Renaissance Emerging Markets Fund. Annual Management Report of Fund Performance

Transcription

1 Renaissance Emerging Markets Fund Annual Management Report of Fund Performance for the financial year ended August 31, 2017 All figures are reported in Canadian dollars unless otherwise noted This annual management report of fund performance contains financial highlights but does not contain the complete annual financial statements of the investment fund If you have not received a copy of the annual financial statements with this annual management report of fund performance, you can get a copy of the annual financial statements at your request, and at no cost, by calling us toll-free at FUND (3863), by writing to us at Renaissance Investments, 1500 Robert-Bourassa Boulevard, Suite 800, Montreal, QC, H3A 3S6, by visiting the SEDAR website at sedarcom, or by visiting renaissanceinvestmentsca Unitholders may also contact us using one of these methods to request a copy of the investment fund s proy voting policies and procedures, proy voting disclosure record, or quarterly portfolio disclosure Management Discussion of Fund Performance Investment Objective and Strategies Investment Objective: Renaissance Emerging Markets Fund (the Fund) seeks to achieve long-term capital appreciation by investing in securities, principally equities, of issuers in countries having smaller capital markets Investment Strategies: The Fund invests in equity securities of countries having smaller capital markets (primarily common shares) but may also buy securities that are convertible into common shares Risk The Fund is an emerging markets equity fund that is suitable for long-term investors who can tolerate high investment risk Effective September 11, 2017, the Fund's risk rating was changed from "high" to "medium to high" This risk rating change is not a result of changes to the investment objectives, investment strategies or management of the Fund, but is due to the adoption of the new investment risk classification methodology under NI Investment Funds, which is described in the Fund s simplified prospectus The Manager will review the risk rating of the Fund at least annually, or whenever the Manager determines the risk rating is no longer appropriate Although the risk rating changed, the overall level of risk remains as discussed in the simplified prospectus Results of Operations The portfolio sub-advisor of the Fund is Victory Capital Management Inc (the sub-advisor) The commentary that follows provides a summary of the results of operations for the period ended August 31, 2017 All dollar figures are epressed in thousands, unless otherwise indicated The Fund's net asset value increased by 30% during the period, from $7,959 as at August 31, 2016 to $10,350 as at August 31, 2017 Net sales of $796 and positive investment performance resulted in an overall increase in net asset value Class A units of the Fund posted a return of 202% for the period The Fund s benchmark, the MSCI Emerging Markets Inde (the benchmark), returned 194% for the same period The Fund s return is after the deduction of fees and epenses, unlike the benchmark's return See Past Performance for the return of the other class of units offered by the Fund Global stock markets rose in response to encouraging corporate earnings, positive political developments in Europe and epectations of higher policy rates following years of quantitative easing (monetary policy used by central banks to increase money supply) Emerging markets generally outperformed developed markets Despite geopolitical tensions, the outcome of the US presidential election, and allegations of new political issues in Brazil, the largest boost for emerging markets equities was the decline in the US dollar over the period Uncertainty regarding the new US administration s ability to pass fiscal reforms contributed to the decline in the US dollar The benchmark posted strong returns, gaining in 11 out of 12 months, and outpacing developed markets An epected increase in global economic growth also benefited emerging markets, particularly from signs of economic epansion in Europe, which should provide more demand for emerging markets eports The strongest returns came from Poland, Hungary and Greece, while the weakest were from Pakistan and Egypt Growth-oriented stocks outperformed their value counterparts While volatile, oil prices ultimately rose 57% over the period In late May, the Organization of the Petroleum Eporting Countries announced that it was etending its output cuts to the end of March 2018 Gold prices were also volatile, and rose just 1% over the period Economic growth in China was better than epected After several years of little to no maintenance, improvement or upgrades to equipment and infrastructure, there were signs of capital goods spending in mining and metals, energy, construction and industrials Increased prices for commodities, energy, shipping and semiconductor wafers also indicated improving supply/demand dynamics The International Monetary Fund affirmed China s ability to grow in the 64% to 65% range over the net two years, epecting it to benefit from policy reforms and global growth A rise in consumption, as part

