Schroder Unit Trusts Limited Prospectus

Schroder Unit TrustsLimitedProspectus1 September 2021

(Intermediary)

Schroder Unit Trusts Limited(Intermediary)

Prospectus

1 September 2021

Schroder Unit Trusts LimitedInternet Site: http://www.schroders.co.uk

http://www.schroders.co.uk

Schroder Unit Trusts Limited Prospectus 5

Important informationThis Prospectus relates to the following funds:

Fund Date authorised FCA Product Reference Number

Schroder Absolute Return Bond Fund 09/10/92 154448

Schroder Asian Alpha Plus Fund 08/11/07 473111

Schroder Asian Income Fund 08/01/90 144961

Schroder Asian Income Maximiser 21/05/10 521508

Schroder European Alpha Plus Fund 04/07/03 225498

Schroder European Smaller Companies Fund 05/05/89 143273

Schroder Gilt and Fixed Interest Fund 12/05/89 143274

Schroder Global Cities Real Estate 16/09/05 433312

Schroder Global Cities Real Estate Income 21/12/10 535979

Schroder Global Emerging Markets Fund 26/08/93 163142

Schroder Global Equity Income Fund 23/02/07 462470

Schroder Global Healthcare Fund 08/05/00 191402

Schroder High Yield Opportunities Fund 17/01/00 190765

Schroder Income Fund 29/04/88 109439

Schroder Income Maximiser 01/09/05 435499

Schroder Managed Balanced Fund 08/12/97 185324

Schroder Managed Wealth Portfolio 06/08/90 146630

Schroder Recovery Fund 29/04/88 109448

Schroder Small Cap Discovery Fund 23/01/12 573343

Schroder Strategic Bond Fund 15/02/12 574961

Schroder Tokyo Fund 02/02/89 142596

Schroder UK Alpha Plus Fund 06/06/02 200093

Schroder UK Equity Fund 29/04/88 109454

Schroder UK Mid 250 Fund 30/09/99 190174

Schroder UK Smaller Companies Fund 29/04/88 109451

Schroder US Equity Income Maximiser 22/02/17 769360

Schroder US Mid Cap Fund 11/05/01 195182

Schroder US Smaller Companies Fund 23/11/01 144966

All funds have been authorised by the FCA.

This prospectus has been prepared in accordance with the rules contained in the Collective Investment Schemes Sourcebook(COLL) which forms part of the FCA Handbook of Rules and Guidance (the Regulations) and complies with the requirements ofCOLL 4.2 of COLL.

Valid as at (and dated): 1 September 2021

ContentsImportant information . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5Definitions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8Management . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10Administration . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12

Section 1 1. The Funds . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 141.1. Structure . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 141.2. Classes of Units . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 141.3. Proportion Accounts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15

Section 2 2. Dealing in Units . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 162.1. Buying and Selling Units . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 162.2. Pricing of Units . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 172.3. Suspension or Deferrals . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 172.4. Market Timing Policy, Late Trading Policy and Fair Value Pricing . . . . . . . . . . . . . . . . . . . . 18

Section 3 3. General Information . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 193.1. Charges and Expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 193.2. Reporting, Distributions and Accounting Dates . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 213.3. UK Taxation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 213.4. Meetings and Unitholder Rights . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 233.5. Winding Up a Fund . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 243.6. Additional Information . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24

Appendix I Investment Restrictions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27

Appendix II Risks of Investment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35

Appendix III Fund Details . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 45Schroder Absolute Return Bond Fund . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 46Schroder Asian Alpha Plus Fund . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 48Schroder Asian Income Fund . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 50Schroder Asian Income Maximiser . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 52Schroder European Alpha Plus Fund . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 54Schroder European Smaller Companies Fund . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 56Schroder Gilt & Fixed Interest Fund . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 58Schroder Global Emerging Markets Fund . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 60Schroder Global Equity Income Fund . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 62Schroder Global Healthcare Fund . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 64Schroder Global Cities Real Estate Income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 66Schroder Global Cities Real Estate . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 68Schroder High Yield Opportunities Fund . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 70Schroder Income Fund . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 72Schroder Income Maximiser . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 74Schroder Managed Balanced Fund . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 76Schroder Managed Wealth Portfolio . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 78Schroder Recovery Fund . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 80Schroder Small Cap Discovery Fund . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 82Schroder Strategic Bond Fund . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 84Schroder Tokyo Fund . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 86Schroder UK Alpha Plus Fund . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 88

6 Schroder Unit Trusts Limited Prospectus

Schroder UK Equity Fund . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 90Schroder UK Mid 250 Fund . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 92Schroder UK Smaller Companies Fund . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 94Schroder US Equity Income Maximiser . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 96Schroder US Mid Cap Fund . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 98Schroder US Smaller Companies Fund . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 100

Appendix IV Eligible Markets List . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 102

Appendix V Determination of Net Asset Value . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 104

Appendix VI Other Collective Investment Schemes managed by the Manager . . . . . . . . . . 107

Appendix VII Performance Details . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 109

Appendix VIII Other Information . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 114



DefinitionsAccumulation Unita Unit which accumulates the income arising in respect ofthat Unit so that it is reflected in the value of that Unit

AdministratorJ.P. Morgan Europe Limited, the provider of fund accountantand related fund administration services to the Funds.

Base Currencythe currency in which the Units, the accounts and theUnitholder's statement will be expressed (in each case GBP(£))

Business Daya week day on which banks and the London stock exchangesare normally open for business in the UK. If the London StockExchange is closed as a result of a holiday or for any otherreason, or there is a holiday somewhere else or any otherreason which impedes the calculation of the fair market valueof the Fund or a significant position thereof, the Managermay decide that any business day shall not be construed assuch

COLLthe Collective Investment Schemes Sourcebook, issued by theFCA, which provides a regime of product regulation forauthorised funds and sets appropriate standards ofprotection for investors by specifying a number of productfeatures of authorised funds and how they are to beoperated

Dealing Daya Business Day which does not fall within a period ofsuspension of calculation of the net asset value per Unit ofthe relevant class or of the net asset value of the relevantFund (unless stated otherwise in this Prospectus) and suchother day as the Manager may, with the consent of theTrustee, decide from time to time

ESMAEuropean Securities and Markets Authority

EUWAEuropean Union (Withdrawal) Act 2018

FCAFinancial Conduct Authority

Fundsall the authorised unit trust funds listed in this Prospectus or,where the singular is used, any one of those funds

GBP (£)pounds sterling, or any currency which may be the lawfulcurrency of the UK from time to time. Any change fromSterling to any other currency will take place by operation oflaw and in such circumstances will not require Unitholderconsent

Income Unita Unit which distributes its income

Investment Advisera discretionary fund manager to one or more of the Funds

Portfolio Currencythe currency or currencies of the assets in which a Fund isinvested

ManagerSchroder Unit Trusts Limited

Net Asset Valuethe value of the scheme property attributable to a Fund lessthe liabilities of the Fund as calculated in accordance with theTrust Deed and the FCA Rules

Regulationsthe rules as set forth by the FCA in its Handbook of Rules andGuidance

Transfer AgentHSBC Bank Plc

Trust Deedthe document constituting a Fund

TrusteeJ.P. Morgan Europe Limited

UCITSan "undertaking for collective investment in transferablesecurities" (a) established in an EEA State, within themeaning of points a) and b) of Article 1(2) of the UCITS IVDirective; or (b) (from the date on which the EUWA come intoeffect) established in an EEA state or the UK, within themeaning of section 236A of the Financial Services andMarkets Act 2000, as amended.

UCITS DirectiveDirective 2009/65/EC of the European Parliament and of theCouncil of 13 July 2009, as amended, on the coordination oflaws, regulations and administrative provisions relating toUCITS;


Unita unit in a Fund (or a fraction)

Unitholdera holder of a Unit in a Fund

UKUnited Kingdom

US Personany person defined as a US person under Regulation S of theUnited States Securities Act 1933

USA or USthe United States of America (including the States and theDistrict of Columbia), its territories, its possessions and anyother areas subject to its jurisdiction


ManagementManagerThe manager of the Funds is Schroder Unit Trusts Limited(the Manager), a company incorporated on 2nd April 2001 inEngland and Wales and authorised by the FCA with effectfrom December 2001. The Funds have an unlimited duration.

The Manager has established remuneration policies for thosecategories of staff, including senior management, risk takers,control functions, and any employees receiving totalremuneration that takes them into the same remunerationbracket as senior management and risk takers whoseprofessional activities have a material impact on the riskprofiles of the Manager, that:

– are consistent with and promote sound and effective riskmanagement and do not encourage risk taking which isinconsistent with the risk profiles of the Funds; and

– are in line with the business strategy, objective valuesand interests of the Manager and which do not interferewith the obligation of the Manager to act in the bestinterests of the Funds.

Schroders has an established Remuneration Committeeconsisting of independent non-executive directors ofSchroders plc. The Committee met nine times during 2020.Their responsibilities include recommending to the board ofSchroders plc the Schroders group policy on directors’remuneration, overseeing the remuneration governanceframework and ensuring that remuneration arrangementsare consistent with effective risk management. The role andactivities of the Committee and their use of advisors arefurther detailed in the Remuneration Report and theCommittee’s Terms of Reference (both available on theSchroders group website).

The Manager delegates responsibility for determiningremuneration policy to the Remuneration Committee ofSchroders plc. The Manager defines the objectives of eachFund it manages and monitors adherence to those objectivesand conflict management. The Remuneration Committeereceives reports from the Manager regarding each Fund’sobjectives, risk limits and conflicts register and theperformance against those measures. The RemunerationCommittee receives reports on risk, legal and compliancematters from the heads of those areas in its consideration ofcompensation proposals, which provides an opportunity forany material concerns to be escalated.

A summary of the remuneration policy of the Manager andrelated disclosures is atwww.schroders.com/remuneration-disclosures. A paper copyis available free of charge upon request.

Registered Office1 London Wall Place,London EC2Y 5AU

Share CapitalIssued £9,000,001Paid up £9,000,001

Directors (as at 1 September 2021)J. Rainbow – ChairmanP. Chislett

C. Mino PaluelloS. ReedyC. ThomsonP. TruscottH. Williams

None of the above is engaged in any significant businessactivity which is not connected with the business of theManager or any of its Associates.

Ultimate Holding CompanySchroders plc, a company incorporated in England and Wales

Investment ManagementThe Manager has delegated investment management of theFunds to the Investment Adviser set out below in relation toeach Fund as set out in Appendix III:

Schroder Investment Management Limited;Schroder Investment Management (Japan) Limited;Schroder Investment Management (Singapore) Limited;Schroder Investment Management (Hong Kong) Limited;Schroder Investment Management North America Inc;Schroder & Co. Limited; andSchroder Real Estate Investment Management Limited.

The Manager and the Investment Advisers are subsidiarycompanies of Schroders plc.

Schroder Investment Management Limited

Schroder Investment Management Limited is a companyincorporated in England and Wales, whose registered officeand principal place of business is at 1 London Wall Place,London, EC2Y 5AU. Schroder Investment ManagementLimited is authorised and regulated by the FCA.

Schroder Investment Management (Japan) Limited

Schroder Investment Management (Japan) Limited is acompany incorporated in Japan, whose registered office andprincipal place of business is 21st Floor Marunouchi, TrustTower Main, 1-8-3 Marunouchi, Chiyoda-ku, Tokyo 100-0005,Japan. Schroder Investment Management (Japan) Limited isregulated by the Financial Conduct Authority in Japan.

Schroder Investment Management (Singapore) Limited

Schroder Investment Management (Singapore) Ltd is acompany incorporated in Singapore whose registered officeand principal place of business is 138 Market Street, #23-01Capita Green, Singapore 048946. Schroder InvestmentManagement (Singapore) Ltd is authorised to carry oninvestment business by the Monetary Authority of Singapore.

Schroder Investment Management (Hong Kong) Limited

Schroder Investment Management (Hong Kong) Limited is acompany incorporated in Hong Kong whose registered officeand principal place of business is Suites 3301, Level 33, TwoPacific Place, Queensway, Hong Kong. Schroder Investment

http://www.schroders.com/remuneration-disclosures


Management (Hong Kong) Limited is authorised to carry oninvestment business by the Securities and FuturesCommission of Hong Kong.

Schroder Investment Management North America Inc

Schroder Investment Management North America Inc. is acompany incorporated in Delaware, whose principal place ofbusiness is 7 Bryant Park, New York, NY 10018-3706, USA.Schroder Investment Management North America Inc. is aregistered investment adviser with the Securities andExchange Commission of the United States of America.

Schroder & Co. Limited

Schroder & Co. Limited is a company incorporated in Englandand Wales, whose registered office and principal place ofbusiness is at 1 London Wall Place, London, EC2Y 5AU.Schroder & Co. Limited is authorised by the PrudentialRegulation Authority and regulated by the FCA andPrudential Regulation Authority.

Schroder Real Estate Investment Management Limited

Schroder Real Estate Investment Management Limited is acompany incorporated in England and Wales, whoseregistered office and principal place of business is at 1London Wall Place, London, EC2Y 5AU. Schroder Real EstateInvestment Management Limited is authorised and regulatedby the FCA.

Terms of Agreement with ManagerThe appointment of the Investment Advisers has been madeunder agreements between the Manager and the InvestmentAdvisers. Each of the Investment Advisers has fulldiscretionary powers over the investment of the property ofthe Funds subject to the overall responsibility and right ofveto of the Manager. The agreements between the Managerand Investment Advisers may also be terminated withimmediate effect when this is in the interests of Unitholders.

Principal Activities of the InvestmentAdvisersThe principal activities of the Investment Advisers are fundmanagement and investment advice. The InvestmentAdvisers are authorised to deal on behalf of the Funds. Eachof the Investment Advisers shall be entitled to receive for itsown account by way of remuneration for their services a feeof such amount and payable on such basis as shall be agreedin writing from time to time between the parties.


AdministrationTrustee, Custodian and AdministratorThe trustee for all Funds is J.P. Morgan Europe Limited(Trustee).The Trustee is a company limited by shares andincorporated in England and Wales. It is authorised by theFCA.

The Trustee is entrusted with the safekeeping of each Fund'sassets. The Trustee also ensures that each Fund's cash flowsare properly monitored, and in particular that thesubscription monies have been received and all cash of aFund has been booked in the cash account in the name of theFund or the Custodian on behalf of the Fund.

All cash, securities and other assets constituting the assets ofa Fund shall be held under the control of the Trustee onbehalf of the Fund and its Unitholders. The Trustee shallensure that the issue and redemption of Units in a Fund andthe application of the Fund's income are carried out inaccordance with the provisions of UK law and the Trust Deed,and the receipt of funds from transactions in the assets ofthe Fund are received within the usual time limits. Inaddition, the Trustee shall:

(A) ensure that the sale, issue, repurchase, redemption andcancellation of the Units of a Fund are carried out inaccordance with the Regulations and the Trust Deed;

(B) ensure that the value of the Units of a Fund is calculatedin accordance with the Regulations and the Trust Deed;

(C) carry out the instructions of the Manager, unless theyconflict with UK law or the Trust Deed;

(D) ensure that in transactions involving a Fund’s assets anyconsideration is remitted to a Fund within the usual timelimits; and

(E) ensure that a Fund’s income is applied in accordancewith the Regulations and the Trust Deed.

The Trustee regularly provides the Manager with a completeinventory of all assets of the Funds.

The Trustee may, subject to certain conditions and in order tomore efficiently conduct its duties, delegate part or all of itssafekeeping duties over a Fund's assets including but notlimited to holding assets in custody or, where assets are ofsuch a nature that they cannot be held in custody, verificationof the ownership of those assets as well as record-keepingfor those assets, to one or more third-party delegatesappointed by the Trustee from time to time. The Trustee hasappointed JPMorgan Chase Bank N.A. (London Branch) as thecustodian of the property of the Funds (Custodian). For thefinancial instruments which can be held in custody, they maybe held either directly by the Custodian or, to the extentpermitted by applicable laws and regulations, through everythird-party custodian/sub-custodian providing, in principle,the same guarantees as the Custodian itself as to its status asa financial institution subject to the rules of prudentialsupervision considered as equivalent to those provided by EUlegislation.

The Trustee shall exercise due skill, care and diligence inchoosing and appointing the third-party delegates and in theperiodic review and ongoing monitoring of any such third-party delegates and of the arrangements of the third party inrespect of the matters delegated to it.

The liability of the Trustee shall not be affected by the factthat it has entrusted all or some of a Fund's assets in itssafekeeping to such third-party delegates.

In the case of a loss of a financial instrument held in custody,the Trustee shall return a financial instrument of an identicaltype or the corresponding amount to a Fund without unduedelay, except if such loss results from an external eventbeyond the Trustee's reasonable control and theconsequences of which would have been unavoidable despiteall reasonable efforts to the contrary.

A list of the third party delegates appointed by the Trusteecan be found in Appendix VIII.

The amounts paid to the Trustee and Custodian will beshown in each Fund’s report and accounts.

Conflicts of Interest

As part of the normal course of global custody business, theTrustee may from time to time have entered intoarrangements with other clients, funds or other third partiesfor the provision of safekeeping, fund administration orrelated services. Within a multi-service banking group such asJPMorgan Chase Group, from time to time conflicts may arise(i) from the delegation by the Trustee to its safekeepingdelegates or (ii) generally between the interests of theTrustee and those of the Fund, its Unitholders or theManager; for example, where an affiliate of the Trustee isproviding a product or service to a fund and has a financial orbusiness interest in such product or service or receivesremuneration for other related products or services itprovides to the funds such as foreign exchange, securitieslending, pricing or valuation, fund administration, fundaccounting or transfer agency services. In the event of anypotential conflict of interest which may arise during thenormal course of business, the Trustee will at all times haveregard to its obligations under applicable laws includingArticle 25 of the UCITS V Directive.

Up-to-date information regarding the description of theTrustee’s duties and of conflicts of interest that may arisetherefrom as well as from the delegation of any safekeepingfunctions by the Trustee will be made available to Unitholderson request at the Manager's registered office.

Registered Office25 Bank Street,Canary Wharf,London E14 5JP

Head OfficeChaseside,Bournemouth BH7 7DA

Ultimate Holding CompanyJPMorgan Chase & Co., a company incorporated in Delaware,USA

Principal office for unit trust businessChaseside,Bournemouth BH7 7DA


Principal Business ActivityTo act as trustee and depositary of collective investmentschemes

Delegation of ServicesAdministrator

The Manager has delegated the functions of fund accountingservices and valuation and pricing to the Administrator beingJ.P. Morgan Europe Limited, 25 Bank Street, Canary Wharf,London E14 5JP.

Customer Enquiries

The Manager has delegated the functions of CustomerEnquiries, Contract Settlement, Unit Issues and Redemptions,Distribution of Income and Record Keeping to the TransferAgent being HSBC Bank Plc, 8 Canada Square, London, E148HQ.

AuditorThe auditor of the Funds is PricewaterhouseCoopers LLPwhose principal place of business is at Atria One, 144Morrison Street, Edinburgh, EH3 8EX.

Register of UnitholdersThe Manager is responsible for maintaining the register foreach Fund. It has delegated certain registrar functions toHSBC Bank Plc, 8 Canada Square, London, E14 8HQ.


Section 11. The Funds

1.1. Structure

The Funds are authorised unit trusts and are constitutedpursuant to COLL. Each Fund is a UCITS scheme for thepurposes of the categorisations of COLL.

Unitholders hold Units which reflect the value of the assets,held by the relevant Fund. Unitholders will in no event beliable for the debt, if any, of the Funds.

The terms of the Funds may, subject to the provisions of andin accordance with COLL, be amended from time to time. Inall cases, amendments will be notified to Unitholders. For allamendments that are not significant or fundamental,Unitholders will be informed at or after the date theamendment will take place.

Where amendments are deemed by the Manager to besignificant to the Fund, Unitholders will be provided with atleast 60 days’ prior notice before the amendment.

Where the amendments are deemed by the Manager to befundamental to the Fund, Unitholders will be required toapprove the change by way of an extraordinary resolution ata meeting of Unitholders.

1.2. Classes of Units

Unitholders are entitled to participate in the property of aFund and the income from that property in proportion to thenumber of undivided shares in the Fund represented by theUnits held by them. The nature of the right represented byUnits is that of a beneficial interest under a trust.

The Trust Deeds permit the issue of a number of differentclasses and types of Units. At the moment, each class may bemade available as either Income Units and/or AccumulationUnits. An Income Unit represents one undivided Unit whichdistributes its income and an Accumulation Unit representsan undivided Unit with the income arising from thatundivided Unit being reflected in the Accumulation Unitvalue. The classes and types of Units that are currentlyavailable are stated in Appendix III.

Each class of Unit described in Appendix III may vary incharacteristics such as whether it accumulates or pays outincome or attracts different fees and expenses, and as aresult of this monies may be deducted from classes inunequal proportions. In these circumstances theproportionate interests of the classes within a Fund will beadjusted in accordance with the provisions of the Trust Deedof that Fund relating to proportion accounts, details of whichare set out below.

The Trustee may create one or more classes of Units asinstructed from time to time by the Manager. The creation ofadditional Unit classes will not result in any materialprejudice to the interests of Unitholders of existing Unitclasses.

1.2.1. Currency Unit ClassesWhere a class is denominated in a currency which is not theBase Currency, distributions paid on Units of that class shall,in accordance with the Regulations, be in the currency of thatclass. Where it is necessary to convert one currency intoanother, conversions shall be made at a rate of exchange

decided by the Manager as being a rate that is not likely toresult in any material prejudice to the interests of Unitholdersor potential Unitholders.

1.2.2. Currency Hedged Unit ClassesGBP hedged Unit classes may be available for some Funds.Hedged Unit classes allow the Manager to use currencyhedging transactions to seek to minimise the effect ofexchange rate fluctuations between the Base Currency andthe Portfolio Currency of a Fund. Currency hedgingtransactions include entering into over the counter currencyforward contracts and foreign exchange agreements.

Where undertaken, the effects of hedging will be reflected inthe Net Asset Value and, therefore, in the performance of therelevant hedged Unit class. The cost and expenses associatedwith the hedging transactions in respect of the hedged Unitclass(es) and any benefits of the hedging transactions willaccrue to Unitholders in that hedged Unit class only.

The Manager will aim to hedge the currency exposure of theNet Asset Value attributable to a hedged Unit class, howeverthe hedge may not always be at 100%. This is to avoid thetransaction costs of making small and frequent adjustingtransactions. The Manager will review the relevant hedgingpositions daily and, if appropriate, adjust the hedge to reflectany change in currency exposure and the flow of Unitholderissues and redemptions of Units.

The nature of the risks that hedging transactions may involveare set out in Appendix II.

Hedged Unit classes that are currently available are stated inAppendix III.

1.2.3. Unit DistributionsWith effect from 6th April 2017, all units are gross payingunits. The income allocated to such Units is periodicallydistributed (Income Units) or added to capital (AccumulationUnits) without deduction of any income tax.

1.2.4. H UnitsInvestment into the H Units is at the Manager’s discretion.Before the Manager can accept a subscription into the HUnits, a separate legal agreement must be in place betweenthe distributor and Manager containing terms specific toinvestment in the H Units.

1.2.5. L UnitsThe target market for L Units is large distributor clients of theManager. Investment into the L Units is at the Manager’sdiscretion. Before the Manager can accept a subscription intothe L Units, a separate legal agreement must be in placebetween the distributor/investor and Manager containingterms specific to investment in the L Units.

1.2.6. Q, Q1, Q2, Q3, Q4, Q5, Q6, Q7, Q8, Q9 UnitsInvestment into the Q, Q1, Q2, Q3, Q4, Q5, Q6, Q7, Q8, Q9Units is at the Manager’s discretion. Before the Manager canaccept subscriptions into the Q, Q1, Q2, Q3, Q4, Q5, Q6, Q7,Q8, Q9 Units, a separate legal agreement must be in placebetween the investor/distributor and Manager containingterms specific to investment in the Q, Q1, Q2, Q3, Q4, Q5, Q6,Q7, Q8, Q9 Units.


1.2.7. S UnitsS Class Income and S Class Accumulation Units are availableat the Manager’s discretion to certain clients of the Schrodersgroup wealth management business. Before the Managercan accept a subscription into S Units, a legal agreementmust be in place between the investor and the relevant entitywithin the Schroders group wealth management businesscontaining terms specific to investment in the S Units.

In the event that a Unitholder of the S Unit ceases to be aclient of the Schroders group wealth management business,the Unitholder will cease to be eligible to hold S Units and theManger will compulsorily switch the Unitholder into the mostappropriate Income and/or Accumulation (as appropriate)Unit class of the fund. This means that the switch of S Unitswill be automatic without the need for Unitholders to submita switching request to the Manager. Instead, by subscribingfor S Units, Unitholders irrevocably permit the Manager toswitch S Units on their behalf should they cease to be eligibleto invest in the S Units.

1.2.8. X UnitsA feature of the X Units is that they have an alternativecharging structure whereby, in addition to paying theSchroders Annual Charge for X Shares, Unitholders who are aclient of Schroders are charged an additional managementfee directly by Schroders pursuant to a management feeagreement. No management fees are therefore payable inrespect of X Units out of the net assets of the Fund.

1.3. Proportion Accounts

If more than one Units are in issue in a Fund, theproportionate interests of each class in the assets andincome of the Fund shall be ascertained as set out in theTrust Deeds, the relevant provisions being set out as follows:

A notional account will be maintained for each class. Eachaccount will be referred to as a “Proportion Account”.

The word “proportion” in the following paragraphs meansthe proportion which the balance on a Proportion Account atthe relevant time bears to the balance on all the ProportionAccounts of a Fund at that time. The proportionate interest ofa class of Unit in the assets and income of a Fund is its“proportion”.

These will be credited to a Proportion Account:

– the subscription money (excluding any initial charges) forthe issue of Units of the relevant class;

– that class’s proportion of the amount by which the NetAsset Value of the Fund exceeds the total subscriptionmoney for all Units in the Fund;

– that class’s proportion of the Fund’s income received andreceivable; and

– any notional tax benefit.

These will be debited to a Proportion Account:

– the redemption payment for the cancellation of Units ofthe relevant class;

– the class’s proportion of the amount by which the NetAsset Value of the Fund falls short of the totalsubscription money for all Units in the Fund;

– all distributions of income (including equalisation if any)made to Unitholders of that class;

– all costs, charges and expenses incurred solely in respectof that class;

– that class’s share of the costs, charges and expensesincurred in respect of that class and one or more otherclasses in the Fund, but not in respect of the Fund as awhole;

– that class’s share of the costs, charges and expensesincurred in respect of or attributable to the Fund as awhole; and

– any notional tax liability.

Any tax liability in respect of the Fund and any tax benefitreceived or receivable in respect of the Fund will be allocatedbetween classes in order to achieve, so far as possible, thesame result as not materially to prejudice any class. Theallocation will be carried out by the Manager afterconsultation with the Fund’s auditors.

Where a class is denominated in a currency which is not theBase Currency of the Fund, the balance on the ProportionAccount shall be converted into the Base Currency of theFund in order to ascertain the proportions of all classes.Conversions between currencies shall be at a rate ofexchange decided by the Manager as being a rate that is notlikely to result in any material prejudice to the interests ofUnitholders or potential Unitholders.

The Proportion Accounts are notional accounts maintainedfor the purpose of calculating proportions. They do notrepresent debts from the Fund to Unitholders or the otherway round.

Each credit and debit to a Proportion Account shall beallocated to that account on the basis of that class’sproportion immediately before the allocation. All suchadjustments shall be made as are necessary to ensure thaton no occasion on which the proportions are ascertained isany amount counted more than once.

When Units are issued thereafter each such Unit shallrepresent the same proportionate interest in the property ofthe Fund as each other Unit of the same category and classthen in issue in respect of that Fund.

The Fund shall allocate the amount available for incomeallocation (calculated in accordance with COLL) between theUnits in issue relating to the Fund according to the respectiveproportionate interests in the property of the Fundrepresented by the Units in issue at the valuation point inquestion.


