective) in anticipation of changing interest rates. d) selecting investments that are bank or government guaranteed or secured against assets to mitigate default risk. AMB Client Services :

50 The External Investment Manager will seek to reduce all these risks associated with the Fund by virtue of its experience, the analytical process adopted and by structuring a broadly diversified investment pool. Others When deemed appropriate and for the benefit of the Fund, the External Investment Manager may take temporary defensive positions in dealing with adverse market, economical, political and other conditions, that may be inconsistent with the Fund s principal strategy. Investment Approach The Fund seeks to achieve its objective through a policy of diversified investment in convertible debt securities, redeemable debt securities, government backed bonds/securities, rated private debt securities, money market instruments and equities. Unlike the present money market and bond funds, which primarily invest in such instruments only, the AMBEBTF widens its asset universe by participating in a minimum of 85% of its Net Asset Value in fixed income securities and money market and no more than 15% in IPOs. The appointed External Investment Manager shall capitalise on the stringent value investment methodology to select such securities for inclusion in its portfolio. Typically, many IPOs worldwide are priced at a discount to its industry. This practice is due to a need to encourage greater subscription of such securities while reducing the pressure imposed on its underwriters. Upon listing the IPOs will generally attain a value similar to its peers thereby presenting opportunities to the subscriber and also to this Fund. For IPOs (after market) securities however, some may be neglected by the market place and thus become undervalued relative to their peers. Similarly, this presents opportunities for the Fund to exploit. Through channeling a minor portion of the Fund s portfolio to the participation in these securities, the portfolio aims to achieve an enhancement in its bond yields without increasing risks extensively. Investment Strategy/Investment Mechanism Investment Strategy for Fixed Income Investments AMBEBTF s approach is one that recognised the need to exploit anomalies and opportunities as they arise. At the same time, AMBEBTF also seeks to optimise returns (based on our interest rate outlook) at minimal risk; hence, a well diversified portfolio with stringent credit analysis will be adopted in the portfolio. Investment Strategy for Equity Investments In managing the equity portfolios, AMBEBTF will employ a combination of top down and bottom up investment techniques, recognising that these are not mutually exclusive processes. The disciplines governing these processes are closely intertwined and the interaction between asset allocation determination and stock selection is a strong one. Although AMBEBTF take into account the macroeconomic picture, our approach is value driven with emphasis on growth. AMBEBTF will constantly assess all upcoming IPOs and use research and statistical information on IPOs in selecting stocks for the equity portfolio. This research analyses the business, fundamentals, financial results, management control issues and proposed valuation of the IPO. AMBEBTF also employs proprietary statistical information on IPO performance trends, number of pending IPOs, industry sectors and valuation trends to determine the overall tone of market activity. Other information sources used by us include the IPO s prospectus, the results of discussions and meetings with management, periodic corporate financial reports, press releases, general economic and industry data supplied by government agencies and trade associations and research reports prepared by brokers. Investment Policy AMBEBTF is a bond fund that offers investors an opportunity to invest in fixed income securities with a view to enhance the returns on the Fund through selective participation in IPOs. Asset Allocation The Fund may invest a minimum of 85% of its Net Asset Value in fixed income securities and money market and no more than 15% in IPOs. If no good quality IPOs are available, then the Fund will have all its assets in fixed income securities and money market. The equity and fixed income allocation may be reduced to below the minimum levels indicated at the discretion of the Manager only during exceptional circumstances. Exceptional circumstances would include situations: AMB Client Services :

51 i) Where there is an expected sharp downturn in the equity market; ii) When there is high risk of capital loss on fixed income instruments due to interest rate fluctuations; iii) When there is insufficient liquidity in either equity or fixed income instruments for the Fund to transact efficiently; and/or iv) When there is redemption affecting the liquidity position of the Fund. Benchmark The performance of AMBEBTF will be benchmarked against the 3-month fixed deposit rate, from commercial banks which is a commonly used industry practice. AMB Client Services :

52 Type of Fund Income and Capital Growth Fund Category of Fund Equity Fund AMB Ethical Trust Fund Investment Philosophy We believe superior long-term investment performance can be achieved by exploiting inefficiencies in capital markets through rigorous and intensive research within a disciplined investment process. Investment Objective The Fund s primary objective is to provide investors with income and capital growth for medium to long term through investments that comply with ethical principles as defined in this Fund. Any material changes to the investment objective of the Fund would require Unit Holders approval. Approved Fund Size of AMBETF The approved fund size for AMBETF is 300 million Units. Investors Profile Suitable for individual or institutional investors who desires income and capital returns from the equity markets; Suitable for investors who would like to channel their resources to companies that demonstrate socially responsible practices relating to the environment and community; and Suitable for those with an investment horizon exceeding 5 years. Benefits for Investors AMBETF is essentially a socially responsible Fund, which caters for Malaysians who increasingly want a say in how their money is invested. The Fund accomplishes this by channeling pooled funds to companies that are befitting to the agreed upon ethical standards that are defined in the Fund. The Fund represents an affordable investment tool and also rewards companies that are viewed as performing an invaluable service to Malaysia through its ethical activities. Specific Benefits of Investing in AMBETF Free Insurance Protection Coverage for AMBETF Eligible Unit Holders (natural persons) of AMBETF will be given free GPA insurance coverage. Unit Holders holding a minimum of 2,000 Units and above will automatically be covered under the GPA insurance coverage. The sum covered would be RM0.50 for every Unit held subject to a minimum investment of 2,000 Units and maximum coverage of RM200,000. The GPA insurance coverage covers: (i) Death due to accidental causes only; (ii) TPD due to accidental causes; and (iii) Funeral expenses as follows: Units Funeral Expenses 2,000 to 49,999 RM1,000 50,000 and above RM2,000 While the policy is in force, the amount of coverage shall be based on the amount of Units held at the time of accident which led to claim. Eligible Unit Holders must be aged between 18 and 69 years old. The GPA coverage ceases automatically when you attain the age of 70 years old. Eligible principal Unit Holder and jointholder(s) will be covered under the GPA insurance coverage but the sum covered will be shared equally. AMB Client Services :

53 Regular Savings Plan You have the opportunity to invest on a fixed monthly basis through standing instruction. This plan makes regular savings easy and allows you to arrange transfers from your bank account to AMBETF. Affordability Investors can invest with just RM500 as initial investment and subsequent investments can be made with a minimum of RM100. Accessibility Investors can easily access any Distribution Branch to perform any enquiry or transaction. EPF Members Investment Scheme The Manager is a unit trust management company under the EPF Members Investment Scheme. You may withdraw a portion of your EPF savings to invest in AMBETF, which may provide you the opportunity to reap capital growth, thus increasing the value of your EPF Account 1 Retirement Savings subject to rules and regulations of the EPF Members Investment Scheme from time to time. Potential Risks Associated with AMBETF As the Fund invests only in securities of companies which comply with the ethical principles, certain securities which may provide better growth potential but do not comply with the ethical principles are therefore excluded in the portfolio. Hence, the returns of the Fund may be limited when compared to a Fund that has no investment restrictions. Other risks associated with the Fund are described below: - Stock Market Risk This is fluctuation in the market performance due to factors such as fluctuation in interest rates, and changes in economic climate, political and social environments that will affect the stock market as a whole. Individual Stock Risk The performance of each individual stock that a Fund invested in will be reflected in the price per unit. Interest Rate Risk Fixed income securities are particularly sensitive to movements in interest rates. When interest rates rise, the value of fixed income securities falls and vice versa, thus affecting the NAV of the Fund. Credit/Default Risk Credit risk refers to the possibility that the issuer of a fixed income security will be unable to make interest payments or repay the principal in a timely manner. Liquidity Risk Liquidity risk relates to the Fund s ability to quickly and easily trade, at a reasonable price, into and out of positions. Control of Risk The External Investment Manager will take reasonable steps to ensure that the above potential risks are managed by: (a) (b) actively monitoring the Fund s asset allocation to ensure minimum impact from any adverse market movements. They will ensure that the equities and fixed income securities are carefully selected through site visits, fundamental analysis and portfolio diversification. In the case of fixed income securities, The External Investment Manager will also focus on the credit quality of the fixed income securities, which must be of good investment grade of at least BBB rating or equivalent by RAM, MARC or any other similar rating establishment. investing the Funds over a wide range of equities and fixed income securities of different companies which provides diversification across a number of sectors and industries, minimising the risk not only of any single company s securities becoming worthless, but also of all holdings suffering uniformly adverse business conditions. The External Investment Manager will seek to reduce all these risks associated with the Fund by virtue of its experience, the analytical process and by structuring a broadly diversified investment pool. Others When deemed appropriate and for the benefit of the Fund, the External Investment Manager may take temporary defensive positions in dealing with adverse market, economic, political and other conditions, that maybe inconsistent with the Fund s principal strategy. AMB Client Services :

