KB Elite Multi Asset Balanced Fund Quarterly update, Q4 2014 For professional use only
Key events in Q4 2014 October Islamic state forces besiege the Syrian border town of Kobane Bank of Japan announces an expansion of its asset purchase programme November Republican party regains control of the US Senate in midterm elections NATO claims Russian forces have once again re-entered Ukraine December Cuba and the US re-establish diplomatic relations after a 55 year break Oil prices collapse ending the year down 49% 2
Key asset allocation changes in Q4 2014 Asset Group Sep-14 Dec-14 Change Cash & FX 2.6 3.6 1.0 Equities 60.3 60.1-0.2 Fixed Income 29.7 30.1 0.4 Hedge Funds 0.0 0.0 0.0 Real Estate 7.5 7.1-0.4 Commodities 0.0 0.0 0.0 Total 100.0 100.0 Source: Kleinwort Benson 3
Asset allocation Asset class mix as at 31-Dec-2014 Fixed Income 30.1 % Real Estate 7.1% Cash & FX 3.6% Equities 60.1% Asset Weight (%) Cash GBP Cash 0.0 USD Cash 3.6 EUR Cash 0.0 Equities UK 39.9 US 12.3 Europe Ex UK 2.1 Japan 0.0 Asia Pacific Ex Japan 0.0 Emerging Markets 5.9 Fixed Income GBP Government Bonds (Conventional) 8.2 GBP Government Bonds (Index-Linked) 7.3 USD Government Bonds (Conventional) 0.0 GBP Corporate Bonds 7.3 GBP High Yield Bonds 2.2 Emerging Markets Bonds 5.1 Alternatives Hedge Funds 0.0 Real Estate 7.1 Commodities 0.0 Gold 0.0 Source: Kleinwort Benson 4
Currency exposure and top 10 holdings Currency exposure as at 31-Dec-2014 Top 10 Holdings Weight (%) Asia Pacific ex Japan 0.0% Japanese Yen 0.0% Emerging Markets & Commodity 10.9% VANGUARD UK EQUITY FUND 19.2 ISHARES S&P 500 9.2 HSBC FTSE 100 ETF 7.6 UK I/L TREASURY 2024 6.8 US Dollar 15.9% HENDERSON PROPERTY INC 5.7 ISHARES FTSE UK GILT ALL STOCK 4.9 Euro 2.1% UK Sterling 71.1% ISHARES FTSE 100 3.9 UK TREASURY 2024 3.7 USD CASH 3.7 INVESCO PERPETUAL CORP BOND FUND 3.2 Source: Kleinwort Benson 5
Source: Kleinwort Benson; Bloomberg; Morningstar Performance and contribution in Q4 2014 Cumulative Performance Q4 2014 KB Elite Multi Asset Balanced Fund 1 2.3% Morningstar GBP Moderate Allocation Category ( Peer Group ) 1. Performance net of fees, total return, A share class in GBP 2. UK CPI 3. FTSE All Share TR 2.3% Inflation 2-0.2% Equities 3 0.6% Cash and FRNs US dollar strengthening contributed +11 bps to fund s performance Equities UK and European equities lagged those in US In aggregate, equities contributed +85 bps to fund s performance in Q4 Bonds Falling yields resulted in +98 bps contribution to fund performance from UK government bonds Real estate Real estate added +26 bps to fund with strong performance in UK commercial property KB Elite Multi Asset Balanced Q4 2014 Benchmark Index Performance (%) Q4 2014 Performance Contribution (bps) Cash & FRNs NA 11 Currency Futures NA 0 UK Equities 0.6 25 US Equities 8.2 77 Europe ex UK Equities -0.5-6 Japan Equities 1.3-3 Pacific ex Japan Equities 3.3 0 Emerging Markets Equities -0.6-8 Global Equities 4.5 0 Private Equity 6.9 0 GBP Gov Bonds conventional 6.3 45 GBP Gov Bonds - index-linked 8.4 53 USD Gov Bonds conventional 6.1 0 EUR Gov Bonds conventional 2.5 0 GBP Corporate Bonds 4.3 25 USD Corporate Bonds 5.9 0 EUR Corporate Bonds 1.1 0 GBP High Yield Bonds 1.1-3 Emerging Markets Bonds -1.3-11 Commodities -6.6 0 Gold 2.1 0 Real Estate 4.5 26 Hedge Funds -1.7 0 Total 232 6