Section 22. Dealing in Units

2.1. Buying and Selling Units

The dealing office of the Manager is open from 9.00 a.m. until5.30 p.m. each Business Day during which the Manager mayreceive requests for the buying and selling of Units. The timeand price at which a deal takes place depends on therequirements of COLL affecting the pricing of Units.

Instructions accepted by the Manager before the valuationpoint as specified in Appendix III, will normally be executedat the relevant price per Unit, as defined below , calculatedon that Dealing Day (less any applicable redemption charge).

With the consent of the Trustee, the dealing office of theManager may be open on days other than Business Days. Onthese other days, restrictions may be added to the openinghours and the types of business accepted.

The Units in the Funds are not listed or dealt in on anyinvestment exchange.

2.1.1. BuyingUnits may be purchased by sending a completed applicationform to the Manager or by telephoning 0800 182 2399(Dealing). Please note that telephone calls may be recorded.In addition, the Manager may from time to time makearrangements to allow Units to be bought online or throughother communication media. The Manager may accepttransfer of title by electronic communication.

A contract note giving details of the Units purchased will beissued no later than the next Business Day after the DealingDay on which an application to purchase Units is valued bythe Manager.

The Manager will not accept an application for Units to thevalue of less than the minimum subscription amount asdefined in Appendix III. If a holding falls below the minimumholding then the Manager reserves the right to redeem theUnits on behalf of the Unitholder. The Manager reserves theright to reduce or waive the minimum investment levels.

The Manager reserves the right to reject, on reasonablegrounds, any application for Units in whole or in part. TheManager will return any money sent, or the balance, for thepurchase of Units, at the risk of the applicant.

Please refer to Appendix III for details of any initial offerperiods that apply to a new Fund.

2.1.2. Pricing BasisThe Manager currently deals daily on a forward pricing basis,i.e. at prices calculated by reference to the value of theproperty of the Fund at the next valuation point.

2.1.3. Certificates and TitleCertificates are not issued to Unitholders. Title to Units isevidenced by the entry on the register of Unitholders of therelevant Fund(s). Details of the register of Unitholders can befound under “Administration” above.

2.1.4. SellingAt any time during a Dealing Day when the Manager is willingto sell Units it must also be prepared to buy back Units. TheManager may refuse to buy back a certain number of Units ifthe redemption will mean that the Unitholder is left holdingUnits with a value of less than the minimum initialsubscription amount.

Requests to sell Units in a Fund may be made by sendingclear written instructions to the Manager or by telephoningon 0800 182 2399 (Dealing). Please note that telephone callsmay be recorded. In addition, the Manager may from time totime make arrangements to allow Units to be sold online orthrough other communication media. The Manager mayaccept transfer of title by electronic communication.

A contract note giving details of the number and price of theUnits sold back to the Manager will be sent to Unitholders nolater than the next Business Day after the Units were valued.In the event that the Manager requires a signed form ofrenunciation, e.g. in respect of joint Unitholders, corporateUnitholders or redemptions dealt through an agent, a formof renunciation will be attached. Redemption cheques will beissued within four Business Days of receipt by the Manager ofthe instruction and, if appropriate, the duly completeddocumentation.

2.1.5. SwitchingA Unitholder may switch all or some of his or her Units withinclasses of the same Fund or for Units of any class within adifferent Fund. A switch involves the sale of the original Unitsand the purchase of new Units on the same Dealing Day. Thenumber of new Units issued will be determined by referenceto the respective prices of the old and new Units at thevaluation point applicable when the old Units are sold andthe new Units are bought.

If the switch results in a Unitholder holding a number of oldUnits or new Units of a value which is less than the minimumholding of the Fund concerned, the Manager may, at itsdiscretion, convert the whole of the Unitholder’s holdings ofold Units to new Units or refuse to effect any switch of theold Units. No switch will be made during any period when theright of Unitholders to require the redemption of their Unitsis suspended. The general provisions on selling Units shallapply equally to a switch.

Requests to switch Units may be made by sending acompleted application form to the Manager. In addition, theManager may from time to time make arrangements to allowUnits to be switched online or through other communicationmedia. The Manager may accept transfer of title by electroniccommunication.

Unitholders subject to UK tax should note that a switch ofUnits within the same Fund should not be treated as adisposal for the purposes of capital gains taxation. However,switches of Units within the same Fund will be chargeable ifthey involve a switch from a hedged to an unhedged class, orvice versa or a switch between classes hedged to differentcurrencies. Unitholders subject to UK tax should note that aswitch of Units between different Funds is treated as adisposal for the purposes of capital gains taxation.


2.1.6. In-specie TransfersA Unitholder who requests the subscription or redemption ofa number of Units representing in value not less than £1,000,000 may (either at his request or by election of theManager) receive in respect of such redemption an in-specietransfer out of the property of the Fund in question inaccordance with the Regulations. This minimum may bewaived at the Manager’s discretion, in respect ofsubscriptions or redemptions. All in-specie transfers will be atthe discretion of the Manager and Trustee, and the Managermust have taken reasonable care to ensure that the propertyconcerned would not be likely to result in any materialprejudice to the interests of Unitholders.

2.1.7. Transfers of UnitsUnitholders may request a transfer of Units to anotherinvestor by sending a completed stock transfer form to theManager.

2.2. Pricing of Units

2.2.1. Valuation PointThe valuation points of the Funds are stated in Appendix III.Funds are valued on Business Days. This is with the exceptionof Christmas Eve and New Years Eve or the last Business Dayprior to those days annually, when the valuation may becarried out at a time agreed in advance between theManager and the Trustee.

For non Business Days, valuations may be carried out at atime agreed in advance between the Manager and theTrustee.

The Manager may also, if the Trustee agrees, change thevaluation point on any day. The Manager may also carry outan additional valuation, if the Manager believes that due toexceptional circumstances there is good and sufficient reasonto do so, having regard to the interests of Unitholders orpotential Unitholders.

2.2.2. Valuation of PropertyThe valuation determines the Net Asset Value of the Funds.Please see Appendix V for a description of how the value ofthe property of each Fund is determined.

The Manager may at any time during a Business Day carryout an additional valuation of the property of a Fund if theManager considers it desirable to do so.

2.2.3. Publication of PricesThe most recent buying and selling prices will appear daily onthe Schroders’ website. This is our primary method of pricepublication.

2.2.4. EqualisationWhen an incoming Unitholder purchases a Unit during anaccounting period, part of the purchase price will reflect therelevant share of accrued income in the Net Asset Value ofthe Fund. The first allocation of income in respect of that Unitrefunds this amount as a return of capital. The amount ofincome equalisation is calculated by dividing the aggregate ofthe amount of income included in the creation price of Unitsof the type in question issued or re-issued in a groupingperiod by the number of those Units and applying theresulting average to each of the Units in question.

Grouping periods are consecutive periods within each annualaccounting period, being the interim or half yearlyaccounting periods (including the period from the end of thelast interim or half yearly accounting period in an annualaccounting period to the end of that annual accountingperiod) as specified in Appendix III. If there is no distributionof income at the interim or half yearly accounting periods,the periods for grouping of Units will be annual accountingperiods. Grouping is permitted by the Trust Deeds for thepurposes of equalisation.

2.2.5. Calculation of Net Asset ValueThe value of the property of each Fund shall be determinedin accordance with the relevant rules set out in Appendix V.

2.3. Suspension or Deferrals

2.3.1. SuspensionThe Manager may, if the Trustee agrees, or shall if theTrustee so requires, temporarily suspend the issue,cancellation, sale and redemption of Units if the Manager orTrustee (in the case of any requirement by the Trustee),believes that due to exceptional circumstances there is goodand sufficient reason to do so, having regard to the interestsof Unitholders or potential Unitholders. During thesuspension none of the obligations in COLL 6.2 (Dealing) willapply but the Manager will comply with COLL 6.3 (Valuationand Pricing) during the period of suspension to the extentpracticable in light of the suspension.

On suspension, the FCA shall be immediately notified and assoon as practicable given written confirmation of the reasonsfor the suspension. Unitholders will be notified of anysuspension as soon as practicable after the suspensioncommences, including details of the exceptionalcircumstances which have led to the suspension and givingUnitholders details of how to find further information aboutthe suspension.

The suspension shall only continue for as long as theManager and Trustee deem it to be justified in thecircumstances having regard to the interests of Unitholders.Where such suspension takes place, the Manager will publishdetails on its website or by other general means, givingsufficient details to keep Unitholders appropriately informedabout the suspension, including, if known, its possibleduration. The suspension will be reviewed at least every 28days and the Manager and Trustee shall inform the FCA ofthe results of such review and of the proposed restart ofdealings.

Re-calculation of dealing prices will commence on theBusiness Day immediately following the end of thesuspension, at the relevant valuation point.

2.3.2. Deferred RedemptionEach Fund permits deferral of redemptions at a valuationpoint to the next valuation point where the requestedredemptions exceed 10% of the Fund’s value.

Redemptions not processed at a valuation point will beprocessed at the next valuation point.

Available Units to be redeemed will be bought back in equalvalues (up to the amounts requested) across all Unitholderswho have sought to redeem Units at any valuation point atwhich redemptions are deferred. All deals relating to anearlier valuation point will be completed before thoserelating to a later valuation point are considered.


2.4. Market Timing Policy, Late Trading Policy andFair Value Pricing

The Manager does not knowingly allow investments whichare associated with market timing activities, as these mayadversely affect the interests of all Unitholders.

In general, market timing refers to the investment behaviourof a person or group of persons buying, selling or switchingUnits on the basis of predetermined market indicators.Market timing may also be characterised by transactions thatseem to follow a timing pattern or by frequent or largetransactions in Units.

In practice, the underlying property of a Fund which investsin non-European markets or other collective investmentschemes is usually valued on the basis of the last availableprice as at the time when the Net Asset Value of the propertyin the Fund in calculated. The time difference between theclose of the markets in which the Fund invests, and the pointof valuation, can be significant. For example, in the case of aUS traded security, the last available price may be as much as14 hours old. Market developments which could affect thevalue of these securities can occur between the close of themarkets and the point of valuation, will therefore notnormally be reflected in the Net Asset Value per Unit of therelevant Fund.

Accordingly, the Manager may, whenever it is deemed it tobe appropriate and in the interests of Unitholders, implementone, or both of the following measures:

– to reject any application for switching and/orsubscription of Units from Unitholders or potentialUnitholders whom it considers to be associated withmarket timing activity. In such circumstances theManager may combine Units which are under commonownership or control for the purposes of ascertainingwhether Unitholders can be deemed to be involved insuch activities; and

– where a Fund is invested in markets which are closed forbusiness at the time a Fund is valued, allow for the NetAsset Value per Unit to be adjusted to reflect moreaccurately the fair value of the Fund’s underlyingproperty at the point of valuation (fair value pricing).

The Manager uses an independent agent to provide fairvaluation analysis. The adjustment of the Net Asset Value perUnit of a Fund so as to reflect the fair value of the portfolio asat the point of valuation is an automated process.Adjustment factors are applied daily at an individual assetlevel to independently sourced market prices. Theadjustment process covers all equity markets that are closedat the relevant Valuation Point and all Funds that haveexposure to these markets are fair value priced. In applyingfair value pricing, the Manager is seeking to ensure thatconsistent prices are applied across all relevant Funds. Fixedincome and other asset classes are currently not subject tofair value pricing.

Late Trading is not permitted. “Late Trading” is defined asthe acceptance of a subscription, redemption or switch orderreceived after the Fund’s applicable valuation point for thatDealing Day. As such, orders will not be accepted using theprice established at the valuation point for that Dealing Day iforders are received after that time. Late Trading will notinclude a situation in which the Manager is satisfied thatorders which are received after the valuation point have beenmade by investors before then (e. g. where the transmissionof an order has been delayed for technical reasons).


Section 33. General Information

3.1. Charges and Expenses

3.1.1. Initial and Redemption ChargesInitial Charge

The Manager is entitled under the Trust Deeds to an initialcharge which is included in the issue price of the Units (theInitial Charge). The Initial Charge may be waived at theManager’s discretion. Details of the current Initial Charge (ifany) of each Fund is set out in Appendix III. Notice of anincrease to any Initial Charge will be dealt with in accordancewith the FCA Rules.

Redemption Charge

The Trust Deeds of the Funds allow the Manager to impose aredemption charge but at present, there are no plans tointroduce such a charge.

3.1.2. Schroders Annual ChargeThe Manager is permitted to take a charge from each UnitClass of each Fund as payment for carrying out its duties andresponsibilities and to pay for third party services and certainother costs. This is referred to as the “Schroders AnnualCharge”.

The Schroders Annual Charge is set as a rate which is apercentage of the Net Asset Value of each Unit Class of eachFund. The annual rate of this charge for each Unit Class is setout in Appendix III.

The Schroders Annual Charge is calculated and accrued dailyand deducted monthly in arrears from the relevant UnitClass. In the event the actual costs incurred by a Fund exceedthe level of the Schroders Annual Charge applicable to thatUnit Class, the Manager shall bear any such excess. Wherethe actual costs incurred by a Fund fall below the SchrodersAnnual Charge for that Fund, the Manager shall be entitled toretain any amount by which the Schroders Annual Chargeexceeds those actual costs.

Costs and Expenses Included in the Schroders AnnualCharge

The Schroders Annual Charge covers the following:

(A) the Manager’s fees and expenses for carrying out theoperation and management of the Funds;

(B) the fees and expenses payable to the Trustee (includingthe costs of any agents appointed by the Trustee toassist in the discharge of its duties);

(C) the fees and expenses payable by the Manager to theAdministrator in respect of:-

(1) fund accounting and related fund administrationservices;

(2) preparation of financial statements for the Funds;

(3) preparation of tax returns; and

(4) any expenses incurred by the Funds in connectionwith the maintenance of accounting and other booksand records;

(D) any transfer agency fees including those of the TransferAgent;

(E) fees incurred in relation to custody of assets (includingoverseas custody services and any related transactioncharges incurred by the Custodian) including theCustodian’s fees and expenses and related fees levied bylocal tax agents;

(F) fees payable to the Custodian for the provision ofCompliance Reporting Services on the Schroder AsianIncome Maximiser;

(G) any audit fee and any proper expenses of the Auditorand of tax and other professional advisers to the Funds(including any professional advice required by theTrustee in relation to the Funds and discharge of itsduties) ;

(H) the fees and any proper expenses of legal advisers to theFunds and of conducting legal proceedings ;

(I) any costs arising in connection with the publication anddespatch of the price of Units;

(J) costs and expenses in respect of the purchase andmaintenance of insurance policies;

(K) any fees incurred in respect of share class hedging;

(L) all costs from despatch of the half-yearly and otherreports of the Funds;

(M) costs pertaining to the modification of the Trust Deedsand Prospectus;

(N) documentation costs and expenses, such as preparing,printing and distributing the Prospectus and the KIIDs, aswell as the annual reports of the Funds and any otherdocuments made available to Unitholders;

(O) costs of arranging and convening meetings ofUnitholders;

(P) costs of registration, publication of Unit prices, creation,conversion and cancellation of Unit Classes;

(Q) the costs of the Registrar and of establishing andmaintaining the register and any sub-register;

(R) any costs incurred in collection, producing, distributingand dispatching income and other payments toUnitholders or any payments made in respect of theFunds;

(S) costs and charges relating to banking and bankingtransactions (including the conversion of foreigncurrency, stock-lending and other permittedtransactions);

(T) communications with any parties (including telex,facsimile, SWIFT and electronic mail);

(U) the fees of the FCA under Schedule 1, Part III of the Actand any corresponding periodic fees of any regulatoryauthority in a country or territory outside the UK in whichUnits in that Fund are, or may, be marketed;

(V) any sum due or payable by virtue of any provision of theFCA Rules;


(W) any licensing and associated fees; and

(X) value added tax payable on these expenses whereappropriate.

For the purpose of the calculation of the Schroders AnnualCharge, the value of a Fund is inclusive of the Unit issues andcancellations which take effect as at the relevant valuationpoint. Payments will be charged to the capital or income ofthe Fund in accordance with the FCA Rules. The levels of theSchroders Annual Charge will be reviewed by the Manager inexceptional circumstances and on an annual basis in anyevent to ensure that they remain fair to Unitholders. Anyincrease in the Schroders Annual Charge will require priornotice to be given to Unitholders before any such increasemay take effect. The Prospectus will also be revised to reflectthe new rate(s).

Any increase of the Initial Charge or the Schroders AnnualCharge may be made by the Manager, if it is deemed by theManager to be a significant rather than a fundamentalchange, as set out in the provisions of COLL, only after:

(A) giving 60 days’ written notice to the Unitholders (in thecase of an increase of the Schroders Annual Charge) orthe regular savers (in the case of the Initial Charge); and

(B) the Manager revising the Prospectus to reflect theincrease.

If such a change is deemed fundamental, it will require theapproval of the Unitholders.

Discounts to the Schroders Annual Charge

The Manager passes on some of the benefits of potentialsavings generated by significant growth in assets undermanagement by discounting the Schroders Annual Chargepayable in respect of retail Unit Classes in the Funds. The sizeof the discount to the usual Schroders Annual Charge isdetermined by the size of the relevant Fund (as set outbelow) and is capped at 0.05%.

For equity funds:

– the Schroders Annual Charge payable in respect of retailUnit Classes in Funds with £1 billion plus of assets undermanagement is discounted by 0.02%.



A numerical example for equity funds is set out below.

Unit Trust assets undermanagement

Discounted Schroders Annual Chargefor a retail Unit Class (for example aClass A Unit)

Schroders Annual Charge: 1.50%

£1.8bn 1.48%

£2.4bn 1.46%

£3.0bn and above 1.45%

For fixed income and multi-asset funds, a 0.02% discount isapplied to the Schroders Annual Charge payable in respect ofretail Unit Classes in Funds with £1 billion plus of assets

under management and a further 0.02% discount is appliedfor each further £2 billion plus of assets under management,subject to a cap of 0.05%.

A numerical example for fixed income and multi-asset fundsis set out below.

Unit Trust assets undermanagement

Discounted Schroders Annual Chargefor a retail Unit Class (for example aClass A Unit)

Schroders Annual Charge: 1.50%

£1.8bn 1.48%

£2.4bn 1.48%

£3.0bn 1.46%

£4.0bn 1.46%

£5.0bn and above 1.45%

The Manager reviews the Net Asset Value of each of theFunds on a daily basis and implements the applicablediscount on a forward basis on the next Dealing Day.

The Manager reserves the right to change the Net AssetValue ranges at which discounts apply or the discountapplied for any given Net Asset Value range. In the event ofany such change, the Manager will notify Unitholders inwriting.

3.1.3. Other ExpensesThe expenses set out in this section 1.1.3 are payable out ofthe Scheme Property and do not fall within the SchrodersAnnual Charge. No payments may be made out of theproperty of the Funds other than payments permitted byCOLL and the following (to the extent of the actual amountincurred):

(A) brokers’ commission, fiscal charges and otherdisbursements which are:-

(1) necessarily incurred in effecting transactions for thatFund; and

(2) normally shown in contract notes, confirmationnotes and difference accounts as appropriate.

(B) ongoing costs incurred at Fund level by holding collectiveinvestment schemes and other investment vehicles notmanaged by a member of the Schroders group. Any suchfees incurred in respect of investment in funds managedby Schroders will be rebated to the relevant Fund;

(C) any costs incurred in respect of dealings in derivatives;

(D) interest on borrowings permitted under COLL andcharges incurred in effecting or terminating suchborrowings or in negotiating or varying the terms ofsuch borrowings;

(E) taxation and duties payable in respect of the property ofthe Fund, the Trust Deed or the issue of Units;

(F) liabilities on unitisation, amalgamation or reconstructionarising in certain circumstances as set out in COLL;

(G) all charges and expenses incurred in relation to stocklending. (The Funds do not currently undertake any stocklending activities. In the event that the Funds stock lendin the future, the payment paid to the stock lendingagent will not exceed 17.5% of the gross income


generated by the stock lending arrangements. TheManager may receive around 20% of the gross incomegenerated from stock lending to cover administrationservices which are carried out and expenses properlyincurred in supporting any stock lending activities. Aminimum of 62.5% of the gross income generated fromthe stock lending activities will be applied to the schemeproperty for the benefit of the Funds and Unitholders.);

(H) extraordinary fees and expenses such as those relatingto potential or actual legal proceedings and tax reclaims,and the fees and expenses of legal and otherprofessional advisers;

(I) such other expenses as the Manager resolves areproperly payable out of the Fund's property; and

(J) value added tax payable on these expenses whereappropriate.

3.1.4. Exemption from Liability to Account for ProfitsThe Manager, Trustee and Custodian are not liable to accountto the Unitholders of any Fund for any profits or benefits thatthey make or receive that are derived from or in connectionwith:

(A) dealings in the Units of a Fund;

(B) any transaction in Fund property; or

(C) the supply of services to the Fund.

The Manager is under no obligation to account to the Trusteeor to Unitholders for any profit it makes on buying or sellingUnits.

3.2. Reporting, Distributions and Accounting Dates

3.2.1. Report and AccountsFollowing the removal of the requirement to produce shortreports by the FCA, the Manager will no longer produce shortreports for half-yearly and annual accounting periods endingafter 1 January 2017.

The Manager will, within four months after the end of eachannual accounting period and two months after the end ofeach half-yearly accounting period respectively, makeavailable full report and accounts, free of charge, on requestor online at www.schroders.co.uk.

3.2.2. Accounting and Income Distribution DatesThe Funds’ annual accounting dates, half yearly accountingdates and income allocation dates are listed in Appendix III.

Each holder of Income Units is entitled, on the relevantincome allocation date, to the net income attributable to thatholding. Net income on Accumulation Units is not distributedbut is accumulated into the value of each Unit.

Distributions will be paid by crediting a Unitholder’s bank orbuilding society account.

Any distribution that remains unclaimed for a period of 6years after the distribution became due for payment willrevert to the Fund.

The Manager reserves the right to change or createadditional accounting and income distribution dates, usuallyas a result of accounting or taxation changes.

The amount available for distribution in any accountingperiod is calculated by taking the aggregate of the incomereceived or receivable for the account of the Fund in respectof that period, and deducting the aggregate of the Manager’sand Trustee’s remuneration and other payments properlypaid or payable out of the income account in respect of thataccounting period and adding the Manager’s best estimateof any relief from tax on that remuneration and those otherpayments.

The Manager then makes such other adjustments as itconsiders appropriate (and after consulting the auditors asappropriate) in relation to taxation, the proportion of theprices received or paid for Units that is related to income(taking into account any provisions in the Trust Deed),income equalisation, potential income which is unlikely to bereduced until 12 months after the income allocation date,income which should not be accounted for on an accrualbasis because of law of information as to how it accrues,transfers between the income and capital accounts and anyother relevant matters.

3.3. UK Taxation

The taxation of income and capital gains of both the Fundsand Unitholders is subject to the fiscal law and practice of theUK and of the jurisdictions in which Unitholders are residentor otherwise subject to tax. The following summary of theanticipated tax treatment in the UK does not constitute legalor tax advice and applies only to persons holding Units as aninvestment.

Prospective Unitholders should consult their ownprofessional advisers on the tax implications of making aninvestment in, holding or disposing of Units and the receiptof distributions and deemed distributions with respect tosuch Units under the laws of the countries in which they maybe liable to taxation.

This summary is based on the taxation law and practice inforce at the date of this document, but prospectiveUnitholders should be aware that the relevant fiscal rules andpractice or their interpretation might change. The followingtax summary is not a guarantee to any investor of the taxresults of investing in the Funds.

3.3.1. Taxation of the FundsAs the Funds are authorised by the FCA as unit trust funds,they are exempt from UK tax on capital gains realised on thedisposal of investments held by them (including interest-paying securities and derivatives contracts). Certain Fundsmay invest in offshore funds which, in certain circumstances,may give rise to gains which are categorised as incomerather than capital gains for UK tax purposes and so arechargeable to corporation tax.

Dividends from UK and from overseas companies (and anypart of dividend distributions from authorised unit trusts andopen-ended investment companies which represent thosedividends) are generally not subject to corporation tax.

The Funds will each be subject to UK corporation tax at acurrent rate of 20% on other types of income but afterdeducting allowable management expenses and the grossamount of interest distributions, where relevant. Where aFund suffers foreign tax on income received, this may insome circumstances be deducted from the UK tax due onthat income.

A Fund will make dividend distributions except where over60% of its property has been invested throughout thedistribution period in qualifying assets (broadly interest-


paying investments), in which case it will make interestdistributions. Dividend and interest distributions made ortreated as made by each Fund are not subject to UKwithholding tax.

3.3.2. Taxation of UnitholdersEach Fund will be treated for tax purposes as distributing toits Unitholders for each distribution period the whole of theincome shown in its accounts as being income available forpayment to Unitholders or for reinvestment, regardless ofthe amount actually distributed. Accordingly, any excess ofthe amount so shown over the income actually distributedwill be deemed to be distributed to Unitholders in proportionto their respective interests in the Fund. The date of any suchdeemed distribution will be determined by the Fund’srelevant interim or annual income allocation date (details ofwhich are given above).

Dividend Distributions

UK resident individual Unitholders

Where Units are held outside an ISA, total dividends receivedin a tax year up to the tax-free dividend allowance will be freeof income tax. Dividends totalling in excess of that amountwill be subject to tax at the Unitholder’s marginal rate of tax.The rates applicable to dividend income are 7.5%, 32.5% and38.1% where they fall within the basic rate, higher rate andadditional rate bands respectively. Dividends received onUnits held within an ISA will continue to be tax-free.

UK resident corporate Unitholders

Corporate Unitholders who receive dividend distributionsmay have to divide them into two (in which case theallocation between franked investment income andunfranked income received will be set out on the taxvoucher). Any part representing dividends received from a UKcompany will be treated as dividend income (that is, frankedinvestment income) and no further tax will be due on it. Theremainder will be received as an annual payment afterdeduction of income tax at the basic rate, and corporateUnitholders may, depending on their circumstances, be liableto tax on the gross distribution, subject to credit for the taxdeemed deducted.

The corporate streaming rules also limit the maximumamount of income tax that may be reclaimed from HMRevenue & Customs (HMRC) on the unfranked stream. Themaximum amount reclaimable by a corporate Unitholder isthe corporate Unitholder’s portion of the Fund’s net liabilityto corporation tax in respect of gross income. The taxvoucher will state the Fund’s net liability to corporation tax inrespect of the gross income.

Interest Distributions

Schroder Absolute Return Bond Fund, Schroder Gilt and FixedInterest Fund, Schroder High Yield Opportunities Fund andSchroder Strategic Bond Fund pay interest distributionswithout the deduction of withholding tax (which will beautomatically reinvested in the Fund in the case ofAccumulation Units).


Where Units are held within an ISA, this income is free of tax.For Units held outside an ISA, a Personal Savings Allowance isavailable to exempt the first £1,000 of interest income fromtax in the hands of basic rate taxpayers. The Allowance is£500 for higher rate taxpayers and nil for additional ratetaxpayers. Total interest received in excess of the Allowance

in a tax year will be subject to tax at the Unitholder’smarginal rate of tax. The rates applicable to savings incomeare 20%, 40% and 45% for the tax year 2021-22 where theyfall within the basic rate, higher rate and additional ratebands respectively.


UK resident corporate Unitholders should note that wherethey hold a Fund which makes interest distributions, gainswill be subject to loan relationship rules.

Income equalisation

The first income allocation received by a Unitholder afterbuying the Units may include an amount of incomeequalisation. This is effectively a repayment of the incomeequalisation paid by the Unitholder as part of the purchaseprice. It is a return of capital, and it is not taxable. Rather itshould be deducted from the acquisition cost of the Units forcapital gains tax purposes. There is an exception to this rulewhen the equalisation forms part of the first incomedistribution following a switch or share/unit class conversion,in which case the entire distribution should be treated asincome and no part of it will represent a return of capital.