2 Renaissance Emerging Markets Fund of a rising middle class across Asia, contributed to strong performance in the consumer discretionary and information technology sectors In November 2016, the Indian government s surprise decision to demonetize large-denomination bank notes weighed on the country s equity market However, Indian equities rebounded in 2017 on positive economic news and the government s implementation of a nationwide goods-and-services ta and identity card system Stock selection in China was the most significant contributor to the Fund s performance on a regional basis In terms of sectors, security selection in the financials and industrials sectors contributed significantly to performance Individual contributors included Aeroflot - Russian Airlines PJSC and Alibaba Group Holding Ltd Aeroflot benefited from positive operating results and an attractive dividend, which supported its stock price Alibaba benefited from the general momentum in the information technology sector, eceeding growth epectations through its digital media and cloud revenues Security selection in Meico was a significant detractor from the Fund s performance, as was stock selection in the real estate sector Moderate individual detractors from the Fund s performance included Airasia BHD and Mando Corp Airasia reported weak results in the first quarter of 2017 as a result of higher oil prices and increasing competition Korean auto parts manufacturer Mando was negatively affected by slowing auto sales in China and the US The sub-advisor added Hon Hai Precision Industry Co Ltd to the Fund as it is positioned to benefit from Apple Inc s net iphone release, should Apple adopt organic light-emitting diode technology for all its models Hon Hai Precision would maintain its market share and achieve better margins than its peers The Fund s eisting holding in Ping An Insurance (Group) Co of China Ltd was increased for its growth outlook and prospects The sub-advisor has a favourable view of margin improvements in the company s long-term protection unit, banking and trust business, as well as of its growing financial technology business Itau Unibanco Holding SA was eliminated in order to reduce the Fund s financial services eposure in Brazil Airasia was eliminated in favour of more attractive investment opportunities LUKOIL PJSC was trimmed to realize profits and reallocate funds to more attractive opportunities The sub-advisor also aimed to reduce the Fund s eposure to the energy sector Recent Developments Effective April 27, 2017, the composition of the Independent Review Committee (IRC) changed Tim Kennish and William Thornhill resigned as members of the IRC and Susan Silma and Bryan Houston were appointed as members of the IRC Related Party Transactions CIBC and its affiliates have the following roles and responsibilities with respect to the Fund, and receive the fees described below in connection with their roles and responsibilities Manager, Trustee, and Portfolio Advisor of the Fund CAMI, a wholly-owned subsidiary of CIBC, is the Fund's Manager, Trustee, and Portfolio Advisor CAMI receives management fees with respect to the Fund's day-to-day business and operations, calculated based on the net asset value of each respective class of units of the Fund as described in Management Fees As Trustee, CAMI holds title to the Fund's property (cash and securities) on behalf of its unitholders As Portfolio Advisor, CAMI provides, or arranges to provide, investment advice and portfolio management services to the Fund CAMI also compensates dealers in connection with their marketing activities regarding the Fund From time to time, CAMI may provide seed capital to the Fund Distributor Dealers and other firms sell units of the Fund to investors These dealers and other firms include CIBC s related dealers such as the CIBC Investor s Edge discount brokerage division of CIBC Investor Services Inc (CIBC ISI), the CIBC Imperial Service division of CIBC ISI, and the CIBC Wood Gundy division of CIBC World Markets Inc (CIBC WM) CIBC ISI and CIBC WM are wholly-owned subsidiaries of CIBC CAMI may pay sales commissions and trailing commissions to these dealers and firms in connection with the sale of units of the Fund These dealers and other firms may pay a portion of these sales commissions and trailing commissions to their advisors who sell units of the Fund to investors Brokerage Arrangements and Soft Dollars The Portfolio Advisor makes decisions, including the selection of