Longer-term performance and risk Short-term Medium-term Long-term Risk (5 Year) Cumulative Performance YTD 1 Year 3 Year 5 Year Volatility (ann.) Max drawdown KB Elite Multi Asset Balanced Fund 1 4.6% 4.6% 15.4% 23.5% 6.9% -8.3% Inflation 2 0.5% 0.5% 5.8% 14.5% NA NA Cash 3 0.5% 0.5% 1.5% 2.5% NA NA Morningstar GBP Moderate Allocation Category ( Peer Group ) 5.4% 5.4% 25.2% 34.3% 6.3% -6.5% Equities 4 1.2% 1.2% 37.3% 51.8% 12.3% -14.5% Performance since inception (%) 70 60 50 40 30 20 10 0-10 KB Elite Multi Asset Balanced Fund Morningstar GBP Moderate Allocation Category ("Peer Group") UK CPI -20 Aug-05 Aug-07 Aug-09 Aug-11 Aug-13 1. Performance net of fees, total return, A share class in GBP 2. UK Consumer Price Index 3. Bank of England Base Rate 4. FTSE All Share TR Source: Kleinwort Benson; Bloomberg; Morningstar The Fund has grown investors wealth at a rate of c. 4.5% per annum over the past 5 years. The Fund has delivered a positive real return over the past 1, 3 and 5 years. The Fund has significantly outperformed cash over the past 1, 3 and 5 years. The Fund has participated in the post-crisis bull market in risk assets but not as fully as the average of its peer group owing to positioning. The Fund has participated in the post-crisis bull market but has not been able to keep pace with equities given its balanced mandate. 7
Net monthly performance since launch KB Elite Multi Asset Balanced Fund 1 YTD Performance (%) Performance (%) Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec YTD Hit Rate (%) Morningstar GBP Moderate Allocation Category ("Peer Group") Inflation 2 Cash 3 Equities 4 2005-0.1 1.0-0.0 2.4 2.6 6.0 60 7.4 0.7 1.9 7.9 2006 2.5 0.3 1.8 0.2-2.8 1.1 0.6 0.0-0.0 1.3 0.6 1.3 6.9 83 7.6 2.7 4.6 16.8 2007 0.5-0.1 0.8 2.1 2.4 0.5 0.1-1.1 3.4 2.7-3.1 1.1 9.7 75 2.5 2.1 5.5 5.3 2008-4.7 1.3-1.9 3.8 0.2-3.6-2.3 3.0-6.9-12.7-0.7 3.2-20.4 42-15.5 4.1 4.9-29.9 2009-3.7-3.1 6.5 6.3 1.0-0.9 5.8 4.3 4.2-1.7 2.6 2.4 25.7 67 17.9 1.9 0.7 30.1 2010-2.0 3.5 3.0 0.4-2.7-3.3 1.6-0.7 6.1 1.4 1.0 4.0 12.7 67 10.0 3.2 0.5 14.5 2011-1.3 0.5 1.0 0.6 0.1-0.0-1.4-2.8-4.3 2.9-0.8 0.7-5.0 50-2.5 4.8 0.5-3.5 2012 1.2 0.8-0.8-1.0-1.3 1.5 1.8 0.4 0.6-0.5 0.9 0.3 4.0 67 8.3 2.6 0.5 12.3 2013 3.3 2.4 0.5-0.3 1.4-2.9 2.6-2.9 0.2 3.2-1.4 0.2 6.1 67 9.7 2.1 0.5 20.8 2014-2.1 2.7-0.5 0.4 1.7-0.7 0.1 2.4-1.6 0.5 2.9-1.0 4.6 58 5.4 0.5 0.5 1.2 Since inception (%, ann.) 4.7 5.0 2.7 2.1 6.7 1. Performance net of fees, total return, A share class in GBP 2. UK CPI 3. Bank of England Base Rate 4. FTSE All Share TR Source: Kleinwort Benson; Bloomberg; Morningstar 8
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 1.4268 A GBP Reinvest Reporting Shares B0FQ2M8 1.4272 B GBP Income Reporting Shares B0FQ4N6 1.38 B GBP Accumulating Non-Reporting Shares B84RG59 1.1075 C GBP Income Reporting Shares B3TXYQ4 1.4300 A EUR Accumulating Reporting Shares B8JYT01 1.0500 B EUR Accumulating Non-Reporting Shares B8NY2P3 1.0800 A USD Accumulating Reporting Shares B7T4FM8 1.1100 A USD Accumulating Non-Reporting Shares B89HR95 1.1100 B USD Accumulating Non-Reporting Shares B8N7H13 1.0900 C USD Accumulating Non-Reporting Shares B8N3CB6 1.0000 Dealing: Weekly Yield: Nil Fund size: GBP 100.0m Fees Share class Annual Management Charge A 1.25% B 1.50% C 0.60% Source: Kleinwort Benson, data as at 31-Dec-2014 9
Key Risks This document is not available for general distribution in, from or into the United Kingdom because these Funds are an unregulated Collective Investment Scheme whose promotion is restricted by sections 238 and 240 of the Financial Services and Markets Act 2000. When distributed in, from or into the United Kingdom, this document is only intended for persons having professional experience of investing in unregulated schemes, high net worth companies, partnerships, associations or trusts and personnel of any of the foregoing having professional experience of investing in unregulated