Capital Gains


Unitholders who are resident in the UK for tax purposes may,depending on their personal circumstances, be liable tocapital gains tax on gains arising from the redemption,transfer or other disposal of Units. However, if the total gainsfrom all sources realised by an individual Unitholder in a taxyear, after deducting allowable losses, are less than theannual exemption, there is no capital gains tax to apply.Individual Unitholders with net gains in excess of the annualexemption will be chargeable to capital gains tax at the rateof tax applicable to them. Where income equalisation applies(see above), the buying price of Units includes accruedincome which is repaid to the investor with the first allocationof income following the purchase. This repayment is deemedto be a repayment of capital and is therefore made withoutdeduction of tax but must be deducted from the investor’sbase cost of the relevant Units for purposes of calculatingany liability to capital gains tax.


Corporate Unitholders within the charge to UK corporationtax will be subject to corporation tax on gains arising fromthe redemption, transfer or other disposal of Units.

Corporate Unitholders of Schroder Absolute Return BondFund, Schroder Gilt and Fixed Interest Fund, Schroder HighYield Opportunities Fund and Schroder Strategic Bond Fundwill also be taxable by reference to the movement in thevalue of their holding over their accounting period.

Individual Unitholders will find further information in HMRC’sHelp Sheets, available atwww.hmrc.gov.uk/sa/forms/content.htm or from theOrderline 0845 9000 404 to help them complete their taxreturns.

This summary on tax issues relating to Funds is an overviewonly and investors should consult their own tax adviser for amore detailed analysis of tax issues arising for them frominvesting in a Fund.

http://www.hmrc.gov.uk/sa/forms/content.htm


Automatic Exchange of Information: US Foreign AccountTax Compliance Act 2010 (FATCA) and OECD CommonReporting Standard 2016 (CRS)

FATCA was enacted in the United States of America on 18March 2010 as part of the Hiring Incentives to RestoreEmployment Act. It includes provisions under which theManager as a Foreign Financial institution (FFI) may berequired to report directly to the Internal Revenue Service(IRS) certain information about Units in a Fund held by US taxpayers or other foreign entities subject to FATCA and tocollect additional identification information for this purpose.Financial institutions that do not enter into an agreementwith the IRS and comply with FATCA regime could be subjectto 30% withholding tax on any payment of US source incomeas well as on the gross proceeds deriving from the sale ofsecurities generating US income made to the Manager. On 30June 2014 the United Kingdom entered into a Model 1Intergovernmental agreement (IGA) with the United States ofAmerica.

CRS has been implemented by Council Directive 2014/107/EUon the mandatory automatic exchange of tax informationwhich was adopted on 9 December 2014. CRS wasimplemented among most member states of the EuropeanUnion on 1 January 2016. Under CRS, the Manager may berequired to report to HMRC certain information about Unitsheld in a Fund or Funds by Unitholders who are tax residentin a CRS participating country and to collect additionalidentification information for this purpose.

In order to comply with its FATCA and CRS obligations, theManager may be required to obtain certain information fromUnitholders so as to ascertain their tax status. Under theFATCA IGA referred to above, if the Unitholder is a specifiedUS person, a US owned non-US entity, non- participating FFIor does not provide the requisite documentation, theManager will need to report information on theseUnitholders to HMRC, in accordance with applicable laws andregulations, which will in turn report this to the IRS. UnderCRS, if the Unitholder is tax resident in a CRS participatingcountry and does not provide the requisite documentation,the Manager will need to report information on theseUnitholders to HMRC, in accordance with applicable laws andregulations. Provided that the Manager acts in accordancewith these provisions it will not be subject to withholding taxunder FATCA.

Unitholders and intermediaries should note that it is theexisting policy of the Manager that Units are not beingoffered or sold for the account of US Persons or Unitholderswho do not provide the appropriate CRS information.Subsequent transfers of Units to US Persons are prohibited. IfUnits are beneficially owned by any US Person or a personwho has not provided the appropriate CRS information, theManager may in its discretion compulsorily redeem suchUnits. Unitholders should moreover note that under theFATCA legislation, the definition of specified US persons willinclude a wider range of Unitholders than the current USPerson definition.

3.4. Meetings and Unitholder Rights

3.4.1. Meetings of Unitholders and Voting rightsA meeting of Unitholders duly convened and held may, byextraordinary resolution, require, authorise or approve anyact, matter or document in respect of which any suchresolution is required or expressly contemplated by theRegulations, but shall not have any other powers.

Unitholders will receive at least 14 days’ notice of anymeeting of Unitholders and are entitled to be counted in thequorum and vote at any such meeting either in person or byproxy.

A quorum at a meeting of Unitholders is two Unitholderspresent in person or by proxy, or in the case of a bodycorporate by a duly authorised representative of all the Unitsin issue. If a quorum is not present within a reasonable timefrom the start of the meeting, the meeting will be adjournedto a day and time which is at least seven days after the dayand time of the meeting at a place to be appointed by thechairman. If at such adjourned meeting a quorum is notpresent after a reasonable time from the time of themeeting, one person entitled to be counted in a quorumpresent at the meeting shall constitute a quorum. At anymeeting of Unitholders, on a show of hands every Unitholderwho (being an individual) is present in person or (being acorporation) is present by its representative properlyauthorised in that regard, shall have one vote unless a poll is(before or on the declaration of the result of the show ofhands) demanded by the chairman of the meeting or by notless than two Unitholders or by the Trustee. On a poll thevoting rights for each Unit in issue are the proportion of thevoting rights attached to all the Units in issue that the priceof the Unit bears to the aggregate price or prices of all theUnits in issue seven days before the notice of meeting wassent out. On a poll, votes may be given either personally orby proxy. A Unitholder entitled to more than one vote neednot, if he votes, use all his votes or cast all the votes he usesin the same way.

For joint Unitholders, only the vote of the first named in theregister of Unitholders can be taken. Except where anextraordinary resolution (requiring a majority of 75% of thetotal number of votes cast to be passed) is specificallyrequired or permitted, any resolution of Unitholders ispassed by a simple majority. In the case of an equality of, oran absence of, votes cast, the chairman is entitled to thecasting vote.

In the context of despatch of notice, “Unitholders” mean thepersons who were entered in the register of Unitholders as ata certain day chosen by the Manager before the notice ofmeeting was sent out but excluding persons who are knownnot to be entered on the register at the date of despatch ofthe notice.

In the context of voting, “Unitholders” mean the personswho were entered on the register of Unitholders at a timechosen by the Manager and stated in the relevant notice ofthe meeting.

The Manager is not entitled to vote at or be counted in aquorum at a meeting of Unitholders in respect of Units heldor deemed to be held by the Manager, except where theManager holds Units on behalf of, or jointly with, a personwho, if himself the sole registered Unitholder would beentitled to vote, and from whom the Manager has receivedvoting instructions. Associates of the Manager are entitled tobe counted in a quorum and, if they hold Units on behalf of aperson who would have been entitled to vote if he had beena registered Unitholder and they have received votinginstructions from that person, may vote in respect of suchUnits pursuant to such instructions.

3.4.2. Notices to UnitholdersAll notices or documents about the Funds will be sent to theaddress of the first named Unitholder only as appearing onthe register or by electronic means. A notice is duly served if


it is delivered to the address of the first named Unitholder asappearing in the register or is delivered by electronic meansin accordance with COLL.

Any notice or document served by post is deemed to havebeen served on the second Business Day following the day onwhich it is posted. Any document left at a registered addressor delivered other than by post is deemed to have beenserved on that day. All documents and remittances are sentat the risk of the Unitholder.

3.5. Winding Up a Fund

3.5.1. Circumstances where winding up may occurThe Trustee shall proceed to wind-up a Fund:-

(A) if the order declaring the Fund to be an authorised unittrust fund (Order of Authorisation) is revoked; or

(B) f the Manager or the Trustee requests the FCA to revokethe Order of Authorisation and it has agreed (providedno material change in any relevant factor occurs) that onthe winding-up of the Fund, it will accede to a request bythe Manager or Trustee that the Order of Authorisationbe revoked; or

(C) on the effective date of a duly approved scheme ofarrangement which is to result in a Fund being left withno property.

If any of the events set out above or any other events statedto trigger a winding up under COLL occurs, the Trustee shallcease the creation and cancellation of Units and the Managerwill cease issuing, redeeming, buying and selling Units.

For the hedged Unit class(es), if at any time the net assetvalue of a class falls below £1 million, the Manager may at itsdiscretion, in the interest of remaining Unitholders, close theUnit class without a Unitholder vote. In such instance theManager may, inter alia and in its sole discretion, reject anyapplication for the purchase, sale or switching of the affectedhedged Units, or compulsorily redeem or require the sale ortransfer of any such Units.

3.5.2. Manner of Winding UpIn the case of a scheme of arrangement referred to above,the Trustee shall wind-up the Fund in accordance with theapproved scheme of arrangement.

In any other case, the Trustee shall, as soon as practicableafter the Fund is to be wound-up, realise the property of theFund and, after paying all liabilities properly payable andretaining provision for the costs of the winding-up, distributethe proceeds to the Unitholders and the Managerproportionately to the size of their holdings.

Any unclaimed net proceeds or other cash held by theTrustee after one year from the date the proceeds becamepayable, shall be paid by the Trustee into court, although theTrustee will have the right to retain any expenses incurred inmaking that payment. On completion of the winding-up, theTrustee shall notify the FCA in writing of that fact and theTrustee or the Manager shall request that the FCA revoke theOrder of Authorisation.

3.6. Additional Information

3.6.1. Exercise of voting rightsThe Investment Advisers and the Manager have a strategy fordetermining how voting rights attached to ownership ofscheme property are to be exercised for the benefit of each

Fund. A summary of this strategy is available from theManager on request. Details of action taken in respect of theexercise of voting rights are available from the Managerupon request.

3.6.2. Best ExecutionThe Manager’s order execution policy sets out the basis uponwhich the Manager will effect transactions and place ordersin relation to the Funds whilst complying with its obligationsunder the FCA Handbook to obtain the best possible resultfor the Manager on behalf of each Fund. Details of the orderexecution policy are available from the Manager on request.

3.6.3. ComplaintsComplaints should be addressed to Head of InvestorServices, Schroders, PO Box 1402, Sunderland SR43 4AF. Youcan request a copy of the Manager’s written internalcomplaints procedures by writing to the above address orcontact Schroders Investor Services on 0800 182 2400. Youmay also have the right to refer the complaint directly to theFinancial Ombudsman Service, Exchange Tower, London, E149SR. Information about the Financial Ombudsman Servicecan be found at www.financial-ombudsman.org.uk. Astatement of your rights to compensation in the event ofSchroders being unable to meet its liabilities to you isavailable from the FCA and the Financial ServicesCompensation Scheme. Further details can be found at www.fscs.org.uk/

3.6.4. Money LaunderingThe Manager is responsible for complying with UK anti-money laundering regulations. In order to implement theseprocedures that the Manager has in place to facilitate itscompliance, in certain circumstances, Unitholders may beasked to provide some proof of identity when buying orselling Units. Until satisfactory evidence has been receivedthe Manager reserves the right to refuse to pay the proceedsof a redemption of Units or to pay income on Units to aUnitholder.

3.6.5. Non-UK UnitholdersThe Funds are not registered for public offer outside of theUK. The Manager reserves the right to reject any applicationsfor Units in any of the Funds from non-UK investors at its solediscretion. The Manager may accept applications for Units inany of the Funds from non-UK investors if the investment ispermitted under any applicable laws and the investorsatisfies the Manager’s on boarding requirements.

The distribution of this Prospectus and the offering orpurchase of Units in any of the Funds may be restricted incertain jurisdictions. No persons receiving a copy of thisProspectus in any such jurisdiction may treat this Prospectusas constituting an invitation to them to subscribe for Unitsunless, in the relevant jurisdiction, such an invitation couldlawfully be made to them. Accordingly this Prospectus doesnot constitute an offer or solicitation by anyone in anyjurisdiction in which such offer or solicitation is not lawful orin which the person making such offer or solicitation is notqualified to do so or to anyone to whom it is unlawful tomake such offer or solicitation. It is the responsibility of anypersons in possession of this Prospectus and any personswishing to apply for Units in any of the Funds to informthemselves of and to observe all applicable laws andregulations of any relevant jurisdiction. Prospectiveapplicants for Units in any of the Funds should informthemselves as to legal requirements of so applying and any


applicable exchange control regulations and taxes in thecountries of their respective citizenship, residence ordomicile.

The Units in the Funds which are described in this Prospectushave not been and will not be registered under the UnitedStates Securities Act of 1933 (the Securities Act), the UnitedStates Investment Company Act of 1940 as amended (theInvestment Company Act) or under the securities laws of anystate of the US and may be offered, sold or otherwisetransferred only in compliance with the Securities Act andsuch state or other securities laws. The Units in the Fundswhich are described in this Prospectus may not be offered orsold to or for the account of any US Person. If you are in anydoubt as to your status, you should consult your financial orother professional adviser.

3.6.6. Genuine Diversity of Ownership ConditionInterests in the Funds are widely available, and the Managerundertakes that they will be marketed and made availablesufficiently widely and in a manner appropriate to reach theintended categories of Investor who meet the broadrequirements for investment in any given unit class, and arenot intended to be limited to particular investors or narrowly-defined groups of investor. Please refer to Appendix III forthe details of the minimum levels of investment and/orinvestor categories that are specified as eligible to acquireparticular unit classes.

Provided that a person meets the broad requirements forinvestment in any given unit class, he/she may obtaininformation on and acquire the relevant units in the Fund,subject to the paragraphs immediately following.

3.6.7. Who can investAs authorised unit trusts, the Funds are available forinvestment by the public. Investment in the Funds may notbe suitable for all investors. Your investment should beconsidered in light of your own personal circumstances,including your specific investment needs and risk appetite. Ifyou are in any doubt about any of the Funds' suitability toyour investment needs, you should seek appropriateprofessional advice.

3.6.8. Compulsory Redemption and ConversionThe Manager may, if necessary, redeem Units to ensure thatUnits are neither acquired nor held by, or on behalf of, anyperson in breach of the law or requirements of any countryor government or regulatory authority or which might haveadverse taxation or other pecuniary consequences for theManager including a requirement to register under the lawsand regulations of any country or authority. The Managermay in this context require a Unitholder to provide suchinformation as they may consider necessary to establishwhether the Unitholder is the beneficial owner of the Unitswhich they hold.

If it shall come to the attention of the Manager at any timethat Units are beneficially owned by a US Person, theManager will have the right to compulsorily redeem suchUnits.

The Manager may also, at its discretion, convert holdings ofone class of Units to another where it believes this to be inthe best interests of investors. Such circumstances mayinclude where the conversion will offer investors the benefitsof economies of scale, or will otherwise result in lower fees. Amandatory conversion of Units shall only take place wherethe Manager has given appropriate prior notice to affectedinvestors in accordance with COLL.

Unitholders subject to UK tax should note that conversionsshould not generally be treated as a disposal for thepurposes of capital gains tax, other than for conversionsbetween hedged and unhedged Unit Classes, or vice versa.

The Manager will not apply any fees where it carries out acompulsory conversion of Units.

Unitholders subject to UK tax should note that conversionsare should not generally be treated as a disposal for thepurposes of capital gains tax, other than for conversionsbetween hedged and unhedged Unit Classes, or vice versa.

The Manager will not apply any fees where it carries out acompulsory conversion of Units.

3.6.9. Literature requestInvestors can obtain free of charge on request, copies of:

(A) this Prospectus and Key Investor Information Document(if applicable) for each Fund;

(B) the Trust Deed by which each Fund is constituted andgoverned, as amended or supplemented; and

(C) the latest annual report and accounts of each Fund andthe latest half yearly report.

These documents are available on request from the Managerat the address listed in the section entitled “Administration”.The Prospectus, Key Investor Information Documents and theFund report and accounts are also available online at www.schroders.co.uk.

3.6.10. Data Protection ActFor the purposes of the General Data Protection Regulation2016/679 (GDPR), or the statutory equivalent thereof whichforms part of English law by virtue of the EUWA, (asapplicable) the data controllers in relation to any personaldata you supply are the Funds and the Manager.

In order to comply with our obligations and responsibilitiesunder applicable data protection law, we are required by lawto make available to you a privacy policy which details howwe collect, use, disclose, transfer, and store your information.Please find a copy of our privacy policy atwww.schroders.com/en/privacy-policy. By signing theapplication form, you acknowledge that you have read andunderstood the contents of our privacy policy.

3.6.11. Acceptable Minor Non-Monetary BenefitsSchroders may pay to or accept from third parties minor non-monetary benefits as permitted by the FCA’s Conduct ofBusiness Sourcebook provided that they are capable ofenhancing services provided to clients; and do not impairSchroders’ duty to act honestly, fairly and in the bestinterests of clients. Such minor non-monetary benefits mayinclude:

– information or documentation relating to financialinstruments or investment services;

– written material from third parties;

– participation in conferences, seminars and other trainingevents;

– reasonable de minimis hospitality; and

– research.

http://www.schroders.com/en/privacy-policy


3.6.12. Benchmark RegulationUnless otherwise disclosed in this Prospectus, the indices orbenchmarks used within the meaning of the Regulation (EU)2016/1011, or the statutory equivalent thereof which formspart of English law by virtue of the EUWA, (as applicable) (the“Benchmark Regulations”) by the Funds are, as at the date ofthis Prospectus, provided by benchmark administrators whoappear on the register of administrators and benchmarksmaintained by the relevant supervisory authority. TheManager maintains written plans setting out the actions thatwill be taken in the event of the benchmark materiallychanging or ceasing to be provided. Copies of a descriptionof these plans are available upon request and free of chargefrom the registered office of the Manager.


Appendix IInvestment RestrictionsThe investment objective and policy of each of the Funds, setout in Appendix III, are subject to the limits on investmentunder Chapter 5 of COLL, which are summarised below.

1. Transferable Securities/ Money MarketInstruments

Each Fund may invest without limitation, except whereotherwise specifically stated in:

(A) transferable securities (as defined for the purposes ofCOLL) admitted to or dealt in on an eligible market, and

(B) approved money market instruments (as defined for thepurpose of COLL) admitted or dealt in on an eligiblemarket and issued or guaranteed by:

(1) a central, regional or local authority or central bankof an EEA State, the European Central Bank, theEuropean Union or the European Investment Bank, anon-EEA State or, in the case of a federal state, byone of the members making up the federation, or bya public international body to which one or more EEAStates belong or

(2) an establishment subject to prudential supervision inaccordance with criteria defined by European Unionlaw or an establishment which is subject to andcomplies with prudential rules considered by the FCAto be at least as stringent as those laid down byEuropean Union law

Each Fund may invest up to 10% of its net asset value inaggregate in transferable securities and/or approved moneymarket instruments that do not fulfil the criteria above.

Eligible markets for the Funds are explained and set out inAppendix IV.

2. WarrantsExcept for the following, no more than 5% of each Fund maybe invested where the transferable security or money marketinstrument is a warrant:

– Schroder Absolute Return Bond Fund

– Schroder Asian Alpha Plus Fund

– Schroder Asian Income Maximiser

– Schroder Global Cities Real Estate

– Schroder Global Cities Real Estate Income

– Schroder Income Maximiser

– Schroder Managed Balanced Fund

– Schroder Managed Wealth Portfolio

– Schroder Recovery Fund

– Schroder Small Cap Discovery Fund

– Schroder Strategic Bond Fund

– Schroder US Equity Income Maximiser

Each of the above Funds is permitted to invest over 5% ofits scheme property in warrants. As with derivative use,the outcome of the use of warrants, in terms of the riskprofile of the Funds, depends on our underlyinginvestment rationale for the Fund in question. While wedo not expect to invest high percentages of schemeproperty to be held in warrants, if we do use them in sucha way, this may lead to a higher volatility in the Unit priceof that Fund.

On investment, the exposure created by the exercise of thewarrant must not exceed the spread limits of a UCITSscheme.

3. Nil/Partly paidA transferable security or a money market instrument onwhich any sum is unpaid may be invested in only if it isreasonably foreseeable that the amount of any existing andpotential call for any sum unpaid could be paid by the Fund,at the time when payment is required, without contraveningthe other rules in this appendix.

4. Collective Investment SchemesEach Fund may invest in units of any other collectiveinvestment schemes which are:

(A) UCITS Schemes;

(B) schemes recognised under Section 270 of the FinancialServices and Markets Act 2000;

(C) non-UCITS retail schemes as defined in COLL;

(D) schemes authorised in an EEA State provided therestrictions in Articles 50(1)(e) of the UCITS Directive aremet (or if applicable, in the UK provided that thestatutory equivalent to Article 50(1)(e) of the UCITSDirective which forms part of English law by virtue of theEUWA, is met); or

(E) schemes authorised by the competent authority of anOECD member country (other than another EEA State)which has:

(1) signed the IOSCO Multilateral Memorandum ofUnderstanding; and

(2) approved the scheme’s management company, rulesand depositary/custody arrangements; provided therequirements of article 50(1)(e) of the UCITSDirective or the statutory equivalent thereof whichforms part of English law by virtue of the EUWA (asapplicable) are met);

provided that no more than 30% of the value of the Fund maybe invested in other collective investment schemes which arenot UCITS Schemes but satisfy b) to e) above and that theschemes invested in cannot themselves invest more than 10%in other collective investment schemes.

The Funds may invest in units of a fund operated by theManager or an associate of the Manager. No charge will bemade for the issue or redemption of those units.

No Fund may invest more than 10% of net asset value in unitsof collective investment schemes except for:




where up to 100% of net asset value may be invested. Themaximum level of management fee that may be charged tothe Fund for these underlying funds is 3% of its Net AssetValue. The maximum level of management fee that the Fundmay charge is the same as the current management chargeset out in Appendix III.

5. DepositsIn the case of:




– Schroder Gilt and Fixed Interest Fund







each Fund may invest in deposits without limitation, only withan approved bank and which are repayable on demand orhas the right to withdraw and maturing in no more than 12months.

Cash and near cash may only be held to assist in theredemption of Units, the efficient management of the Fundor purposes regarded as ancillary to the Fund.

6. Derivatives and ForwardsThe Manager has the power to buy and sell derivatives(including, but not limited to, futures, swaps, options andcontracts for difference) and forwards both on exchange andoff exchange, in all Funds as set out in the section“Derivatives and Forward Use” below, provided they arepermitted. A derivative is permitted where the underlyingasset is a transferable security, money market instrument,deposit, derivative or collective investment scheme (all only inso far as COLL permits the Funds to invest in these assetclasses directly). A derivative is also permitted where theunderlying assets are financial indices, interest rates, foreignexchange rates or currencies. Any transaction entered intoon-exchange must be effected on or under the rules of aneligible derivatives market. Off-exchange derivatives andforwards must only be entered into with approvedcounterparties, on approved terms, and must be capable ofreliable valuation and subject to verifiable valuation (all asdefined in and on the terms detailed in COLL).

The Manager will ensure that any transaction in derivativesand forwards is covered in accordance with COLL. Thisincludes ensuring at all times that each Fund has enoughassets to adequately cover the derivative positions. Inassessing the adequacy of the cover for derivative positionsthe Manager will take into account the value of theunderlying assets, counterparty risk, the time taken toliquidate any derivative position and reasonably foreseeablemarket movement.

When using derivatives, the Manager uses a riskmanagement process that enables it to monitor the risk of aFund’s derivative positions. The global risk exposure of aFund is calculated daily either by means of the commitmentapproach or the Value-at-Risk (VaR) approach. Unlessspecified otherwise in Appendix III, the global exposurerelating to financial derivative instruments will be calculatedusing a commitment approach. A statement will be made inAppendix III to indicate which Funds apply a VaR approach tocalculate their global exposure.

Commitment approach

The commitment approach is simply defined as the marketvalue exposure of derivatives, after netting and hedging, notexceeding the Net Asset Value of a Fund. This is typically usedon funds where derivative usage is low or funds which limittheir derivatives commitment to 100% or less of their NetAsset Value.

The global exposure relating to financial derivativeinstruments is calculated taking into account the currentvalue of the underlying assets, the counterparty risk,foreseeable market movements and the time available toliquidate the positions.

VaR approach

VaR is a means of measuring the potential loss to a Fund dueto market risk. Historical data is used in the calculation ofVaR. The period used for this purpose is the observationperiod.

VaR reports will be produced and monitored on a daily basisbased on the following criteria:

– 1 month holding period;

– 99% unilateral confidence interval;

– at least a one year effective historical observation period(250 days) unless market conditions require a shorterobservation period; and

– parameters used in the model are updated at leastquarterly.

Stress testing will also be applied at a minimum of once permonth.

VaR limits are set using an absolute or relative approach.

(A) Absolute VaR approach

The absolute VaR approach is generally appropriate inthe absence of an identifiable reference portfolio orbenchmark, for example with absolute return funds.Under the absolute VaR approach a limit is set as apercentage of the Net Asset Value of the Fund. Theabsolute VaR limit of a Fund has to be set at or below20% of its Net Asset Value. This limit is based upon a 1month holding period and a 99% unilateral confidenceinterval.

(B) Relative VaR approach

The relative VaR approach is used for Funds where a VaRbenchmark reflecting the investment strategy which theFund is pursuing is defined. Under the relative VaRapproach a limit is set as a multiple of the VaR of abenchmark or reference portfolio. The relative VaR limitof a fund has to be set at or below twice the VaR of theFund’s VaR benchmark. Information on the specific VaRbenchmark used is disclosed in Appendix III.


Upon request, the Manager will provide further details of thequantitative limits and methods used in applying the riskmanagement of each Fund as well as any recentdevelopments in the risk and yields of the main categories ofinvestment of each Fund.

Expected level of leverage

Funds quantifying global exposure using a VaR approachdisclose their expected level of leverage.

The expected level of leverage is an indicator and not aregulatory limit. The Fund's levels of leverage may be higherthan this expected level as long as the Fund remains in linewith its risk profile and complies with its VaR limit.

The annual report will provide the actual level of leverageover the past period and additional explanations on thisfigure.

The level of leverage is a measure of (i) the derivative usageand (ii) the reinvestment of collateral in relation to efficientportfolio management transactions. It does not take intoaccount other physical assets directly held in the portfolio ofthe relevant Funds. It also does not represent the level ofpotential capital losses that a Fund may incur. The level ofleverage is calculated as (i) the sum of notionals of allfinancial derivative contracts entered into by the Fundexpressed as a percentage of the Fund's Net Asset Value and(ii) any additional leverage generated by the reinvestment ofcollateral in relation to efficient portfolio managementtransactions.

This methodology does not:

– make a distinction between financial derivativeinstruments that are used for investment or hedgingpurposes. As a result strategies that aim to reduce risk willcontribute to an increased level of leverage for the Fund.

– allow the netting of derivative positions. As a result,derivative roll-overs and strategies relying on acombination of long and short positions may contribute toa large increase of the level of leverage when they do notincrease or only cause a moderate increase of the overallFund risk.

– take into account the derivative underlying assets'volatility or make a distinction between short-dated &long-dated assets. As a result, a Fund that exhibits a highlevel of leverage is not necessarily riskier than a Fund thatexhibits a low level of leverage.

Derivatives and Forward UseEfficient Management

Derivatives and forwards may be used for the efficientmanagement of all Funds. The aim of any derivative orforward used for such reasons is not to materially alterthe risk profile of the Fund, but rather to assist theManager in meeting the investment objectives of eachFund as set out in Appendix III by:

– reducing risk; and/or

– reducing cost; and/or

– generating additional income or capital for eachFund.

Where transactions in derivatives or forward transactions areused for the account of the authorised fund in accordancewith any of the provisions of this section, nothing in thissection prevents the Trustee at the request of the Manager,from

(A) lending, depositing, pledging or charging schemeproperty for margin requirements

(B) transferring scheme property under the terms of anagreement in relation to margin requirements, providedthat the authorised fund manager reasonably considersthat both the agreement and the margin arrangementsmade under it (including in relation to the level ofmargin) provide appropriate protection to Unitholders.

The aim of reducing risks or costs will allow the Manager toenter into exposures on permissible assets or currenciesusing derivatives or forwards as an alternative to selling orpurchasing underlying assets or currencies. These exposuresmay continue for as long as the Manager considers that theuse of derivatives continues to meet the original aim.

