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The Fund is a flexible asset allocation fund. The Fund's investment strategy is to invest in global equities and equity related securities (including REITS), cash and investment grade fixed-income government securities rated. The Fund may also use financial derivative instruments for the sole purpose of efficient portfolio management and reducing exchange rate risk and then only subject to the restrictions included in the section entitled ''Appendix III Efficient Portfolio Management'' in the Prospectus.
The equities component of the Fund represents the Contrarius Group's selection of global equities and equity related securities. This component of the Fund will be exposed to all the risks and rewards of the global equities and equity related securities selected for the Fund using proprietary investment research undertaken by the Investment Manager, the Sub-Investment Manager and the Investment Advisor.
In order to reduce stock market risk the Fund has the flexibility of implementing a hedging strategy and may therefore sell equity index futures to reduce stock market risk. The extent of stock market hedging will depend on the Investment Manager's and Sub-Investment Manager's view on the long-term return prospects for global equities and equity related securities. In seeking to achieve its investment objective, the Fund may vary its net exposure to global equities and equity related securities between 0% and 75%. In so doing, the Fund aims, over the long-term, to earn a return higher than an absolute return, such absolute return being US$ bank deposits. Given the longterm, contrarian, valuation-based investment philosophy, there will be times when the Fund will materially underperform its benchmark in the short-term in order to achieve its objective of long-term outperformance.
Since inception and over the latest ten-year period the Fund has outperformed its Benchmark, the absolute return of US$ bank deposits. Over the latest five-year period the Fund has underperformed its Benchmark. Investors are reminded that the Fund may experience periods of underperformance in pursuit of its objective.
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