Historic fund objective changes

Funds with objective changes within the last ten years can be found in the table below.

Funds listed A-Z

 Fund  Event  Date  Previous objective
M&G (Lux) Absolute Return Bond Fund Objective change 22 July 2019 The fund aims to deliver combined income and capital growth of at least the cash rate plus 2.5% a year over any three-year period. That is before any charges are taken and in any market conditions. The cash rate is based on the three-month EURIBOR rate at which banks borrow money from each other. The fund aims to achieve this while seeking to minimise the degree to which the value of the fund fluctuates over time, and also seeking to limit monthly losses. Managing the fund in this way reduces its ability to achieve returns significantly above three-month EURIBOR plus 2.5%. 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
The fund will invest predominantly – at least 70% – in bonds (loans to governments or companies paying fixed, floating or index-linked returns), currencies, cash, near cash (short-term and easily traded bonds) and deposits. These assets may be issued anywhere in the world and denominated in any currency. The fund may gain exposure to financial assets by investing through other funds or through the use of derivatives. Derivatives are financial contracts with a value derived from one or more underlying assets. The fund may use derivatives to reduce risk, to benefit from the fall in price of specific assets, and to gain exposure to investments exceeding the value of the fund in order to increase its potential return. Derivatives may be used to meet the fund's objective and for efficient portfolio management purposes. Derivatives the fund may invest in include:
- Spot and forward contracts (bespoke agreements to buy or sell assets at a specified price at a future date)
- Exchange-traded futures (standard agreements to buy or sell currencies, shares, bonds or interest rates at a future date at a predetermined price)
- Swaps (agreements which involve exchanging cashflows with another party), including fixed or index-linked interest rate swaps, inflation-linked interest rate swaps, share, bonds, currency, or other asset swaps.
- Credit default swaps (agreements which exchange credit risk between parties.
- For example, they can be used to protect the fund against potential defaults of companies, group of companies or governments.) These swaps can be ‘single name’ where the credit risk relates to a bond of one particular issuer, or ‘index’ where the underlying asset is an index of bonds from different issuers.
Options on shares, bonds, currencies or indexes (options offer the right or the obligation to buy or sell an asset at an agreed price and time). Bonds the fund may invest in include:
- Up to 20% in asset-backed securities (tradeable market instruments whose income and therefore value derives from a specified group of underlying assets)
- Bonds classified as ‘investment grade’ by one of the recognised ratings agencies (that is, rated ‘BBB-’ or above by Fitch or Standard & Poor’s, or ‘Baa3’ or above by Moody’s)
- Up to 60% combined in unrated debt securities and ‘sub-investment grade’ bonds (that is, rated lower than ‘BBB-‘ by Fitch or Standard & Poor’s, or lower than ‘Baa3’ by Moody’s)
- Bonds issued or guaranteed by companies, governments, local authorities, government agencies or certain public international bodies. Bonds from issuers located in emerging markets.
- Up to 20% in contingent convertible bonds (bonds issued by companies which convert into shares in the company when certain conditions are met). The fund may also enter into total return swaps (agreements which involve exchanging flows of income and capital gains from an underlying asset with another party). The fund’s exposure through total return swaps will generally not exceed 25% of the fund’s value. The maximum which can be subject to total return swaps is 50% of the fund’s value.
M&G (Lux) Conservative Allocation Fund Objective change  22 July 2019 The fund aims to provide a positive total return (combined income and capital growth) of 3-6% on average per year over any three-year period by investing in a mix of assets from anywhere in the world.

Investment policy and strategy

Core investment: The fund will typically invest within the following net allocation ranges:

- 0-100% in bonds

- 0-35% in company shares

- 0-20% in other assets (including convertibles and property-related securities)

The fund typically invests in the above assets via derivatives. The fund may also invest in assets directly or through other funds. The ranges shown above are on a net basis, that is, ‘long’ positions (investments that profit from a rise in asset prices) net of ‘short’ positions (investments held via derivatives that profit from a fall in asset prices). Using derivatives to invest also allows the fund to create ‘leverage’, meaning that the fund can gain exposure to investments that exceed its value, thus increasing potential returns (or losses) in both rising and falling markets.