The aim of generating additional income allows the Managerto write options on existing assets where it considers thetransaction will result in the Fund deriving a benefit, even ifthe benefit obtained results in the surrendering the chance ofgreater benefit in the future.

The aim of generating additional capital allows the Managerto take advantage of any pricing imperfections in relation tothe acquisition and disposal (or disposal and acquisition) ofrights relating to assets the same as, or equivalent to whichthe Fund holds or may hold.

The following types of risks are relevant in relation to theefficient management of the Funds:

– Market risk – which is the risk of losses due to adversemarket movements in the price of the assets held by theFund or rates or changes in the anticipated or calculatedvolatility of these movements (volatility risk).

– Interest rate risk – which is the risk that changes to aninterest rate will have an adverse impact on the marketvalue of a portfolio, and is the main risk impacting theprice of investment grade bonds.

– Credit risk – is the risk that an issuer will default. on thepayment of coupons and/or redemptions.

– Foreign exchange (FX) risk – which is the risk that anasset held in the Fund in a currency other than the BaseCurrency of the Fund may be affected by changes in theexchange rate between the two currencies.

The following techniques are included in the efficientmanagement of the Funds:

– Hedging – where the Manager may manage market andFX risk related to assets held in a Fund by usingderivatives to reduce any perceived loss. In relation to FXhedging this includes the use of cross currency hedgingtechniques.

– Cash flow management – where the Manager maymanage market risk following cash flows into the Fundby using derivatives to gain an exposure to an individualasset or obtain the desired exposure to an index.Thereafter the Manager may retain the position whilst itremains appropriate to manage subsequent inflows andoutflows of cash efficiently.


– Asset allocation – where the Manager may managemarket risk by using derivatives to achieve a desiredexposure to an index, basket of shares or bonds, orbetween different markets. The derivatives positions willbe closed out where the Manager has achieved thedesired exposure by the buying or selling of theunderlying stock, but there is no fixed time limit withinwhich this closing out will take place.

– Fixed income management – where the Manager will usederivatives to manage credit risk and interest rate risk inrelation to bond Funds. This technique includes themanagement of a Fund’s duration (duration being theterm used to measure the sensitivity of a bond’s price tointerest rate changes which is dependent on the bond’smaturity profile and coupon pay-out schedule).

– Buying and selling protection – where the Manager may:

Sell protection (i.e. gain long credit exposure) in CreditDefault Swaps where the objectives of the Fund can beachieved at lower risk and/or cost than transacting theunderlying,

Buy protection (i.e. gain short credit exposure) in indexCredit Default Swaps for hedging purposes,

Buy protection (i.e. gain short credit exposure) in singlename Credit Default Swaps to hedge an existing longcredit position or to create an outright short creditposition that is covered by liquid assets within the Fund.

– Overwriting/Yield enhancement - where the Manager willlook to generate additional income in a Fund by writingoptions on assets held, provided this is consistent with aFund’s investment objective. Such techniques are inaddition to, and separate from any income derived fromstock lending activities permitted by the section entitled“Stock Lending and Repurchase transactions” below.

Using Derivatives for specific investment purposes

In the case of:




– Schroder Gilt & Fixed Interest Fund





– Schroder High Yield Opportunities Fund

– Schroder Recovery Fund

– Schroder Small Cap Discovery Fund



derivatives may be used for specific investment purposesin accordance with the rules summarised in the section“Derivatives and Forwards” above in addition to beingused for efficient management.

In the case of:



it is not the current intention to use derivatives forspecific investment purposes in addition to being used forefficient management. Should there be a change in thisintention registered Unitholders will be given appropriatenotice.

The aim of any derivative or forward used for specificinvestment purposes is not to materially alter the riskprofile of the Fund, rather their use is to assist theManager in meeting the investment objectives of eachFund as set out in Appendix III.

Total Return Swaps

Where specified in the investment policy, a Fund may enterinto Total Return Swaps (TRS) with an approved bank (asdefined in COLL) and credit losses. TRS entered into by aFund may be in the form of funded and/or unfunded swaps.An unfunded swap means a swap where no upfront paymentis made by the total return receiver at inception. A fundedswap means a swap where the total return receiver pays anupfront amount in return for the total return of the referenceasset and can therefore be costlier due to the upfrontpayment requirement.

All revenue arising from TRS, net of direct and indirectoperational costs and fees, will be returned to each Fund. Theinvestment policy of the Fund will specify the underlyingstrategy and the composition of the investment portfolio orindex. Where the Fund uses TRS, the underlying consists ofinstruments in which the Fund may invest according to itsInvestment Objective and Policy.

A TRS is a type of financial derivative instrument between twoparties in which each party agrees to make a series ofpayments to the other at regular scheduled dates, with atleast one set of payments determined by the return on anagreed underlying reference asset and which include, inaddition, any income generated on the reference asset (suchas dividends and/or bonus shares). Long and short positionsgained through index, commodity, bond and equity TRS mayincrease exposure to credit-related risks. There are certainrisks involved in using total return swaps. Please see inparticular the following risk factors in Appendix II:‘Counterparty Risk’ and ‘Particular Risks of over-the-counter“OTC” Derivative Transactions’.

Valuation of OTC derivatives

For the purposes of this section the Manager must: establish,implement and maintain arrangements and procedureswhich ensure appropriate, transparent and fair valuation ofthe exposures of a Fund to OTC derivatives; and ensure thatthe fair value of OTC derivatives is subject to adequate,accurate and independent assessment. Where thearrangements and procedures referred to in this sectioninvolve the performance of certain activities by third parties,the Manager must comply with the requirements in the FCAHandbook SYSC 8.1.13 R (additional requirements for amanagement company) and COLL 6.6A.4 R (4) to (6) (duediligence requirements of AFMs of UCITS schemes). Thearrangements and procedures referred to this section mustbe: adequate and proportionate to the nature and complexityof the OTC derivative concerned and adequatelydocumented.


7. Spread limits(A) For the purposes of this section, companies included in

the same group for the purposes of consolidatedaccounts as defined in accordance with the SeventhCouncil Directive 82/349/EEC of 13 June 1983 based onArticle 54(3)(g) of the Treaty on consolidated accounts (orthe statutory equivalent thereof which forms part ofEnglish law by virtue of the EUWA, as applicable) or, inthe same group in accordance with internationalaccounting standards, are regarded as a single body.

(B) Not more than 20% in value of the property of each Fundis to consist of deposits with a single body.

(C) Not more than 5% in value of the property of each Fundis to consist of transferable securities (as defined inCOLL) or money-market instruments issued by any singlebody.

(D) The limit of 5% in c) is raised to 10% in respect of up to40% in value of the property of each Fund. Coveredbonds need not be taken into account for the purpose ofapplying the limit of 40%. The limit of 5% in (c) is raisedto 25% in value of the property of each Fund in respect ofcovered bonds, provided that when a Fund invests morethan 5% in covered bonds issued by a single body, thetotal value of covered bonds held must not exceed 80%in value of the property of the relevant Fund.

(E) In applying c) and d), certificates representing certainsecurities (as defined in COLL) are to be treated asequivalent to the underlying security.

(F) The combined exposure to any one counterparty in OTCderivative transactions, repurchase transactions andstock lending transactions, must not exceed 5% in valueof the property of each Fund; this limit being raised to10% where the counterparty is an approved bank (asdefined in COLL). Calculation of the exposure to acounterparty will be carried out in accordance with COLL.

(G) Not more than 20% in value of the property of each Fundis to consist of transferable securities and money-marketinstruments issued by the same group (as referred to ina) above).

(H) For Schroder Managed Wealth Portfolio and SchroderManaged Balanced Fund not more than 20% in value ofthe Fund is to consist of the Units of any one collectiveinvestment scheme (as defined in COLL).

(I) In applying the limits in b), c), d), e) and f), not more than20% in value of the property of the Fund is to consist ofany combination of two or more of the following:

(1) transferable securities (including covered bonds) ormoney-market instruments issued by; or

(2) deposits made with; or

(3) exposures from OTC derivatives transactions,repurchase transactions and stock lendingtransactions made with a single body.

(J) In applying the limits in f) and i) above, the exposure inrespect of OTC derivative transactions, repurchasetransactions and stock lending transactions, may bereduced to the extent that collateral is held in respect ofit if the collateral meets the relevant conditions set out inCOLL.

These limits do not apply to government and publicsecurities, as to which see below.

8. Government and Public SecuritiesIn respect of the Schroder Absolute Return Bond Fund,Schroder Gilt and Fixed Interest Fund, Schroder High YieldOpportunities Fund and Schroder Strategic Bond Fund, eachFund may invest without limitation in transferable securitiesthat are defined by the FCA as government and publicsecurities (GAPS). At any time, where no more than 35% ofsuch Funds value is invested in GAPS issued by any oneissuer, there is no limit to the amount which may be investedin GAPS of any one issue or issuer.

When any of the aforementioned Funds invests more than35% of its value the Manager must, before any suchinvestment is made consult with the Trustee, and as a result:

– have considered if the issuer of the GAPS is one which isappropriate in accordance with the investment objectivesof each Fund;

– ensure that no more than 30% in value of each Fundconsists of GAPS of any one issue; and

– ensure that each Fund includes GAPS issued by that oranother issuer of at least six different issues.

More than 35% of the property of each Fund may be investedin GAPS issued by or on behalf of or guaranteed by theGovernment of the UK (including the Scottish Administration,the Executive Committee of the Northern Ireland Assembly,the National Assembly of Wales) Australia, Austria, Belgium,Canada, Denmark, Finland, France, Germany, Greece, Iceland,Ireland, Italy, Japan, Liechtenstein, Luxembourg, Netherlands,New Zealand, Norway, Portugal, Spain, Sweden, Switzerlandand United States (including Government National MortgageAssociation (GNMA), Student Loan Marketing Association(SLMA), Tennessee Valley Authority (TVA), Federal Home LoanBank (FHLB), Federal Farm Credit Bank (FFCB), FinancingCorporation (FICO), Private Export Funding Corporation(PEFCO), Resolution Funding Corporation (RFCO) or by one ofthe following international organisations: AfricanDevelopment Bank, Asian Development Bank (ADB), Councilof Europe Development Bank, Deutsche Ausgleichsbank(DTA), Eurofima, European Bank for Reconstruction andDevelopment (EBRD), European Investment Bank (EIB), Inter-American Development Bank (IADB), International Bank forReconstruction and Development (IBRD), InternationalFinance Corporation (IFC), Kreditanstalt für Wiederaufbau(KFW), LCR Finance plc and the Nordic Investment Bank(NIB).

In relation to such securities: issue, issued and issuer includeguarantee, guaranteed and guarantor; and an issue differsfrom another if there is a difference as to repayment date,rate of interest, guarantor or other material terms of theissue.

In applying the 20% limit with respect to a single body (asspecified in the section ”Spread Limits”), HTUgovernmentand public securitiesUTH issued by that body shall be takeninto account.

9. Significant InfluenceThe Manager must not acquire, or cause to be acquired foreach Fund, transferable securities issued by a body corporateand carrying rights to vote (whether or not on substantiallyall matters) at a general meeting of that body corporate ifimmediately before the acquisition, the aggregate of anysuch securities held for each Fund, taken together with any


such securities already held for other authorised unit trustsof which it is also the Manager, gives the Manager powersignificantly to influence the conduct of business of that bodycorporate; or the acquisition gives the Manager that power.

The Manager is to be taken to have power significantly toinfluence the conduct of business of a body corporate if itcan, because of the transferable securities held for all theauthorised unit trusts of which it is the Manager, exercise orcontrol the exercise of 20% or more of the voting rights inthat body corporate (disregarding for this purpose anytemporary suspension of voting rights in respect of thetransferable securities of that body corporate).

10. ConcentrationEach Fund:

(A) must not acquire transferable securities (other than debtsecurities) which do not carry a right to vote on anymatter at a general meeting of the body corporate thatissued them; and represent more than 10% of thosesecurities issued by that body corporate;

(B) must not acquire more than 10% of the debt securitiesissued by any single body;

(C) must not acquire more than 25% of the Units of a singlecollective investment Fund;

(D) must not acquire more than 10% of the money marketinstruments issued by any single body;

(E) need not comply with the limits in (b), (c) and (d) aboveif, at the time of acquisition, the net amount in issue ofthe relevant investment cannot be calculated.

11. BorrowingThe Trustee may, on the instructions of the Manager andsubject to COLL, borrow money from an eligible institution oran approved bank for the use of each Fund on terms that theborrowing is to be repayable out of the property of the Fund.

Borrowing must be on a temporary basis must not bepersistent and in any event must not exceed three monthswithout the prior consent of the Trustee which may be givenonly on such conditions as appear appropriate to the Trusteeto ensure that the borrowing does not cease to be on atemporary basis. The Manager must ensure that borrowingdoes not, on any Business Day, exceed 10% of the value ofthe property of each Fund.

These borrowing restrictions do not apply to “back to back”borrowing for currency hedging purposes, i.e. borrowingpermitted in order to reduce or eliminate risk arising byreason of fluctuations in exchange rates.

12. Stock lending and repurchase transactionsEach Fund may enter into repurchase transactions and stocklending transactions. Should any Fund use such techniquesand instruments defined under items "Securities and CashLending" and "Repurchase Agreements" in the future, theManager will comply with the applicable regulations and inparticular Regulation (EU) 2015/2365 of 25 November 2015 ontransparency of securities financing transactions and of reuse(or the statutory equivalent thereof which forms part ofEnglish law by virtue of the EUWA (as applicable) (the “SFTRegulation”) and all the information required by the SFTRegulation will be available upon request at the registeredoffice of the Manager. The Prospectus will be updated priorto the use of any such techniques and instruments.

Repurchase agreements consist of transactions governed byan agreement whereby a party sells securities or instrumentsto a counterparty, subject to a commitment to repurchasethem, or substituted securities or instruments of the samedescription, from the counterparty at a specified price on afuture date specified, or to be specified, by the transferor.Such transactions are commonly referred to as repurchaseagreements for the party selling the securities orinstruments, and reverse repurchase agreements for thecounterparty buying them.

Securities lending transactions consist in transactionswhereby a lender transfers securities or instruments to aborrower, subject to a commitment that the borrower willreturn equivalent securities or instruments on a future dateor when requested to do so by the lender.

There are certain risks involved in entering into repurchasetransactions and stock lending transactions. Please see inparticular the following risk factors in Appendix II:‘Counterparty Risk’, ‘Particular Risks of over-the-counter“OTC” Derivative Transactions’ and ‘Specific Risks linked toStock Lending and Repurchase Transactions’. These risks mayexpose Unitholders to an increased risk of loss. Please alsonote that certain potential conflicts of interests may arise inrelation to efficient portfolio management techniques. Forfurther details please see the risk factor ‘Potential Conflicts ofInterest’ in Appendix II.

All the revenues arising from repurchase transactions andstock lending transactions shall be returned to the relevantFund following the deduction of any direct and indirectoperational costs and fees arising. Such direct and indirectoperational costs and fees, which shall not include hiddenrevenue, shall include fees and expenses payable tocounterparties and/or stock lending agents and will be atnormal commercial rates (including any applicable VAT).

To the extent permitted by and within the limits prescribedby COLL relating to the use of financial techniques andinstruments (as may be amended, supplemented or replacedfrom time to time) and the ESMA Guidelines on ETFs andother UCITS issues (to the extent applicable), each Fund mayenter as buyer or seller into repurchase transactions andengage in securities lending transactions for the purpose ofgenerating additional capital or income or for reducing itscosts or risks.

In respect of repurchase transactions, the Fund will, on adaily basis, receive from or post to, its counterparty collateralof a type and market value sufficient to satisfy therequirements of the Regulations.

In respect of securities loans, the Fund will ensure that on adaily basis it receives or posts to its counterparty collateral ofat least the market value of the securities lent. Such collateralmust be in the form of cash or securities that satisfy therequirements of the Regulations.

A Fund must have the right at any time to require the returnof any security it has lent out or to terminate any securitieslending agreement it has entered into.

A Fund that enters into a repurchase transaction as buyershall ensure that it is able to recall the full amount of cash orto terminate the reverse repurchase transaction at any time.

A Fund that enters into a repurchase transaction as sellershall ensure that it is able to recall any securities sold underthe transaction or to terminate the transaction at any time.


Fixed-term repurchase transactions that do not exceed sevendays shall be considered as arrangements on terms thatallow the assets to be recalled at any time by the Fund.

Each Fund shall ensure that the level of its exposure torepurchase transactions are such that it is able to comply atall times with its redemption obligations.

13. General power to accept or underwriteplacings

Any power in Chapter 5 of COLL to invest in transferablesecurities may be used by the Manager for the purpose ofentering into any agreement or understanding which is anunderwriting or sub-underwriting agreement, or whichcontemplates that securities will or may be issued, subscribedfor or acquired for the account of a Fund.

The Manager may only engage in such an agreement orunderstanding in relation to securities which the relevantFund could otherwise invest in directly in accordance with theinvestment objective and policies of the Fund and subject tothe limits on investment set out in Appendix I.

This ability does not apply to an option, or a purchase of atransferable security which confers a right to subscribe for oracquire a transferable security, or to convert one transferablesecurity into another.

The exposure of a Fund to agreements and understandingsas set out above, on any Business Day be covered and besuch that, if all possible obligations arising under them hadimmediately to be met in full, there would be no breach ofany of the investment limits in Chapter 5 of COLL or asotherwise set out in this section.

14. Manager’s policy on collateral andmanagement of collateral

Where a Fund enters into OTC financial derivativetransactions, stock lending or repurchase transactions(whether as buyer or seller), all collateral used to reducecounterparty risk exposure should comply with the followingcriteria:

(A) Liquidity: Any collateral received other than cash shall beliquid and traded on a regulated market or multilateraltrading facility with transparent pricing in order that itcan be sold quickly at a price that is close to pre-salevaluation. Collateral received shall also comply with theprovisions in section “Concentration” above.

(B) Valuation: Collateral received shall be valued inaccordance with the rules described under the section"Calculation of Net Asset Value" on at least a daily basis.Assets that exhibit high price volatility shall not beaccepted as collateral unless suitably conservativehaircuts are in place.

(C) Issuer credit quality: The collateral received shall be of ahigh credit quality.

(D) Correlation: Collateral should be issued by an entity thatis independent from the counterparty and is expectednot to display a high correlation with the performance ofthe counterparty.

(E) Diversification: Collateral should be sufficientlydiversified in terms of country, markets and issuers.

(F) Immediately available: Collateral received must becapable of being fully enforced by the Fund at any timewithout reference to or approval from the counterparty.

Collateral will be valued, on a daily basis, using availablemarket prices and taking into account appropriate haircutswhich will be determined for each asset class based on thehaircut policy adopted by the Manager.

In accordance with the collateral policy of the Funds, andsubject to the above criteria, collateral received by the Fundsmust be in the form of one of or more of the following:

(A) Cash;

(B) a certificate of deposit;

(C) a letter of credit;

(D) a readily realisable security;

(E) commercial paper with no embedded derivative content;or

(F) a money-market fund as defined in Regulation (EU) 2017/1131 of the European Parliament and of the Council of 14June 2017 on money market funds, once applicable (orthe statutory equivalent thereof which forms part ofEnglish law by virtue of the EUWA, as applicable).

Without limiting the above, it is anticipated that collateralreceived by the Funds shall predominantly be in cash andgovernment bonds.

Where there is a title transfer, the collateral received shall beheld by the Trustee, or its agent. For other types of collateralarrangement (i.e. where there is no title transfer), thecollateral can be held by a third party custodian which issubject to prudential supervision, and which is unrelated tothe provider of the collateral.

Non-cash collateral received cannot be sold, re-invested orpledged.

Cash collateral shall only be:

– placed on deposit with entities as prescribed in section“Deposits” above;

– invested in high-quality government bonds;

– used for the purpose of reverse repurchase transactionsprovided the transactions are with credit institutionssubject to prudential supervision and the Fund is able torecall at any time the full amount of cash on accruedbasis;

– a money-market fund as defined in Regulation (EU) 2017/1131 of the European Parliament and of the Council of 14June 2017 on money market funds, once applicable (orthe statutory equivalent thereof which forms part ofEnglish law by virtue of the EUWA, as applicable).

Re-invested cash collateral shall be diversified in accordancewith the diversification requirements applicable to non-cashcollateral.

While re-invested cash is required to be diversified and mayonly be re-invested in the manner set out above, thereremains a risk that the value of the asset invested in usingcash collateral received by a Fund falls below the amountrequired to be returned to the cash collateral provider. Anyshortfall will be borne by the Fund causing loss to the Fundand consequently Unitholders.


15. Haircut policyThe Manager, on behalf of each Fund, has established ahaircut policy in respect of each class of assets received ascollateral. A haircut is a discount applied to the market valueof a collateral asset to account for the fact that its valuation,or liquidity profile, may deteriorate over time. The haircuttherefore provides a ‘risk cushion’. The haircut policy takesaccount of the characteristics of the relevant asset class,including the credit standing of the issuer of the collateral,the price volatility of the collateral and the results of anystress tests which may be performed in accordance with thecollateral management policy. Subject to the framework ofagreements in place with the relevant counterparty, whichmay or may not include minimum transfer amounts, it is theintention of the Manager in respect of the Funds that anycollateral received shall have a value, adjusted in light of thehaircut policy, which equals or exceeds the relevantcounterparty exposure where appropriate.

Eligible Collateral Remaining Maturity Haircut

Cash N/A 0%

Government Bonds One year or under 2%

More than one yearup to and includingfive years

3%

More than five yearsup to and includingten years

5%

More than ten yearsup to and includingthirty years

7%

More than thirtyyears up to andincluding forty years

10%

More than fortyyears up to andincluding fifty years

13%

16. Risk ManagementThe Manager uses a risk management process, enabling it tomonitor and measure as frequently as appropriate the risk ofeach Fund’s position and their contribution to the overall riskprofile of the Fund.

Reporting

The following details of the risk management process mustbe regularly notified by the Manager to the FCA and at leaston an annual basis:

(A) a true and fair view of the types of derivatives andforward transactions to be used within a Fund togetherwith their underlying risks and any relevant quantitativelimits; and

(B) the methods for estimating risks involved in derivativeand forward transactions.


Appendix IIRisks of Investment1. General RisksPast performance is not a guide to future performance andUnits should be regarded as a medium to long-terminvestment. The value of investments and the incomegenerated by them may go down as well as up andUnitholders may not get back the amount originally invested.Where the currency of a Fund varies from the Unitholder’shome currency, or where the currency of a Fund varies fromthe currencies of the markets in which the Fund invests, thereis the prospect of additional loss (or the prospect ofadditional gain) to Unitholders greater than the usual risks ofinvestment.

2. Investment Objective RiskInvestment objectives express an intended result but there isno guarantee that such a result will be achieved. Dependingon market conditions and the macro economic environment,investment objectives may become more difficult or evenimpossible to achieve. There is no express or impliedassurance as to the likelihood of achieving the investmentobjective for a Fund.

3. Risk of Suspension of Unit dealingsInvestors are reminded that in certain circumstances theirright to redeem or transfer Units may be suspended (seesection entitled “Suspension”).

4. Interest Rate RiskThe values of bonds and other debt instruments usually riseand fall in response to changes in interest rates. Declininginterest rates generally increase the values of existing debtinstruments, and rising interest rates generally reduce thevalue of existing debt instruments. Interest rate risk isgenerally greater for investments with long durations ormaturities. Some investments give the issuer the option tocall or redeem an investment before its maturity date. If anissuer calls or redeems an investment during a time ofdeclining interest rates, a Fund might have to reinvest theproceeds in an investment offering a lower yield, andtherefore might not benefit from any increase in value as aresult of declining interest rates.

5. Credit RiskThe ability, or perceived ability, of an issuer of a debt securityto make timely payments of interest and principal on thesecurity will affect the value of the security. It is possible thatthe ability of the issuer to meet its obligation will declinesubstantially during the period when a Fund owns securitiesof that issuer, or that the issuer will default on its obligations.An actual or perceived deterioration in the ability of an issuerto meet its obligations will likely have an adverse effect onthe value of the issuer’s securities.

If a security has been rated by more than one nationallyrecognised statistical rating organisation the Fund’sInvestment Adviser may consider the highest rating for thepurposes of determining whether the security is investmentgrade. A Fund will not necessarily dispose of a security heldby it if its rating falls below investment grade, although theFund’s Investment Adviser will consider whether the securitycontinues to be an appropriate investment for the Fund. The

Fund’s Investment Adviser considers whether a security isinvestment grade only at the time of purchase. Some of theFunds will invest in securities which will not be rated by anationally recognised statistical rating organisation, but thecredit quality will be determined by the Investment Adviser.

Credit risk is generally greater for investments issued at lessthan their face values and required to make interestpayments only at maturity rather than at intervals during thelife of the investment. Credit rating agencies base theirratings largely on the issuer’s historical financial conditionand the rating agencies’ investment analysis at the time ofrating. The rating assigned to any particular investment doesnot necessarily reflect the issuer’s current financial condition,and does not reflect an assessment of an investment’svolatility and liquidity. Some of the Funds invest in belowinvestment grade securities. Although investment gradesecurities generally have lower credit risk than securitiesrated below investment grade, they may share some of therisks of lower-rated securities, including the possibility thatthe issuers may be unable to make timely payments ofinterest and principal and thus default.

6. Liquidity RiskLiquidity risk exists when particular investments are difficultto purchase or sell. A Fund’s investment in illiquid securitiesmay reduce the returns of the Fund because it may be unableto sell the illiquid securities at an advantageous time or price.Investments in foreign securities, derivatives or securitieswith substantial market and/or credit risk tend to have thegreatest exposure to liquidity risk. Illiquid securities may behighly volatile and difficult to value.

7. Inflation / Deflation RiskInflation is the risk that a Fund’s assets or income from aFund’s investments may be worth less in the future asinflation decreases the value of money. As inflation increases,the real value of a Fund’s portfolio could decline. Deflationrisk is the risk that prices throughout the economy maydecline over time. Deflation may have an adverse effect onthe creditworthiness of issuers and may make issuer defaultmore likely, which may result in a decline in the value of aFund’s portfolio.

8. Financial Derivative Instrument RiskFor a Fund that uses financial derivative instruments to meetits investment objective, there is no guarantee that theperformance of the financial derivative instruments will resultin a positive effect for the Fund and its Unitholders. The useof financial derivative instruments may increase the Unitprice volatility, which may result in higher losses for theUnitholder.

A Fund may incur costs and fees in connection with totalreturn swaps, contracts for difference or other financialderivative instruments with similar characteristics, uponentering into these instruments and/or any increase ordecrease of their notional amount. The amount of these feesmay be fixed or variable. Information on costs and feesincurred by each Fund in this respect, as well as the identityof the recipients and any affiliation they may have with theTrustee, the Investment Manager or the Manager, ifapplicable, may be available in the annual report.


9. Warrants RiskWhen a Fund invests in warrants, the price, performance andliquidity of such warrants are typically linked to theunderlying stock. However, the price, performance andliquidity of such warrants will generally fluctuate more thanthe underlying securities because of the greater volatility ofthe warrants market. In addition to the market risk related tothe volatility of warrants, a Fund investing in syntheticwarrants, where the issuer of the synthetic warrant isdifferent to that of the underlying stock, is subject to the riskthat the issuer of the synthetic warrant will not perform itsobligations under the transactions which may result in theFund, and ultimately its Unitholders, suffering a loss.

10. Credit Default Swap RiskThe use of credit default swaps normally carries a higher riskthan investing in bonds directly. A credit default swap allowsthe transfer of default risk. This allows a Fund to effectivelybuy insurance on a reference obligation it holds (hedging theinvestment) or buy protection on a reference obligation itdoes not physically own in the expectation that the credit willdecline in quality. One party, the protection buyer, makes astream of payments to the seller of the protection, and apayment is due to the buyer if there is a credit event (adecline in credit quality, which will be predefined in theagreement between the parties). If the credit event does notoccur the buyer pays all the required premiums and the swapterminates on maturity with no further payments. The risk ofthe buyer is therefore limited to the value of the premiumspaid. In addition, if there is a credit event and the Fund doesnot hold the underlying reference obligation, there may be amarket risk as the Fund may need time to obtain thereference obligation and deliver it to the counterparty.Furthermore, if the counterparty becomes insolvent, the Fundmay not recover the full amount due to it from thecounterparty. The market for credit default swaps maysometimes be more illiquid than the bond markets. A Fundwill mitigate this risk by monitoring in an appropriate mannerthe use of this type of transaction.