markets and dealers and the negotiation of commissions, with respect to the purchase and sale of portfolio securities, and the eecution of portfolio transactions Brokerage business may be allocated by the Portfolio Advisor to CIBC WM and CIBC World Markets Corp, each a subsidiary of CIBC CIBC WM and CIBC World Markets Corp may also earn spreads on the sale of fied income securities and other securities to the Fund A spread is the difference between the bid and ask prices for a security in the applicable marketplace, with respect to the eecution of portfolio transactions The spread will differ based upon various factors such as the nature and liquidity of the security Dealers, including CIBC WM and CIBC World Markets Corp, may furnish goods and services, other than order eecution, when CAMI processes trades through them (referred to in the industry as soft-dollar arrangements) These goods and services are paid for with a portion of brokerage commissions and assist CAMI with investment decision-making services for the Fund or relate directly to the eecution of portfolio transactions on behalf of the Fund The fees and spreads for services of the Custodian directly related to the eecution of portfolio transactions by the Fund are paid by CAMI and/or dealer(s) directed by CAMI, up to the amount of the credits generated under soft dollar arrangements from trading on behalf of the Fund during that month 2

3 Renaissance Emerging Markets Fund In addition, the Manager may enter into commission recapture arrangements with certain dealers with respect to the Fund Any commission recaptured will be paid to the Fund During the period, the Fund did not pay any brokerage commissions or other fees to CIBC WM or CIBC World Markets Corp Spreads associated with fied income and other securities are not ascertainable and, for that reason, cannot be included when determining these amounts Fund Transactions The Fund may enter into one or more of the following transactions (the Related Party Transactions) in reliance on the standing instructions issued by the Independent Review Committee (IRC): l l l l l invest in or hold equity securities of CIBC or issuers related to a portfolio sub-advisor; invest in or hold non-echange-traded debt securities of CIBC or an issuer related to CIBC in a primary offering and in the secondary market; make an investment in the securities of an issuer for which CIBC WM, CIBC World Markets Corp, or any affiliate of CIBC (a Related Dealer) acts as an underwriter during the offering of the securities at any time during the 60-day period following the completion of the offering of such securities (in the case of a private placement offering, in accordance with the eemptive relief order granted by the Canadian securities regulatory authorities and in accordance with the policies and procedures relating to such investment); purchase equity or debt securities from or sell them to a Related Dealer, where it is acting as principal; and purchase securities from or sell securities to another investment fund or a managed account managed by the Manager or an affiliate of the Manager At least annually, the IRC reviews the Related Party Transactions for which they have issued standing instructions The IRC is required to advise the Canadian securities regulatory authorities, after a matter has been referred to or reported to it by the Manager, if it determines that an investment decision was not made in accordance with conditions imposed by securities legislation or the IRC in any Related Party Transactions requiring its approval Custodian CIBC Mellon Trust Company is the custodian of the Fund (the Custodian) The Custodian holds all cash and securities for the Fund and ensures that those assets are kept separate from any other cash or securities that the custodian might be holding The Custodian also provides other services to the Fund including record-keeping and processing of foreign echange transactions The fees and spreads for services of the Custodian directly related to the eecution of portfolio transactions by the Fund are paid by CAMI and/or dealer(s) directed by CAMI, up to the amount of the credits generated under soft dollar arrangements from trading on behalf of the Fund during that month All other fees and spreads for the services of the Custodian are paid by the Manager and charged to the Fund on a recoverable basis CIBC owns a 50% interest in the Custodian Service Provider CIBC Mellon Global Securities Services Company (CIBC GSS) provides certain services to the Fund, including securities lending, fund accounting and reporting, and portfolio valuation Such servicing fees are paid by the Manager and charged to the Fund on a recoverable basis CIBC indirectly owns a 50% interest in CIBC GSS 3