54 Investment Policy 1) The diagram below displays the investment policy practiced by the AMBETF: - COMPANIES LISTED ON THE BURSA MALAYSIA PERFORMANCE FILTER NEGATIVE FILTER TO REMOVE INAPPROPRIATE INVESTMENTS; - principal business in the promotion of gaming, tobacco and alcohol POSITIVE FILTER; - Environmentally friendly - Promote healthy social values - Good corporate governance IDENTIFY SUITABLE COMPANIES FOR INVESTMENT PURPOSES 2) To achieve the objective of the AMBETF, the Fund will only invest in companies that are deemed to meet our stringent value investment criterion. For further details, please refer to the section entitled Investment Approach. 3) As the Fund places heavy emphasis on the need to invest only in ethical companies, the Fund will screen its investments and remove companies whose principal business involves the promotion of gambling, tobacco and alcohol. This screen is known as the Negative Filter. The Fund may also abstain from investing in companies that have violated ethical principles during the management of this Fund. The remaining securities after the negative filters are deemed as Ethical. 4) Besides having a Negative Filter, the Fund will also have a Positive Filter. This filter encourages companies to practice the following activities as listed below: - POSITIVE FILTERS Environmentally friendly Promote healthy social values Maintain good corporate governance EXAMPLES Provides eco-friendly products and services Prevention of pollution Recycling Promotes sports, community projects Fulfils social obligations e.g. Housing for the poor, education and medical care Charitable Good community relations Ensure compliance to regulations and proper dissemination of information to stakeholders and employees Steering management to enhance well-being of employees and customers AMB Client Services :

55 5) Few companies shall fulfill the entire criterion as laid out by the positive filters. This is where the External Investment Manager will encourage these companies to practise the above principles if the Fund has them within its portfolio. This will be known as our Shareholder Activism Programme. The External Investment Manager shall leverage on the expertise of the Ethical Panel of Advisors to accomplish successful practice of the above procedures. 6) Further to our Shareholder Activism Programme, the External Investment Manager may from time to time vote on company resolutions, after considering the Fund s financial interests and social objectives. However, there may be instances in which the External Investment Manager may not vote if the resolution is irrelevant or unimportant. 7) Should any of the securities within our portfolio deviate from the Fund s objectives then the deviation procedures will commence. Please refer to the section entitled Deviation Procedure. 8) There is no specific percentage or monetary limit on the Fund s investment in a single industry or security. However, the limitations will be subject to prevailing regulatory Guidelines. Investment Approach Our investment approach combines a macro-economic and market analysis top-down approach to decide on strategic asset allocation with a rigorous bottom-up approach for stock selection which will emphasise on value and growth potential of the stocks. Macro Economic Analysis Strategic Asset Allocation Monitor and assess investment environment to identify emerging investment trends and themes. Stock Selection Portfolio Construction Fundamental Analysis; Valuation screen for growth, value, momentum and quality; Liquidity and market capitalisation consideration. The equity selection will be based on a rigorous process, which will appraise the relative value of a company in terms of: - Price/Earnings (P.E.) P.E. to growth Dividend growth Dividend yield Price-book value Quality of earnings (Volatility, Sustainability, Visibility) Financial strength Competitive risks Profit margin Cash flow analysis Quality of management Investment Strategy/Investment Mechanism The Fund seeks to maximise total returns by providing investors with capital appreciation while reducing risk through diversified investments, mainly in equities listed in the Bursa Malaysia that comply with ethical principles as defined in this Fund. Asset allocation in equities and/or bonds will be subjected to a maximum of 90-98%. The Fund will maintain a minimum of 2-10% in short-term money market instruments. The Fund will invest primarily in equities. However, the Fund is not restricted from participating in bonds/fixed income instruments when deemed appropriate. AMB Client Services :

56 Asset Allocation 90% to 98% in equities and/or bonds 2% to 10% in short term money market instruments Min 50% in equities and/or bonds The above asset allocation of the Fund is only indicative and will be reviewed from time to time depending on economic and market conditions. The bulk of investments will be invested over a medium to long-term period with active disposal and liquidation of the investments, a strategy to control risk as well as to optimise capital gains. This is especially so when the full growth potential of the investment is deemed to have been reduced over a prolonged bull run and the resultant liquidity may prove handy for further investments along similar lines when the market has sufficiently eased off. The External Investment Manager in making its investment decision shall at all times comply with the investment restrictions and requirements as set out in the Deed. The equity and fixed income allocation may be reduced to below the minimum levels indicated at the discretion of the Manager only during exceptional circumstances. Exceptional circumstances would include situations: i) Where there is an expected sharp downturn in the equity market; ii) When there is high risk of capital loss on fixed income instruments due to interest rate fluctuations; iii) When there is insufficient liquidity in either equity or fixed income instruments for the Fund to transact efficiently; and/or iv) When there is redemption affecting the liquidity position of the Fund. Benchmark The performance of AMBETF will be benchmarked against an internally created benchmark comprising of the FBM Emas Syariah Index and Finance Indices on an 80:20 basis. These 2 indices are available from the Bursa Malaysia. Deviation Procedure When any of the stocks contained within the portfolio has deviated from the Fund s ethical objectives, the External Investment Manager needs to undertake several measures. However it is necessary that the actions can only be undertaken when the infringement is a publicly known factor is uncontestable in nature. During such events a Deviation Report will be issued and a meeting between the External Investment Manager and the Ethical Panel of Advisors, will be held to discuss the issue. The deviation report should be accompanied with proof of the deviation. The meeting will require them to assess the nature of the infringement, the frequency of such infringements, and the extent of damage created by the infringement in terms of contingent liabilities. Once the Fund reaches a consensus the Manager will then undertake to perform any of the following actions: - 1) Communicate with the company to voice our concerns; 2) Reduce our portfolio holdings in the company; and/or 3) Remove the company from our investment portfolio with a classification of the stock as not investable over a period of 5 years. The duration for the above actions will be a maximum of 2 years. Where the infringement is serious (i.e. possible occurrence of huge contingent liabilities, regulatory actions etc.) the Fund will perform phase 3 without going through phases 1 2, and the time frame for such actions shall not exceed 6 months. Shareholder Activism Programme This programme entails that the External Investment Manager will encourage companies to adopt the activities as laid out in the positive filters. This can only be conducted if the Fund has an active stake over the company. The program is conducted through an open dialogue with the company. The Fund will neither protest nor conduct strikes to enforce its recommendations. AMB Client Services :

57 Type of Fund Capital Growth Fund Category of Fund Equity Fund AMB Value Trust Fund Investment Philosophy Investment of AMBVTF will invest into securities which are trading below their intrinsic values. The Fund is structured to provide investors with capital growth in the medium to long term. Investment Objective The primary objective of AMBVTF is to provide investors with capital growth through investments into securities that are trading at a discount to their intrinsic values, while minimising the risk in the medium to long term. Any material changes to the investment objective of the Fund would require Unit Holders approval. Approved Fund Size of AMBVTF The approved fund size of AMBVTF is 300 million Units. Investors Profile The ideal investor for this fund should have the following characteristics: - (i) Willing to accept risks for returns presented by the stock market; (ii) Want to capitalise on the value investment approach when investing in equity markets; and (iii) Possessing an investment horizon in excess of 5 years. Benefits for Investors Provides investors with an alternative approach when investing in equity markets. Value Investments do not behave in a similar fashion when compared to growth oriented investments. This is generally due to the fact that value funds are normally associated with neglected or out-of-favour stocks while growth funds are involved with well-analysed stocks. Specific Benefits of Investing in AMBVTF Free Insurance Protection Coverage for AMBVTF Eligible Unit Holders (natural persons) of AMBVTF will be given free GPA insurance coverage. Unit Holders holding a minimum of 2,000 Units and above will automatically be covered under the GPA insurance coverage. The sum covered would be RM0.50 for every Unit held subject to a minimum investment of 2,000 Units and maximum coverage of RM200,000. The GPA Insurance Coverage covers: (i) Death due to accidental causes only; (ii) TPD due to accidental causes; and Funeral expenses as follows: Units Funeral Expenses 2,000 to 49,999 RM1,000 50,000 and above RM2,000 While the policy is in force, the amount of coverage shall be based on the amount of Units held at the time of accident which led to claim. Eligible Unit Holders must be aged between 18 and 69 years old. The GPA coverage ceases automatically when you attain the age of 70 years old. Eligible principal Unit Holder and jointholder(s) will be covered under the GPA insurance coverage but the sum covered will be shared equally. AMB Client Services :