11. Futures, Options and Forward TransactionsRisk

A Fund may use options, futures and forward contracts oncurrencies, securities, indices, currency, volatility, inflationand interest rates for hedging and investment purposes.

Transactions in futures may carry a high degree of risk. Theamount of the initial margin is small relative to the value ofthe futures contract so that transactions are “leveraged” or“geared”. A relatively small market movement will have aproportionately larger impact which may work for or againstthe Fund. The placing of certain orders which are intended tolimit losses to certain amounts may not be effective becausemarket conditions may make it impossible to execute suchorders.

Transactions in options may also carry a high degree of risk.Selling (“writing” or “granting”) an option generally entailsconsiderably greater risk than purchasing options. Althoughthe premium received by the Fund is fixed, the Fund maysustain a loss well in excess of that amount. The Fund willalso be exposed to the risk of the purchaser exercising theoption and the Fund will be obliged either to settle the optionin cash or to acquire or deliver the underlying investment. Ifthe option is “covered” by the Fund holding a correspondingposition in the underlying investment or a future on anotheroption, the risk may be reduced.

Forward transactions and purchasing options, in particularthose traded over-the-counter and not cleared through acentral counterparty, have an increased counterparty risk. If acounterparty defaults, the Fund may not get the expectedpayment or delivery of assets. This may result in the loss ofthe unrealised profit.

12. Credit Linked Note RiskA credit linked note is a debt instrument which assumes bothcredit risk of the relevant reference entity (or entities) andthe issuer of the credit linked note. There is also a riskassociated with the coupon payment; if a reference entity in abasket of credit linked notes suffers a credit event, thecoupon will be re-set and paid on the reduced nominalamount. Both the residual capital and coupon are exposed tofurther credit events. In extreme cases, the entire capital maybe lost. There is also the risk that a note issuer may default.

13. Equity Linked Note RiskThe return component of an equity linked note is based onthe performance of a single equity security, a basket ofsecurities or an equity index. Investment in theseinstruments may cause a capital loss if the value of theunderlying security decreases. In extreme cases the entirecapital may be lost. These risks are also found in investing inequity investments directly. The return payable for the note isdetermined at a specified time on a valuation date,irrespective of the fluctuations in the underlying stock price.There is no guarantee that a return or yield on an investmentwill be made. There is also the risk that a note issuer maydefault.

A Fund may use equity linked notes to gain access to certainmarkets, for example emerging and less developed markets,where direct investment is not possible. This approach mayresult in the following additional risks being incurred – lack ofa secondary market in such instruments, illiquidity of theunderlying securities, and difficulty selling these instrumentsat times when the underlying markets are closed.

14. General Risks of Over-the-Counter (OTC)Derivative Transactions

Instruments traded in OTC markets may trade in smallervolumes, and their prices may be more volatile thaninstruments principally traded on exchanges. Suchinstruments may be less liquid than more widely tradedinstruments. In addition, the prices of such instruments mayinclude an undisclosed dealer mark-up which a Fund may payas part of the purchase price.

In general, there is less government regulation andsupervision of transactions in OTC markets than oftransactions entered into on organised exchanges. OTCderivatives are executed directly with the counterparty ratherthan through a recognised exchange and clearing house.Counterparties to OTC derivatives are not afforded the sameprotections as may apply to those trading on recognisedexchanges, such as the performance guarantee of a clearinghouse.

The principal risk when engaging in OTC derivatives (such asnon-exchange traded options, forwards, swaps or contractsfor difference) is the risk of default by a counterparty whohas become insolvent or is otherwise unable or refuses tohonour its obligations as required by the terms of theinstrument. OTC derivatives may expose a Fund to the riskthat the counterparty will not settle a transaction inaccordance with its terms, or will delay the settlement of thetransaction, because of a dispute over the terms of the


contract (whether or not bona fide) or because of theinsolvency, bankruptcy or other credit or liquidity problemsof the counterparty. Counterparty risk is generally mitigatedby the transfer or pledge of collateral in favour of the Fund.The value of the collateral may fluctuate, however, and it maybe difficult to sell, so there are no assurances that the valueof collateral held will be sufficient to cover the amount owedto the Fund.

A Fund may enter into OTC derivatives cleared through aclearing house that serves as a central counterparty. Centralclearing is designed to reduce counterparty risk and increaseliquidity compared to bilaterally-cleared OTC derivatives, butit does not eliminate those risks completely. The centralcounterparty will require margin from the clearing brokerwhich will in turn require margin from the Fund. There is arisk of loss by a Fund of its initial and variation margindeposits in the event of default of the clearing broker withwhich the Fund has an open position or if margin is notidentified and correctly report to the particular Fund, inparticular where margin is held in an omnibus accountmaintained by the clearing broker with the centralcounterparty. In the event that the clearing broker becomesinsolvent, the Fund may not be able to transfer or "port" itspositions to another clearing broker.

EU Regulation No 648/2012 on OTC derivatives, centralcounterparties and trade repositories (also known as theEuropean Market Infrastructure Regulation, or EMIR), whichcame into force on 16 August 2012, introduces uniformrequirements in respect of OTC derivative transactions byrequiring certain “eligible” OTC derivatives transactions to besubmitted for clearing to regulated central clearingcounterparties and by mandating the reporting of certaindetails of derivatives transactions to trade repositories. Inaddition, EMIR imposes requirements for appropriateprocedures and arrangements to measure, monitor andmitigate operational and counterparty credit risk in respect ofOTC derivatives contracts which are not subject to mandatoryclearing. These requirements include the exchange of marginand, where initial margin is exchanged, its segregation by theparties, including by the Funds.

While many of the obligations under EMIR have come intoforce, as at the date of this Prospectus the requirement tosubmit certain OTC derivative transactions to central clearingcounterparties (CCPs) and the margin requirements for non-cleared OTC derivative transactions are subject to astaggered implementation timeline. It is not yet fully clearhow the OTC derivatives market will adapt to the newregulatory regime. Prospective Unitholders and Unitholdersshould also be aware that EMIR will transposed into UK lawfollowing Brexit (“UK EMIR”), but that the transposition ofspecific EMIR requirements in this context may be slightlynuanced in order to take account of the existing UK legalframework within which UK EMIR will function. Goingforward, potentially there could also be differences in themanner in which further EMIR obligations (for instance,under the EMIR Refit) and similar future obligations under UKEMIR are defined and implemented. Accordingly, it is difficultto predict the full impact of EMIR and UK EMIR on the Funds,which may include an increase in the overall costs of enteringinto and maintaining OTC derivatives contracts and the needto comply with multiple regulatory regimes. ProspectiveUnitholders and Unitholders should be aware that theregulatory changes arising from EMIR, UK EMIR and othersimilar regulations such as the Dodd-Frank Wall StreetReform and Consumer Protection Act may in due courseadversely affect a Fund’s ability to adhere to its investmentpolicy and achieve its investment objective.

Unitholders should be aware that the regulatory changesarising from EMIR and other applicable laws requiring centralclearing of OTC derivatives may in due course adverselyaffect the ability of the Funds to adhere to their respectiveinvestment policies and achieve their investment objective.

Investments in OTC derivatives may be subject to the risk ofdiffering valuations arising out of different permittedvaluation methods. Although the Manager has implementedappropriate valuation procedures to determine and verify thevalue of OTC derivatives, certain transactions are complexand valuation may only be provided by a limited number ofmarket participants who may also be acting as thecounterparty to the transactions. Inaccurate valuation canresult in inaccurate recognition of gains or losses andcounterparty exposure.

Unlike exchange-traded derivatives, which are standardisedwith respect to their terms and conditions, OTC derivativesare generally established through negotiation with the otherparty to the instrument. While this type of arrangementallows greater flexibility to tailor the instrument to the needsof the parties, OTC derivatives may involve greater legal riskthan exchange-traded instruments, as there may be a risk ofloss if the agreement is deemed not to be legally enforceableor not documented correctly. There also may be a legal ordocumentation risk that the parties may disagree as to theproper interpretation of the terms of the agreement.However, these risks are generally mitigated, to a certainextent, by the use of industry-standard agreements such asthose published by the International Swaps and DerivativesAssociation (ISDA).

15. OTC Derivative Clearing RiskA Fund’s OTC derivative transactions may be cleared prior tothe date on which the mandatory clearing obligation takeseffect under EMIR in order to take advantage of pricing andother potential benefits. OTC derivative transactions may becleared under the “agency” model or the “principal-to-principal” model. Under the principal-to-principal modelthere is usually one transaction between the Fund and itsclearing broker and another back-to-back transactionbetween the clearing broker and the CCP whereas under theagency model there is one transaction between the Fund andthe CCP. It is expected that many of a Fund’s OTC derivativetransactions which are cleared will be under the “principal-to-principal” model. However, the following risks are relevant toboth models unless otherwise specified.

The CCP will require margin from the clearing broker whichwill in turn require margin from the Fund. The Fund’s assetsposted as margin will be held in an account maintained bythe clearing broker with the CCP. Such account may containassets of other clients of the clearing broker (an “omnibusaccount”) and if so, in the event of a shortfall, the assets ofthe Fund transferred as margin may be used to cover lossesrelating to such other clients of the clearing broker upon aclearing broker or CCP default.

The margin provided to the clearing broker by a Fund mayexceed the margin that the clearing broker is required toprovide to the CCP, particularly where an omnibus account isused. The Fund will be exposed to the clearing broker inrespect of any margin which has been posted to the clearingbroker but not posted to and recorded in an account with theCCP. In the event of the insolvency or failure of the clearingbroker, the Fund’s assets posted as margin may not be aswell protected as if they had been recorded in an accountwith the CCP.


A Fund will be exposed to the risk that margin is notidentified to the particular Fund while it is in transit from theFund’s account to the clearing broker’s account and onwardsfrom the clearing broker’s account to the CCP. Such margincould, prior to its settlement, be used to offset the positionsof another client of the clearing broker in the event of aclearing broker or CCP default.

A CCP’s ability to identify assets attributable to a particularclient in an omnibus account is reliant on the correctreporting of such client’s positions and margin by therelevant clearing broker to that CCP. A Fund is thereforesubject to the operational risk that the clearing broker doesnot correctly report such positions and margin to the CCP. Insuch event, margin transferred by the Fund in an omnibusaccount could be used to offset the positions of anotherclient of the clearing broker in that omnibus account in theevent of a clearing broker or CCP default.

In the event that the clearing broker becomes insolvent, aFund may be able to transfer or “port” its positions toanother clearing broker. Porting will not always beachievable. In particular, under the principal-to-principalmodel, where a Fund’s positions are within an omnibusaccount, the ability of the Fund to port its positions isdependent on the timely agreement of all other partieswhose positions are in that omnibus account and so portingmay not be achieved. Where porting is not achieved, theFund’s positions may be liquidated and the value given tosuch positions by the CCP may be lower than the full valueattributed to them by the Fund. Additionally, there may be aconsiderable delay in the return of any net sum due to theFund while insolvency proceedings in respect of the clearingbroker are ongoing.

If a CCP becomes insolvent, subject to administration or anequivalent proceeding or otherwise fails to perform, a Fund isunlikely to have a direct claim against the CCP and any claimwill be made by the clearing broker. The rights of a clearingbroker against the CCP will depend on the law of the countryin which the CCP is established and other optionalprotections the CCP may offer, such as the use of a thirdparty custodian to hold the Fund’s margin. On the failure of aCCP, it is likely to be difficult or impossible for positions to beported to another CCP and so transactions will likely beterminated. In such circumstances, it is likely that the clearingbroker will only recover a percentage of the value of suchtransactions and consequently the amount the Fund willrecover from the clearing broker will be similarly limited. Thesteps, timing, level of control and risks relating to thatprocess will depend on the CCP, its rules and the relevantinsolvency law. However, it is likely that there will be materialdelay and uncertainty around when and how much assets orcash, if any, the clearing broker will receive back from theCCP and consequently the amount the Fund will receive fromthe clearing broker.

16. Counterparty RiskA Fund conducts transactions through or with brokers,clearing houses, market counterparties and other agents. AFund will be subject to the risk of the inability of any suchcounterparty to perform its obligations, whether due toinsolvency, bankruptcy or other causes.

A Fund may invest into instruments such as notes, swaps orwarrants the performance of which is linked to a market orinvestment to which the Fund seeks to be exposed. Suchinstruments are issued by a range of counterparties andthrough its investment the Fund will be subject to thecounterparty risk of the issuer, in addition to the investmentexposure it seeks.

The Funds will only enter into OTC derivatives transactions,repurchase transactions and stock lending transactions withreputable institutions which are subject to prudentialsupervision and specialising in these types of transactions. Inprinciple, the counterparty risk for such transactions shouldnot exceed 10% of the relevant Fund’s net assets when thecounterparty is an approved bank or 5% of its net assets inother cases. However, if a counterparty defaults, the actuallosses may exceed these limits. If a counterparty were todefault on its obligations this may have an adverse impact onthe performance of the relevant Fund causing loss toinvestors.

17. Risks Associated with Dodd-Frank Wall StreetReform

Recent legislative and regulatory reforms, including Dodd-Frank Wall Street Reform, are expected to result in newregulation of swap agreements, including clearing, margin,reporting, recordkeeping and registration requirements. Newregulations, could, amongst other things, restrict a Fund’sability to engage in swap transactions (for example, bymaking certain types of swap transactions no longer availableto a Fund) and/or increase the costs of such swaptransactions (for example, by increasing margin or capitalrequirements) and a Fund may as a result be unable toexecute its investment strategies in a manner the Managermight otherwise choose. It is also unclear how the regulatorychanges will affect counterparty risk.

18. Custody RiskAssets of the Funds are safe kept by the Custodian andUnitholders are exposed to the risk of the Custodian notbeing able to fully meet its obligation to restitute in a shorttime frame all of the assets of the Funds in the case ofbankruptcy of the Custodian. Securities of the Funds willnormally be identified in the Custodian's books as belongingto the Funds and segregated from other assets of theCustodian which mitigates but does not exclude the risk ofnon restitution in case of bankruptcy. However, no suchsegregation applies to cash which increases the risk of nonrestitution in case of bankruptcy. The Custodian does notkeep all the assets of the Funds itself but uses a network ofsub-custodians which are not part of the same group ofcompanies as the Custodian. Unitholders are exposed to therisk of bankruptcy of the sub-custodians in the same manneras they are to the risk of bankruptcy of the Custodian.

A Fund may invest in markets where custodial and/orsettlement systems are not fully developed. The Custodianmay have no liability where the assets of the Funds that aretraded in such markets.

19. Smaller Companies RiskA Fund which invests in smaller companies may fluctuate invalue more than other Funds. Smaller companies may offergreater opportunities for capital appreciation than largercompanies, but may also involve certain special risks. Theyare more likely than larger companies to have limitedproduct lines, markets or financial resources, or to depend ona small, inexperienced management group. Securities ofsmaller companies may, especially during periods wheremarkets are falling, become less liquid and experience short-term price volatility and wide spreads between dealing prices.They may also trade in the OTC market or on a regionalexchange, or may otherwise have limited liquidity.Consequently investments in smaller companies may bemore vulnerable to adverse developments than those inlarger companies and the Fund may have more difficultyestablishing or closing out its securities positions in smaller


companies at prevailing market prices. Also, there may beless publicly available information about smaller companiesor less market interest in the securities, and it may takelonger for the prices of the securities to reflect the full valueof the issuers’ earning potential or assets.

20. Technology Related Companies RiskInvestments in the technology sector may present a greaterrisk and a higher volatility than investments in a broaderrange of securities covering different economic sectors. Theequity securities of the companies in which a Fund may investare likely to be affected by world-wide scientific ortechnological developments, and their products or servicesmay rapidly fall into obsolescence. In addition, some of thesecompanies offer products or services that are subject togovernmental regulation and may, therefore, be adverselyaffected by governmental policies. As a result, theinvestments made by a Fund may drop sharply in value inresponse to market, research or regulatory setbacks.

21. Lower Rated, Higher Yielding Debt SecuritiesRisk

A Fund may invest in lower rated, higher yielding debtsecurities, which are subject to greater market and creditrisks than higher rated securities. Generally, lower ratedsecurities pay higher yields than more highly rated securitiesto compensate investors for the higher risk. The lower ratingsof such securities reflect the greater possibility that adversechanges in the financial condition of the issuer, or risinginterest rates, may impair the ability of the issuer to makepayments to holders of the securities. Accordingly, aninvestment in the Fund is accompanied by a higher degree ofcredit risk than is present with investments in higher rated,lower yielding securities.

22. Property and Real Estate CompaniesSecurities Risk

The risks associated with investments in securities ofcompanies principally engaged in the real estate industryinclude: the cyclical nature of real estate values; risks relatedto general and local economic conditions; overbuilding andincreased competition; increases in property taxes andoperating expenses; demographic trends and variations inrental income; changes in zoning laws; casualty orcondemnation losses; environmental risks; regulatorylimitations on rents; changes in neighbourhood values;related party risks; changes in the appeal of properties totenants; increases in interest rates; and other influences ofcapital markets on real estate. Generally, increases in interestrates will increase the costs of obtaining financing, whichcould directly and indirectly decrease the value of the Fund'sinvestments.

The real estate market has, at certain times, not performed inthe same manner as equity and bond markets. As the realestate market frequently performs, positively or negativelyand without any correlation to the equity or bond markets,these investments may affect the performance of the Fundeither in a positive or a negative manner.

23. Mortgage Related and Other Asset BackedSecurities Risks

Mortgage-backed securities, including collateralisedmortgage obligations and certain stripped mortgage-backedsecurities represent a participation in, or are secured by,mortgage loans. Asset-backed securities are structured likemortgage-backed securities, but instead of mortgage loansor interests in mortgage loans, the underlying assets may

include such items as motor vehicles instalment sales orinstalment loan contracts, leases of various types of real andpersonal property and receivables from credit cardagreements.

Traditional debt investments typically pay a fixed rate ofinterest until maturity, when the entire principal amount isdue. By contrast, payments on mortgage-backed and manyasset-backed investments typically include both interest andpartial payment of principal. Principal may also be prepaidvoluntarily, or as a result of refinancing or foreclosure. AFund may have to invest the proceeds from prepaidinvestments in other investments with less attractive termsand yields. As a result, these securities may have lesspotential for capital appreciation during periods of declininginterest rates than other securities of comparable maturities,although they may have a similar risk of decline in marketvalue during periods of rising interest rates. As theprepayment rate generally declines as interest rates rise, anincrease in interest rates will likely increase the duration, andthus the volatility, of mortgage-backed and asset-backedsecurities. In addition to interest rate risk (as describedabove), investments in mortgage-backed securitiescomposed of subprime mortgages may be subject to ahigher degree of credit risk, valuation risk and liquidity risk(as described above). Duration is a measure of the expectedlife of a fixed income security that is used to determine thesensitivity of the security’s price to changes in interest rates.Unlike the maturity of a fixed income security, whichmeasures only the time until final payment is due, durationtakes into account the time until all payments of interest andprincipal on a security are expected to be made, includinghow these payments are affected by prepayments and bychanges in interest rates.

The ability of an issuer of asset-backed securities to enforceits security interest in the underlying assets may be limited.Some mortgage-backed and asset backed investmentsreceive only the interest portion or the principal portion ofpayments on the underlying assets. The yields and values ofthese investments are extremely sensitive to changes ininterest rates and in the rate of principal payments on theunderlying assets. Interest portions tend to decrease in valueif interest rates decline and rates of repayment (includingprepayment) on the underlying mortgages or assetsincrease; it is possible that a Fund may loose the entireamount of its investment in an interest portion due to adecrease in interest rates. Conversely, principal portions tendto decrease in value if interest rates rise and rates ofrepayment decrease. Moreover, the market for interestportions and principal portions may be volatile and limited,which may make them difficult for a Fund to buy or sell.

A Fund may gain investment exposure to mortgage-backedand asset-backed investments by entering into agreementswith financial institutions to buy the investments at a fixedprice in a future date. A Fund may or may not take delivery ofthe investments at the termination date of such anagreement, but will nonetheless be exposed to changes inthe value of the underlying investments during the term ofthe agreement.

24. Initial Public Offerings RiskA Fund may invest in initial public offerings, which frequentlyare smaller companies. Such securities have no tradinghistory, and information about these companies may only beavailable for limited periods. The prices of securities involvedin initial public offerings may be subject to greater pricevolatility than more established securities.


25. Risk associated with Debt Securities issuedpursuant to Rule 144A under the SecuritiesAct of 1933

SEC Rule 144A provides a safe harbour exemption from theregistration requirements of the Securities Act of 1933 forresale of restricted securities to qualified institutional buyers,as defined in the rule. The advantage for Unitholders may behigher returns due to lower administration charges.However, dissemination of secondary market transactions inrule 144A securities is restricted and only available toqualified institutional buyers. This might increase thevolatility of the security prices and, in extremes conditions,decrease the liquidity of a particular rule 144A security.

26. Emerging and Less Developed MarketsSecurities Risk

Investing in emerging markets and less developed marketssecurities poses risks different from, and/or greater than,risks of investing in the securities of developed countries.These risks include; smaller market-capitalisation of securitiesmarkets, which may suffer periods of relative illiquidity;significant price volatility; restrictions on foreign investment;and possible repatriation of investment income and capital.In addition, foreign investors may be required to register theproceeds of sales, and future economic or political crisescould lead to price controls, forced mergers, expropriation orconfiscatory taxation, seizure, nationalisation or the creationof government monopolies. Inflation and rapid fluctuations ininflation rates have had, and may continue to have, negativeeffects on the economies and securities markets of certainemerging and less developed countries.

Although many of the emerging and less developed marketsecurities in which a Fund may invest are traded on securitiesexchanges, they may trade in limited volume and mayencounter settlement systems that are less well organisedthan those of developed markets. Supervisory authoritiesmay also be unable to apply standards that are comparablewith those in developed markets. Thus there may be risksthat settlement may be delayed and that cash or securitiesbelonging to the relevant Fund may be in jeopardy becauseof failures of or defects in the systems or because of defectsin the administrative operations of counterparties. Suchcounterparties may lack the substance or financial resourcesof similar counterparties in a developed market. There mayalso be a danger that competing claims may arise in respectof securities held by or to be transferred to the Fund andcompensation schemes may be non-existent or limited orinadequate to meet the Fund’s claims in any of these events.

In addition investments in certain emerging and lessdeveloped countries, such as Russia and Ukraine, arecurrently subject to certain heightened risks with regard tothe ownership and custody of securities. In these countries,shareholdings are evidenced by entries in the books of acompany or its registrar (which is neither an agent norresponsible to the custodian). No certificates representingshareholdings in companies will be held by the custodian orany of its local correspondents or in an effective centraldepository system. As a result of this system and the lack ofeffective state regulation and enforcement, a Fund could loseits registration and ownership of the securities throughfraud, negligence or even mere error. Debt securities alsohave an increased custodial risk associated with them as suchsecurities may, in accordance with market practice in theemerging or less developed countries, be held in custodywith institutions in those countries which may not haveadequate insurance coverage to cover loss due to theft,destruction or default. It should be taken into consideration

that when investing in government debt of emerging or lessdeveloped countries, particularly Ukraine, whether via theprimary or secondary market, local regulations may stipulatethat investors maintain a cash account directly with the sub-custodian. Such balance represents a debt due from the sub-custodian to the investors and the custodian shall not beliable for this balance.

Additional risks of emerging market securities may include:greater social, economic and political uncertainty andinstability; more substantial governmental involvement in theeconomy; less governmental supervision and regulation;unavailability of currency hedging techniques; companiesthat are newly organised and small; differences in auditingand financial reporting standards, which may result inunavailability of material information about issuers; and lessdeveloped legal systems. In addition taxation of interest andcapital gains received by non-residents varies amongemerging and less developed markets and, in some casesmay be comparatively high. There may also be less well-defined tax laws and procedures and such laws may permitretroactive taxation so that the Fund could in the futurebecome subject to local tax liabilities that had not beenanticipated in conducting investment activities or valuingassets.

27. Shanghai-Hong Kong Stock Connect andShenzhen-Hong Kong Stock Connect

All Funds which can invest in China may invest in China A-Shares through the Shanghai-Hong Kong Stock Connect andthe Shenzhen-Hong Kong Stock Connect programmes (theStock Connect) subject to any applicable regulatory limits.The Shanghai-Hong Kong Stock Connect and the Shenzhen-Hong Kong Stock Connect programmes are securities tradingand clearing linked programmes developed by Hong KongExchanges and Clearing Limited (HKEx), the Hong KongSecurities Clearing Company Limited (HKSCC), ShanghaiStock Exchange or Shenzhen Stock Exchange, and ChinaSecurities Depository and Clearing Corporation Limited(ChinaClear) with an aim to achieve mutual stock marketaccess between mainland China and Hong Kong. Theseprogrammes allow foreign investors to trade certainShanghai Stock Exchange or Shenzhen Stock Exchange listedChina A-Shares through their Hong Kong based brokers.

The Funds seeking to invest in the domestic securitiesmarkets of the Peoples Republic of China (PRC) may use theStock Connect in addition to the QFII and RQFII schemes and,thus, are subject to the following additional risks:

General Risk: The relevant regulations are untested andsubject to change. There is no certainty as to how they will beapplied which could adversely affect the Funds. The StockConnect requires use of new information technology systemswhich may be subject to operational risk due to its cross-border nature. If the relevant systems fail to functionproperly, trading in both Hong Kong and Shanghai/Shenzhenmarkets through the Stock Connect could be disrupted.

Clearing and Settlement Risk: The HKSCC and ChinaClearhave established the clearing links and each will become aparticipant of each other to facilitate clearing and settlementof cross-boundary trades. For cross-boundary trades initiatedin a market, the clearing house of that market will on onehand clear and settle with its own clearing participants, andon the other hand undertake to fulfil the clearing andsettlement obligations of its clearing participants with thecounterparty clearing house.


Legal /Beneficial Ownership: Where securities are held incustody on a cross-border basis, there are specific legal/beneficial ownership risks linked to compulsory requirementsof the local Central Securities Depositaries, HKSCC andChinaClear.

As in other emerging and less developed markets (pleaserefer above to the section entitled “Emerging Markets andLess Developed Markets Securities Risk”), the legislativeframework is only beginning to develop the concept of legal/formal ownership and of beneficial ownership or interest insecurities. In the case of China Connect legal ownership isfurther complicated by the fact that both local CentralSecurities Depositaries – HKSCC and ChinaClear – need to bepart of the chain of title. This means that multiple legalframeworks are relevant to establishing title and thatoperating risk is increased by the need to engage bothHKSCC and ChinaClear in the processing of dividend paymentand other asset servicing activity and, potentially, sometrades which require movements of securities in HKSCC’saccount at ChinaClear.

In the event ChinaClear defaults, HKSCC will act inaccordance with its participating members’ instructions totake action against issuers of securities held through ChinaConnect. However, as would be the case when investing inChina A shares through arrangements with banks in China,recourse in the event of ChinaClear’s default may be limited.Accordingly, in the event of a default by ChinaClear, theFunds may not fully recover their losses or their StockConnect securities and the process of recovery could also bedelayed.

Operational Risk: The HKSCC provides clearing, settlement,nominee functions and other related services of the tradesexecuted by Hong Kong market participants. PRC regulationswhich include certain restrictions on selling and buying willapply to all market participants. In the case of sale, pre-delivery of shares are required to the broker, increasingcounterparty risk. Because of such requirements, the Fundsmay not be able to purchase and/or dispose of holdings ofChina A-Shares in a timely manner.

Quota Limitations: The program is subject to quotalimitations which may restrict the Funds ability to invest inChina A-Shares through the program on a timely basis.