4 Renaissance Emerging Markets Fund Financial Highlights The following tables show selected key financial information about the Fund and are intended to help you understand the Fund s financial performance for the period ended August 31 The Fund's Net Assets per Unit¹ - Class A Units Net Assets, beginning of period $ 1709 $ 1559 $ 1658 $ 1362 $ 1246 Increase (decrease) from operations: Total revenue $ 057 $ 041 $ 043 $ 043 $ 039 Total epenses (070) (063) (068) (068) (042) Realized gains (losses) for the period 210 (034) Unrealized gains (losses) for the period (196) Total increase (decrease) from operations 2 $ 341 $ 138 $ (089) $ 300 $ 131 Distributions: From income (ecluding dividends) $ $ $ $ $ From dividends From capital gains Return of capital Total Distributions 3 $ $ $ $ $ Net Assets, end of period $ 2055 $ 1709 $ 1559 $ 1658 $ This information is derived from the Fund's audited annual financial statements The Fund adopted IFRS on September 1, 2014 Previously, the Fund prepared its financial statements in accordance with Canadian Generally Accepted Accounting Principles (GAAP) as defined in Part V of the CPA Canada Handbook Under Canadian GAAP, the Fund measured fair values of its investments in accordance with CICA Handbook Section 3855 which required the use of bid prices for long positions and ask prices for short positions As such, the net assets per unit figure presented in the financial statements may differ from the net asset value calculated for fund pricing purposes An eplanation of these differences can be found in the notes to the financial statements issued prior to September 1, 2014 Upon adoption of IFRS, the Fund measures the fair value of its investments by using the close market prices, where the close market price falls within the bid-ask spread As such, the Fund's accounting policies for measuring the fair value of investments in the financial statements are consistent with those used in measuring the net asset value for transactions with unitholders Accordingly, the opening net asset figure as at September 1, 2013 reflects the adjusted amount in accordance with IFRS All figures presented for periods prior to September 1, 2013 were prepared in accordance with Canadian GAAP 2 Net assets and distributions are based on the actual number of units outstanding at the relevant time The total increase (decrease) from operations is based on the weighted average number of units outstanding during the period 3 Distributions were paid in cash, reinvested in additional units of the Fund, or both Ratios and Supplemental Data - Class A Units Total Net Asset Value (000s) 4 $ 9,842 $ 7,807 $ 8,458 $ 10,539 $ 10,793 Number of Units Outstanding 4 479, , , , ,419 Management Epense Ratio 5 280% 307% 306% 306% 306% Management Epense Ratio before waivers or absorptions 6 469% 542% 507% 476% 421% Trading Epense Ratio 7 062% 063% 075% 113% 047% Portfolio Turnover Rate % 9352% 12456% 20325% 7402% Net Asset Value per Unit $ 2055 $ 1709 $ 1559 $ 1658 $ This information is presented as at August 31 of the period(s) shown 5 Management epense ratio is based on the total epenses of the fund (ecluding commissions and other portfolio transaction costs), incurred by or allocated to a class of units for the period shown, epressed as an annualized percentage of the daily average net asset value of that class during the period 6 The decision to waive and/or absorb management fees and operating epenses is at the discretion of the Manager The practice of waiving and/or absorbing management fees and operating epenses may continue indefinitely or may be terminated at any time without notice to unitholders 7 The trading epense ratio represents total commissions and other portfolio transaction costs before income taes epressed as an annualized percentage of the daily average net asset value during the period Spreads associated with fied income securities trading are not ascertainable and, for that reason, are not included in the trading epense ratio calculation The trading epense ratio includes the fees attributable to echange-traded funds 8 The portfolio turnover rate indicates how actively the portfolio advisor and/or portfolio sub-advisor manages the portfolio investmentsa portfolio turnover rate of 100% is equivalent to a fund buying and selling all of the securities in its portfolio once in the course of the period The higher a portfolio turnover rate in a period, the greater the trading costs payable by a fund in the period, and the greater the chance of an investor receiving taable capital gains in the year There is not necessarily a relationship between a high turnover rate and the performance of a fund 4