schemes (each within the Financial Services and Markets Act 2000 (Promotion of Collective Investment Schemes) (Exemptions) Order 2001 (as amended)), persons outside the European Economic Area receiving it electronically, persons outside the United Kingdom receiving it non-electronically and any other persons to whom it may be communicated lawfully. No other person should act or rely on it. Other persons distributing this document from or into the United Kingdom must satisfy themselves that it is lawful to do so. This document is intended for clients of Kleinwort Benson (Channel Islands) Limited, Kleinwort Benson (Channel Islands) Investment Management Limited and Kleinwort Benson Bank Limited. Retail clients should seek professional advice on the suitability of these funds. This set of financial statements is not intended as a solicitation to buy and is for information purposes only. This fund is not approved as an authorised foreign collective investment scheme in terms of South African legislation. 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. Key features documentation is available on request. Fluctuations in exchange rates may cause the value of investments denominated in currencies other than sterling to fall or rise. Past performance does not guarantee future performance. The levels and bases of and relief from taxation may change. The value of tax relief will depend on individual circumstances. Important Information This publication has been approved and issued in the United Kingdom by Kleinwort Benson. 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 firm reference number is 119269 and Kleinwort Benson is a member of the London Stock Exchange. Kleinwort Benson is a company incorporated in England and Wales with company number 2056420 and VAT number 991 2295 95. Registered Office 14 St. George Street London W1S 1FE. Telephone +44 (0) 20 3207 7000. Kleinwort Benson is the brand name of Kleinwort Benson (Channel Islands) Investment Management Limited which is a company incorporated in Jersey with company number 13270. Registered Office Kleinwort Benson House Wests Centre St Helier Jersey JE4 8PQ. It is regulated by the Jersey Financial Services Commission, the Guernsey Financial Services Commission for the conduct of investment business. Kleinwort Benson is the brand name for Kleinwort Benson (Channel Islands) Limited which is a company incorporated in Guernsey with company number 52103. It is regulated by the Guernsey Financial Services Commission for Banking and Investment Services. Kleinwort Benson is also authorised and regulated by the United Kingdom ( UK ) Financial Conduct Authority ( FCA ) in respect of UK regulated mortgage business and its FCA firm reference number is 310344; registered office, Dorey Court, Admiral Park, St Peter Port, Guernsey GY1 2HT. Telephone number +44 (0) 1481 727111. Telephone calls may be recorded. Kleinwort Benson places all client deposits with a spread of approved counterparties and other parts of the Kleinwort Benson Group (the Group ). As such their financial standing is linked to that of the Group. Depositors should form their own view of the financial standing of Kleinwort Benson and the Group based upon publicly available information. Kleinwort Benson is a participant in the Guernsey Banking Deposit Compensation Scheme (the Scheme ). The Scheme offers protection for qualifying deposits up to 50,000.00 subject to certain limitations. The maximum total amount of compensation is capped at 100,000,000.00 in any 5 year period. Full details are available on the Scheme s website www.dcs.gg or on request. 10