In addition, derivatives are used to reduce risk and costs and to manage the impact of changes in currency exchange rates on the fund’s investments.

Other investment: The fund may also invest in currencies and hold cash, deposits and warrants.

Strategy in brief: The fund is managed with a highly flexible investment approach. The investment manager has the freedom to allocate capital between different types of assets in response to changes in economic conditions and asset prices. The approach combines in-depth research to work out the ‘fair’ value of assets over the medium to long term, with analysis of the market’s short-term reactions to events, to identify investment opportunities. The fund seeks to manage risk by investing globally across multiple asset classes, sectors, currencies and countries. Where the investment manager believes opportunities are limited to a few areas, the portfolio may be very concentrated in certain assets or markets. The investment manager will normally seek to hold at least 60% of the fund in euros.
Corporate Bond Fund Objective change 25 May 2017 The Fund aims to achieve a higher total return (the combination of income and growth of capital) from investment than would be obtainable in UK government fixed interest securities (ie gilts) of similar maturities.
M&G (Lux) Emerging Markets Bond Fund Objective change 22 July 2019 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 bond market over any three-year period.

Investment policy and strategy

Core investment: At least 80% of the fund is invested in bonds issued by the governments, government agencies or companies of emerging market nations*, which can be denominated in any currency.

Other investment: The fund also invests in currencies, focusing mainly on emerging market currencies and major currencies such as the US dollar and euro. It also holds cash or assets that can be turned quickly into cash.

Use of derivatives: The fund typically invests directly but may also invest indirectly via derivatives. Derivatives may also be used to manage risks and reduce costs, as well as to offset the impact of currency exposures arising from the fund’s non-US dollar investments. For more information on the types of bonds held and derivatives used, please refer to the Prospectus.

* 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 selects investments based on an assessment of global, regional, and country-specific macroeconomic factors, followed by in-depth analysis of individual bond issuers.

The investment manager is assisted in the selection of individual bonds by the deputy fund manager and an in-house team of analysts. The fund is diversified by investing in a range of bonds from across the global emerging markets.

Performance comparator: The fund is actively managed. A composite index comprising 1/3 JPMorgan EM Government Bond Index Global Diversified, 1/3 JPMorgan EM Corporate Bond Index Broad Diversified and 1/3 JPMorgan EM Government Local currency Bond Index Global Diversified is a point of reference against which the performance of the fund may be measured. These indices represent the emerging market government bond markets denominated in hard currencies, the emerging market corporate bond markets denominated in hard currencies and the emerging market government bond markets denominated in local currencies, respectively.
M&G (Lux) Emerging Markets Hard Currency Bond Fund Objective chang 22 July 2019 The fund aims to provide a positive total return (combined income and capital growth) that is higher than the hard currency emerging market bond market over any three-year period.

Investment policy and strategy

Performance measurement: The fund’s performance is measured against the average of the Morningstar Global Emerging Markets Bond fund sector, representing the hard currency emerging market bond fund market. The investment manager has the discretion to identify the countries that qualify as emerging markets. Typically, these will be countries that the International Monetary Fund or World Bank defines as emerging or developing economies. Core investment: At least 80% of the fund will be invested in bonds issued by emerging market governments and government-related institutions, denominated in hard currency.
These refer to currencies of developed countries, including, but not limited to, the US dollar, euro, yen and sterling. The fund typically invests directly in assets. It may also invest indirectly via derivatives.

Other investments: The fund may also have limited investment in bonds issued by emerging market companies or bonds issued in emerging market currencies. The fund may also invest in cash and deposits, other debt instruments and other funds.