5 Renaissance Emerging Markets Fund The Fund's Net Assets per Unit¹ - Class F Units Net Assets, beginning of period $ 1088 $ 978 $ 1026 $ 831 $ 749 Increase (decrease) from operations: Total revenue $ 040 $ 027 $ 025 $ 026 $ 023 Total epenses (032) (026) (027) (028) (014) Realized gains (losses) for the period 137 (022) Unrealized gains (losses) for the period (193) Total increase (decrease) from operations 2 $ 220 $ 100 $ (122) $ 193 $ 094 Distributions: From income (ecluding dividends) $ $ $ $ $ From dividends From capital gains Return of capital Total Distributions 3 $ $ $ $ $ Net Assets, end of period $ 1323 $ 1088 $ 978 $ 1026 $ This information is derived from the Fund's audited annual financial statements The Fund adopted IFRS on September 1, 2014 Previously, the Fund prepared its financial statements in accordance with Canadian Generally Accepted Accounting Principles (GAAP) as defined in Part V of the CPA Canada Handbook Under Canadian GAAP, the Fund measured fair values of its investments in accordance with CICA Handbook Section 3855 which required the use of bid prices for long positions and ask prices for short positions As such, the net assets per unit figure presented in the financial statements may differ from the net asset value calculated for fund pricing purposes An eplanation of these differences can be found in the notes to the financial statements issued prior to September 1, 2014 Upon adoption of IFRS, the Fund measures the fair value of its investments by using the close market prices, where the close market price falls within the bid-ask spread As such, the Fund's accounting policies for measuring the fair value of investments in the financial statements are consistent with those used in measuring the net asset value for transactions with unitholders Accordingly, the opening net asset figure as at September 1, 2013 reflects the adjusted amount in accordance with IFRS All figures presented for periods prior to September 1, 2013 were prepared in accordance with Canadian GAAP 2 Net assets and distributions are based on the actual number of units outstanding at the relevant time The total increase (decrease) from operations is based on the weighted average number of units outstanding during the period 3 Distributions were paid in cash, reinvested in additional units of the Fund, or both Ratios and Supplemental Data - Class F Units Total Net Asset Value (000s) 4 $ 508 $ 152 $ 103 $ 149 $ 157 Number of Units Outstanding 4 38,379 14,003 10,491 14,483 18,930 Management Epense Ratio 5 162% 163% 164% 164% 165% Management Epense Ratio before waivers or absorptions 6 318% 365% 336% 296% 236% Trading Epense Ratio 7 062% 063% 075% 113% 047% Portfolio Turnover Rate % 9352% 12456% 20325% 7402% Net Asset Value per Unit $ 1323 $ 1088 $ 978 $ 1026 $ This information is presented as at August 31 of the period(s) shown 5 Management epense ratio is based on the total epenses of the fund (ecluding commissions and other portfolio transaction costs), incurred by or allocated to a class of units for the period shown, epressed as an annualized percentage of the daily average net asset value of that class during the period 6 The decision to waive and/or absorb management fees and operating epenses is at the discretion of the Manager The practice of waiving and/or absorbing management fees and operating epenses may continue indefinitely or may be terminated at any time without notice to unitholders 7 The trading epense ratio represents total commissions and other portfolio transaction costs before income taes epressed as an annualized percentage of the daily average net asset value during the period Spreads associated with fied income securities trading are not ascertainable and, for that reason, are not included in the trading epense ratio calculation The trading epense ratio includes the fees attributable to echange-traded funds 8 The portfolio turnover rate indicates how actively the portfolio advisor and/or portfolio sub-advisor manages the portfolio investmentsa portfolio turnover rate of 100% is equivalent to a fund buying and selling all of the securities in its portfolio once in the course of the period The higher a portfolio turnover rate in a period, the greater the trading costs payable by a fund in the period, and the greater the chance of an investor receiving taable capital gains in the year There is not necessarily a relationship between a high turnover rate and the performance of a fund 5