58 Regular Savings Plan You have the opportunity to invest on a fixed monthly basis through standing instruction. This plan makes regular savings easy and allows you to arrange transfers from your bank account to AMBVTF. Affordability Investors can invest with just RM500 as initial investment and subsequent investments can be made with a minimum of RM100. Accessibility Investors can easily access any Distribution Branch to perform any enquiry or transaction. EPF Members Investment Scheme The Manager is a unit trust management company under the EPF Members Investment Scheme. You may withdraw a portion of your EPF savings to invest in AMBVTF, which may provide you the opportunity to reap capital growth, thus increasing the value of your EPF Account 1 Retirement Savings subject to rules and regulations of the EPF Members Investment Scheme from time to time. Potential Risks Associated with AMBVTF As the Fund invests primarily in securities, which are listed on the Bursa Malaysia, it may be subject to a higher level of risk than a portfolio diversifying its holdings across several markets and economies. Other risks associated with the Fund are described below: - Stock Market Risk This is fluctuation in the market performance due to factors such as fluctuation in interest rates, and changes in economic climate, political and social environments that will affect the stock market as a whole. Individual Stock Risk The performance of each individual stock that a Fund invested in will be reflected in the price per unit. Interest Rate Risk Fixed income securities are particularly sensitive to movements in interest rates. When interest rates rise, the value of fixed income securities falls and vice versa, thus affecting the NAV of the Fund. Credit/Default Risk Credit risk refers to the possibility that the issuer of a fixed income security will be unable to make interest payments or repay the principal in a timely manner. Liquidity Risk Liquidity risk relates to the Fund s ability to quickly and easily trade, at a reasonable price, into and out of positions. Control of Risk The External Investment Manager will take reasonable steps to ensure that the above potential risks are managed by: a) actively monitoring the Fund s asset allocation to ensure minimum impact from any adverse market movements. They will ensure that the equities and fixed income securities are carefully selected through site visits, fundamental analysis and portfolio diversification. In the case of fixed income securities, The External Investment Manager will also focus on the credit quality of the fixed income securities, which must be of good investment grade of at least BBB rating or equivalent by MARC or any other similar rating establishment. b) investing the Fund over a wide range of equities and fixed income securities of different companies which provides diversification across a number of sectors and industries, minimising the risk not only of any single company s securities becoming worthless, but also of all holdings suffering uniformly adverse business conditions. The External Investment Manager will seek to reduce all these risks associated with the Fund by virtue of its experience, the analytical process and by structuring a broadly diversified investment pool. Others When deemed appropriate and for the benefit of the Fund, the External Investment Manager may take temporary defensive positions in dealing with adverse market, economic, political and other conditions, that may be inconsistent with the Fund s principal strategy. AMB Client Services :

59 Investment Policy 1) The Fund will invest in companies that are competitive and well-managed and that offer attractive growth prospects over the medium to long term. The Fund will invest in 2 categories of companies: those that are either, strong and competitive on a global or regional basis, and those that are strong within their domestic markets. While the main focus will be on long-term growth, the Manager will only invest in companies where valuation levels can be justified. Competitive edge will be defined in terms of: - superiority of products and service; business franchise; distribution capability; forward looking management; shareholder value orientated management style; financial strength; research and development capability; and high barriers to entry for competitors. 2) There is no specific percentage or monetary limit on the Fund s investment in a single industry or security. Investment Approach Our investment approach emphasises on a bottom-up approach that focuses on specific stock selection rather than markets and sectors. Nevertheless, the Fund will adopt a macro-economic and market analysis top-down approach to decide on strategic asset allocation. Stocks are selected for their value (Value Driven Approach). Stock Universe In depth Analysis Stock Selection Portfolio Construction Fundamental Analysis; Valuation screen for growth, value,momentum and quality; Liquidity and market capitalization consideration. The equity selection will be based on a rigorous process, which will appraise the intrinsic value of a company in terms of: - Price/Earnings (P.E.) P.E. to growth Dividend growth Dividend yield Price-book value Quality of earnings (Volatility, Sustainability, Visibility) Financial strength Competitive risks Profit margin Cash flow analysis Quality of management. Investment Strategy/Investment Mechanism The Fund seeks to maximise total returns by providing investors with capital appreciation while reducing risk through diversified investments, mainly in equities listed on the Bursa Malaysia. Asset allocation in equities and/ or bonds will be subjected to a maximum of 90-98%.The Fund will maintain a minimum of 2-10% in short-term money market instruments. AMB Client Services :

60 The Fund will invest primarily in equities. However, the Fund is not restricted from participating in bonds/fixed income instruments when deemed appropriate. Asset Allocation 90% to 98% in equities and/ or debt Instruments 2% to 10% in cash/ money market Instruments Min 50% in equities and/ or bonds The above asset allocation of the Fund is only indicative and will be reviewed from time to time depending on economic and market conditions. The bulk of investments will be invested over a medium to long-term period with active disposal and liquidation of the investments, a strategy to control risk as well as to optimise capital gains. This is especially so when the full growth potential of the investment is deemed to have been reduced over a prolonged bull run and the resultant liquidity may prove handy for further investments along similar lines when the market has sufficiently eased off. The External Investment Manager in making its investment decision, shall at all times comply with the investment restrictions and requirements as set out in the Deed. The equity and fixed income allocation may be reduced to below the minimum levels indicated at the discretion of the Manager only during exceptional circumstances. Exceptional circumstances would include situations: i) Where there is an expected sharp downturn in the equity market; ii) When there is high risk of capital loss on fixed income instruments due to interest rate fluctuations ; iii) When there is insufficient liquidity in either equity or fixed income instruments for the Fund to transact efficiently;and/or iv) When there is redemption affecting the liquidity position of the Fund. Benchmark The performance of AMBVTF will be benchmarked against the KLCI which is obtainable from the Bursa Malaysia. AMB Client Services :

61 Type of Fund Income Fund Category of Fund Fixed Income Fund AMB Lifestyle Trust Fund Today Investment Philosophy AMBLTFT will invests in a well-diversified portfolio of assets, which includes money market securities, fixed income securities, equities and other securities that are permitted by the authorities from time to time. The portfolio is an actively managed defensive Fund aimed to provide investors with regular income and moderate capital growth. Investment Objective To seek regular income stream and moderate capital growth through investments into fixed income securities and dividend yielding equities. Any material changes to the investment objective of the Fund would require Unit Holders approval. Approved Fund Size of AMBLTF Today The approved Fund size for AMBLTF Today is 250 million Units. Investors Profile The Fund is suitable for investors with the following profile: - Investors who seek a defensive investment solution that comprises fixed income Instruments and a minor portion of equity; and Investors who seek returns from a professionally managed Fund. Benefits for Investors Extensive Diversification Your portfolio is made up of all the essential asset classes comprising equities, bonds and money market instruments. Active Management Professional External Investment Managers manage an investment mix that emphasises income generation for you. A Personalised Approach You decide when you will need your money and how you feel about risk, and choose the AMB lifestyle portfolio that is tailored to meet your needs. The AMB Lifestyle portfolio allows you the flexibility to select the right segment to fit your lifestyle or requirement over a wider time horizon. Example: If you have a longer time period before money is required, you may have a higher tolerance for risk in your investments. This is because peaks and troughs of performance tend to smooth out over time. If there is a shorter period of time before your retirement income is needed, then a lower tolerance for risk is allowed. Each AMB Lifestyle portfolio represents the number of years you expect to begin realising your investment. As you get closer to the year of withdrawal, the External Investment Manager will gradually re-balance the portfolio mix to optimize your returns. Professional External Investment Managers A team of professional External Investment Managers backed by a research team at UOB-OSK Asset Management Sdn Bhd will use their expertise to build and manage the portfolios. The stocks, bonds and money market instruments in AMBLTF Today are carefully selected with the aim of seeking a regular income stream and moderate capital growth. Specific Benefits of Investing in AMBLTF Today Regular Savings Plan You have the opportunity to invest on a fixed monthly basis through standing instruction. This plan makes regular savings easy and allows you to arrange transfers from your bank account to AMBLTF Today. AMB Client Services :