Strategy in brief: The fund is managed with a flexible investment approach which begins with analysis of the global economy. Within this framework, the fund manager’s approach involves forming a view on the economic outlook, identifying countries with solid fundamentals and evaluating the quality of individual bonds. This disciplined, multi-pronged approach provides the basis for the fund’s asset allocation, country and currency weighting, as well as selection of bonds.
M&G (Lux) Emerging Markets Income Opportunities Fund Objective change 22 July 2019 The fund aims to provide an annual income of 4-6%. Provided this can be achieved, the fund also aims to grow capital over any five-year period. There is no guarantee that the fund will meet its investment objective and investors may not recoup the amount they originally invested.

Investment policy and strategy

Core investment: At least 80% of the fund will be invested in emerging market assets, including company shares, bonds and real estate investment trusts. The fund may invest across different countries, sectors and company sizes.

The fund invests in companies domiciled or conducting the majority of their business in emerging market countries. At least 25% of the fund will be invested in shares of such companies and at least 25% in their bonds at all times.

The fund manager has the discretion to identify the countries that qualify as emerging markets. Typically, these will be countries that the International Monetary Fund or World Bank defines as emerging or developing economies.

The fund typically invests directly. It may also invest indirectly through derivatives. In addition, derivatives are used to meet the fund’s investment objective and to reduce risk and costs.

Strategy in brief: The fund will employ a bottom-up approach to find the best investments across the capital structure to deliver on the fund’s stated income target while striving to generate long-term capital growth.

Corporate bonds typically generate and have historically generated a higher level of income yield than company shares. Consequently, income is not the fund manager’s only consideration when selecting shares. Instead, the fund will hold shares for their investment characteristics and their expected total return profile rather than purely their dividend yield. The fund’s allocation between bonds and shares is an output of the investment process and portfolio construction and, as such, will be the result of the fund manager investing in the best ideas, individually and relatively, across the capital spectrum.

Other investments: The fund may also invest in cash and deposits, other debt instruments and other funds.
M&G (Lux) Episode Macro Fund Objective change 22 July 2019 The fund aims to provide a combination of capital growth and income to deliver a return of 4-8% above the 3-month LIBOR, over any five-year period. LIBOR is the rate at which banks borrow money from each other.

Investment policy and strategy

Core investment: Typically, the fund will use derivatives to invest in a range of assets, including shares in companies, bonds, currencies, cash or assets that can be turned quickly into cash. The fund may also invest directly. The fund is fully flexible and has no limits or ranges in any particular asset class. The fund may also invest in China A-Shares via the Shanghai-Hong Kong Stock Connect and the Shenzhen-Hong Kong Stock Connect.

Other investment: The fund may also invest in other funds, including real estate investment trusts, asset-backed securities, convertibles and warrants. Use of derivatives: The fund can use derivatives to take short positions and to gain exposure to investments exceeding the fund’s value, thus increasing potential returns (or losses) in both rising and falling markets.

For more information on the types of derivatives used, please refer to the Prospectus.

Strategy in brief: The fund has a highly flexible investment approach, with the freedom to invest in different types of assets from anywhere in the world. 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 cases where the investment manager believes the opportunities are limited to a few areas, the fund may be very concentrated in certain assets or markets. Such strategies may result in greater changes in the fund’s short-term performance.

Performance comparator: The fund’s performance will be referenced against the 3-month LIBOR.
M&G (Lux) Global Macro Fund Objective change 22 July 2019 The fund aims to provide a combination of capital growth and income to deliver a return that is higher than that of the global bond market over any five year period.

Investment policy and strategy
Core investment: At least 80% of the fund is invested in bonds, including investment grade bonds, high yield bonds, unrated bonds and asset-backed securities. These bonds may be issued by governments and their agencies, public authorities, quasi-sovereigns, supranational bodies and companies. Issuers of these bonds may be located in any country, including emerging markets*, and denominated in any currency.