6 Renaissance Emerging Markets Fund The Fund's Net Assets per Unit¹ - Class O Units a Net Assets, beginning of period $ 2140 $ 1955 b Increase (decrease) from operations: Total revenue $ 056 $ 029 Total epenses (018) (011) Realized gains (losses) for the period 273 (050) Unrealized gains (losses) for the period Total increase (decrease) from operations 2 $ 499 $ 199 Distributions: From income (ecluding dividends) $ $ From dividends From capital gains Return of capital Total Distributions 3 $ $ Net Assets, end of period $ 2639 $ 2140 a Information presented is for the period from October 30, 2015 to August 31, 2016 b Initial offering price 1 This information is derived from the Fund's audited annual financial statements The Fund adopted IFRS on September 1, Net assets and distributions are based on the actual number of units outstanding at the relevant time The total increase (decrease) from operations is based on the weighted average number of units outstanding during the period 3 Distributions were paid in cash, reinvested in additional units of the Fund, or both Ratios and Supplemental Data - Class O Units a Total Net Asset Value (000s) 4 $ $ Number of Units Outstanding Management Epense Ratio 5 000% 000%* Management Epense Ratio before waivers or absorptions 6 000% 000%* Trading Epense Ratio 7 062% 063% Portfolio Turnover Rate % 9352% Net Asset Value per Unit $ 2639 $ 2140 a Information presented is for the period from October 30, 2015 to August 31, 2016 * Ratio has been annualized 4 This information is presented as at August 31 of the period(s) shown 5 Management epense ratio is based on the total epenses of the fund (ecluding commissions and other portfolio transaction costs), incurred by or allocated to a class of units for the period shown, epressed as an annualized percentage of the daily average net asset value of that class during the period 6 The decision to waive and/or absorb management fees and operating epenses is at the discretion of the Manager The practice of waiving and/or absorbing management fees and operating epenses may continue indefinitely or may be terminated at any time without notice to unitholders 7 The trading epense ratio represents total commissions and other portfolio transaction costs before income taes epressed as an annualized percentage of the daily average net asset value during the period Spreads associated with fied income securities trading are not ascertainable and, for that reason, are not included in the trading epense ratio calculation 8 The portfolio turnover rate indicates how actively the portfolio advisor and/or portfolio sub-advisor manages the portfolio investmentsa portfolio turnover rate of 100% is equivalent to a fund buying and selling all of the securities in its portfolio once in the course of the period The higher a portfolio turnover rate in a period, the greater the trading costs payable by a fund in the period, and the greater the chance of an investor receiving taable capital gains in the year There is not necessarily a relationship between a high turnover rate and the performance of a fund 6

7 Renaissance Emerging Markets Fund Management Fees The Fund pays CAMI an annual management fee to cover the costs of managing the Fund Management fees are based on the net asset value of the Fund and are calculated daily and paid monthly Management fees are paid to CAMI in consideration for providing, or arranging for the provision of, management, distribution, and portfolio advisory services Advertising and promotional epenses, office overhead epenses, and trailing commissions are paid by CAMI out of the management fees received from the Fund The Fund is required to pay applicable taes on the management fees paid to CAMI Refer to the simplified prospectus for the annual management fee rate for each class of units For Class O units, the management fee is negotiated with and paid by, or as directed by, unitholders or dealers and discretionary managers on behalf of unitholders Such Class O management fee will not eceed the Class A unit management fee rate The following table shows a breakdown of the services received in consideration of the management fees, as a percentage of the management fees collected from the Fund for the period ended August 31, 2017 These amounts do not include waived fees or absorbed epenses ClassAUnits ClassFUnits Sales and trailing commissions paid to dealers 6327% 000% General administration, investment advice, and profit 3673% 10000% Past Performance The performance data provided assumes reinvestment of distributions only and does not take into account sales, redemption, distribution, or other optional charges payable by any unitholder that would have reduced returns Past performance does not necessarily indicate how a fund will perform in the future The Fund s returns are after the deduction of fees and epenses, and the difference in returns between classes of units is primarily due to differences in the management epense ratio See Financial Highlights for the management epense ratio Year-by-Year Returns These bar charts show the annual performance of each class of units of the Fund for each of the periods shown, and illustrate how the performance has changed from period to period These bar charts show, in percentage terms, how an investment made on September 1 would have increased or decreased by August 31, unless otherwise indicated Class A Units 40% 20% 127% 92% 218% 97% 202% 0% -20% -112% -136% -33% -129% -60% -40%