Investor Compensation: The Funds will not benefit from localinvestor compensation schemes. Stock Connect will onlyoperate on days when both the PRC and Hong Kong marketsare open for trading and when banks in both markets areopen on the corresponding settlement days. There may beoccasions when it is a normal trading day for the PRC marketbut the Funds cannot carry out any China A-Shares trading.The Funds may be subject to risks of price fluctuations inChina A-Shares during the time when Stock Connect is nottrading as a result.

Tax: Unitholders should be aware that changes in mainlandChina's taxation legislation could affect the amount ofincome which may be derived, and the amount of capitalreturned, from the investments in the Fund. In particular, thetaxation position of foreign investors holding Chinese shareshas historically been uncertain. The PRC tax authoritiesannounced in November 2014 that gains on the transfer ofshares and other equity investments in China by foreigninvestors would be subject to a 'temporary' exemption fromcapital gains withholding tax. There was no comment aboutthe duration of this temporary exemption. The situation isbeing kept under review for indications of any change inmarket practice or the release of further guidance from the

PRC authorities, and accruals for PRC capital gainswithholding tax may commence without notice upon therelease of such guidance if this is believes to be appropriate.

28. China Bond ConnectChina Bond Connect (the Bond Connect) is a bond tradinglink between China and Hong Kong which allows foreigninstitutional investors to invest in onshore Chinese bonds andother debt instruments traded on the China Interbank BondMarket (CIBM). Funds can, subject to their investment policy,invest in the instruments traded on the CIBM via the BondConnect.

The Bond Connect is an initiative launched in July 2017 formutual bond market access between Hong Kong andmainland China, established by China Foreign ExchangeTrade System & National Interbank Funding Centre (CFETS),China Central Depositary & Clearing Co., Ltd, ShanghaiClearing House, Hong Kong Exchanges and Clearing Limitedand Central Moneymarkets Unit.

Under the prevailing regulations in mainland China, eligibleforeign investors may invest in the bonds traded on the CIBMthrough the northbound trading of the Bond Connect(Northbound Trading Link). There is no investment quota forthe Northbound Trading Link.

Pursuant to the prevailing regulations in mainland China, anoffshore custody agent recognised by the Hong KongMonetary Authority (currently, the Central MoneymarketsUnit) must open omnibus nominee accounts with an onshorecustody agent recognised by the People's Bank of China(currently recognised onshore custody agents are the ChinaSecurities Depository & Clearing Co., Ltd and InterbankClearing Company Limited). All bonds traded by eligibleforeign investors will be registered in the name of CentralMoneymarkets Unit, which will hold such bonds as a nomineeowner.

For investments via the Bond Connect, the relevant filings,registration with the People's Bank of China and accountopening have to be carried out via an onshore settlementagent, offshore custody agent, registration agent and/orother third parties. As such, the Funds are subject to the risksof default on the part of such third parties.

Investing in instruments traded on the CIBM via the BondConnect is also subject to regulatory risks. The relevant rulesand regulations are subject to change which may potentiallyhave retrospective effect. If the relevant mainland Chineseauthorities suspend account opening or trading on the CIBM,the Funds' ability to invest in the CIBM will be adverselyaffected. In such event, the relevant Fund’s ability to achieveits investment objective may be negatively affected.

There is no specific written guidance from the mainlandChina tax authorities on the treatment of income tax andother tax categories payable in respect of trading in the CIBMby eligible foreign institutional investors via the BondConnect.

29. Specific Risks linked to Stock Lending andRepurchase Transactions

Stock lending and repurchase transactions involve certainrisks. There is no assurance that a Fund will achieve theobjective for which it entered into a transaction.

Repurchase transactions might expose the Fund to riskssimilar to those associated with optional or forwardderivative financial instruments, the risks of which are


described in other parts of this Prospectus. Stock loans may,in the event of a counterparty default or an operationaldifficulty, be recovered late and only in part, which mightrestrict the Fund's ability to complete the sale of securities orto meet redemption requests.

The Fund's exposure to its counterparty will be mitigated bythe fact that the counterparty will forfeit its collateral if itdefaults on the transaction. If the collateral is in the form ofsecurities, there is a risk that when it is sold it will realiseinsufficient cash to settle the counterparty's debt to the Fundor to purchase replacements for the securities that were lentto the counterparty. In the latter case, the Fund's tri-partylending agent will indemnify the Fund against a shortfall ofcash available to purchase replacement securities but there isa risk that the indemnity might be insufficient or otherwiseunreliable.

In the event that the Fund reinvests cash collateral in one ormore of the permitted types of investment that are describedabove, there is a risk that the investment will earn less thanthe interest that is due to the counterparty in respect of thatcash and that it will return less than the amount of cash thatwas invested. There is also a risk that the investment willbecome illiquid, which would restrict the Fund's ability torecover its securities on loan, which might restrict the Fund'sability to complete the sale of securities or to meetredemption requests.

30. Private equityA Fund may gain exposure to private equity throughinvestment in transferable securities and/or regulatedcollective investment schemes which themselves invest in thisasset class. Investments in private equity involve a highdegree of risk and can be illiquid and highly speculative.

31. Hedge FundsA Fund may gain exposure to hedge funds throughinvestment in transferable securities and/or regulatedcollective investment schemes which themselves invest inthese asset classes. Underlying hedge funds will utilise bothexchange-traded and over-the-counter derivatives, including,but not limited to, futures, forwards, swaps, options andcontracts for differences, as part of its investment policy.These risks associated with these instruments are describedabove. The underlying hedge funds may also sell covered anduncovered options on securities. To the extent that suchoptions are uncovered, such underlying hedge funds couldincur an unlimited loss.

Underlying hedge funds may only be available forsubscription or redemption on a periodic basis (e.g.quarterly). Furthermore some such schemes may be closedfor subscription/and or redemptions, may be subject tocertain restrictions or limitations, and there is unlikely to bean active secondary market in the shares or Units of suchunderlying hedge funds. Accordingly it may be difficult orimpossible for an underlying hedge fund to acquire, realiseor value its investment as and when it deems appropriate.The inability to accurately value and/or realise suchinvestments may restrict the ability of an underlying hedgefund to redeem shares or Units.

32. Hedging of Unit ClassesHedging transactions will be entered into whether or not theBase Currency is declining or increasing in value relative tothe Portfolio Currency. Hedged Unit classes aim to provideUnitholders with a return correlated to the Portfolio Currency

performance of the Fund by reducing the effect of exchangerate fluctuations between the Base Currency and thePortfolio Currency.

The performance of a hedged Unit class may differ fromother Unit classes of a Fund. This is because the return onunhedged Unit classes is based on both the performance ofthe Fund’s investments and the performance of the PortfolioCurrency relative to GBP whereas the return on a hedgedUnit class is based only on the performance of the Fund’sinvestments, in the event that the foreign currency exposureis successfully hedged.

Unitholders should be aware that hedging activity can onlyreduce, not eliminate, the effect of movements in exchangerates between the Base Currency and the Portfolio Currency.There is no guarantee that hedged Unit classes will not sufferadverse effects due to exchange rate fluctuations. Inparticular, Unitholders invested in hedged Unit classes shouldbe aware that when Units in a Fund are bought and/or sold,or Units are switched from a hedged Unit class to anotherUnit class in the same Fund, the necessary currency hedgingadjustments will be carried out after the Fund’s valuationpoint. This may lead to differences between the valuation ofthe Fund’s portfolio and FX exchange rates used to make thehedging adjustments. The volatility of the underlying assetclass may magnify the impact of any imperfect hedging,causing the currency hedged Unit class to be over or underhedged. This risk will be born by Unitholders of the relevanthedged Unit class.

Transaction costs arising from the hedging programme willbe borne by the relevant hedged Unit class and this maynegatively impact the Unit class returns. Such transactioncosts will also increase the more frequently the forwardcurrency contracts used for the purposes of hedging arerolled.

As it is not possible to legally segregate Unit classes’ liabilitiesfrom those of other Unit classes in the same Fund, there is arisk that, in certain limited circumstances, the hedgingtransactions undertaken in relation to a hedged Unit classcould result in liabilities which might affect the net assetvalue of the other Unit classes of the same Fund.

33. Potential Conflicts of InterestThe Investment Advisers and the Manager may effecttransactions in which the Investment Advisers or theManager have, directly or indirectly, an interest which mayinvolve a potential conflict with their duties to a Fund. Neitherthe Investment Advisers nor the Manager shall be liable toaccount to a Fund for any profit, commission orremuneration made or received from or by reason of suchtransactions or any connected transactions nor will theInvestment Advisers' fees, unless otherwise provided, beabated.

Where a conflict cannot be avoided, The Investment Advisersand the Manager will have regard to their respectiveobligations to act in the best interests of the Fund so far aspracticable, having regard to their obligations to otherclients, when undertaking any investment business wherepotential conflicts of interest may arise. The InvestmentAdvisers will ensure that Unitholders in affected Funds aretreated fairly and that such transactions are effected onterms which are not less favourable to a Fund than if thepotential conflict had not existed.

The Investment Advisers and the Manager acknowledge thatthere may be some situations where the organisational oradministrative arrangements in place for the management of


conflicts of interest are not sufficient to ensure, withreasonable confidence, that risks of damage to the interestsof a Fund or its Unitholders will be prevented. Should anysuch situations arise the Manager will disclose these toUnitholders in an appropriate format.

Such potential conflicting interests or duties may arisebecause the Investment Advisers or the Manager may haveinvested directly or indirectly in a Fund.

34. Specific Risk relating to CollateralManagement

Counterparty risk arising from investments in OTC financialderivative instruments and securities lending transactions,repurchase agreements and buy-sell back transactions isgenerally mitigated by the transfer or pledge of collateral infavour of a Fund. However, transactions may not be fullycollateralised. Fees and returns due to the Fund may not becollateralised. If a counterparty defaults, the Fund may needto sell non-cash collateral received at prevailing marketprices. In such a case the Fund could realise a loss due, interalia, to inaccurate pricing or monitoring of the collateral,adverse market movements, deterioration in the credit ratingof issuers of the collateral or illiquidity of the market onwhich the collateral is traded. Difficulties in selling collateralmay delay or restrict the ability of the Fund to meetredemption requests.

A Fund may also incur a loss in reinvesting cash collateralreceived, where permitted. Such a loss may arise due to adecline in the value of the investments made. A decline in thevalue of such investments would reduce the amount ofcollateral available to be returned by the Fund to thecounterparty as required by the terms of the transaction. TheFund would be required to cover the difference in valuebetween the collateral originally received and the amountavailable to be returned to the counterparty, therebyresulting in a loss to the Fund.

35. The Benchmark RegulationThe London Interbank Offered Rate and other indices whichare deemed “benchmarks” have been the subject ofinternational and other regulatory guidance as well asproposals for reform. Some of these reforms are alreadyeffective while others are still to be implemented. Thesereforms may cause such benchmarks to perform differentlythan in the past, or to disappear entirely, or have otherconsequences which cannot be predicted. Any suchconsequence could have a material adverse effect on anyInvestments linked to a benchmark.

A key element of the reform of benchmarks within the EU isRegulation (EU) 2016/1011 of the European Parliament and ofthe Council on indices used as benchmarks in financialinstruments and financial contracts or to measure theperformance of investment funds (the BenchmarkRegulation).

The scope of the Benchmark Regulation is wide and, inaddition to so-called “critical benchmark” indices such as theLondon Interbank Offered Rate, could also potentially applyto many other interest rate indices, as well as other indices(including “proprietary” indices or strategies) which arereferenced in financial instruments (including investments)and/or other financial contracts entered into by the Funds,the Manager or its delegates

The Benchmark Regulation could have a material impact onany investment linked to a “benchmark” index, including inany of the following circumstances:

(i) an index which is a “benchmark” cannot be used as suchif its administrator has not obtained authorisation or isbased in a non-EU jurisdiction which does not haveequivalent regulation. In such event, depending on theparticular “benchmark” and the applicable terms of theinvestments, the investment could be de-listed, adjusted,redeemed or otherwise impacted; and

(ii) the methodology or other terms of the “benchmark”could be changed in order to comply with the terms ofthe Benchmark Regulation, and such changes could havethe effect of reducing or increasing the rate or level oraffecting the volatility of the published rate or level, andcould lead to adjustments to the terms of theinvestments, including calculation agent determination ofthe rate or level in its discretion.

36. IBOR ReformThe term “IBOR” refers generally to any reference rate orbenchmark rate that is an “interbank offered rate” intendedto reflect, measure or estimate the average cost to certainbanks of borrowing or obtaining unsecured short-term fundsin the interbank market in the relevant currency andmaturity. IBORs have been used extensively as referencerates across the financial markets for many years. A Fundmay invest in securities or derivatives whose value orpayments are derived from an IBOR. Bond Funds and multi-asset Funds that invest in floating rate debt securities,interest rate swaps, total return swaps and other derivativesare most likely to be adversely impacted by IBOR reform.However, other Funds such as those that invest in contractsfor difference or real estate investment trusts may also beadversely impacted.

Pursuant to recommendations of the Financial Stability Board(FSB), financial institutions and other market participantshave been working to promote the development ofalternative reference rates (ARRs). ARRs are in response toconcerns over the reliability and robustness of IBORs. In July2017, the UK Financial Conduct Authority (FCA) announcedthat the FCA would no longer use its influence or powers topersuade or compel contributing banks to make IBORsubmissions after the end of 2021. Following this statement,other regulators across the globe have madeannouncements encouraging financial institutions and othermarket participants to transition from the use of IBORs to theuse of new ARRs by the end of 2021. This has raised concernsabout the sustainability of IBORs beyond 2021.

Regulatory and industry initiatives concerning IBORs mayresult in changes or modifications affecting investmentsreferencing IBORs, including a need to determine or agree asubstitute ARR, and/or a need to determine or agree aspread to be added to or subtracted from, or to make otheradjustments to, such ARR to approximate an IBOR equivalentrate (as further described below), not all of which can beforeseen at the time a Fund enters into or acquires an IBOR-referencing investment.

If the composition or characteristics of an ARR differ in anymaterial respect from those of an IBOR it may be necessaryto convert the ARR into another IBOR-equivalent ARR beforeit is considered a suitable substitute for the relevant IBOR.Converting an ARR into one or more IBOR-equivalent ratesmay be possible by adding, subtracting or otherwiseincorporating one or more interest rate or credit spreads, orby making other appropriate adjustments. Whether suchadjustments are accurate or appropriate may depend on avariety of factors, including the impact of market conditions,liquidity, transaction volumes, the number and financialcondition of contributing or reference banks and other


considerations at the time of and leading up to suchconversion. Even with spreads or other adjustments, IBOR-equivalent ARRs may be only an approximation of therelevant IBOR and may not result in a rate that is theeconomic equivalent of the specific IBORs used in a Fund’sIBOR-referencing investments. This could have a materialadverse effect on a Fund.

The conversion from an IBOR to an ARR may also require theparties to agree that a payment is made from one party tothe other to account for the change in the characteristics ofthe underlying reference rate. This payment may be requiredto be made by a Fund.

Until the applicable industry working group and/or marketparticipants have agreed a standard methodology for theconversion from an IBOR to an IBOR-equivalent ARR it isdifficult to determine whether and how such conversions willbe made. For example, conversions and adjustments couldbe made by developers of ARRs or by compiling bodies,sponsors or administrators of ARRs, or by a methodestablished by them. Conversions may instead be agreedbilaterally between a Fund and its counterparty or by theapplicable calculation agent under such investments. Thiscould lead to different results for similar IBOR-referencinginvestments which could have a material adverse effect onthe performance of a Fund.

Appendix IIIFund DetailsGeneral

Where a Fund's investment policy refers to investments incorporations of a particular country or region, suchreference means (in the absence of any furtherspecification) investments in companies listed, incorporated,headquartered or having their principal business activities insuch country or region.

Where a Fund's investment policy refers to investments innon-government bonds, such reference includes (in theabsence of any further specification) those issued byquasigovernment, supra-national agencies and sub-sovereign issuers as well as bonds issued by corporateentities.

Where a Fund’s investment policy refers to investmentsissued in a particular currency, such reference includes (inthe absence of any further specification) investments issuedin another currency but hedged back to the specifiedcurrency.

Where a Fund states that it will invest a percentage of itsassets in a certain way (i) the percentage is indicative onlyas, for example, the Manager may adjust the Fund'sexposure to certain asset classes in response to adversemarket and/or economic conditions and/or expectedvolatility, when in the Manager’s view to do so would be inthe best interests of the Fund and its unitholders; and (ii)such assets exclude cash or other liquidities which are notused as backup for derivatives unless otherwise stated.When a Fund states that it invests up to a maximumpercentage of its assets (e.g. 80%) in a certain way, suchassets include cash or other liquidities which are not used asbackup for derivatives.

Where a Fund’s investment policy includes a benchmark,this has been chosen for the following reasons:

(A) for a comparator benchmark, many funds sold in the UKare grouped into sectors by the Investment Association(the “IA”, the trade body that represents UK investmentmanagers) to help investors to compare funds withbroadly similar characteristics. If the Fund is classified inany particular IA sector, this IA sector is shown as acomparator benchmark in the investment policy. TheFund may also show a comparator benchmark wherethe Investment Manager and the Manager believe thatthis benchmark is a suitable comparison forperformance purposes.

(B) for a target benchmark that is a financial index, thebenchmark has been selected because it isrepresentative of the type of companies or other typesof interest in which the Fund is likely to invest, and it is,therefore, an appropriate target in relation to the returnthat the Fund aims to provide and as a comparator forthe Fund’s overall performance.

(C) for a target benchmark that is not a financial index, thebenchmark has been selected because the target returnof the Fund is to deliver or exceed the return of thatbenchmark as stated in the investment objective.

(D) for a constraining benchmark, the benchmark has beenselected because the Investment Manager isconstrained by reference to the value, price orcomponents of that benchmark as stated in theinvestment objective.


Schroder Absolute Return Bond FundInvestment Objective

The Fund aims to provide an absolute return of the ICE BofASterling 3-Month Government Bill Index plus 1% (after feeshave been deducted) over rolling 12-month periods byinvesting directly or indirectly in fixed and floating ratesecurities issued by governments, government agencies andcompanies worldwide. Absolute returns means the Fundseeks a positive return over rolling 12-month periods in allmarket conditions, but this cannot be guaranteed and yourcapital is at risk.

Investment Policy

The Fund is actively managed and invests at least 80% of itsassets directly, or indirectly through derivatives, in fixed andfloating rate securities denominated in sterling (or in othercurrencies and hedged back into sterling) issued bygovernments, government agencies, supra-national andcorporate issuers worldwide. As the Fund is index-unconstrained it is managed without reference to an index.

The Fund may invest up to 50% of its assets in belowinvestment grade securities as measured by Standard &Poor’s or an equivalent credit rating agency, or in unratedsecurities.

The Fund may invest up to 100% of its assets in asset-backedsecurities and mortgage-backed securities.

The Fund may also invest directly or indirectly in securities(including in other asset classes), countries, regions,industries or currencies, collective investment schemes(including Schroder funds) and money market instruments,and hold cash.

The Fund may use derivatives with the aim of achievinginvestment gains, reducing risk or managing the Fund moreefficiently (for more information please refer to section 6 ofAppendix I of the Prospectus). The Fund may use leverageand take short positions.

Fund Characteristics

Classes of Units A Accumulation and A IncomeL Accumulation and L IncomeX IncomeX Income (Monthly)Z Accumulation and Z Income

Base Currency GBP (£)

Valuation Point 12:00 p.m.

Dealing Frequency Daily

Settlement Period of Subscription andRedemption Proceeds

Within 4 Business Days from the relevant Dealing Day

Investment Adviser Schroder Investment Management Limited

Annual Accounting Date 31 December

Half-Yearly Accounting Date 30 June

Income Allocation Date 28 February and 31 August

X Income (Monthly): 31 January, 28 February, 31 March, 30 April, 31 May, 30 June, 31 July, 31 August, 30September, 31 October, 30 November and 31 December.

Profile of a Typical Investor The Fund is a low to medium risk fund aiming to provide an absolute return of the ICE BofA Sterling 3-Month Government Bill Index plus 1% per annum (after fees have been deducted) over rolling 12month periods. It may be suitable for investors who are seeking to combine income with some capitalgrowth opportunities in the relative stability of the debt markets over the long term. Investors shouldbe aware that the fund’s value may be adversely affected in the short term in some marketenvironments and should regard their investment as medium to long-term and should read the riskwarnings set out in Appendix II and the Fund's Key Investor Information Document before investing.

Benchmark The Fund’s performance should be assessed against its target benchmark of the ICE BofA Sterling 3-Month Government Bill Index plus 1%.

Benchmark Selection The benchmark has been selected because the target return of the Fund is to deliver or exceed thereturn of that benchmark as stated in the investment objective.

Global Risk Exposure The Fund may use derivative instruments for efficient management and for specific investmentpurposes. For further information please see Appendix I. Section 6: “Using Derivatives for specificinvestment purposes”.

The Fund employs the absolute Value-at-Risk (VaR) approach to measure its global risk exposure.

Expected Level of Leverage 500%

The expected level of leverage may be higher when markets are more volatile, impacting the value ofthe derivative positions held by the Fund. See Appendix I Section 6: “Derivatives and Forwards” forfurther information.


Specific Fund Risk Factors Specific fund risk factors are disclosed in the Key Investor Information Document (KIID) and shouldbe read in conjunction with the general risks of investment detailed in Appendix II.

Schroders Annual Charge BeingCharged Wholly to Capital

As a result of the annual management fee being charged wholly to capital, the distributable incomemay be higher, but the capital value may be eroded which may affect future performance. Theconsequential increase in income may result in an increase in Unitholder's personal income taxliability.

Emerging Markets Risk The Fund will invest a portion of its assets in the securities of companies incorporated in or operatingin emerging markets and investors should be aware of the risks noted below in relation to the Fund’semerging market allocation.

Controls on foreign investment and limitations on repatriation of invested capital and on the Fund’sability to exchange local currencies for sterling

Greater price volatility, substantially less liquidity and significantly smaller market capitalisation ofsecurities markets

Currency devaluations and other currency exchange rate fluctuations

More substantial government intervention in the economy

Higher rates of inflation

Less government supervision and regulation of the securities markets and participants in thosemarkets

Political uncertainty

Investment in Lower Rated, HighYielding Debt Securities

The Fund may invest in lower rated, higher yielding debt securities, which are subject to greatermarket and credit risks than higher rated securities. Generally, lower rated securities pay higheryields than more highly rated securities to compensate investors for the higher risk. The lower ratingsof such securities reflect the greater possibility that adverse changes in the financial condition of theissuer, or rising interest rates, may impair the ability of the issuer to make payments to holders of thesecurities. Accordingly, an investment in the Fund is accompanied by a higher degree of credit riskthan is present with investments in higher rated, lower yielding securities.

Total Return Swaps The Fund will use financial derivative instruments (including total return swaps) for investmentpurposes as well as for efficient portfolio management purposes. Where the Fund uses total returnswaps, the underlying consists of instruments in which the Fund may invest according to itsInvestment Objective and Policy. Long and short positions gained through bond total return swapsmay increase exposure to credit-related risks. The gross exposure of total return swaps will notexceed 40% and is expected to remain within the range of 0% to 30% of the Net Asset Value. In certaincircumstances this proportion may be higher.

Unit Class Features

Classes of Units Minimum InitialInvestment

MinimumSubsequentInvestment

Minimum Holding Schroders AnnualCharge

Initial Charge

A £1,000 or £50 permonth under regularsavings plan

£500 £1,000 1.05% 0.00%

L None None None Up to 1.00% 0.00%

X £25,000,000 £10,000,000 £25,000,000 0.05% O.00%

Z £50,000 £10,000 £50,000 0.65% 0.00%

See Section 3.1.1. “Manager’s Charges” above for further detail on the charges and the potential discount to the SchrodersAnnual Charge for retail Unit Classes.


Schroder Asian Alpha Plus FundInvestment Objective

The Fund aims to provide capital growth in excess of theMSCI AC Asia ex Japan (Net Total Return) index (after feeshave been deducted) over a three to five year period byinvesting in equity and equity related securities of Asiancompanies, excluding Japan.

Investment Policy

The Fund is actively managed and invests at least 80% of itsassets in equity and equity related securities of Asiancompanies, excluding Japan.

‘Alpha' funds invest in companies in which the InvestmentManager has a high conviction that the current share pricedoes not reflect the future prospects for that business.

The Fund benefits from the Investment Manager’sestablished research capabilities in the Asia (excludingJapan) region that identifies companies with positive cashflow, balance-sheet strength and valuation support.

The Fund may also invest directly or indirectly in othersecurities (including in other asset classes), countries,regions, industries or currencies, collective investmentschemes (including Schroder funds), warrants and moneymarket instruments, and hold cash.

The Fund may use derivatives with the aim of achievinginvestment gains, reducing risk or managing the Fund moreefficiently (for more information please refer to section 6 ofAppendix I of the Prospectus).


Classes of Units A Accumulation and A IncomeL Accumulation and L IncomeQ2 AccumulationS IncomeZ Accumulation and Z Income







Annual Accounting Date 30 June

Half-Yearly Accounting Date 31 December

Income Allocation Date 31 August

Profile of a Typical Investor The Fund is a higher risk fund aiming to provide capital growth. It may be suitable for investors whoare more concerned with maximising long-term returns than minimising possible short-term losses.Investors should regard their investment as medium to long-term and should read the risk warningsset out in Appendix II and the Fund's Key Investor Information Document before investing.

Benchmark The Fund’s performance should be assessed against its target benchmark, being to exceed the MSCIAC Asia ex Japan (Net Total Return) index, and compared against the Investment Association AsiaPacific ex Japan sector average return. The Investment Manager invests on a discretionary basis andis not limited to investing in accordance with the composition of the benchmark.

Benchmark Selection The target benchmark has been selected because it is representative of the type of investments inwhich the Fund is likely to invest, and it is, therefore, an appropriate target in relation to the returnthat the Fund aims to provide.

The comparator benchmark has been selected because the Investment Manager and the Managerbelieve that this benchmark is a suitable comparison for performance purposes given the Fund’sinvestment objective and policy.



Unit Class Features




Initial Charge


£500 £1,000 1.69% 0.00%


Q2 None None None Up to 1.00% 0.00%

S None None None Up to 1.00% 0.00%

Z £50,000 £10,000 £50,000 0.94% 0.00%



Schroder Asian Income FundInvestment Objective

The Fund aims to provide income and capital growth inexcess of the MSCI AC Pacific ex Japan (Net Total Return)index (after fees have been deducted) over a three to fiveyear period by investing in equity and equity relatedsecurities of Asia Pacific companies excluding Japan butincluding Australia and New Zealand.

Investment Policy

The Fund is actively managed and invests at least 80% of itsassets in equity and equity related securities of Asia Pacificcompanies, excluding Japan but including Australia and NewZealand, which offer dividend payments.


The Fund may use derivatives with the aim of reducing riskor managing the Fund more efficiently (for moreinformation please refer to section 6 of Appendix I of theProspectus).


Classes of Units A Accumulation and A IncomeL Accumulation and L IncomeS IncomeZ Accumulation and Z Income







Annual Accounting Date 15 January

Half-Yearly Accounting Date 15 July

Income Allocation Date 15 March and 15 September

Profile of a Typical Investor The Fund is a higher risk fund aiming to provide income with some capital growth potential. It may besuitable for investors who are more concerned with achieving a higher income through investment inhigh yield equity securities. Investors should regard their investment as medium to long-term andshould read the risk warnings set out in Appendix II and the fund's Key Investor InformationDocument before investing.

Benchmark The Fund’s performance should be assessed against its target benchmark, being to exceed the MSCIAC Pacific ex Japan (Net Total Return) index, and compared against the Investment Association AsiaPacific ex Japan sector average return. The Investment Manager invests on a discretionary basis andis not limited to investing in accordance with the composition of this benchmark.




All Charges Being Charged Wholly toCapital

As a result of all charges being charged wholly to capital, the distributable income may be higher, butthe capital value may be eroded which may affect future performance. The consequential increase inincome may result in an increase in Unitholder's personal income tax liability.


