KB Elite Multi Asset Balanced Fund Quarterly update, Q1 2014
Key events in Q1 2014 January China releases economic data for 2013 showing slowest rate of growth since 1999 Russia hosts 2014 Winter Olympics in Sochi February President Putin orders Russian troops into Crimea Facebook announces purchase of instant messaging platform, WhatsApp, for $19 billion March Russia annexes Crimea US and Europe announce sanctions against Russia 2
Key asset allocation changes in Q1 2014 January Reduced fund s Hedge Funds exposure; increased equities and fixed income allocations March Reduced fund s Asia Pacific ex Japan equity exposure; increased USD cash Asset Group Dec-13 Mar-14 Change Cash & FX 5.0 6.7 1.7 59.7 62.1 2.4 Fixed Income 22.5 23.8 1.3 Hedge Funds 5.2 0.2-5.0 Real Estate 7.7 7.3-0.4 Commodities 0.0 0.0 0.0 Total 100.0 100.0 Source: Kleinwort Benson 3
Asset allocation Asset class mix as at 31-Mar-2014 Fixed Income 23.8% Real Estate 7.3% Hedge Funds 0.2% Commodities 0.0% Cash & FX 6.7% 62.1% Asset Weight (%) Cash GBP Cash 0.8 USD Cash 5.9 EUR Cash 0.0 UK 36.3 US 9.4 Europe Ex UK 6.4 Japan 3.1 Asia Pacific Ex Japan 0.0 Emerging Markets 6.5 Private Equity 0.4 Fixed Income GBP Government Bonds (Conventional) 5.1 GBP Government Bonds (Index-Linked) 4.9 USD Government Bonds (Conventional) 0.0 GBP Corporate Bonds 7.4 US High Yield Bonds 2.0 Emerging Markets Bonds 4.5 Alternatives Hedge Funds 0.2 Real Estate 7.3 Commodities 0.0 Gold 0.0 Source: Kleinwort Benson 4
Currency exposure and top holdings Currency exposure as at 31-Mar-2014 Top 10 Holdings Weight (%) Asia Pacific ex Japan 0.0% Japanese Yen 3.1% Emerging Markets & Commodity 11.0% VANGUARD UK EQUITY FUND 17.1 ISHARES S&P 500 9.4 ISHARES FTSE 100 8.7 HSBC FTSE 100 ETF 6.8 ISHARES MSCI EUROPE EX.UK 6.4 US Dollar 17.5% UK Sterling 62.1% HENDERSON PROPERTY INC 5.9 USD Cash 5.9 Euro 6.4% ISHARES FTSE UK GILT ALL STOCK 5.0 ISHARES MSCI EMERGING MKTS 4.3 ISHARES BC GBP IND-LNK GILTS 3.9 Source: Kleinwort Benson 5
Performance and contribution in Q1 2014 Cumulative Performance KB Elite Multi Asset Balanced Fund Morningstar GBP Moderate Allocation Category ( Peer Group ) 1 Month 3 Months YTD 1 Year 3 Year 5 Year Source: Kleinwort Benson; Bloomberg 1. KB Elite Multi Asset Balanced fund launched 3-Aug-2005 2. Asset Risk Consultants Private Client Indices 3. March and quarterly performance is indicative Since Launch 1-0.5% -0.0% -0.0% -0.2% 4.7% 49.3% 46.9% -0.2% 0.8% 0.8% 3.8% 16.2% 57.8% 51.5% UK CPI 0.6% 0.3% 0.3% 1.8% 8.1% 16.2% 27.4% ARC Sterling Balanced Asset -0.6% 0.7% 0.7% 3.2% 14.6% 47.1% 52.7% PCI 2,3 Equity markets contributed -57 bps to fund s performance in Q1 Japanese equities lagged those in Europe ex UK and the US Bonds Falling yields resulted in a +20 bps contribution to fund performance from UK government bonds and +18bps contribution from GBP Investment Grade corporate bonds Real estate Real estate added +23 bps to the fund with strong performance in UK commercial property KB Elite Multi Asset Balanced Q1 2014 Benchmark Index Performance (%) Q1 2014 Performance Contribution (bps) Cash & FRNs NA -2 Currency Futures NA 1 UK -0.6-19 US 1.0 8 Europe ex UK 3.0 15 Japan -5.5-27 Asia Pacific ex Japan 0.4-16 Emerging -1.1-16 Global 0.5 0 Private Equity 2.2-2 GBP Gov Bonds conventional 2.1 10 GBP Gov Bonds - index-linked 3.2 10 USD Gov Bonds conventional 0.7 0 EUR Gov Bonds conventional 0.5 0 GBP Corporate Bonds 2.4 15 USD Corporate Bonds 2.3 0 EUR Corporate Bonds 1.9 0 US High Yield Bonds 2.0 6 Emerging Markets Bonds 1.6-4 Commodities 5.0 0 Gold 5.8 0 Real Estate 4.4 23 Hedge Funds 1.0-3 Total -4 6
Source: Kleinwort Benson; Morningstar; data from Aug-2005 to Mar-2014 Long-term performance and risk Performance since inception 1 (%) 60 50 40 30 20 10 0 KB Elite Multi Asset Balanced Fund Morningstar GBP Moderate Allocation Category ("Peer Group") UK CPI KB Elite Multi Asset Balanced Fund 2 Morningstar GBP Moderate Allocation "Peer Group" 3 4 UK CPI Performance since launch 46.9 51.5 82.3 27.4 Performance (since launch, annualised) 4.5 4.9 7.2 2.8 Volatility (since launch, annualised) 9.6 8.2 14.9 N/A Return/Risk (since launch) 0.5 0.6 0.5 N/A Maximum drawdown -27.1-21.3-34.7 N/A Volatility as % of equity volatility 64 55 100 N/A Monthly Hit Rate (%) 64 63 63 N/A -10-20 Aug-05 Aug-07 Aug-09 Aug-11 Aug-13 1. KB Elite Multi Asset Balanced fund launched 3-Aug-2005 2. Performance is net of costs and fees 3. Performance relates to the A share class as this fund has a long term performance record. Customers of Financial Advisers are invested in the B share class which pays trail commission. 4. MSCI AC World Net TR (GBP) KB Elite Multi Asset Balanced Fund has produced performance in-line with its peers since launch. The fund has delivered a positive real return. The fund has produced lower returns than equities but has done so with lower volatility and drawdown. The performance data for KB Elite Multi Asset Balanced Fund is net of fees whereas data for equities is gross and does not reflect implementation costs to an investor. 7