Other investments: The fund can also invest in any currency, and cash or assets that can be turned quickly into cash. Use of derivatives: Derivatives may be used to invest indirectly in bonds. Derivatives may also be used to manage risks and reduce costs, as well as to offset the impact of changes in currency exchange rates on the fund’s investments.

For more information on the types of bonds held and derivatives used, please refer to the Prospectus.

* 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 fund is a flexible global bond fund. The investment manager selects investments based on an assessment of macroeconomic factors such as economic growth, interest rates and inflation.

This analysis determines which areas of the global bond markets the investment manager believes the fund should invest in to achieve its objective. It also influences the subsequent selection of individual bond holdings, as well as the fund’s currency exposures. The investment manager is assisted in the selection of individual bonds by the deputy manager and an in-house team of analysts.

Performance comparator: The fund is actively managed. The Bloomberg Barclays Global Aggregate Index is a point of reference against which the performance of the fund may be measured.
M&G (Lux) Global Target Return Fund Objective change 22 July 2019 The fund aims to deliver combined income and capital growth of at least the cash rate plus 4% a year over any three-year period. That is before any charges are taken and in any market conditions. The cash rate is based on the three-month EURIBOR rate at which banks borrow money from each other. The fund aims to achieve this while seeking to minimise the degree to which the value of the fund fluctuates over time, and also seeking to limit monthly losses. Managing the fund in this way reduces its ability to achieve returns significantly above three-month EURIBOR plus 4%. 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

The fund has a highly flexible investment approach with the freedom to hold different types of assets issued anywhere in the world. The manager can allocate capital between asset classes in response to changing economic conditions and asset prices moving below their ‘fair’ value where investors react emotionally to events. The blend of assets held in the fund is regularly adjusted depending on where the manager sees the most value, and to manage risks in order to limit losses. The manager looks to manage risk by combining diversified and relatively uncorrelated assets (which are affected by market conditions in different ways) and by employing derivatives strategies to help protect or profit from falling markets. Where the fund manager believes it appropriate, the fund may hold a high level of cash. The fund will primarily invest in bonds (loans to governments or companies paying a rate of interest), company shares, currencies, cash and near cash (short-term and easily tradeable bonds). The fund will mostly gain exposure to these assets by investing through derivatives, and by investing directly. It may also invest through other funds. The fund will typically take positions at index, sector or thematic level but it may also take positions in individual shares or bonds. Derivatives are financial contracts with a value derived from one or more underlying assets. The fund may also use derivatives to reduce risk, to benefit from the fall in price of specific assets, and to gain exposure to investments exceeding the value of the fund in order to increase potential returns. The fund may also invest in deposits and warrants (allowing the fund manager to buy stocks for a fixed price until a certain date) which may be from anywhere in the world and denominated in any currency. Derivatives the fund may invest in include: • Spot and forward contracts (bespoke agreements to buy or sell assets at a specified price at a future date).

Exchange-traded futures (standard agreements to buy or sell currencies, shares, bonds or interest rates at a future date at a predetermined price)

Swaps (agreements which involve exchanging cashflows with another party), including fixed or index-linked interest rate swaps, inflation-linked interest rate swaps, shares, bonds, currency, or other asset swaps

Single company and index credit default swaps. These contracts are meant to exchange the credit risk between parties. For example, they can be used to protect the fund against potential defaults of companies, group of companies or governments

Options on shares, bonds, currencies or indexes (options offer the right or the obligation to buy or sell an asset at an agreed price and time). Bonds the fund may invest in include:

- Bonds classified as ‘investment grade’ by one of the recognised ratings agencies (that is, rated ‘BBB-’or above by Fitch or Standard & Poor’s, or ‘Baa3’ or above by Moody’s)

- Bonds issued or guaranteed by companies, governments, local authorities, government agencies or certain public international bodies
- Convertible bonds (bonds issued by companies that give the bondholder the option to trade in the bond for shares in the company)

- Up to 60% in ‘sub-investment grade’ bonds (that is, rated lower than ‘BBB-‘ by Fitch or Standard & Poor’s, or lower than ‘Baa3’ by Moody’s) which will not be rated below ‘CCC’.