62 Affordability Investors can invest just RM500 as an initial investment and subsequent investments can be made at a minimum of RM100 Accessibility Investors can easily access any Distribution Branch to perform any enquiry or transaction. EPF Members Investment Scheme The Manager is a unit trust management company under the EPF Members Investment Scheme. You may withdraw a portion of your EPF savings to invest in AMBLTF Today, which may provide you the opportunity to reap capital growth, thus increasing the value of your EPF Account 1 Retirement Savings subject to rules and regulations of the EPF Members Investment Scheme from time to time. Potential Risks Associated with AMBLTF Today While attempts are made to reduce risks encountered by the portfolio, investors should be advised that the following risks are inherent in such investments: - Stock/Bond Market Risk These are risks that affect the entire market as a whole. It is possible that at times the entire market may decline, and no matter how well diversified the portfolio is, the entire portfolio of investment will decline also. Credit/Default Risk It is possible that the issuer of fixed income securities may not be able to service periodic coupon payments and/or repay principal when due, thus affecting the value of investments for Unit Holders. Interest Rate Risks Fixed income securities/debentures are particularly sensitive to movements in interest rates. As interest rates rise, prices generally fall and vice-versa. Furthermore, those with longer duration and lower coupon rates are more susceptible to interest rate movements. Liquidity Risk Liquidity risk is the risk that the security/instrument invested in cannot be readily sold and converted into cash. This can occur when trading volume for the security is low and/or when there is a lack of demand for the security. In managing liquidity risk, the Fund will limit its exposure to instruments, which are deemed less liquid. Individual Stock Risk This risk refers to the individual risk of the respective companies issuing the securities. Specific risks include but are not limited to changes in consumer tastes and demand, legal suits, competitive operating environments, changing industry conditions and management omissions and errors. This risk can be minimised through investing in a wide range of companies in different sectors, thus functioning independently from one another. Currency Risk Currency risk is also known as foreign exchange risk. It is risk associated with investments that are denominated in foreign currencies. When the foreign currencies fluctuate in an unfavourable movement against Ringgit Malaysia, the investments will face currency losses in addition to the capital gains/losses. This will lead to a lower NAV of the Fund. Country Risk The foreign investment of the Fund may be affected by risks specific to the country which it invests in. Such risks include changes in a country s economic fundamentals, social and political stability, currency movements and foreign policies etc. These may have an adverse impact on the prices of securities of listed companies. Control of Risk The External Investment Manager will take reasonable steps to ensure that the above potential risks are managed by: a) actively monitoring the Fund s asset allocation to ensure minimum impact from any adverse market movements. They will ensure that the equities and fixed income securities are carefully selected through site visits, fundamental analysis and portfolio diversification. In the case of fixed income securities, The External Investment Manager will also focus on the credit quality of the fixed income securities, which must be of good investment grade of at least BBB rating or equivalent by RAM, MARC or any other similar rating establishment. AMB Client Services :

63 b) investing the Fund over a wide range of equities and fixed income securities of different companies which provides diversification across a number of sectors and industries, minimising the risk not only of any single company s securities becoming worthless, but also of all holdings suffering uniformly adverse business conditions. The External Investment Manager will seek to reduce all these risks associated with the Fund by virtue of its experience, the analytical process and by structuring a broadly diversified investment pool. Others When deemed appropriate and for the benefit of the Fund, the External Investment Manager may take temporary defensive positions in dealing with adverse market, economic, political and other conditions, that may be inconsistent with the Fund s principal strategy. Investment Strategy/Investment Mechanism To achieve its investment objective of a regular income stream, the Fund will allocate at least 80% of its assets into the Malaysian fixed income markets with the balance in dividend yielding equities to enhance the returns for the portfolio. To reduce the volatility of our equity investments, we may diversify by investing in both the Malaysia and other Asian markets. The equity portion can and will be reduced to zero in times of market uncertainties. Futures may also be employed from time to time to hedge the portfolio. In formulating the investment strategy, the Manager will consider the following to determine the portion of investment to be in foreign markets (within permitted amounts): - a) Comparison of economic outlook of other Asian economies against the Malaysian economy to determine the growth prospects and economic cycle. b) Assessment of country, political and social risks. c) Comparison of liquidity flows in all the Asian countries. d) Risks or attractions specific to countries/region. e) Currency risks. Asset Allocation The following table indicates the maximum & minimum exposures for equities and fixed income (comprising of bonds & money market Instruments) :- Min 0 Max 20% in equities Min 80% Max 100% in bonds and money market/cash. Benchmark The performance of AMBLTF Today will be benchmarked against the FBM Emas Index and 12-month fixed deposit rate which is based on 80% of the 12-month fixed deposit rate and 20% from the performance of FBM Emas Index. These benchmark returns are obtainable from the commercial banks and Bursa Malaysia respectively. Temporary Defensive Positions The Manager may take defensive positions in anticipation of, or in the event of adverse economic or market conditions, to minimise losses. The equity portion could be hedged through futures contracts (under the Act) and the fixed income/debenture portion could be hedged through the 3month Kuala Lumpur Inter Bank Offered Rate (KLIBOR) Futures and/or the 5-year Malaysian Government Securities (MGS) futures contracts. Should the Manager deem appropriate the equity portion can be reduced proportionately to reflect the Managers view. AMB Client Services :

64 Type of Fund Growth Fund Category of Fund Balanced Fund AMB Lifestyle Trust Fund 2009 Investment Philosophy AMBLTF 2009 will invests in a well-diversified portfolio of assets, which includes money market securities, fixed income securities, equities and other securities that are permitted by the authorities from time to time. The portfolio is an actively managed balanced Fund aimed to optimise returns while minimising risks encountered by investors. The Fund is particularly suited to investors who have a 5 year investment horizon, or more, from the launch of the Fund. Investment Objective To provide capital growth for investors through a well-diversified balanced portfolio that is specially catered for a 5- year investment period. The Fund, over its investment period, shall progressively adopt more defensive investment strategies as the Fund approaches maturity. Any material changes to the investment objective of the Fund would require Unit Holders approval. Approved Fund Size of AMBLTF 2009 The approved Fund size of AMBLTF 2009 is 250 million Units. Investors Profile The Fund is suitable for investors with the following profile: - Investors who seek an investment solution for a period of 5 years or more; Investors who seek returns from a professionally managed fund that is well diversified across various asset classes; and Investors who desire to have a fund that will automatically become more defensive over time. Benefits for Investors Extensive Diversification Your portfolio is made up of all the essential asset classes comprising equities, bonds and money market instruments that will be balanced over time to optimise your investment. Active Management Professional External Investment Managers manage the investment mix of your AMB Lifestyle portfolio to create the optimal risk and return for each stage of your life or target maturity date of the Fund. A Personalised Approach You decide when you will need your money and how you feel about risk, and choose the AMB Lifestyle portfolio that is tailored to meet your needs. The AMB Lifestyle portfolio allows you the flexibility to select the right segment to fit your lifestyle or requirement over a wider time horizon. Example: If you have a longer time period before money is required, you may have a higher tolerance for risk in your investments. This is because peaks and troughs of performance tend to smooth out over time. If there is a shorter period of time before your retirement income is needed, then a lower tolerance for risk is allowed. Each AMB Lifestyle portfolio represents the number of years you expect to begin realising your investment. As you get closer to the year of withdrawal, the External Investment Manager will gradually re-balance the portfolio mix to optimize your returns. Professional External Investment Managers A team of professional External Investment Managers backed by a research team at UOB-OSK Asset Management Sdn Bhd will use their expertise to build and manage the portfolios. AMB Client Services :

65 The stocks, bonds and money market instruments in AMB Lifestyle Funds are carefully selected to give you the advantage of time. The individual portfolios are based on the idea that the way you invest should change as you go through your life and your retirement gets closer. Your needs may change as you approach retirement, as well as your risk tolerance. Specific Benefits of Investing in AMBLTF 2009 Free Insurance Protection Coverage Eligible Unit Holders (natural persons) of AMBLTF 2009 will be given free standard GPA coverage. Unit Holders holding a minimum amount of 2,000 Units and above will automatically be covered under the Standard GPA insurance for accidental death and TPD with the following extensions:-. (i) Medical expenses (ii) Funeral expenses (iii) Repatriation expenses Units Medical Expenses Funeral Expenses Repatriation Expenses 2,000 49,999 RM1,000 RM1,000 RM1,000 50,000 and above RM2,000 RM2,000 RM2,000 The sum insured would be RM0.50 for every Unit held subject to a minimum investment of 2,000 Units and maximum coverage of RM150,000. While the policy is in force, the amount of sum insured per eligible Unit Holder shall be the last amount of Units held by the eligible Unit Holder as at the date of accident leading to claim. Eligible Unit Holder must be aged between 18 to 69 years old. The standard GPA coverage ceases automatically when you attain the age of 70 years old. Eligible principal Unit Holder and jointholder(s) will be covered under the standard GPA but the sum covered will be shared equally. Regular Savings Plan You have the opportunity to invest on a fixed monthly basis through standing instruction. This plan makes regular savings easy and allows you to arrange transfers from your bank account to AMBLTF Affordability Investors can invest just RM500 as an initial investment and subsequent investments can be made with a minimum of RM100. Accessibility Investors can easily access any Distribution Branch to perform any enquiry or transaction. EPF Members Investment Scheme The Manager is a unit trust management company under the EPF Members Investment Scheme. You may withdraw a portion of your EPF savings to invest in AMBLTF 2009, which may provide you the opportunity to reap capital growth, thus increasing the value of your EPF Account 1 Retirement Savings subject to rules and regulations of the EPF Members Investment Scheme from time to time. Potential Risks Associated with AMBLTF 2009 While attempts are being made to reduce risks encountered by the portfolio, investors should be advised that the following risks are inherent in such investments: - Stock/Bond Market Risk These are risks that affect the entire market as a whole. It is possible that at times the entire market may decline, and no matter how well diversified the portfolio is, the entire portfolio of investment will also decline. Credit/Default Risk It is possible that the issuer of fixed income securities may not be able to service periodic coupon payments and/or repay principal when due, thus affecting the value of investments for Unit Holders. AMB Client Services :