Unit Class Features




Initial Charge


£500 £1,000 1.67% 0.00%



Z £50,000 £10,000 £50,000 0.92% 0.00%



Schroder Asian Income MaximiserInvestment Objective

The Fund aims to provide income and capital growth byinvesting in equity and equity related securities of Asiancompanies, excluding Japan. The Fund aims to deliver anincome of 7% per year but this is not guaranteed and couldchange depending on market conditions.

Investment Policy

The Fund is actively managed and invests at least 80% of itsassets in equity and equity related securities of Asiancompanies, excluding Japan, which are selected for theirlong term income and capital growth potential.

To seek to enhance the yield, the Investment Managerselectively sells short dated call options over individualsecurities, portfolios of securities or indices held by theFund, by agreeing strike prices above which potential capitalgrowth is sold.



The Fund’s investment strategy will typically underperform asimilar portfolio without derivatives in periods when theunderlying stock prices are rising, and has the potential tooutperform when the underlying stock prices are falling.









Annual Accounting Date 31 December

Half-Yearly Accounting Date 31 March, 30 June and 30 September

Income Allocation Date 28 February, 31 May, 31 August and 30 November

Profile of a Typical Investor The Fund is a higher risk fund aiming to provide income with some capital growth potential. It may besuitable for investors who are more concerned with achieving a higher income through investment inhigh yield equity securities. Investors should regard their investment as medium to long-term andshould read the risk warnings set out in Appendix II and the Fund's Key Investor InformationDocument before investing.

Benchmark The Fund’s performance should be assessed against the income target of 7% per year, and comparedagainst the MSCI AC Pacific ex Japan (Net Total Return) index and the Investment Association AsiaPacific ex Japan sector average return.






Quoted Target Yield is NotGuaranteed

The quoted target yield for this Fund is an estimate and is not guaranteed. The yield is the sum of thefour quarterly distributions that comprise the fund year, each calculated by dividing the quarterlydistribution amount by the Unit price at the start of that quarter.

Use of Covered Call Options forInvestment Purposes

This Fund uses derivatives to achieve its investment objective. The way in which derivatives are usedwill increase the income paid to Unitholders and reduce volatility, but there is the potential thatperformance or capital value may be eroded.


Unit Class Features




Initial Charge


£500 £1,000 1.70% 0.00%



Z £50,000 £10,000 £50,000 0.95% 0.00%



Schroder European Alpha Plus FundInvestment Objective

The Fund aims to provide capital growth in excess of theFTSE World Series Europe ex UK (Gross Total Return) index(after fees have been deducted) over a three to five yearperiod by investing in equity and equity related securities ofEuropean companies, excluding the UK.

Investment Policy

The Fund is actively managed and invests at least 80% of itsassets in a concentrated range of equity and equity relatedsecurities of European countries, excluding the UK. TheFund typically holds 35 to 60 companies.

‘Alpha' funds invest in companies in which the investmentmanager has a high conviction that the current share pricedoes not reflect the future prospects for that business.

The Fund may also invest directly or indirectly in othersecurities (including in other asset classes), countries(including the UK), regions, industries or currencies,collective investment schemes (including Schroder funds),warrants and money market instruments, and hold cash.



Classes of Units A Accumulation and A IncomeL Accumulation and L IncomeS IncomeZ Accumulation and Z IncomeGBP Hedged A Accumulation and GBP Hedged A IncomeGBP Hedged Z Accumulation and GBP Hedged Z Income







Schroder Investment Management Limited as manager of the currency exposure of the fund withauthority to effect FX hedging of Unit classes

Annual Accounting Date 15 March

Half-Yearly Accounting Date 15 September

Income Allocation Date 15 May


Benchmark The Fund’s performance should be assessed against its target benchmark, being to exceed the FTSEWorld Series Europe ex UK (Gross Total Return) index, and compared against the InvestmentAssociation Europe ex UK sector average return. The Investment Manager invests on a discretionarybasis and is not limited to investing in accordance with the composition of the benchmark.




Concentrated Portfolio Risk This Fund invests in a smaller than usual number of stocks and can invest heavily in specific types ofcompanies, sectors or regions. A fund which invests in a smaller number of stocks may fluctuate morein value than a fund that invests in a larger number of stocks as the portfolio is more concentratedand less diversified. Stock selection will drive portfolio construction, which may result in significantbiases at both a sector and regional level.

Hedged Unit Classes There is no guarantee that the hedging strategy applied in hedged Unit classes will entirely eliminatethe adverse effects of changes in exchange rates between the Base Currency and the PortfolioCurrency.


In addition, it should be noted that hedging transactions will be entered into whether or not thecurrency of a hedged Unit class is declining or increasing in value in relation to the Base Currency orPortfolio Currency or Portfolio Currencies. Hedged Unit classes aim to provide investors with a returncorrelated to the Portfolio Currency performance of the Fund by reducing the effect of exchange ratefluctuations between the Base Currency and the Portfolio Currency.

Unit Class Features




Initial Charge


£500 £1,000 1.70% 0.00%

A (Hedged) £1,000 or £50 permonth under regularsavings plan

£500 £1,000 1.73% 0.00%



Z £50,000 £10,000 £50,000 0.95% 0.00%

Z (Hedged) £50,000 £10,000 £50,000 0.98% 0.00%



Schroder European Smaller Companies FundInvestment Objective

The Fund aims to provide capital growth in excess of theEuromoney Smaller Europe ex UK (Gross Total Return) index(after fees have been deducted) over a three to five yearperiod by investing in equity and equity related securities ofsmall-sized European companies, excluding the UK.

Investment Policy

The Fund is actively managed and invests at least 80% of itsassets in equity and equity related securities of small-sizedEuropean companies, excluding the UK. These arecompanies that, at the time of purchase, are similar in sizeto those comprising the bottom 30% by marketcapitalisation of the European equity market, excluding theUK.

The Fund may also invest in European companiesheadquartered or quoted outside Europe which derive asignificant proportion of their revenues or profits fromEurope.

The small cap universe is an extensive, diverse andconstantly changing area of the European market. Smallercompanies offer investors exposure to some niche growthareas that, often, cannot be accessed through largecompanies. They also tend to grow more rapidly than largerfirms.


The Fund may use derivatives with the aim of reducing riskand managing the Fund more efficiently (for moreinformation please refer to section 6 of Appendix I of theProspectus).


Classes of Units A Accumulation and A IncomeZ Accumulation and Z Income







Annual Accounting Date 30 November

Half-Yearly Accounting Date 31 May

Income Allocation Date 31 January


Benchmark The Fund’s performance should be assessed against its target benchmark, being to exceed theEuromoney Smaller Europe ex UK (Gross Total Return) index, and compared against the InvestmentAssociation European Smaller Companies sector average return. The Investment Manager invests ona discretionary basis and is not limited to investing in accordance with the composition of thebenchmark.





Unit Class Features




Initial Charge


£500 £1,000 1.69% 0.00%

Z £50,000 £10,000 £50,000 0.94% 0.00%



Schroder Gilt & Fixed Interest FundInvestment Objective

The Fund aims to provide income and capital growth inexcess of the FTSE Gilts All Stocks index (after fees havebeen deducted) over a three to five year period by investingin fixed and floating rate securities issued by governmentsworldwide.

Investment Policy

The Fund is actively managed and invests at least 95% of itsassets in fixed and floating rate securities denominated insterling (or in other currencies and hedged back intosterling) issued by governments, government agencies and

supra-nationals worldwide. The Fund invests at least 80% ofits assets in fixed and floating rate securities issued by theUK government.

The Fund may also invest directly or indirectly in securities(including in other asset classes), countries, regions,industries or currencies, collective investment schemes(including Schroder funds) and money market instruments,and hold cash.










Annual Accounting Date 31 August

Half-Yearly Accounting Date 28 February

Income Allocation Date 31 October and 30 April

Profile of a Typical Investor The Fund is a low risk fund aiming to provide income with some capital growth potential. It may besuitable for investors who are seeking to combine income with some capital growth opportunities inthe relative stability of the debt markets over the long term. Investors should regard their investmentas medium to long-term and should read the risk warnings set out in Appendix II and the Fund's KeyInvestor Information Document before investing.

Benchmark The Fund’s performance should be assessed against its target benchmark, being to exceed the FTSEGilts All Stocks index, and compared against the Investment Association UK Gilts sector averagereturn. The Investment Manager invests on a discretionary basis and is not limited to investing inaccordance with the composition of the benchmark.



Global Risk Exposure The Fund may use derivative instruments for efficient management and for specific investmentpurposes.

The Fund employs the relative Value-at-Risk (VaR) approach to measure its global risk exposure.

VaR benchmark FTSE UK Gilts ALL Index







Unit Class Features




Initial Charge


£500 £1,000 0.58% 0.00%

Z £50,000 £10,000 £50,000 0.38% 0.00%



Schroder Global Emerging Markets FundInvestment Objective

The Fund aims to provide capital growth in excess of theMSCI Emerging Markets (Net Total Return) index ( after feeshave been deducted) over a three to five year period byinvesting in equity and equity related securities of emergingmarket companies worldwide.

Investment Policy

The Fund is actively managed and invests at least 80% of itsassets in equity and equity related securities of emergingmarket companies worldwide.

The Fund may also invest in companies headquartered orquoted on developed markets if those companies derive asignificant proportion of their revenues or profits inemerging markets.




Classes of Units A Accumulation and A IncomeS IncomeZ Accumulation and Z Income







Annual Accounting Date 31 March

Half-Yearly Accounting Date 30 September

Income Allocation Date 31 May

Profile of a Typical Investor The Fund is a higher risk fund aiming to provide capital growth. It may be suitable for investors whoare more concerned with maximising long-term returns than minimising possible short-term losses.Investors should regard their investment as medium to long-term and should read the risk warningsset out in Appendix II and the fund's Key Investor Information Document before investing.

Benchmark The Fund’s performance should be assessed against its target benchmark, being to exceed the MSCIEmerging Markets (Net Total Return) index, and compared against the Investment Association GlobalEmerging Markets sector average return. The Investment Manager invests on a discretionary basisand is not limited to investing in accordance with the composition of the benchmark.




Emerging Markets Risk Substantially all the Fund’s assets will, in normal circumstances, be invested in the securities ofcompanies incorporated in or operating in emerging markets. The Fund will therefore be subject, to amuch greater degree than funds investing in Europe, North America, or other developed markets, toa number of risk factors including:









Because of the limited forward market for the purchase of sterling in most, if not all, emergingmarkets and the limited circumstances in which the Fund expects to hedge against declines in thevalue of foreign currencies generally, the Fund will be adversely affected by devaluations in suchcurrencies against sterling to the extent that the Fund is invested in securities denominated incurrencies experiencing a devaluation. In addition, accounting, auditing and financial reportingstandards in many emerging markets are different from UK standards. As a result, certain materialdisclosures may not be made and less information may be available to the Fund and other investorsthan would be the case if the Fund’s investments were restricted to securities in developed markets.

Whilst the Investment Manager believes that the Fund offers potential for enhanced capitalappreciation, no assurance can be given that this objective will be achieved. Potential investors whoare in any doubt as to the risks involved in investment in the Fund should obtain their own financialadvice.

Unit Class Features




Initial Charge


£500 £1,000 1.72% 0.00%


Z £50,000 £10,000 £50,000 0.97% 0.00%



Schroder Global Equity Income FundInvestment Objective

The Fund aims to provide income and capital growth inexcess of the MSCI World (Net Total Return) Index (afterfees have been deducted) over a three to five year period byinvesting in equity and equity related securities ofcompanies worldwide.

Investment Policy

The Fund is actively managed and invests at least 80% of itsassets in equity and equity related securities of companiesworldwide which offer sustainable dividend payments.

The Fund seeks to invest in a diversified portfolio of equityand equity related securities whose dividend yield inaggregate is greater than the average market yield. Equities

with below average dividend yield may be included in theportfolio when the Investment Manager considers that theyhave the potential to pay above average income in future.











Annual Accounting Date 15 July

Half-Yearly Accounting Date 15 January

Income Allocation Date 15 March and 15 September


Benchmark The Fund’s performance should be assessed against its target benchmark, being to exceed the MSCIWorld (Net Total Return) Index, and compared against the MSCI World Value (Net Total Return) Indexand the Investment Association Global Equity Income sector average return. The Investment Managerinvests on a discretionary basis and is not limited to investing in accordance with the composition ofthe benchmark.


The comparator benchmarks have been selected because the Investment Manager and the Managerbelieve that these benchmarks are a suitable comparison for performance purposes given the Fund’sinvestment objective and policy.





Unit Class Features




Initial Charge


£500 £1,000 1.70% 0.00%



Z £50,000 £10,000 £50,000 0.95% 0.00%



Schroder Global Healthcare FundInvestment Objective

The Fund aims to provide capital growth by investing inequity and equity related securities of healthcare andmedical related companies worldwide.

Investment Policy

The Fund is actively managed and invests at least 80% of itsassets in equity and equity related securities of companiesworldwide, which are engaged in healthcare provision,medical services and related products.

The Fund is positioned to benefit from the structural growthin demand for healthcare provision and medical treatments,supported by demographic trends, improving standards of

living and technological advancements. The InvestmentManager will position the Fund to benefit from these strongthemes by investing in areas such as biotechnology, genericdrug manufacture and supply, pharmaceuticals, healthinsurance and hospital supplies.












Half-Yearly Accounting Date 15 February

Income Allocation Date 15 October

Profile of a Typical Investor The Fund is a higher risk fund aiming to provide capital growth. It may be suitable for investors whoare more concerned with maximising long-term returns than minimising possible short-term losses.Investors should regard their investment as medium to long-term and should read the risk warningsset out in Appendix II and the fund's Key Investor Information Document before investing.

Benchmark The Fund does not have a target benchmark. The Fund’s performance should be compared againstthe MSCI AC World Health Care Daily (Gross Total Return) index and the Investment AssociationGlobal sector average return.

Benchmark Selection The comparator benchmarks have been selected because the Investment Manager and the Managerbelieve that each of these benchmarks is a suitable comparison for performance purposes given theFund’s investment objective and policy.











Sector Specific Fund This Fund focuses on specific sectors and this can carry more risk than funds spread over a number ofdifferent industry sectors.

Unit Class Features




Initial Charge


£500 £1,000 1.67% 0.00%

Z £50,000 £10,000 £50,000 0.92% 0.00%



Schroder Global Cities Real Estate IncomeInvestment Objective

The Fund aims to provide income and capital growth inexcess of inflation (as measured by the UK Consumer PriceIndex) plus 3% per annum (after fees have been deducted)over a three to five year period by investing globally inequity and equity related securities of real estate companiesworldwide that offer regular dividend payments. This cannotbe guaranteed and your capital is at risk.

Investment Policy

The Fund is actively managed and invests at least 70% of itsassets in equity and equity related securities of real estatecompanies worldwide. The Fund may invest in real estateinvestment trusts.

The Fund may also invest in collective investment schemes(including Schroder funds) that invest in equity and equityrelated securities of real estate companies, warrants andmoney market instruments, and may hold cash.

The Fund may use derivatives with the aim of achievinginvestment gains, reducing risk or managing the Fund moreefficiently (for more information please refer to section 6 ofAppendix I of the Prospectus).The use of derivativeinstruments may include but is not limited to taking long orshort exposures to interest rates and foreign exchangecurrency contracts.


Classes of Units A Accumulation and A IncomeL Accumulation and L IncomeX IncomeZ Accumulation and Z Income







Annual Accounting Date 30 April

Half-Yearly Accounting Date 31 July, 31 October and 31 January

Income Allocation Date 30 June, 30 September, 31 December and 31 March


Benchmark The Fund’s performance should be assessed against its target benchmark, being to exceed the UKConsumer Price Index plus 3% per annum, and compared against the FTSE EPRA NAREIT DevelopedDividend Plus (Gross Total Return) index and the Investment Association Property Investment Sectoraverage return.

Benchmark Selection The target benchmark has been selected because the target return of the Fund is to deliver or exceedthe return of that benchmark as stated in the investment objective.

The comparator benchmarks have been selected because the Investment Manager and the Managerbelieve that each of these benchmarks is a suitable comparison for performance purposes given theFund’s investment objective and policy.
















Unit Class Features




Initial Charge


£500 £1,000 1.70% 0.00%


X £25,000,000 £10,000,000 £25,000,000 0.05% 0.00%

Z £50,000 £10,000 £50,000 0.95% 0.00%



Schroder Global Cities Real EstateInvestment Objective

The Fund aims to provide income and capital growth inexcess of inflation (as measured by the UK Consumer PriceIndex) plus 3% per annum (after fees have been deducted)over a three to five year period by investing in equity andequity related securities of real estate companies worldwide.This cannot be guaranteed and your capital is at risk.

Investment Policy

The Fund is actively managed and invests at least 80% of itsassets in equity and equity related securities of real estatecompanies worldwide which generate the majority of theirearnings from real estate investment related activities. TheFund may invest in real estate investment trusts.

The Fund seeks exposure to companies that invest in citiesthat the Investment Manager believes will exhibit continuedeconomic growth, supported by factors such as stronginfrastructure and supportive planning regimes.

The Fund may also invest in collective investment schemes(including Schroder funds) that invest in equity and equityrelated securities of real estate companies, warrants andmoney market instruments, and may hold cash.

The Fund may use derivatives with the aim of reducing riskand to manage the Fund more efficiently (for moreinformation please refer to section 6 of Appendix I of theProspectus).

Further Information

The Fund does not currently use derivatives to achieveinvestment gains. If the Manager decides to use derivativesthis way, this may result in a more volatile Unit price and soresult in a higher degree of market risk, therefore theManager will give registered Unitholders appropriate noticeif it decides to do so.


Classes of Units A Accumulation and A IncomeL Accumulation and L IncomeGBP Hedged L Accumulation and GBP Hedged L IncomeZ Accumulation and Z IncomeGBP Hedged Z Income






Investment Adviser Schroder Real Estate Investment Management Limited


Annual Accounting Date 20 September

Half-Yearly Accounting Date 20 March

Income Allocation Date 20 November

Profile of a Typical Investor The Fund is a higher risk fund aiming to provide income and capital growth. It may be suitable forinvestors who are more concerned with maximising long-term returns than minimising possibleshort-term losses. Investors should regard their investment as medium to long-term and should readthe risk warnings set out in Appendix II and the fund's Key Investor Information Document beforeinvesting.

Benchmark The Fund’s performance should be assessed against its target benchmark, being to exceed the UKConsumer Price Index plus 3% per annum, and compared against the FTSE EPRA NAREIT Developed(Gross Total Return) index and the Investment Association Property Investment Sector averagereturn.








Unit Class Features




Initial Charge


£500 £1,000 1.67% 0.00%


L (Hedged) None None None Up to 1.00% 0.00%

Z £50,000 £10,000 £50,000 0.92% 0.00%

Z (Hedged) £50,000 £10,000 £50,000 0.95% 0.00%



Schroder High Yield Opportunities FundInvestment Objective

The Fund aims to provide income and capital growth ofbetween 4.5% and 6.5% per annum (after fees have beendeducted) over a three to five year period by investing infixed and floating rate securities worldwide. This cannot beguaranteed and your capital is at risk.

Investment Policy

The Fund is actively managed and invests at least 80% of itsassets in fixed and floating rate securities (denominated inor hedged back into Sterling) issued by governments,government agencies, supra-nationals and companiesworldwide.

The Fund invests at least 50% of its assets in Pan-Europeanfixed and floating rate securities.

The Fund invests at least 80% of its assets in belowinvestment grade securities (as measured by Standard &Poor’s or any other equivalent credit rating agencies) or inunrated securities.




Classes of Units A Accumulation and A IncomeX AccumulationZ Accumulation and Z Income








Other Accounting Dates 27 January, 27 February, 27 March, 27 April, 27 May, 27 June, 27 August, 27 September, 27 October, 27November, 27 December

Income Allocation Dates 25 September, 25 March, 25 April, 25 May, 25 June, 25 July, 25 August, 25 October, 25 November, 25December, 25 January and 25 February

Profile of a Typical Investor The Fund is a medium risk fund aiming to provide income by investing in fixed and floating ratesecurities worldwide. The Fund also aims to provide capital growth. It may be suitable for investorswho are seeking to combine income with some capital growth opportunities in the relative stability ofthe debt markets over the long term. Investors should regard their investment as medium to long-term and should read the risk warnings set out in Appendix II and the Fund's Key InvestorInformation Document before investing.

Benchmark The Fund’s performance should be assessed against the income and capital growth target of between4.5% and 6.5% per year, and compared against the Investment Association High Yield Investmentsector average return.




Global Risk Exposure The Fund may use derivative instruments for efficient management and for specific investmentpurposes.

















Unit Class Features




Initial Charge


£500 £1,000 1.37% 0.00%

X £25,000,000 £10,000,000 £25,000,000 0.02% 0.00%

Z £50,000 £10,000 £50,000 0.72% 0.00%



Schroder Income FundInvestment Objective

The Fund aims to provide income and capital growth inexcess of the FTSE All Share (Gross Total Return) Index (afterfees have been deducted) over a three to five year period byinvesting in equity and equity related securities of UKcompanies.

Investment Policy

The Fund is actively managed and invests at least 80% of itsassets in a concentrated range of equity and equity relatedsecurities of UK companies. These are companies that areincorporated, headquartered or have their principalbusiness activities in the UK. The Fund typically holds 30 to50 companies.

The Fund focuses on companies that have certain "Value"characteristics. Value is assessed by looking at indicatorssuch as cash flows, dividends and earnings to identifysecurities which the Investment Manager believes havebeen undervalued by the market.




Classes of Units A Accumulation and A IncomeL Accumulation and L IncomeQ IncomeS Accumulation and S IncomeZ Accumulation and Z Income







Annual Accounting Date 25 February

Half-Yearly Accounting Date 25 August

Income Allocation Date 25 April and 25 October


Benchmark The Fund’s performance should be assessed against its target benchmark, being to exceed the FTSEAll Share (Gross Total Return) Index, and compared against the MSCI UK Value (Gross Total Return)Index and the Investment Association UK Equity Income sector average return. The InvestmentManager invests on a discretionary basis and is not limited to investing in accordance with thecomposition of the benchmark.








Unit Class Features




Initial Charge


£500 £1,000 1.66% 0.00%


Q None None None Up to 1.00% 0.00%


Z £50,000 £10,000 £50,000 0.91% 0.00%



Schroder Income MaximiserInvestment Objective

The Fund aims to provide income and capital growth byinvesting in equity and equity-related securities of UKcompanies. The Fund aims to deliver an income of 7% peryear but this is not guaranteed and could change dependingon market conditions.

Investment Policy

The Fund is actively managed and invests at least 80% of itsassets in equity and equity related securities of UKcompanies which are selected for their long term incomeand capital growth potential. These are companies that areincorporated, headquartered or have their principalbusiness activities in the UK.

To seek to enhance the yield, the Investment Managerselectively sells short dated call options over individualsecurities, portfolios of securities or indices held by theFund, by agreeing strike prices above which potential capitalgrowth is sold.



The Fund’s investment strategy will typically underperform asimilar portfolio without derivatives in periods when theunderlying stock prices are rising, and outperform when theunderlying stock prices are falling.


Classes of Units A Accumulation and A IncomeL Accumulation and L IncomeQ IncomeS IncomeZ Accumulation and Z Income








Quarterly Accounting Dates 30 November, 28 February and 31 May

Income Allocation Dates 31 October, 31 January, 30 April and 31 July


Benchmark The Fund’s performance should be assessed against the income target of 7% per year, and comparedagainst the FTSE All Share (Gross Total Return) index and the Investment Association UK EquityIncome sector average return.












Unit Class Features




Initial Charge


£500 £1,000 1.66% 0.00%


Q None None None Up to 1,00% 0.00%


Z £50,000 £10,000 £50,000 0.91% 0.00%



Schroder Managed Balanced FundInvestment Objective

The Fund aims to provide capital growth and income byinvesting in a diversified range of assets and marketsworldwide.

Investment Policy

The Fund is actively managed and invests indirectly throughcollective investment schemes, exchange traded funds, realestate investment trusts or closed ended funds, in equityand equity related securities, fixed and floating ratesecurities or alternative assets worldwide.

Alternative assets may include funds that use absolutereturn strategies or funds that invest in real estate,commodities or private equity.

The Fund may invest up to 100% of its assets in collectiveinvestment schemes managed by Schroders.

The Fund may also invest directly in equity and equityrelated securities and fixed and floating rate securities. TheFund may also invest directly or indirectly in money marketinstruments and hold cash.



Classes of Units A AccumulationH Accumulation and H IncomeI Accumulation and I IncomeZ Accumulation and Z Income









Income Allocation Date 23 April

Profile of a Typical Investor The Fund is a medium risk fund aiming to provide capital growth with some income throughinvestment in a selection of Schroders’ and other fund managers’ collective investment schemes. Itmay be suitable for investors who are seeking long-term growth potential offered throughinvestment in equities and bonds as well as other asset classes. Investors should regard theirinvestment as medium to long-term and should read the risk warnings set out in Appendix II and theFund's Key Investor Information Document before investing.

Benchmark The Fund does not have a target benchmark. The Fund’s performance should be compared againstthe Investment Association Mixed Investment 40% to 85% Shares sector average return.

Benchmark Selection The comparator benchmark has been selected because the Investment Manager and the Managerbelieve that this benchmark is a suitable comparison for performance purposes given the Fund’sinvestment objective and policy.


Investment in collective investmentschemes managed by the Manager

The Fund may invest up to 100% of its net asset value in the units and shares of funds managed by oroperated by the Manager or an associate of the Manager. Where the Fund invests in funds managedby or operated by the Manager or an associate, the Schroders Annual Charge and AdministrationCharge (if any) paid by these funds to the Manager will be rebated to the Fund.


Unit Class Features




Initial Charge


£500 £1,000 1.68% 0.00%

H £1,000,000 £20,000 £1,000,000 0.61% 0.00%

I £1,000,000 £20,000 £1,000,000 0.57% 0.00%

Z £50,000 £10,000 £50,000 0.93% 0.00%



Schroder Managed Wealth PortfolioInvestment Objective

The Fund aims to achieve capital growth and income ofinflation (as measured by the UK Consumer Price Index)plus 3.5% per annum (after fees have been deducted) over afive to seven year period by investing in a diversified rangeof assets and markets worldwide. This cannot beguaranteed and your capital is at risk.

Investment Policy

The Fund is actively managed and invests its assets directly,or indirectly through collective investment schemes,exchange traded funds, real estate investment trusts orclosed ended funds, in equity and equity related securities,fixed and floating rate securities and alternative assetsworldwide. Alternative assets may include funds that useabsolute return strategies or funds that invest directly inreal estate or indirectly in commodities.

The Fund invests at least 50% of its assets in collectiveinvestment schemes (including Schroder funds).

The Fund will seek to increase returns and reduce downsiderisk by making tactical adjustments to its holdings based onmarket conditions. The Fund will invest within the followingranges:

Cash: 0% - 20%

Bonds: 20% - 50%

Equities: 25% - 60%

Alternative Investments 0% - 35%

The Fund may also invest in warrants and money marketinstruments, and hold cash.



Classes of Units A Accumulation and A IncomeS Accumulation and S IncomeZ Accumulation and Z Income






Investment Adviser Schroder & Co. Limited

Annual Accounting Date 31 January

Half-Yearly Accounting Date 31 July

Income Allocation Date 31 March

Profile of a Typical Investor The Fund is a medium risk fund aiming to provide capital growth with some income potential throughinvestment in a selection of Schroders’ and other fund managers’ collective investment schemes. Itmay be suitable for investors who are seeking long-term growth potential offered throughinvestment in equities and bonds as well as other asset classes. Investors should regard theirinvestment as medium to long-term and should read the risk warnings set out in Appendix II and theFund's Key Investor Information Document before investing.

Benchmark The Fund’s performance should be assessed against its target benchmark of the UK Consumer PriceIndex plus 3.5%, and compared against the Investment Association Mixed Investment 40% to 85%Shares sector average return.