- Bonds from issuers located in emerging markets

- Up to 20% in contingent convertible bonds (bonds issued by companies which convert into shares in the company when certain conditions are met)

- Up to 10% in asset-backed securities (tradeable market instruments whose income and therefore value derives from a specified group of underlying assets). The fund may also enter into total return swaps (agreements which involve exchanging flows of income and capital gains from an underlying asset with another party). The fund’s exposure through total return swaps will generally not exceed 25% of the fund’s value. The maximum which can be subject to total return swaps is 50% of the fund’s value.
M&G (Lux) Global High Yield ESG Bond Fund Objective change 22 July 2019 The fund aims to provide a combination of capital growth and income while considering environmental, social and governance (ESG) factors, and seeks to achieve a higher ESG rating than the global high yield market.

Investment policy and strategy

Core investment: At least 80% of the fund is invested in high yield bonds issued by companies located in any country, including emerging markets*, which may be denominated in any currency.

Other investment: The fund may also invest in bonds issued by governments, investment grade corporate bonds, asset-backed securities, cash and assets that can be turned quickly into cash.

Use of derivatives: Derivatives may be used to invest indirectly in bonds. Derivatives may also be used to manage risks and reduce costs, as well as to offset the impact of currency exposures arising from the fund’s non-US dollar investments.

For more information on the types of bonds held and derivatives used, please refer to the Prospectus, which can be found by visiting www.mandg.lu/literature

* 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 fund is a flexible global high yield bond fund. The investment manager selects investments based on in-depth analysis of individual bond issues, combined with an assessment of macroeconomic factors such as economic growth, interest rates and inflation.

The investment manager is assisted in the selection of individual bonds by an in-house team of analysts. Environmental, social and governance (ESG) considerations are fully integrated into the investment process and an ethical screen is applied to exclude companies operating in certain sectors, subject to internal thresholds. Also excluded are companies that are assessed to be in breach of the United Nations Global Compact principles on human rights, labour, environment and anti-corruption.

Performance comparator: The fund is actively managed. The BofA Merrill Lynch Global High Yield Index (USD Hedged) is a point of reference against which the performance of the fund may be measured.
M&G (Lux) Income Allocation Fund Objective change 22 July 2019 The fund has two aims:
- to provide growing income over any three-year period by investing in a mix of assets from anywhere in the world.
- to provide capital growth of 2-4% on average per year over any three-year period.

Investment policy and strategy

Core investment: The fund will typically invest in income-generating assets within the following allocation ranges:

- 40-80% in bonds
- 10-50% in company shares
- 0-20% in other assets (including convertibles)

The fund typically invests directly. It may also invest indirectly via derivatives or through other funds.

Other investment: The fund may also invest in currencies and hold cash, deposits and warrants. In addition, derivatives may 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 is managed with a highly flexible investment approach. The investment manager has the freedom to allocate capital between different types of assets in response to changes in economic conditions and asset prices.