66 Interest Rate Risk Fixed income securities/debentures are particularly sensitive to movements in interest rates. As interest rates rise, prices generally fall and vice-versa. Furthermore, those with longer duration and lower coupon rates are more susceptible to interest rate movements. Liquidity Risk Liquidity risk is the risk that the security/instrument invested in cannot be readily sold and converted into cash. This can occur when trading volume for the security is low and/or when there is a lack of demand for the security. In managing liquidity risk, the Fund will limit its exposure to instruments which are deemed less liquid. Individual Stock Risk This risk refers to the individual risk of the respective companies issuing the securities. Specific risk includes but is not limited to changes in consumer tastes and demand, legal suits, competitive operating environments, changing industry conditions and management omissions and errors. This risk can be minimised through investing in a wide range of companies in different sectors, which thus function independently from one another. Currency Risk Currency risk is also known as foreign exchange risk. It is risk associated with investments that are denominated in foreign currencies. When the foreign currencies fluctuate in an unfavourable movement against Ringgit Malaysia, the investments will face currency losses in addition to the capital gains/losses. This will lead to a lower NAV of the Fund. Country Risk The foreign investment of the Fund may be affected by risks specific to the country which it invests in. Such risks include changes in a country s economic fundamentals, social and political stability, currency movements and foreign policies etc. These may have an adverse impact on the prices of securities of listed companies. Control of Risk The External Investment Manager will take reasonable steps to ensure that the above potential risks are managed by: a) actively monitoring the Fund s asset allocation to ensure minimum impact from any adverse market movements. They will ensure that the equities and fixed income securities are carefully selected through site visits, fundamental analysis and portfolio diversification. In the case of fixed income securities, The External Investment Manager will also focus on the credit quality of the fixed income securities, which must be of good investment grade of at least BBB rating or equivalent by RAM, MARC or any other similar rating establishment. b) investing the Funds over a wide range of equities and fixed income securities of different companies which provides diversification across a number of sectors and industries, minimising the risk not only of any single company s securities becoming worthless, but also of all holdings suffering uniformly adverse business conditions. The External Investment Manager will seek to reduce all these risks associated with the Fund by virtue of its experience, the analytical process and by structuring a broadly diversified investment pool. Others When deemed appropriate and for the benefit of the Fund, the External Investment Manager may take temporary defensive positions in dealing with adverse market, economic, political and other conditions, that may be inconsistent with the Fund s principal strategy. Investment Strategy/Investment Mechanism To achieve its investment objectives, the Fund will invest in Malaysian equities & fixed income securities where appropriate. Foreign equities may be included to further diversify the Fund. In formulating the investment strategy, the Manager will consider the following to determine the portion of investment to be in foreign markets (within permitted amounts): - a) Comparison of economic outlook of Malaysian and other Asian economies to determine the growth prospects and economic cycle of each country; b) Assessment of country, political and social risks; c) Comparison of liquidity flows in all the Asian countries; d) Risks or attractions specific to countries/region; and e) Currency risks. AMB Client Services :

67 OTHER INVESTMENT STRATEGY AND PROCESSES In addition to the strategy employed above the Fund is unique in its investment methodology as it regularly employs two asset-rebalancing practices at specific intervals within the life of the Fund. These 2 asset-rebalancing practices are done on: - 1) Interim Asset Rebalancing Date (IARD) 2) Targeted Asset Rebalancing Date (TARD) The purpose for the 2 practices is detailed below. Asset Class Movement The AMBLTF 2009 is a Fund, which periodically reviews its asset allocation to contain risks while maximizing its return potential. This is carried out on the IARD, which is every 3 months beginning from the commencement date of the Fund. In addition to this, the Fund will also employ a progressively defensive investment strategy every thirty (30) months into the life of the Fund. This process of systematic reduction of risk for the portfolio takes place on the TARD. This is accomplished via a targeted asset allocation ( TAA ) indicated upfront to the Unit Holder. The AMBLTF 2009 predetermined asset allocation for each 30 months period is as displayed in the diagram below. AMBLTF 2009 begins with higher equity allocation to provide better growth potential during the initial years. AMBLTF 2009 approaches maturity with lower equity exposure, thereby reducing volatility. 5 years to maturity 2.5 years to maturity Maturity 34% 27% 20% 66% 73% 80% TAA 1 TAA 2 Maturity Bonds and money market Equities Interim Asset Rebalancing Date (IARD) IARD occurs every 3months after the launch date of the Fund. The review on these dates aims to keep the portfolio within the TAA limits as agreed with the investor for that particular 30month period. Should the overall portfolio differ from the TAA requirements at each 3month period, adjustments will be made to correct the imbalances in the asset allocation. The imbalance is usually caused by market fluctuations. AMB Client Services :

68 E.g. If the TAA for the investment period is targeted at 66% bonds & money markets and 34% equities, and at an IARD the portfolio consisted of 52% bonds and money markets and 48% equities, then the External Investment Manager will liquidate the excessive equity exposure while simultaneously increasing the bonds and money markets portion. While the TAA pre-determines the asset mix between fixed income (bonds and money market Instruments) and equities, discretion is given to the Manager to increase the bond and money market mix in accordance to their economic and market outlook. The variation allowed for bonds and money market for each TAA is as displayed on the table below. Targeted Asset Rebalancing Date (TARD) Every 2 ½ years into the life of the Fund, AMBLTF 2009 will adopt an increasingly defensive asset allocation strategy. The purpose for this is to ensure that as the investment horizon shortens, the investor will not be exposed to excessive risk. This process involves reducing the volatility of the portfolio by increasing holding in less volatile assets such as bonds and cash, while reducing volatile assets such as equity. Asset Allocation The following table indicates the maximum and minimum target exposures for equities and fixed income (comprising of bonds and money market Instruments) for each TAA: TAA 1 TAA 2 Bonds & money market min 66% 73% Bonds & money market max 71% 78% Equity minimum 29% 22% Equity maximum 34% 27% Benchmark The benchmark will be based on the proportion of equity & fixed income stated at the start of the TARD as illustrated in the Table below. Asset Mix / Benchmark TAA 1 TAA 2 Equity - FBM Emas Index 34% 27% Bonds & money market 12-month fixed deposit rate 66% 73% An illustration of the benchmark is as follows: - Benchmark (TAA 1) = (% change in FBM Emas Index x 34% of NAV) + (% fixed deposit rate return x 66% of NAV) Benchmark (TAA 2) = (% change in FBM Emas Index x 27% of NAV) + (% fixed deposit rate return x 73% of NAV) The FBM Emas Index and the 12-month fixed deposit rate are obtainable from the Bursa Malaysia and commercial banks respectively. Temporary Defensive Positions While the TAA will be adhered to at all times, the Manager may take defensive positions in anticipation of, or in the event of, adverse economic or market conditions, to minimise losses. The equity portion could be hedged through futures contracts (under the Act) and the fixed income / debenture portion could be hedged through the 3month KLIBOR futures and/or the 5-year MGS futures contracts. Specific Salient Features of the Fund and Terms of Investing in the Fund such as Commencement Date, Maturity Date In addition to the discipline of having a more conservative TAA towards the maturity of the Fund as detailed above, the Fund will diversify its holdings in equities and fixed income securities within the limits permitted. As the Fund approaches its maturity date, the duration of the fixed income securities will be shortened to match the maturity date as closely as possible. The selection of stocks in the equity portfolio will also be more defensive as the Fund approaches the maturity date. AMB Client Services :

