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| | Investment Policies Up to 80% of the assets of UK Financial Services Products Fund Sicav Plc - U.K.F.S.P. Fund Sicav Plc will be invested in NEW single premium 'with profit' insurance policies as described above, issued by British Insurance Companies(i.e. insurance companies that are established and regulated by the Financial Services\Authority (FSA) in the UK, subject however to all insurance policies to be invested in being issued by insurance companies having a minimum S&P and/or Moody's rating of "A+". The Fund will invest mainly in Endowment Policies
IT IS UNDERSTOOD THAT THE HOLDERS OF SHARES IN THE FUND WILL NOT BE THE BENEFICIARIES OF THE UNDERLYING INSURANCE POLICIES BUT WILL ONLY OWN THE SHARES OF THE FUND INVESTING IN SUCH INSURANCE POLICIES, AND THAT ONLY THE FUND ITSELF, WHERE APPLICABLE, SHALL HOLD SUCH TITLE OF 'BENEFICIARY' TO THE BENEFITS ACCRUING FROM THE INSURANCE POLICIES.
It is understood that the 'Assured' under the insurance policies will be a small group of individuals, which could be a small group of initial investors in the Fund (subject to such investors agreeing in writing), a small group of officials connected to the Fund (subject to such officials agreeing in writing), or a small group of a mix of both. In all cases the Fund will be the sole beneficiary of any and all proceeds deriving from the insurance policy.
The 'Insurable Interest' under the insurance policies shall be that in the case of death of the Assured, or on maturity of the insurance policies, the sum assured and, where applicable, the minimum yield, is guaranteed up to the value of 101%. In practice, an insurance policy will only become due in the event of the death of all the individuals constituting the Assured, or on maturity of the insurance policies, in which case the sum assured, where applicable the minimum yield, and any further bonuses due will be paid out by the insurance company into the Fund's assets, the Fund being the sole beneficiary under the insurance policies.
By investing up to 80% of the net asset value of the Fund in these New Insurance Policies, the rationale of the Fund is to give investors in the Fund an indirect exposure to a broad spread of investments which can include equities, property and also fixed income products and time deposits, therefore investors in the Fund will be indirectly participating in the performance of the 'with profit' fund and accordingly will also be partaking pro-rata to any bonus declared by the insurance company whilst at the same time building in a 'Sum Assured' element and thereby protecting the sum assured and, where relevant, the guaranteed minimum yield and possibly declared bonuses.
Up to 20% of the assets of the Fund can be invested in equities, bonds, commodities and derivative financial instruments that are traded on an official regulated exchange, and in capital guaranteed financial products issued by highly recognized international banks rated A+ or above that provide capital guarantees, and sometimes also guaranteed minimum returns payable on maturity or periodically, that are linked to the performance of a specifically referenced benchmark, such as a specific Hedge Fund or similar product and/or an internationally recognized Index, and also in any other investment undertakings for which NAV is calculated.
By investing up to 20% of the net asset value of the Fund in such investments, which in the Investment Manager's opinion are considered to be conducive to the achievement of the Fund's investment objective, the rationale of the Fund is to give investors exposure to a wide variety of investment instruments, including equities, bonds, commodities, derivative financial instruments, capital guaranteed financial products and other investment undertakings for which NAV is calculated thereby giving the investors the opportunity of participating in a higher performance then that offered by investments with lower exposure to market fluctuations.
Initially the Fund will only issue Accumulation shares, however it retains the option to create Distribution shares at a later stage, even if this is unlikely for the foreseeable future. Accordingly no distributions will be made and hence no Distribution shares will be created at the outset. It follows, and indeed their nature requires it, that the investments made in the underlying insurance policies and capital guaranteed products will be retained in the Fund's portfolio for longer periods of time than would normally be the case with other types of underlying assets in a fund. Having said that, it is possible that investments in capital guaranteed products may be sold from time to time in order to realize profits, and investments in the insurance policies will be organized in such a way that they will have different maturity dates. Moreover any investments in listed securities (equities and bonds) and units of other funds are by their nature not necessarily long-term, and turnover of this type of underlying asset of the Fund may be frequent if this is considered by the Investment Manager to be in the best interests of the Fund and its investors. Accordingly, from time to time the Fund will be receiving, with respect to matured insurance policies or upon death of the Assured, repayment of the invested capital, payment of any guaranteed gains and payment of any extra-declared bonuses, and the Fund may also receive on a regular basis proceeds from the sale of any listed securities (bond and equities) and units in other funds it may hold in its portfolio. It follows that the Fund, on a regular basis, will have a certain amount of liquidity available that, if it creates Distribution shares, it can use to pay dividends. Hence, any dividends payable in the future with respect to possible future Distribution shares shall be paid out of realized gains. The Investment Manager shall decide on when, if at all, Distribution shares should be issued, and what amount of dividend shall be payable to the holders of such Distribution shares.
The Investment Manager may, at its sole discretion, alter the investment policies listed above, provided that any material change thereof shall be notified to the MFSA, the shareholders of the Fund and any other competent authorities.
"AUTHORISED INVESTOR RESTRICTION | | ||
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