The approach combines in-depth research to work out the ‘fair’ value of assets over the medium to long term, with analysis of the market’s short-term reactions to events, to identify investment opportunities. The fund seeks to manage risk by investing globally across multiple asset classes, sectors, currencies and countries. Where the investment manager believes opportunities are limited to a few areas, the portfolio may be very concentrated in certain assets or markets. The investment manager will normally seek to hold at least 70% of the fund in euros.
European Corporate Bond Fund Objective change 25 May 2017 As a result of the Swiss National Bank removing the currency peg since the balance sheet date, 31 December 2014, the Net Asset Value per share of the Swiss franc share classes has increased by approximately 12% to 12 February 2015.
European High Yield Bond Fund Objective change 25 May 2017 The Fund aims to maximise total return (the combination of income and growth of capital) while generating a high level of income.
European Select Fund Objective change and name change from European Fund 6 November 2015 The Fund’s prime objective is long term capital growth. It invests wholly or predominantly in a diversified portfolio of securities of European (excluding United Kingdom) issuers. When not wholly invested as above, it may also invest in companies which are listed or registered outside Europe but trade within it. Income is of secondary importance when investments are selected.
Global Dividend Fund Objective change 25 May 2017 The Fund aims to deliver a dividend yield above the market average, by investing mainly in a range of global equities. The Fund aims to grow distributions over the long term whilst also maximising total return (the combination of income and growth of capital).
Global Government Bond Fund (formerly International Sovereign Bond Fund)
Objective change and name change from International Sovereign Bond Fund 4 July 2014 The Fund aims to maximise total return (the combination of income and growth of capital) through investment in a portfolio of investment grade debt instruments.
Global High Yield Bond Fund
(formerly High Yield Corporate Bond Fund) 
Objective change 25 May 2017 The Fund is designed to maximise total return (the combination of income and growth of capital) while generating a high level of income.
Global Select Fund Objective and name changed from the M&G Global Growth Fund. 6 November 2015 The Fund invests principally in the equities of UK companies with high growth potential with the sole objective of capital growth. Income considerations are ignored.
Global Select Fund Objective change 17 November 2017 The fund aims to provide income and capital growth over five years or more by investing mainly in a range of company shares from anywhere in the world.
Global Themes Fund Objective and name change from M&G Global Basics Fund 17 November 2017 The fund aims to grow capital over five years or more.
Core investment: At least 70% of the fund is invested in the shares of companies from anywhere in the world that operate in primary industries (such as mining and agriculture) and secondary industries (such as manufacturing), and also in companies that service these industries.
Other investments: The fund may also invest in the shares of companies from other types of businesses. Generally, less than 10% is held as cash or assets that can be turned into cash quickly.
Strategy in brief: The fund manager focuses on shares in companies that operate in primary industries (such as mining and agriculture) and secondary industries (such as manufacturing), and also in companies that service these industries. The emphasis is to identify and exploit investment themes that are likely to be the key long-term drivers of growth and select those companies best equipped to benefit from these themes. The fund manager follows a high-conviction global equity strategy which seeks to deliver long-term capital growth.
Lux Floating Rate High Yield Solution Objective clarification 12 June 2019 Objective: The fund aims to provide a competitive global high yield bond market exposure whilst limiting interest rate risk. Fund performance will be measured against a global high yield composite index* over any five-year period. The fund is actively managed and the index is a point of reference against which the performance of the fund may be measured. Investment policy and strategy *The composite index consists of 2/3 the Markit CDX® North American High Yield Index and 1/3 the iTraxx Crossover Index. Core investment: At least 70% of the fund is invested synthetically in floating rate high yield bonds. This exposure is achieved by combining high yield credit default swap (CDS) indices with government floating rate bonds (rated A or above by Standard & Poor’s), from anywhere in the world, or cash. A high yield CDS index is a derivative instrument that gives investors indirect exposure to a basket of high yield bonds which are easily traded and have low interest rate risk. Currency exposures within the fund will be typically in US dollars. Derivatives may be used to offset the impact of currency exposures arising from the fund’s non-USD investments. Other investment: The fund may also invest in other assets, including government bonds, currencies, cash or assets that can be turned quickly into cash, other debt securities, warrants and other funds. Use of derivatives: Derivatives are used for investment purposes and to allow the fund to gain exposure to investments exceeding the fund’s value, thus increasing potential returns (or losses). Derivatives may also be used to manage risks and reduce costs. For more information on the types derivatives used, please refer to the Prospectus, which can be found by visiting www.mandg.lu. Strategy in brief: The fund is globally diversified and seeks to provide exposure to a broad range of high yield bond issuers across different sectors. The investment manager has the flexibility to adjust the fund’s credit exposure and regional allocation depending on current market valuations and the macroeconomic environment, including the likely path of economic growth, inflation and interest rates.
M&G (Lux) Japan Smaller Companies Fund Objective change 22 July 2019 The fund aims to provide a combination of capital growth and income to deliver a return that is higher than that of the Japanese smaller companies stockmarket over any five-year period.

