A best ideas, comprehensive China-centric fixed income solution investing across the full universe of onshore CNY and offshore USD bonds which can exploit relative value opportunities.
For Inc-2 and Inc-3 shares classes, expenses are charged to the capital account rather than to income, so capital will be reduced. This could constrain future capital and income growth. Income may be taxable.
Changes in the relative values of different currencies may adversely affect the value of investments and any related income.
There is a risk that the issuers of fixed income investments (e.g. bonds) may not be able to meet interest payments nor repay the money they have borrowed. The worse the credit quality of the issuer, the greater the risk of default and therefore investment loss.
The use of derivatives may increase overall risk by magnifying the effect of both gains and losses leading to large changes in value and potentially large financial loss. A counterparty to a derivative transaction may fail to meet its obligations which may also lead to a financial loss.
These markets carry a higher risk of financial loss than more developed markets as they may have less developed legal, political, economic or other systems.
Investments may be primarily concentrated in specific countries, geographical regions and/or industry sectors. This may mean that, in certain market conditions, the value of the portfolio may decrease whilst more broadly-invested portfolios might grow.
The Fund may invest more than 35% of its assets in securities issued or guaranteed by a permitted sovereign entity, as defined in the definitions section of the Fund’s prospectus.
On some investments (e.g. the Implied Yield from Forward Foreign Exchange derivative contracts) any gains may be allocated to income rather than the capital account. This may cause greater fluctuations in the capital value of the fund. Income may be taxable.
The value of fixed income investments (e.g. bonds) tends to decrease when interest rates rise.
Aims to protect investors from a decline in the value of the reference currency only (the currency in which accounts are reported) and will not protect against a decline in the values of the currencies of the underlying investments, where these are different from the reference currency. Difference between the currencies of the underlying investments and the reference currency may cause loss when the reference currency rises against the share class currency. Such hedging will not be perfect. Success is not assured.