The fund aims to deliver combined income and capital growth of at least 5% a year above the 3-month GBP LIBOR, before any charges are taken, over any five-year period. LIBOR is the rate at which banks borrow money from each other. There is no guarantee that the fund will achieve a positive return over any period. Investors may not get back the original amount they invested.
Investment policy and strategy
Core investment:The fund is typically invested in a mix of assets, including company shares, bonds, convertibles and currencies. The fund may invest directly or indirectly via other funds or derivatives. A minimum of 30% of the fund is exposed to sterling and a minimum of 60% to developed market currencies (including sterling).
Other investments: The fund may also invest indirectly in property and other assets via other funds or derivatives. Derivatives may also be used to reduce risk and costs and to manage the impact of changes in currency exchange rates on the fund’s investments.
Strategy in brief: The fund has a very flexible investment approach, with the freedom to invest in different types in response to changes in economic conditions and the valuation of assets. The fund will typically invest 20-60% of its assets in company shares and convertibles, 30-75% in bonds or cash, and up to 20% in other assets.
These allocations reflect the net exposure of the portfolio. The approach combines in-depth research to work out the "fair" value of assets over the medium to long term, with analysis of market reactions to events to identify investment opportunities. In particular, the fund manager seeks to respond when asset prices move away from a reasonable sense of "fair" long-term value due to the market’s reaction to events.
Benchmark: 3-month GBP LIBOR + 5%
The fund manager makes active investment decisions for the fund. The benchmark is a target which the fund seeks to achieve. The target benchmark is used solely to measure the fund’s performance.
For unhedged share classes, the rate is shown in the share class currency.
Bonds: Loans to governments and companies that pay interest.
Convertibles: Bonds issued by companies that usually pay a set rate of interest and which can be exchanged for predetermined amounts of company shares.
Derivatives: Financial contracts whose value is derived from other assets.
Warrants: Financial contracts which allow the fund manager to buy stocks for a fixed price until a certain date.
Risks associated with the fund
The value and income from the fund's assets will go down as well as up. This will cause the value of your investment to fall as well as rise. There is no guarantee that the fund will achieve its objective and you may get back less than you originally invested.
The fund may use derivatives to profit from an expected rise or fall in the value of an asset. Should the asset's value vary in an unexpected way, the fund may lose as much as or more than the amount invested.
The fund invests in other funds, which are subject to the risks associated with the type of assets held in those funds.
The fund can be exposed to different currencies. Movements in currency exchange rates may adversely affect the value of your investment.
Investments in bonds are affected by interest rates, inflation and credit ratings. It is possible that bond issuers will not pay interest or return the capital. All of these events can reduce the value of bonds held by the fund.
Investing in emerging markets involves a greater risk of loss due to greater political, tax, economic, foreign exchange, liquidity and regulatory risks, among other factors. There may be difficulties in buying, selling, safekeeping or valuing investments in such countries.
In exceptional circumstances where assets cannot be fairly valued, or have to be sold at a large discount to raise cash, we may temporarily suspend the fund in the best interest of all investors.
The fund could lose money if a counterparty with which it does business becomes unwilling or unable to repay money owed to the fund.
Further details of the risks that apply to the fund can be found in the fund's Prospectus.
The performance webpage for this fund is currently being reconfigured.