Investment policy and strategy

Core investment: At least 80% of the fund is invested in the shares of smaller companies that are domiciled, or conducting the major part of their economic activity, in Japan. The fund usually holds shares in fewer than 50 companies. Smaller companies are defined as those in the bottom third of total market capitalisation of all publicly listed companies in Japan.

Other investment: The fund also holds cash or assets that can be turned quickly into cash.

Strategy in brief: The investment manager selects stocks from across a wide range of industries.

The focus is on stocks where the share price is not fully reflecting the level of earnings that the company can sustain over the medium to long term. The investment manager believes this can happen because human biases can temporarily prevent investors from making objective assessments of the prospects for company earnings. The investment manager applies disciplined and rigorous fundamental analysis to ensure a high level of conviction around the valuation for each of the companies held in the fund.

Performance comparator: The fund is actively managed. The Russell Nomura Mid-Small Index is a point of reference against which the performance of the fund may be measured.
North American Dividend Fund  Objective and fund name change from American Fund  28 April 2015  The Fund’s objective is long term capital growth through investment wholly or mainly in securities of North American (including Canadian) issuers. When not wholly invested as above, it may only invest in companies which are listed, registered or trading within North America.
Pan European Select Smaller Companies Fund Objective and fund name change 25 May 2018 Objective
The fund aims to grow capital over five years or more by investing mainly in the shares of smaller companies from across Europe, including the UK.
Investment policy and strategy
Core investment: At least 70% of the fund is invested in the shares of companies that make up the bottom third of all publicly listed firms in Europe, in terms of their stockmarket value.
Other investments: The fund also invests in medium and larger companies to enhance its liquidity (its ability to raise cash quickly).
Strategy in brief: The fund manager invests in the shares of companies deemed to be of quality and with sustainable business models, where an element of change is helping to drive their value, and short-term issues have created attractive buying opportunities.
The fund manager keeps the fund concentrated, generally holding fewer than 50 well-understood stocks, with a typical holding period of three to five years. The fund may invest across a wide range of industries. The fund manager maintains a balance of stocks with different risks and rewards to build a fund that has the potential to cope in a variety of market conditions. Income is not a top priority when choosing investments.
Pan European Dividend Fund Objective change 25 May 2017 The Fund aims to deliver a dividend yield above the market average, by investing mainly in a range of European equities. The Fund aims to increase distributions over the long term whilst also maximising total return (the combination of income and growth of capital).
Pan European Select Fund Objective and fund name change from Pan European Fund 6 November 2015 The Fund invests wholly or mainly in European (including UK) companies. The Fund may also invest in companies outside Europe but only when these companies derive the majority of their income from European activity. The objective is to maximise long term total return (the combination of income and growth of capital).
Pan European Select Fund Objective change 17 November 2017 The fund aims to provide capital growth and income over five years or more by investing mainly in a range of company shares from across Europe, including the UK.
Recovery Fund Objective change 1 March 2019 The fund aims to grow capital over five years or more by investing predominantly in the shares of companies that, at the time of investment, are out of favour with the stockmarket, and where the fund manager believes a good management team is making concerted efforts to turn the business around.
Core investment: At least 80% of the fund is invested in the shares of companies. Currently these are predominantly UK-listed companies.
Other investments: Generally, less than 10% is held as cash or assets that can be turned into cash quickly.
Strategy in brief: The fund invests in those businesses whose problems are solvable and temporary rather than structural in nature, and which are expected to move through a recovery cycle. This is a relatively simple investment approach focusing on three key factors: people, strategy and cashflow. Developing a constructive dialogue with company management is fundamental to the investment process. The fund manager takes a long-term view with a typical holding period of five years or more.
Performance measurement: The fund is actively managed. The FTSE All-Share Index is a point of reference against which the performance of the fund may be measured.
Short Dated Corporate Bond Fund Objective change 13 March 2018 Objective: The fund aims to provide income with stability of capital over three to five years. There is no guarantee that the fund will achieve this objective over any period. The income distributions and the value of your investment may rise and fall and you may not get back the amount you originally invested.
Core investment: At least 70% of the fund is invested in bonds. Typically, these bonds are issued by companies due to be repaid within three years and floating rate notes. The fund holds these assets directly and through derivatives.
Other investments: The fund also invests in bonds issued by governments (usually of developed countries) and high yield bonds. In some market conditions, the fund may have a high proportion invested in liquid assets (that is, assets that are easy to sell, such as cash).
Use of derivatives: Derivatives may be used to gain exposure to the fund’s core and other investments, to reduce risks and costs and to manage the impact of changes in currency exchange rates on the fund’s investments. Strategy in brief: Credit research is at the heart of the fund's investment process. The fund is well diversified and maintains a short duration, or low sensitivity to changes in interest rates, in order to minimise the impact of interest rate movements on the fund's capital value. The fund manager believes this can best be achieved by selecting bonds that pay a variable rate and bonds that have a short repayment date.
M&G (Lux) Sustainable Allocation Fund Objective change 22 July 2019 The fund aims to provide combined capital growth and income of 4-8% per year over any five-year period, while considering environmental, social and governance (ESG) factors.