69 AMB Lifestyle Trust Fund 2014 Type of Fund Growth Fund Category of Fund Balanced Fund Investment Philosophy AMBLTF 2014 will invests in a well-diversified portfolio of assets, which includes money market securities, fixed income securities, equities and other securities that are permitted by the authorities from time to time. The portfolio is an actively managed balanced Fund aimed to optimise returns while minimising risks encountered by investors. The Fund is particularly suited to investors who have a 10 year investment horizon, or more, from the launch of the Fund. Investment Objective To provide capital growth for investors through a well-diversified balanced portfolio that is specially catered for a ten (10) year investment period. The Fund, over its investment period, shall progressively adopt more defensive investment strategies as the Fund approaches maturity. Any material changes to the investment objective of the Fund would require Unit Holders approval. Approved Fund Size of AMBLTF 2014 The approved Fund size of AMBLTF 2014 is 250 million Units. Investors Profile The Fund is suitable for investors with the following profile: - Investors who seek an investment solution for a period of 10 years or more Investors who seek returns from a professionally managed fund that is well diversified across various asset classes; and Investors who desire to have a fund that would automatically become more defensive over time. Benefits for Investors Extensive Diversification Your portfolio is made up of all the essential asset classes comprising equities, bonds and money market instruments that will be balanced over time to optimise your investment. Active Management Professional External Investment Managers manage the investment mix of your AMB Lifestyle portfolio to create the optimal risk and return for each stage of your life or target maturity date of the Fund. A Personalised Approach You decide when you will need your money and how you feel about risk, and choose the AMB Lifestyle portfolio that is tailored to meet your needs. The AMB Lifestyle portfolio allows you the flexibility to select the right segment to fit your lifestyle or requirement over a wider time horizon. Example: If you have a longer time period before money is required, you may have a higher tolerance for risk in your investments. This is because peaks and troughs of performance tend to smooth out over time. If there is a shorter period of time before your retirement income is needed, then a lower tolerance for risk is allowed. Each AMB Lifestyle portfolio represents the number of years you expect to begin realising your investment. As you get closer to the year of withdrawal, the External Investment Manager will gradually re-balance the portfolio mix to optimize your returns. Professional External Investment Managers A team of professional External Investment Managers backed by a research team at UOB-OSK Asset Management Sdn Bhd will use their expertise to build and manage the portfolios. AMB Client Services :

70 The stocks, bonds and money market instruments in AMBLF 2014 are carefully selected to give you the advantage of time. The individual portfolios are based on the idea that the way you invest should change as you go through your life and your retirement gets closer. Your needs may change as you approach retirement, as well as your risk tolerance. Specific Benefits of Investing in AMBLTF 2014 Free Insurance Protection Coverage Eligible Unit Holders (natural persons) of AMBLTF 2014 will be given free standard GPA coverage. Unit Holders holding a minimum amount of 2,000 Units and above will automatically be covered under the standard GPA insurance for accidental death and TPD with the following extensions:- (i) Medical expenses (ii) Funeral expenses (iii) Repatriation expenses Units Medical Expenses Funeral Expenses Repatriation Expenses 2,000 49,999 RM1,000 RM1,000 RM1,000 50,000 and above RM2,000 RM2,000 RM2,000 The sum insured would be RM0.50 for every Unit held subject to a minimum investment of 2,000 Units and maximum coverage of RM150,000. While the policy is in force, the amount of sum insured per eligible Unit Holder shall be the amount of Units held by the eligible Unit Holder as at the date of accident leading to the claim. Eligible Unit Holder must be aged between 18 to 69 years old. The standard GPA coverage ceases automatically when you attain the age of 70 years old. Eligible principal Unit Holder and jointholder(s) will be covered under the standard GPA but the sum covered will be shared equally. Regular Savings Plan You have the opportunity to invest on a fixed monthly basis through standing instruction. This plan makes regular savings easy and allows you to arrange transfers from your bank account to AMBLTF Affordability Investors can invest just RM500 as an initial investment and subsequent investments can be made with a minimum of RM100. Accessibility Investors can easily access any Distribution Branch to perform any enquiry or transaction. EPF Members Investment Scheme The Manager is a unit trust management company under the EPF Members Investment Scheme. You may withdraw a portion of your EPF savings to invest in AMBLTF 2014, which may provide you the opportunity to reap capital growth, thus increasing the value of your EPF Account 1 Retirement Savings subject to rules and regulations of the EPF Members Investment Scheme from time to time. Potential Risks Associated with AMBLTF 2014 While attempts are being made to reduce risks encountered by the portfolio, investors should be advised that the following risks are inherent in such investments: - Stock Bond Market Risk These are risks that affect the entire market as a whole. It is possible that at times the entire market may decline, and no matter how well diversified the portfolio is, the entire portfolio of investment will decline also. Credit/Default Risk It is possible that the issuer of fixed income securities may not be able to service periodic coupon payments and/or repay principal when due, thus affecting the value of investments for Unit Holders. Interest Rate Risks Fixed income securities/debentures are particularly sensitive to movements in interest rates. As interest rates rise, prices generally fall and vice-versa. Furthermore, those with longer duration and lower coupon rates are more susceptible to interest rate movements. AMB Client Services :

71 Liquidity Risk Liquidity risk is the risk that the security/instrument invested in cannot be readily sold and converted into cash. This can occur when trading volume for the security is low and/or when there is a lack of demand for the security. In managing liquidity risk, the Fund will limit its exposure to instruments, which are deemed less liquid. Individual Stock Risk This risk refers to the individual risk of the respective companies issuing the securities. Specific risk includes but is not limited to changes in consumer tastes and demand, legal suits, competitive operating environments, changing industry conditions and management omissions and errors. This risk can be minimised through investing in a wide range of companies in different sectors, which thus function independently from one another. Currency Risk Currency risk is also known as foreign exchange risk. It is risk associated with investments that are denominated in foreign currencies. When the foreign currencies fluctuate in an unfavourable movement against Ringgit Malaysia, the investments will face currency losses in addition to the capital gains/losses. This will lead to a lower NAV of the Fund. Country Risk The foreign investment of the Fund may be affected by risks specific to the country which it invests in. Such risks include changes in a country s economic fundamentals, social and political stability, currency movements and foreign policies etc. These may have an adverse impact on the prices of securities of listed companies. Control of Risk The External Investment Manager will take reasonable steps to ensure that the above potential risks are managed by: a) actively monitoring the Fund s asset allocation to ensure minimum impact from any adverse market movements. They will ensure that the equities and fixed income securities are carefully selected through site visits, fundamental analysis and portfolio diversification. In the case of fixed income securities, The External Investment Manager will also focus on the credit quality of the fixed income securities, which must be of good investment grade of at least BBB rating or equivalent by RAM, MARC or any other similar rating establishment. b) investing the Funds over a wide range of equities and fixed income securities of different companies which provides diversification across a number of sectors and industries, minimising the risk not only of any single company s securities becoming worthless, but also of all holdings suffering uniformly adverse business conditions. The External Investment Manager will seek to reduce all these risks associated with the Fund by virtue of its experience, the analytical process and by structuring a broadly diversified investment pool. Others When deemed appropriate and for the benefit of the Fund, the External Investment Manager may take temporary defensive positions in dealing with adverse market, economic, political and other conditions, that may be inconsistent with the Fund s principal strategy. Investment Strategy/Investment Mechanism To achieve its investment objectives, the Fund will invest in Malaysian equities and fixed income securities. Where appropriate Asian equities may be included to further diversify the Fund. In formulating the investment strategy, the Manager will consider the following to determine the portion of asset class to be in foreign investments (within permitted amounts):- a) Comparison of economic outlook of Malaysian and other Asian economies to determine the growth prospects and economic cycle of each country; b) Assessment country, political and social risks; c) Comparison of liquidity flows in all Asian countries; d) Risks or attractions specific to countries/region; and e) Currency risks. AMB Client Services :

72 INVESTMENT STRATEGY AND PROCESSES In addition to the strategy employed above, the Fund is unique in its investment methodology as it regularly employs two asset-rebalancing practices at specific intervals within the life of the Fund. These 2 asset-rebalancing practices are done on: - 1) Interim Asset Rebalancing Date (IARD) 2) Targeted Asset Rebalancing Date (TARD) The purpose for the 2 practices is detailed below. Asset Class Movement The AMBLTF 2014 is a Fund, which periodically reviews its asset allocation to contain risks while maximizing its return potential. This is carried out on the IARD, which is every 3 months beginning from the commencement date of the Fund. In addition to this, the Fund will also employ a progressively defensive investment strategy every thirty (30) months into the life of the Fund. This process of systematic reduction of risk for the portfolio takes place on the TARD. This is accomplished via a targeted asset allocation ( TAA ) indicated upfront to the Unit Holder. The AMBLTF 2014 predetermined asset allocation for each 30month period is as displayed in the diagram below. AMBLTF 2014 begins with higher equity allocation to provide better growth potential during the initial years. AMBLTF 2014 approaches maturity with lower equity exposure, thereby reducing volatility. 10 years to 7.5 years to 5 years to 2.5 years to Maturity maturity maturity maturity maturity 54% 46% 60% 40% 66% 34% 27% 73% 80% 20% TAA 1 TAA 2 TAA 3 TAA 4 Maturity Bonds and money market Equities Interim Asset Rebalancing Date (IARD) IARD occurs every 3months after the launch date of the Fund. The review on these dates aims to keep the portfolio within, the TAA limits as agreed with the investor for that particular 30month period. Should the overall portfolio differ from the TAA requirements at each 3month period, adjustments will be made to correct the imbalances in the asset allocation. The imbalance is usually caused by market fluctuations. E.g. If the TAA for the investment period is targeted at 66% bonds and money markets and 34% equities, and at an IARD the portfolio consisted of 52% bonds and money markets and 48% equities, then the External Investment Manager will liquidate the excessive equity exposure while simultaneously increasing the bonds and money markets portion. AMB Client Services :

