The fund aims to provide a combination of capital growth and income to deliver a return that is higher than that of the global emerging markets stockmarket over any five-year period.
Investment policy and strategy
Core investment: At least 80% of the fund is invested in the shares of companies domiciled, or conducting the major part of their economic activity, in emerging market countries*. The fund may invest in China A-Shares via the Shanghai-Hong Kong Stock Connect and the Shenzhen-Hong Kong Stock Connect.
Other investment: The fund also holds cash or assets that can be turned quickly into cash.
* Emerging market countries are defined as those included within the MSCI Emerging Markets Index and/or those included in the World Bank’s definition of developing economies, as updated from time to time.
Strategy in brief: The investment manager invests in the shares of companies whose long-term prospects are considered to be undervalued. Stock selection is driven by in-depth analysis of individual companies, with a specific focus on their level of profitability, their corporate governance practices and the valuation of the shares. The investment manager selects stocks with distinct profitability profiles to build a fund that has the potential to cope in a variety of market conditions.
Performance comparator: The fund is actively managed. The MSCI Emerging Markets Index is a point of reference against which the performance of the fund may be measured.
Risks associated with the fund
The value of investments and the income from them will rise and fall. This will cause the fund price, as well as any income paid by the fund, to fall as well as rise. There is no guarantee the fund will achieve its objective, and you may not get back the amount you originally invested.
The fund will invest in emerging markets which are generally smaller, more sensitive to economic and political factors, and where investments are less easily bought and sold. In exceptional circumstances, the fund may encounter difficulties when selling or collecting income from these investments, which could cause the fund to incur a loss. In extreme circumstances, it could lead to the temporary suspension of dealing in shares in the fund.
Changes in currency exchange rates will affect the value of your investment.
If the share class is hedged (H share class), it aims to mirror the performance of another share class. We cannot guarantee that the hedging objective will be achieved. The hedging strategy will limit holders of the hedged share class from benefiting if the hedged share class currency falls against the US dollar.
Where market conditions make it hard to sell the fund’s investments at a fair price to meet customers’ sale requests, we may temporarily suspend dealing in the fund’s shares.
Some transactions the fund makes, such as placing cash on deposit, require the use of other financial institutions (for example, banks). If one of these institutions defaults on their obligations or becomes insolvent, the fund may incur a loss.
The fund invests mainly in company shares and is therefore likely to experience larger price fluctuations than funds that invest in bonds and/or cash.