8 Renaissance Emerging Markets Fund Class F Units 40% 20% 142% 108% 235% 112% 216% 0% -20% -98% -123% -19% -116% -47% -40% Class O Units 40% 30% 20% 233% 10% 94% 0% 16 a 17 a 2016 return is for the period from October 30, 2015 to August 31, 2016 Annual Compound Returns This table shows the annual compound return of each class of units of the Fund for each indicated period ended on August 31, 2017 The annual compound return is also compared to the Fund s benchmark The Fund s benchmark is the MSCI Emerging Markets Inde 1 Year 3 Years 5 Years 10 Years* or Since Inception* Inception Date Class A units 202% 74% 105% 18% October 25, 1996 MSCI Emerging Markets Inde 194% 78% 109% 45% Class F units 216% 89% 120% 33% May 25, 2007 MSCI Emerging Markets Inde 194% 78% 109% 45% Class O units 233% 177% October 30, 2015 MSCI Emerging Markets Inde 194% 150% * If a class of units has been outstanding for less than 10 years, the annual compound return since inception is shown MSCI Emerging Markets Inde is a free float-adjusted market capitalization Inde that is intended to represent the emerging countries equity market It includes stocks from emerging countries in Asia, Latin America, Europe, Africa, and the Middle East A discussion of the Fund's relative performance compared to its benchmark can be found in Results of Operations 8

9 Renaissance Emerging Markets Fund Summary of Investment Portfolio (as at August 31, 2017) The summary of investment portfolio may change due to ongoing portfolio transactions of the investment fund A quarterly update is available by visiting renaissanceinvestmentsca The Top Positions table shows a fund s 25 largest positions For funds with fewer than 25 positions in total, all positions are shown % of Net Asset Portfolio Breakdown Value China 270 South Korea 141 Other Equities 134 Taiwan 101 Brazil 81 India 70 South Africa 53 Russia 41 Hong Kong 33 Meico 29 Cash 25 Malaysia 22 % of Net Asset Top Positions Value Samsung Electronics Co Ltd 53 Alibaba Group Holding Ltd 52 Tencent Holdings Ltd 51 Naspers Ltd, Class 'N' 30 Taiwan Semiconductor Manufacturing Co Ltd 26 Ping An Insurance (Group) Co of China Ltd 26 Cash 25 China Construction Bank Corp, Class 'H' 24 Bank of China Ltd, Class 'H' 23 Banco Bradesco SA, ADR 18 Hon Hai Precision Industry Co Ltd 18 Sberbank of Russia PJSC, ADR 16 Yes Bank Ltd 14 ishares MSCI Emerging Markets Inde Fund 14 KB Financial Group Inc 14 LG Chem Ltd 12 Weibo Corp, ADR 12 YY Inc, ADR 10 POSCO, ADR 10 Grupo Financiero Banorte SAB de CV 10 Largan Precision Co Ltd 10 Dewan Housing Finance Corp Ltd 09 China Petroleum and Chemical Corp (Sinopec), Class 'H' 09 Haier Electronics Group Co Ltd 09 China Yongda Automobiles Services Holdings Ltd 09 9

10 A note on Forward-looking Statements The management report of fund performance may contain forward-looking statements Forward-looking statements include statements that are predictive in nature, that depend upon or refer to future events or conditions, or that include words such as epects, anticipates, intends, plans, believes, estimates, or other similar wording In addition, any statements that may be made concerning future performance, strategies, or prospects and possible future actions taken by the fund, are also forward-looking statements Forward-looking statements are not guarantees of future performance These statements involve known and unknown risks, uncertainties, and other factors that may cause the actual results and achievements of the fund to differ materially from those epressed or implied by such statements Such factors include, but are not limited to: general economic, market, and business conditions; fluctuations in securities prices, interest rates, and foreign currency echange rates; changes in government regulations; and catastrophic events The above list of important factors that may affect future results is not ehaustive Before making any investment decisions, we encourage you to consider these and other factors carefully CIBC Asset Management Inc does not undertake, and specifically disclaims, any obligation to update or revise any forward-looking statements, whether as a result of new information, future developments, or otherwise prior to the release of the net management report of fund performance

11 Renaissance Investments 1500 Robert-Bourassa Boulevard, Suite 800 Montreal, Quebec H3A 3S FUND (3863) Website renaissanceinvestmentsca CIBC Asset Management Inc, the manager and trustee of the Renaissance Investments family of funds, is a wholly-owned subsidiary of Canadian Imperial Bank of Commerce Please read the Renaissance Investments family of funds and Aiom Portfolios simplified prospectus before investing To obtain a copy of the simplified prospectus, call FUND (3863), us at info@renaissanceinvestmentsca, or ask your advisor Renaissance Investments is offered by and is a registered trademark of CIBC Asset Management Inc 02383E (201708)