73 While the TAA pre-determines the asset mix between fixed income (bonds and money market Instruments) and equities, discretion is given to the Manager to increase the bond and money market mix in accordance to their economic and market outlook. The variation allowed for bonds and money market for each TAA is as displayed in the Table below. Targeted Asset Rebalancing Date (TARD) Every 2 ½ years into the life of the Fund, AMBLTF 2014 will adopt an increasingly defensive asset allocation strategy. The purpose for this is to ensure that as the investment horizon shortens, the investor will not be exposed to excessive risk. This process involves reducing the volatility of the portfolio by increasing holding in less volatile assets such as bonds and cash, while reducing volatile assets such as equity. Asset Allocation The following table indicates the maximum & minimum target exposures for equities and fixed income (comprising of bonds and money market Instruments) for each TAA: - TAA 1 TAA 2 TAA 3 TAA 4 Bonds & money 54% 60% 66% 73% market min Bonds & money 59% 65% 71% 78% market max Equity minimum 41% 35% 29% 22% Equity maximum 46% 40% 34% 27% Benchmark The benchmark will be based on the proportion of equity and fixed income stated at the start of the TARD as illustrated at the Table below. Asset Mix / Benchmark TAA 1 TAA 2 TAA 3 TAA 4 Equity - FBM Emas Index 46% 40% 34% 27% Bonds & money market 12-month fixed deposit rate 54% 60% 66% 73% An illustration of the benchmark is as follows: - Benchmark (TAA 1) = (% change in FBM Emas Index x 46% of NAV) + (% fixed deposit rate return x 54% of NAV) Benchmark (TAA 2) = (% change in FBM Emas Index x 40% of NAV) + (% fixed deposit rate return x 60% of NAV) Benchmark (TAA 3) = (% change in FBM Emas Index x 34% of NAV) + (% fixed deposit rate return x 66% of NAV) Benchmark (TAA 4) = (% change in FBM Emas Index x 27% of NAV) + (% fixed deposit rate return x 73% of NAV) The FBM Emas Index and the 12-month fixed deposit rate are obtainable from Bursa Malaysia and commercial banks respectively. Temporary Defensive Positions While the TAA will be adhered to at all times, the Manager may take defensive positions in anticipation of, or in the event of adverse economic or market conditions, to minimise losses. The equity portion could be hedged through futures contracts (under the Futures Industry Act 1993) and the fixed income/debenture portion could be hedged through the 3month KLIBOR futures and/or the 5year MGS futures contracts. Specific Salient Features of the Fund and Terms of Investing in the Fund such as Commencement Date, Maturity Date In addition to the discipline of having a more conservative TAA towards the maturity of the Fund as detailed above, the Fund will diversify its holdings in equities and fixed income securities within the limits permitted. As the Fund approaches its maturity date, the duration of the fixed income securities will be shortened to match the maturity date as closely as possible. The selection of stocks in the equity portfolio will also be more defensive as the Fund approaches the maturity date. AMB Client Services :

74 Type of Fund Income and Growth Fund Fund Category Equity Fund AMB Dividend Trust Fund Investment Philosophy AMBDTF will invest in a well-diversified equity portfolio, and which will focus on high (and potentially high) dividend yielding Malaysian and Asian ex-japan (i.e Singapore, Thailand, Indonesia, India, Taiwan, Hong Kong, China, Korea and Australia) equities, as well as in such other markets where approval has been obtained from the authorities from time to time. The portfolio is an actively managed defensive equity Fund that may also invest in fixed income securities as a tactical defensive measure depending on market conditions. Investment Objective To provide investors with a regular income stream and to attain medium to long-term capital appreciation through investing in high (and potentially high) dividend yielding equities (including foreign equities). Any material changes to the investment objectives of the Fund would require Unit Holder s approval. Approved Fund Size of AMBDTF The approved Fund size for AMBDTF is 800 million units. Investors Profile The Fund is suitable for investors with the following profile: Conservative and prefer receiving regular and steady income in the form of distributions; and Moderate risk appetite. Benefits for Investors Diversified Portfolio AMBDTF is a fund that provides investors the opportunity to invest in a well-diversified Malaysian and Asian ex-japan equity portfolio (i.e. Singapore, Thailand, Indonesia, India, Taiwan, Hong Kong, China, Korea and Australia) with exposures ranging from 70% to 99.8%. Regular Income Distribution The Fund will concentrate on high (and potentially high) dividend yielding Malaysian and Asian ex-japan equities that distribute or have the potential to distribute reasonably attractive dividends. Tactical Defensive Measure The portfolio is an actively managed defensive Fund that allows 30% of its NAV to be invested in fixed income securities as a tactical defensive measure depending on market conditions. Specific Benefits of Investing in AMBDTF Free Insurance Protection Coverage Eligible Unit Holders (natural persons) of AMBDTF will be given free GPA coverage. Unit Holders holding a minimum amount of 4,000 Units and above will automatically be covered under the GPA insurance for accidental death and TPD. The sum insured would be RM0.25 for every Unit held subject to a minimum investment of 4,000 Units and maximum coverage of RM200,000. The GPA insurance coverage covers: (i) Death due to accidental causes only; and (ii) TPD due to accidental causes. Eligible Unit Holders must be aged between 18 and 69 years old. The GPA coverage ceases automatically when you attain the age of 70 years old. Eligible Principal Unit Holder and joint holder(s) will be covered under the GPA insurance coverage but the sum covered will be shared equally. AMB Client Services :

75 Regular Savings Plan You have the opportunity to invest on a fixed monthly basis through standing instruction. This plan makes regular savings easy and allows you to arrange transfers from your bank account to AMBLTF Affordability Investors can invest just RM500 as an initial investment and subsequent investments can be made with a minimum of RM100. Accessibility Investors can easily access any Distribution Branch to perform any enquiry or transaction. The Risk Management Strategies and Techniques The External Investment Manager s risk management strategy is to conduct fundamental analysis of economic, political and social factors to evaluate their likely effects on the performance of the markets and sectors. As for the Fund s portfolio, the Manager employs an active asset allocation strategy to reduce or increase the market exposure depending on the risk-reward factor. As highlighted above, investments into fixed income securities can also be made where appropriate. Specifcally for the Fund s equities investments, given the objective of the Fund and intention of the Fund to invest in high (and potentially high) dividend yielding stocks, the internal screen employed will take into account the sustainability of dividends, gearing levels, historical volatility and liquidity. Temporary Defensive Position The Fund s equities investment will range from a minimum of 70% to a maximum of 99.8%. Up to 30% of the Fund may be invested in Malaysian fixed income securities should a defensive strategy be appropriate. Risk Associated with AMBDTF While attempts are being made to reduce risks encountered by the portfolio, investors should be advised that the following risks are inherent in such investments. Potential risks associated with securities and instruments invested by AMBDTF are: Market Risk Risks that affect the entire market as a whole. It is possible that at times the entire market may decline, and no matter how well diversified the portfolio is, the entire portfolio of investment will decline also. Liquidity Risk Liquidity refers to the ease of converting an investment into cash without incurring an overly significant loss in value. Inflation Risk Ideally, the purpose of any investment is to secure returns that are greater than the inflation rate. While the Fund will constantly seek to maximize returns and exceed inflation rate, it may occasionally experience losses that result in returns that will not keep pace with inflation in the short run. Stock Risk This risk refers to the individual risk of the respective companies issuing the securities. Specific risk includes but is not limited to changes in consumer tastes and demand, legal suits, competitive operating environments, changing industry conditions and management omissions and errors. This risk can be minimized through investing in a wide range of companies in different sectors and which thus, function independently from one another. Interest Rate Risk All fixed-income investments are exposed to interest rate risk. The level of interest rate changes frequently and will cause prices of fixed-income securities to change inversely. If interest rate increases, fixed-income securities held by the Fund will suffer price decreases or capital losses. Credit/Default Risk Islamic bonds/debt securities are subject to credit/issuer/default risk, which is the risk that the issuer of the bonds/debt securities becomes unable to service any profit payments or repay the principal amount upon redemption. In the event of such a default, investor may suffer losses with respect to their capital invested and income foregone. To a lesser extent, perception of the issuer s ability to repay its debt obligations may impact its credit rating, resulting in a credit rating downgrade, which may adversely impact the Islamic bonds/debt securities market value. AMB Client Services :