Investment policy and strategy

Core investment: The fund invests globally (including emerging markets), typically as follows:

- 20-80% in bonds
- 20-60% in equities
- 0-20% in other assets

Assets are selected that meet the investment manager’s assessment of ESG factors and impact criteria. 10-30% of the fund is invested in companies that have a positive impact on society by addressing the world’s social and environmental challenges, based on M&G’s impact assessment methodology.

Companies deemed to be in breach of the United Nations Global Compact principles and/or involved in industries such as the production of tobacco or controversial weapons are excluded from the investment universe.

The fund typically invests directly.
It may also invest via derivatives or other funds.

At least 70% of the fund is normally invested in assets valued in euro or in currencies hedged into euro.

Derivatives: Derivatives are used for investment purposes, to reduce risk and costs, and to manage the impact of currency movements.

For more information on the types of bonds held and derivatives used, please refer to the Prospectus.

Strategy in brief: The approach to sustainable investment is through flexible asset allocation, implemented by investing in securities of companies or governments that uphold high standards of ESG behaviour. The approach combines research to work out the ‘fair’ value of assets over the long term with analysis of the economic fundamentals and market’s short-term reactions to events, to identify investment opportunities.
UK Select Fund Objective and fund name change from UK Growth Fund 6 November 2015 The Fund invests principally in the equities of UK companies with high growth potential with the sole objective of capital growth.
UK Select Fund Objective change 1 March 2019 The fund aims to grow capital over five years or more by investing predominantly in the shares of companies that, at the time of investment, are out of favour with the stockmarket, and where the fund manager believes a good management team is making concerted efforts to turn the business around.
Core investment: At least 80% of the fund is invested in the shares of companies. Currently these are predominantly UK-listed companies.
Other investments: Generally, less than 10% is held as cash or assets that can be turned into cash quickly.
Strategy in brief: The fund invests in those businesses whose problems are solvable and temporary rather than structural in nature, and which are expected to move through a recovery cycle. This is a relatively simple investment approach focusing on three key factors: people, strategy and cashflow. Developing a constructive dialogue with company management is fundamental to the investment process. The fund manager takes a long-term view with a typical holding period of five years or more.
Performance measurement: The fund is actively managed. The FTSE All-Share Index is a point of reference against which the performance of the fund may be measured.



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