Fund information Investment objective To achieve long term equity returns with a moderate level of risk through a well diversified portfolio across asset classes. The fund seeks to achieve its objective by investing directly in a range of equities, bonds, money market instruments, derivative instruments, forward transactions, collective investment schemes and other instruments as the Investment Manager may consider appropriate. Fund facts Benchmark: Domicile: Administrator: Custodian: Auditors: Structure: Morningstar GBP Moderate Allocation Category ( Peer Group ) Guernsey Kleinwort Benson (Channel Islands) Fund Services Limited BNP Paribas Trust Company (Guernsey) Limited Deloitte LLP Guernsey Class B Collective Investment Scheme Structured as a Private Cell Company Share Classes Sedol Last Price A GBP Income Reporting Shares B0FPSD8 1.3707 A GBP Reinvest Reporting Shares B0FQ2M8 1.3710 B GBP Income Reporting Shares B0FQ3N6 1.3250 B GBP Accumulating Non-Reporting Shares B84RG59 1.0605 C GBP Income Reporting Shares B3TXYQ4 1.4000 A EUR Accumulating Reporting Shares B8JYT01 1.0100 B EUR Accumulating Non-Reporting Shares B8NY2P3 1.0400 A USD Accumulating Reporting Shares B7T4FM8 1.0700 A USD Accumulating Non-Reporting Shares B89HR95 1.0700 B USD Accumulating Non-Reporting Shares B8N7H13 1.0500 C USD Accumulating Non-Reporting Shares B8N3CB6 1.0000 Dealing: Weekly Yield: Nil Fund size: GBP 116.8m Fees Share class Annual Management Charge B 1.50% Source: Kleinwort Benson, data as at 31-Mar-2014. Performance net of fees, total return, A share class in GBP 8
General risk information The information in this publication is provided for information purposes only and does not take into account the investment objective, the financial situation or the individual needs of any particular person. It is not an offer to buy or sell any particular security or investment. This publication does not constitute advice. All potential investors should seek and obtain advice specific to their circumstances from a qualified financial adviser before making investment decisions. The value of investments, and the income from them, may fall as well as rise and the investor may not get back the amount initially invested. Past performance does not guarantee future performance. Fluctuations in exchange rates may cause the value of investments denominated in currencies other than sterling to fall or rise. The effects of charges and an investor s personal tax circumstances may reduce any returns. Tax treatment depends on an investor s individual circumstances and may be subject to change. Regulatory information This publication is not available for general distribution in, from or into the United Kingdom because this fund is an unregulated Collective Investment Scheme whose promotion is restricted by sections 238 and 240 of the Financial Services and Markets Act 2000. This publication is intended for distribution only to clients of Kleinwort Benson Bank Limited with existing holdings in the KB Elite Multi Asset Balanced Fund. It must not be distributed to or relied on by any other person. This publication is not intended for distribution into the USA or any other jurisdiction in which its distribution would be against a relevant law or regulation. This publication is a financial promotion. It has been approved and issued in the United Kingdom by Kleinwort Benson Bank Limited. Kleinwort Benson is the brand name of Kleinwort Benson Bank Limited. Kleinwort Benson is authorised by the Prudential Regulation Authority and regulated by the Financial Conduct Authority and the Prudential Regulation Authority, reference number 119269 and is a member of the London Stock Exchange. Kleinwort Benson is a company incorporated in England and Wales with company number 2056420. 9