76 Control of Risk The External Investment Manager will take reasonable steps to ensure that the above potential risks are managed by: a) actively monitoring the Fund s asset allocation to ensure minimum impact from any adverse market movements. They will ensure that the equities and fixed income securities are carefully selected through site visits, fundamental analysis and portfolio diversification. In the case of fixed income securities, The External Investment Manager will also focus on the credit quality of the fixed income securities, which must be of good investment grade of at least BBB rating or equivalent by RAM, MARC or any other similar rating establishment. b) investing the Funds over a wide range of equities and fixed income securities of different companies which provides diversification across a number of sectors and industries, minimising the risk not only of any single company s securities becoming worthless, but also of all holdings suffering uniformly adverse business conditions. The External Investment Manager will seek to reduce all these risks associated with the Fund by virtue of its experience, the analytical process and by structuring a broadly diversified investment pool. Others When deemed appropriate and for the benefit of the Fund, the External Investment Manager may take temporary defensive positions in dealing with adverse market, economic, political and other conditions, that may be inconsistent with the Fund s principal strategy. Specific and peculiar risks when investing in the Fund are: Individual Stock Risk The performance of the Fund that invests in stocks is affected by every individual stock that the said Fund has invested. The volatility of prices in each stock will affect the Fund s value daily. Compliance Risk The risk that the Manager and others associated with the scheme will not follow the rules set out in the scheme s constitution and internal policies, or the law that governs the scheme, or will act fraudulently or dishonestly, which will expose the Fund s losses. Currency Risk Currency risk is also known as foreign exchange risk. It is the risk associated with investments that are denominated in foreign currencies. When the foreign currencies fluctuate in an unfavourable direction against the Ringgit Malaysia, the investments will face currency losses in addition to the capital gains/losses. This will lead to a lower NAV of the Fund. Country Risk The foreign investments of the Fund may be affected by risks specific to the country, in which it invests. Such risks include changes in a country s economic fundamentals, social and political stability, currency movements and foreign policies, etc. These may have an adverse impact on the prices of listed securities in the particular country. Investment Strategy/Investment Mechanism The Fund will invest primarily in high dividend yielding stocks both in Malaysia and in Asian ex-japan markets (the latter being subject to a maximum of 30% of the Fund size). The selection of appropriate equities will be driven by the External Investment Manager s internal screening process whereby emphasis will be placed on the sustainability of dividends, price-to-earnings ratios, gearing levels, historical volatility, as well as liquidity. High dividend and potentially high dividend yielding stocks would be measured against domestic 12-month FD rates. Although up to 30% of the Fund can be invested overseas, these investments will be opportunistic in nature. In any event, the dividend yields on overseas investments will also be measured against domestic interest rates. The dividend yields would be based on both historical and prospective. As such, the focus of the Fund would be on companies that can pay out sustainable dividends. This would exclude companies involved in highly cyclical industries where earnings, cash flows and hence dividends tend to fluctuate e.g. property development companies. Historical yields would provide a guide as to the company s dividend payout policy. While some companies may not have a high historical dividend yield, the Fund may still choose to invest in these companies if prospective dividend yields are attractive and sustainable. Where in the opinion of the External Investment Manager a defensive strategy is appropriate, up to 30% of the Fund may be invested in Malaysian fixed income instruments. For fixed income securities, the Fund will mainly invest in fixed income securities carrying a minimum credit rating of AA3 /P1 (RAM or equivalent) to provide investors with a regular stream of income, while minimizing principal volatility. AMB Client Services :

77 The Fund s equities investment will range from a minimum of 70% to a maximum of 99.8% for equities. Up to 30% of the Fund may be invested in Malaysian fixed income securities should a defensive strategy be appropriate. Asset Allocation Min 70% Max 99.8% in equities Min 0.2% Max 30% in fixed income and cash Up to 30% of the Fund size may be invested overseas and the External Investment Manager may choose to invest solely in the domestic market. The equity and fixed income allocation may be reduced to below the minimum levels indicated at the discretion of the Manager only during exceptional circumstances. Exceptional circumstances would include situations: i) Where there is an expected sharp downturn in the equity market; ii) When there is high risk of capital loss on fixed income instruments due to interest rate fluctuations; iii) When there is insufficient liquidity in either equity or fixed income instruments for the Fund to transact efficiently; and/or iv) When there is redemption affecting the liquidity position of the Fund. Performance Benchmark The performance of AMBDTF will be benchmarked against a weighted average of the KLCI performance and current Maybank 12-month fixed deposit rate. The weightings assigned will be in the proportion of 70:30. For example, if the KLCI was to return 10% during the year and Maybank 12-month fixed deposit Rate stood at 4%, the benchmark s return for the one year period would be 8.2% i.e. [(70% X 10%)] + [(30% X 4%)]. The KLCI is obtainable from Bursa Malaysia and the quoted fixed deposit rates are readily available at any Maybank branch nationwide. *The benchmark will be limited to domestic factors such as the Fund s investments overseas will be opportunistic in nature., While up to 30% of the Fund size may be invested overseas, the External Investment Manager may also choose to invest solely in the domestic market. AMB Client Services :

78 PNB Structured Investment Fund Introduction The Fund is a close-ended fund with a five (5)-year finite life. Upon the maturity of the Fund, all of the asset classes will be liquidated and the proceeds of liquidation will be distributed to Unit Holders. During the tenure of the Fund, only Units repurchased by the Manager may be resold based on the NAV per Unit at that point in time. PNB REIT is intended to be listed before the maturity of the Fund. However, if this is not achieved, PNB REIT will be wound-up and the proceeds will be distributed to the sole unit holder of PNB REIT, namely PNB SIF. The Fund shall be terminated on the Maturity Date and all Units held by the Unit Holders will be redeemed. The NAV per Unit will be calculated by dividing the NAV of the Fund by the Units in Circulation. No redemption charge will be imposed on maturity. The net proceeds will be paid to Unit Holders within 2 months after the Maturity Date. Type of Fund Income and growth fund Category of Fund Mixed asset fund Investment Objective The Fund seeks to provide investment opportunities that generate reasonable returns and growth over the tenure of the Fund while endeavouring to provide capital protection to Unit Holders. Any material changes to the investment objective of the Fund would require Unit Holders approval. Investment Policy and Strategy In selecting its investments, the Fund search for strong undervalued investment opportunities that shows potential for long-term capital appreciation as well as income, through a selection process based on careful analysis and valuation by the Investment Manager s team of analysts, who will then submit their recommendations to the Investment Committee of the Fund for approvals. To achieve this objective, the Fund will be investing in a portfolio of Structured Products, PNB REIT, cash equivalent instruments and any other investments permitted by the Deed, which will provide some diversification of the Fund. Structured Products Investment in Structured Products will only be in RM-denominated products that are principal protected upon maturity. As for diversification purposes in Structured Products, the Fund will also be investing in a portfolio of Structured Products with exposure linked to one or more assets such as global equities, commodities, currencies, interest rates, indices or any other underlying(s) as may be permitted under the Deed. The strategies employed by each of the Structured Product will be different in nature, ensuring that the expected risk and return for the portfolio of Structured Products is well-diversified. PNB REIT Investment in PNB REIT offers potential regular income and upside potential through exposure in properties. PNB REIT has principal protection features through a buy-back option with the respective vendors. It is the intention of the Manager to list PNB REIT on the Main Board of Bursa Malaysia within the next five years, thus it will be an opportunity for the Fund to be able to have potential capital gain from the exercise. Cash Equivalent Instruments To meet its liquidity requirements, the Fund will also be investing in cash equivalent instruments, such as, deposits or securities that are issued by more than one party for diversification and reduction of counter party risk. In the overall management of the Fund, active asset allocation strategies will be employed, whereby the Fund will actively manage the distribution of capital between the different assets in order to reduce the adverse effects of downturns and capitalise on upturns, to enable the Fund to pay out competitive returns to investors. The Fund will adopt an active trading strategy in the portfolio of Structured Products, whereby the Investment Manager has the option to increase or decrease the Fund s allocation in Structured Products, taking into account analysis and considerations on the prevailing market and economy outlook, valuations and liquidity requirements. AMB Client Services :

79 Approved Fund Size The approved fund size of the Fund is 3 billion Units. Asset Allocation Up to 80% of the Fund s Net Asset Value may be invested in Structured Products; and Up to 50% of the Fund s Net Asset Value may be invested in PNB REIT; and A minimum of 2% of the Fund s Net Asset Value will be invested in cash and money market instruments to provide for liquidity purposes. Benchmark The benchmark of the Fund is Maybank 12-month fixed deposit rate. The quoted fixed deposit rates are readily available at any Maybank branch. Benefits for Unit Holders Free Insurance Coverage Free insurance coverage on group personal accident takaful is provided for Unit Holders aged between with a minimum investment of ten thousand (10,000) Units at any point of time in PNB SIF. The amount of insurance is equal to the number of Units invested in the ratio of RM1.00 insurance coverage for each Unit, subject to a maximum amount of RM100,000 per Unit Holder of the Fund. The terms and conditions of the free insurance coverage shall apply. Accessibility Unit Holders can easily access any Distribution Branch to perform any enquiry or transaction. Illustration of the structure of PNB SIF AMB Client Services :