Investment in collective investmentschemes managed by the Manager

The Fund may invest up to 100% of its net asset value in the units and shares of funds managed by oroperated by the Manager or an associate of the Manager. Where the Fund invests in funds managedby or operated by the Manager or an associate, the Schroders Annual Charge and AdministrationCharge (if any) paid by these funds to the Manager will be rebated to the Fund.


Unit Class Features




Initial Charge


£500 £1,000 1.56% 0.00%


Z £50,000 £10,000 £50,000 0.81% 0.00%



Schroder Recovery FundInvestment Objective

The Fund aims to provide capital growth in excess of theFTSE All Share (Gross Total Return) Index (after fees havebeen deducted) over a three to five year period by investingin equity and equity related securities of UK companies thathave suffered a severe setback in either share price orprofitability.

Investment Policy

The Fund is actively managed and invests at least 80% of itsassets in equity and equity related securities of UKcompanies. These are companies that are incorporated,headquartered or have their principal business activities inthe UK.

The Fund applies a disciplined value investment approach,seeking to invest in a select portfolio of companies that theInvestment Manager believes are significantly undervaluedrelative to their long-term earnings potential.













Income Allocation Date 15 September


Benchmark The Fund's performance should be assessed against its target benchmark being to exceed the FTSEAll Share (Gross Total Return) Index, and compared against the MSCI UK Value (Gross Total Return)Index and the Investment Association UK All Companies sector average return. The InvestmentManager invests on a discretionary basis and is not limited to investing in accordance with thecomposition of the benchmark.





Unit Class Features




Initial Charge


£500 £1,000 1.66% 0.00%



Z £50,000 £10,000 £50,000 0.91% 0.00%



Schroder Small Cap Discovery FundInvestment Objective

The Fund aims to provide capital growth in excess of itsbenchmark* (after fees have been deducted) over a three tofive year period by investing in equity and equity relatedsecurities of Asian smaller companies (excluding Japan) andin global emerging market smaller companies.

Investment Policy

The Fund is actively managed and invests at least 80% of itsassets in equity and equity related securities of small-sizedAsian (excluding Japan) and global emerging marketcompanies. These are companies that, at the time ofpurchase, are similar in size to those comprising the bottom30% by market capitalisation of the equities market in Asiaand other emerging markets.

The Fund may also invest in small-sized companiesheadquartered in or quoted on developed markets if thosecompanies derive a significant proportion of their revenuesor profits in emerging markets.

The small cap universe is an extensive, diverse andconstantly changing area of Asian and other emergingmarkets. Smaller companies offer investors exposure tosome niche growth areas that, often, cannot be accessedthrough large companies. They also tend to grow morerapidly than larger firms.


The Fund may use derivatives with the aim of achievinginvestment gains, reducing risk and managing the Fundmore efficiently (for more information please refer tosection 6 of Appendix I of the Prospectus).

* The Fund’s benchmark is a blend of the MSCI Small Cap(Net Total Return) indices (Emerging Markets, Hong Kong,Singapore).


Classes of Units A Accumulation and A IncomeL Accumulation and L IncomeZ Accumulation and Z Income








Half-Yearly Accounting Date 15 October

Income Allocation Date 15 June

Profile of a Typical Investor The Fund may be suitable for investors who are seeking long-term returns offered throughinvestment in equities. Investors should read the risk warnings set out in Appendix II and the Fund’sKey Investor Information Document before investing.

Benchmark The Fund's performance should be assessed against its target benchmark, being to exceed a blend ofthe MSCI Small Cap (Net Total Return) indices (Emerging Markets, Hong Kong, Singapore). TheInvestment Manager invests on a discretionary basis and is not limited to investing in accordancewith the composition of the benchmark.












Unit Class Features




Initial Charge


£500 £1,000 1.76% 0.00%


Z £50,000 £10,000 £50,000 1.01% 0.00%



Schroder Strategic Bond FundInvestment Objective

The Fund aims to provide income and capital growth ofbetween 2.5% and 4.5% per annum (after fees have beendeducted) over a three to five year period by investing infixed and floating rate securities issued by governments,government agencies, supra-nationals and companiesworldwide. This cannot be guaranteed and your capital is atrisk.

Investment Policy

The Fund is actively managed and invests at least 80% of itsassets in fixed and floating rate securities denominated insterling (or in other currencies and hedged back intosterling) issued by governments, government agencies,supra-national and corporate issuers worldwide.

The Fund may invest up to 40% of its assets in asset backedsecurities and mortgage backed securities.

The Fund may invest up to 50% of its assets in belowinvestment grade securities as measured by Standard &Poor’s or an equivalent credit rating agency, or in unratedsecurities.




Classes of Units A Accumulation and A IncomeL Accumulation and L IncomeX Income (Quarterly)Z Accumulation and Z Income








Other Accounting Dates X Income (Quarterly): 15 September, 15 December, 15 March

All other units: 15 December

Income Allocation Dates X Income (Quarterly): 15 August, 15 November, 15 February,15 May

All other units: 15 August and 15 February

Profile of a Typical Investor The Fund aims to provide income with some capital growth potential. It may be suitable for investorswho are seeking to combine income with some capital growth opportunities in the relative stability ofthe debt markets over the long term. Investors should be aware that the fund’s value may beadversely affected in the short term in some market environments and should regard theirinvestment as medium to long-term. Investors should read the risk warnings set out in Appendix IIand the Fund's Key Investor Information Document before investing.

Benchmark The Fund’s performance should be assessed against the income and capital growth target of between2.5% and 4.5% per year, and compared against the Investment Association Strategic Bond sectoraverage return.



Global Risk Exposure The Fund may use derivative instruments for efficient management and for specific investmentpurposes. For further information please see Appendix I. Section 6: “Using Derivatives for specificinvestment purposes”.


















Total Return Swaps The Fund will use financial derivative instruments (including total return swaps) for investmentpurposes as well as for efficient portfolio management purposes. Where the Fund uses total returnswaps, the underlying consists of instruments in which the Fund may invest according to itsInvestment Objective and Policy. Long and short positions gained through bond total return swapsmay increase exposure to credit-related risks. The gross exposure of total return swaps will notexceed 40% and is expected to remain within the range of 0% to 30% of the Net Asset Value. In certaincircumstances this proportion may be higher.

Unit Class Features




Initial Charge


£500 £1,000 1.20% 0.00%

L £25,000,000 £10,000,000 £25,000,000 Up to 1.00% 0.00%

X £25,000,000 £10,000,000 £25,000,000 0.05% 10.00%

Z £50,000 £10,000 £50,000 0.70% 0.00%



Schroder Tokyo FundInvestment Objective

The Fund aims to provide capital growth in excess of theTokyo Stock Exchange 1st Section (Gross Total Return) index(after fees have been deducted) over a three to five yearperiod by investing in equity and equity related securities ofJapanese companies.

Investment Policy

The Fund is actively managed and invests at least 80% of itsassets in equity and equity related securities of Japanesecompanies.

Investments are made based on Japan’s economicstrengths, such as its manufacturing industry (in particularon those parts of it that are demonstrating an ability toexploit newly emerging technology) and on sectorsbenefiting from structural change in the economy.




Classes of Units A Accumulation and A IncomeH Accumulation and H IncomeL Accumulation and L IncomeS IncomeZ Accumulation and Z IncomeGBP Hedged A Accumulation and GBP Hedged A IncomeGBP Hedged L Accumulation and GBP Hedged L IncomeGBP Hedged Z Accumulation and GBP Hedged Z Income










Income Allocation Date 30 April

Profile of a Typical Investor The Fund is a medium risk fund aiming to provide capital growth. It may be suitable for investors whoare seeking long-term returns offered through investment in equities. Investors should regard theirinvestment as medium to long-term and should read the risk warnings set out in Appendix II and theFund's Key Investor Information Document before investing.

Benchmark The Fund’s performance should be assessed against its target benchmark, being to exceed the TokyoStock Exchange 1st Section (Gross Total Return) index, and compared against the InvestmentAssociation Japan sector average return. The Investment Manager invests on a discretionary basisand is not limited to investing in accordance with the composition of the benchmark.







Unit Class Features




Initial Charge


£500 £1,000 1.66% 0.00%

A (Hedged) £1,000 or £50 permonth under regularsavings plan

£500 £1,000 1.70% 0.00%

H None None None Up to 1.00% 0.00%




Z £50,000 £10,000 £50,000 0.92% 0.00%

Z (Hedged) £50,000 £10,000 £50,000 0.95% 0.00%



Schroder UK Alpha Plus FundInvestment Objective

The Fund aims to provide capital growth in excess of theFTSE All Share (Gross Total Return) index (after fees havebeen deducted) over a three to five year period by investingin equity and equity related securities of UK companies.

Investment Policy

The Fund is actively managed and invests at least 80% of itsassets in a concentrated range of equity and equity relatedsecurities of UK companies. These are companies that areincorporated, headquartered or have their principalbusiness activities in the UK. The Fund typically holds 30 to60 companies.

‘Alpha' funds invest in companies in which the InvestmentManager has a high conviction that the current share pricedoes not reflect the future prospects for that business.

The Fund may also invest in companies headquartered orquoted outside the UK which derive a significant proportionof their revenues or profits from the UK.

The Fund may also invest directly or indirectly in otherequity and equity related securities, collective investmentschemes (including Schroder funds), fixed income securities,warrants and money market instruments, and hold cash.



Classes of Units A Accumulation and A IncomeL Accumulation and L IncomeS Accumulation and S IncomeZ Accumulation and Z Income







Annual Accounting Date 31 May

Half-Yearly Accounting Date 30 November

Income Allocation Date 31 July


Benchmark The Fund’s performance should be assessed against its target benchmark, being to exceed the FTSEAll Share (Gross Total Return) index, and compared against the Investment Association UK AllCompanies sector average return. The Investment Manager invests on a discretionary basis and is notlimited to investing in accordance with the composition of the benchmark.






Unit Class Features




Initial Charge


£500 £1,000 1.55% 0.00%



Z £50,000 £10,000 £50,000 0.80% 0.00%



Schroder UK Equity FundInvestment Objective

The Fund aims to provide capital growth and income inexcess of the FTSE All Share (Gross Total Return) index (afterfees have been deducted) over a three to five year period byinvesting in equity and equity related securities of UKcompanies.

Investment Policy

The Fund is actively managed and invests at least 80% of itsassets in equity or equity related securities of UKcompanies. These are companies that are incorporated,headquartered or have their principal business activities inthe UK.

The Fund's approach is grounded in the belief thatsentiment drives share prices in the short term, such thatcompanies with strong long-term prospects often becomeundervalued by the market. The Investment Manager looksto invest in the undervalued companies that have scope forpositive change thereby realising the valuation anomalyover the medium to long term.




Classes of Units A Accumulation and A IncomeI AccumulationS Accumulation and S IncomeZ Accumulation and Z Income








Half-Yearly Accounting Date 20 December

Income Allocation Dates 20 August and 20 February

Profile of a Typical Investor The Fund is a medium risk fund aiming to provide capital growth. It may be suitable for investors whoare seeking long-term returns offered through investment in equities. Investors should regard theirinvestment as medium to long-term and should read the risk warnings set out in Appendix II and theFund's Key Investor Information Document before investing.

Benchmark The Fund’s performance should be assessed against its target benchmark, being to exceed the FTSEAll Share (Gross Total Return) index, and compared against the Investment Association UK AllCompanies sector average return. The Investment Manager invests on a discretionary basis and is notlimited to investing in accordance with the composition of the benchmark.





Unit Class Features




Initial Charge


£500 £1,000 1.55% 0.00%

I £25,000,000 £10,000,000 £25,000,000 0.76% 9.09%


Z £50,000 £10,000 £50,000 0.80% 0.00%



Schroder UK Mid 250 FundInvestment Objective

The Fund aims to provide long term capital growth in excessof the FTSE 250 ex Investment Trusts (Gross Total Return)index (after fees have been deducted) over a three to fiveyear period by investing in equity and equity relatedsecurities of companies listed in the FTSE 250 Index exInvestment Trusts.

Investment Policy

The Fund is actively managed and invests at least 80% of itsassets in equity and equity related securities of UKcompanies listed in the FTSE 250 ex - Investment Trustsindex. These are companies that are incorporated,headquartered or have their principal business activities inthe UK.

The Investment Manager believes that these investmentscan potentially offer faster rates of profit and dividendgrowth and higher long-term returns than their largercounterparts.

The Fund may also invest in former components of, orexpected entrants into, that index if the InvestmentManager believes it may be advantageous to do so.




Classes of Units A Accumulation and A IncomeL Accumulation and L IncomeZ Accumulation and Z Income









Income Allocation Date 30 September


Benchmark The Fund’s performance should be assessed against its target benchmark, being to exceed the FTSE250 ex Investment Trusts (Gross Total Return) index, and compared against the InvestmentAssociation UK All Companies sector average return. The Investment Manager invests on adiscretionary basis and is not limited to investing in accordance with the composition of thebenchmark.





Unit Class Features




Initial Charge


£500 £1,000 1.66% 0.00%


Z £50,000 £10,000 £50,000 0.91% 0.00%



Schroder UK Smaller Companies FundInvestment Objective

The Fund aims to provide capital growth in excess of theFTSE UK Series Small Cap ex Investment Trusts (Gross TotalReturn) index (after fees have been deducted) over a threeto five year period by investing in equity and equity relatedsecurities of small-sized UK companies.

Investment Policy

The Fund is actively managed and invests at least 80% of itsassets in equity and equity related securities of small-sizedUK companies. These are companies that are incorporated,headquartered or have their principal business activities inthe UK and, at the time of purchase, are similar in size tothose comprising the bottom 10% by market capitalisationof the UK equities market.

The small cap universe is an extensive, diverse andconstantly changing area of the UK market. Smallercompanies offer investors exposure to some niche growthareas that, often, cannot be accessed through largecompanies. They also tend to grow more rapidly than largerfirms.




Classes of Units A Accumulation and A IncomeS IncomeZ Accumulation and Z Income











Benchmark The Fund’s performance should be assessed against its target benchmark, being to exceed the FTSEUK Series Small Cap ex Investment Trusts (Gross Total Return) index, and compared against theInvestment Association UK Smaller Companies sector average return. The Investment Managerinvests on a discretionary basis and is not limited to investing in accordance with the composition ofthe benchmark.





Unit Class Features




Initial Charge


£500 £1,000 1.67% 0.00%


Z £50,000 £10,000 £50,000 0.91% 0.00%



Schroder US Equity Income MaximiserInvestment Objective

The Fund aims to provide income by investing in equity andequity related securities of large US companies.

The Fund aims to deliver an income of 5% per year but thisis not guaranteed and could change depending on marketconditions.

Investment Policy

The Fund invests at least 80% of its assets in a passivelymanaged portfolio of the top 500 listed US companies bymarket capitalisation.

To seek to enhance the yield, the Investment Managerselectively sells short dated call options over individualsecurities held by the Fund, portfolios of securities or indicesby agreeing strike prices above which potential capitalgrowth is sold.



The Fund’s investment strategy will typically underperform asimilar portfolio of equities without a derivative overlay inperiods when the underlying equity prices are rising, andhas the potential to outperform when the underlying equityprices are falling.


Classes of Units L Accumulation and L IncomeQ Accumulation and Q IncomeZ Accumulation and Z IncomeGBP Hedged L Accumulation and GBP Hedged L IncomeGBP Hedged Q Income









Quarterly Accounting Dates 20 July, 20 October, 20 January.

Income Allocation Dates 20 June, 20 September, 20 December, 20 March

Profile of a Typical Investor The Fund is a higher risk fund aiming to provide income. It may be suitable for investors who areseeking a higher income through investment in equity securities and are comfortable with the risksassociated with such investments. Investors should regard their investment as medium to long-termand should read the risk warnings set out in Appendix II and the Fund's Key Investor InformationDocument before investing.

Benchmark The Fund’s performance should be assessed against the income target of 5% per year, and comparedagainst the S&P 500 (Net Total Return) index and the Investment Association North American sectoraverage return.

Benchmark SelectionThe target benchmark has been selected because the target return of the Fund is todeliver or exceed the return of that benchmark as stated in the investment objective.The comparator benchmarks have been selected because the Investment Manager and the Managerbelieve that each of these benchmarks is a suitable comparison for performance purposes given theFund’s investment objective and policy.











Unit Class Features




Initial Charge



Q None None None Up to 1.00% 0.00%

Q (Hedged) None None None Up to 1.00% 0.00%

Z £50,000 £10,000 £50,000 0.49% 0.00%



Schroder US Mid Cap FundInvestment Objective

The Fund aims to provide capital growth and income inexcess of the Russell 2500 Total Return Lagged (Gross TotalReturn) index (after fees have been deducted) over a threeto five year period by investing in equity and equity relatedsecurities of medium-sized US companies.

Investment Policy

The Fund is actively managed and invests at least 80% of itsassets in equity and equity related securities of medium-sized US companies. These are companies that, at the timeof purchase, are similar in size to those comprising thebottom 40% by market capitalisation of the North Americanequity market.

The Fund focuses on three types of companies that theInvestment Manager believes:

1. demonstrate strong growth trends and improving levelsof cash;

2. generate dependable earnings and revenues; and

3. are undergoing positive change that is not beingrecognised by the market.










Investment Adviser Schroder Investment Management North America Inc




Profile of a Typical Investor The Fund is a higher risk fund aiming to provide capital growth with some income potential. It may besuitable for investors who are more concerned with maximising long-term returns than minimisingpossible short-term losses. Investors should regard their investment as medium to long-term andshould read the risk warnings set out in Appendix II and the Fund's Key Investor InformationDocument before investing.

Benchmark The Fund’s performance should be assessed against its target benchmark, being to exceed theRussell 2500 TR Lagged (Gross Total Return) index, and compared against the Investment AssociationNorth American sector average return. The Investment Manager invests on a discretionary basis andis not limited to investing in accordance with the composition of the benchmark.





Unit Class Features




Initial Charge


£500 £1,000 1.66% 0.00%



Z £50,000 £10,000 £50,000 0.91% 0.00%



Schroder US Smaller Companies FundInvestment Objective

The Fund aims to provide capital growth in excess of theRussell 2000 Lagged (Gross Total Return) index (after feeshave been deducted) over a three to five year period byinvesting in equity and equity related securities of small-sized US companies.

Investment Policy

The Fund is actively managed and invests at least 80% of itsassets in equity and equity related securities of small-sizedUS companies. These are companies that, at the time ofpurchase, are similar in size to those comprising the bottom20% by market capitalisation of the North American equitymarket. The Fund may invest in small-sized Canadiancompanies.

The small cap universe is an extensive, diverse andconstantly changing area of the North American market. TheInvestment Manager believes smaller companies offerinvestors exposure to some niche growth areas that, often,cannot be accessed through large companies. They alsotend to grow more rapidly than larger companies.




Classes of Units A Accumulation and A IncomeS Accumulation and S IncomeZ Accumulation and Z Income






Investment Adviser Schroder Investment Management North America Inc


Half-Yearly Accounting Date 31 October

Income Allocation Date 30 June


Benchmark The Fund’s performance should be assessed against its target benchmark, being to exceed theRussell 2000 Lagged (Gross Total Return) index, and compared against the Investment AssociationNorth American Smaller Companies sector average return. The Investment Manager invests on adiscretionary basis and is not limited to investing in accordance with the composition of thebenchmark.





Unit Class Features




Initial Charge


£500 £1,000 1.67% 0.00%


Z £50,000 £10,000 £50,000 0.92% 0.00%




Appendix IVEligible Markets ListIn order to qualify as an approved security, the market uponwhich securities are admitted to or dealt must, with certainexceptions permitted under COLL regulations, meet certaincriteria as laid down in COLL.

Eligible Markets include any market established in a memberstate of the European Union or the European Economic Area(an EEA State) on which transferable securities admitted toofficial listing in the member state are dealt in or traded. Italso includes Multilateral Trading Facilities (MTFs) operating

in the EU which operate regularly and are open to the public.In the case of all other markets, in order to qualify as aneligible market, the Manager, after consultation with theTrustee, must be satisfied that the relevant market; (A) isregulated; (B) operates regularly; (C) is recognised; (D) isopen to the public; (E) is adequately liquid and (F) hasadequate arrangements for unimpeded transmission ofincome and capital to investors.

The Manager, after consultation with the Trustee, hasdecided that the following securities exchanges are eligiblemarkets in the context of the investment policy of the Funds.

Regional

Europe Those markets established in a member state on which transferablesecurities admitted to official listing in a member state are dealt in ortraded.

The market organised by the International Capital MarketsAssociation (ICMA)

Country

Australia Australian Securities Exchange

Brazil BM&FBOVESPA and Bolsa De Valores De Rio de Janerio

Canada Toronto Stock Exchange and TSX Venture Exchange

China Shanghai Stock Connect

Hong Kong Hong Kong Stock Exchange and GEM (Growth Enterprise Market)

Hong Kong Stock Connect

Hong Kong Bond Connect

India Bombay (Mumbai) Stock Exchange and National Stock Exchange

Indonesia Indonesian Stock Exchange

Israel Tel Aviv Stock Exchange

Japan The stock exchanges in Fukuoka, Nagoya, Sapporo, Osaka and Tokyo,JASDAQ (and Mothers Market sections of Tokyo Stock Exchange)

Korea Korea Exchange and KOSDAQ

Malaysia Bursa Malaysia

Mexico Mexican Stock Exchange

New Zealand New Zealand Stock Exchange

Peru Lima Stock Exchange

Philippines Philippines Stock Exchange

Saudi Arabia Tadawul Exchange

Singapore Singapore Exchange

Sri Lanka Colombo Stock Exchange

South Africa Johannesburg Stock Exchange

Switzerland SIX Swiss Exchange including the former exchange SWX Europe

Taiwan Taipei Exchange and Taiwan GreTai Securities Market

Thailand Stock Exchange of Thailand

Turkey Istanbul Stock Exchange


UK Those markets established in the UK on which transferable securitiesadmitted to official listing in the UK are dealt in or traded, includingLSE and AIM

USA The NASDAQ Global Select Market, The NASDAQ Global Market andThe NASDAQ Capital Market – collectively the NASDAQ Stock Market(the electronic inter-dealer quotation system of America operated bythe National Association of Securities Dealers Inc)

Any exchange registered with the Securities and ExchangeCommission as a national stock exchange including Chicago StockExchange, NASDAQ OMX BX, NASDAQ OMX PHLX, National StockExchange, NYSE Euronext, NYSE Amex and NYSE Arca

The market in transferable securities issued by or on behalf of theGovernment of the United States of America conducted through thosepersons for the time being recognised and supervised by the FederalReserve Bank of New York and known as primary dealers

The Over-the-Counter Market regulated by the National Association ofSecurities Dealers Inc

FINRA Trade Reporting and Compliance Engine (TRACE)

Derivatives

Australia ASX Trade24

Belgium NYSE Euronext Brussels

Brazil BM&FBOVESPA

Canada Montreal Exchange

Columbia Bolsa De Valores

France NYSE Euronext, Paris

Germany Eurex

Hong Kong Hong Kong Futures Exchange

India National Stock Exchange

Italy Borsa Italiana (Italian Derivatives Market)

Japan Osaka Stock Exchange, Tokyo Stock Exchange, Tokyo FinancialExchange

Korea Korea Exchange

Mexico Mercado Mexicano de Derivados

Netherlands NYSE Euronext, Amsterdam

Poland Warsaw Stock Exchange

Russia The Moscow Exchange

Singapore Singapore Exchange

South Africa Johannesburg Stock Exchange

Spain MEFF Renta Variable (Madrid)

Sweden Nasdaq OMX, Stockholm and NASDAQ OMX Nordic

Switzerland Eurex

Taiwan Taiwan Futures Exchange

Turkey Turkish Derivatives Exchange

UK ICE Futures Exchange

USA CME Group (including Chicago Board of Trade (CBOT), ChicagoMercantile Exchange (CME), COMEX, New York Mercantile Exchange(NYMEX)), Chicago Board Options Exchange (CBOE), CBOE FuturesExchange (CFE), ICE Futures US Inc, NASDAQ OMX Futures Exchange(NFX), Eris Exchange


Appendix VDetermination of Net Asset ValueAll Funds listed in this Prospectus are single priced. A singlepriced scheme has a single price for buying and selling unitson any business day (the Mid Market Value) and may besubject to the imposition of a dilution adjustment after whichthe price to be applied is known as the “Dealing Price”.

Units will be bought or sold on a forward price basis beingthe price calculated at the next valuation following receipt ofUnitholders’ instructions by the Manager. Determination ofNet Asset Value for single priced Funds

Calculation of Mid Market Value

The value of the property of the Fund shall be the value of itsassets less the value of its liabilities determined inaccordance with the following provisions.

(A) All the property of the Fund (including receivables) is tobe included, subject to the following provisions.

(B) Property which is not cash (or other assets dealt with inparagraph (C) below) or a contingent liability transactionshall be valued as follows and the prices used shall(subject as follows) be the most recent prices which it ispracticable to obtain:

(1) units or shares in a collective investment scheme:

(I) if a single price for buying and selling units orshares is quoted, at that price; or

(II) if separate buying and selling prices are quoted,at the average of the two prices provided thebuying price has been reduced by any initialcharge included therein and the selling price hasbeen increase by any exit or redemption chargeattributable thereto; or

(III) if, in the opinion of the Manager, the priceobtained is unreliable or no recent traded priceis available or if no recent price exists, at a valuewhich, in the opinion of the Manager, is fair andreasonablew buying and selling the security isquoted, at that price; or

(IV) if separate buying and selling prices are quoted,at the average of the two prices; or

(V) if, in the opinion of the Manager, the priceobtained is unreliable or no recent traded priceis available or if no price exists, at a value which,in the opinion of the Manager, is fair andreasonable;

(2) property other than that described in (1) and (2)above, at a value which, in the opinion of theManager, represents a fair and reasonable mid-market price.

(C) Cash and amounts held in current and deposit accountsand in other time-related deposits shall be valued at theirnominal values.

(D) Property which is a contingent liability transaction shallbe treated as follows:

(1) if a written option, (and the premium for writing theoption has become part of the scheme property),deduct the amount of the net valuation of premiumreceivable. If the property is an off exchangederivative the method of valuation shall be agreedbetween the Manager and the Trustee;

(2) if an off exchange future, include at the net value ofclosing out in accordance with a valuation methodagreed between the Manager and the Trustee;

(3) if any other form of contingent liability transaction,include at the net value of margin on closing out(whether as a positive or negative value). If theproperty is an off exchange derivative, the method ofvaluation shall be agreed between the Manager andthe Trustee.

(E) In determining the value of the scheme property, allinstructions given to issue or cancel units shall beassumed to have been carried out (and any cash paid orreceived) whether or not this is the case.

(F) Subject to paragraphs (G) and (H) below, agreements forthe unconditional sale or purchase of property which arein existence but uncompleted shall be assumed to havebeen completed and all consequential action required tohave been taken. Such unconditional agreements neednot be taken into account if made shortly before thevaluation takes place and, in the opinion of the Manager,their omission shall not materially affect the final netasset amount.

(G) Futures or contracts for differences which are not yetdue to be performed and unexpired and unexercisedwritten or purchased options shall not be included underparagraph (F).

(H) All agreements are to be included under paragraph (F)which are, or ought reasonably to have been, known tothe person valuing the property.

(I) Deduct an estimated amount for anticipated tax liabilitiesat that point in time including (as applicable and withoutlimitation) capital gains tax, income tax, corporation taxand advance corporation tax, value added tax, stampduty and stamp duty reserve tax.

(J) Deduct an estimated amount for any liabilities payableout of the property of the Fund and any tax thereontreating periodic items as accruing from day to day.

(K) Deduct the principal amount of any outstandingborrowings whenever payable and any accrued butunpaid interest on borrowings.

(L) Add an estimated amount for accrued claims for tax ofwhatever nature which may be recoverable.

(M) Add any other credits or amounts due to be paid into theproperty of the Fund.

(N) Add a sum representing any interest or any incomeaccrued due or deemed to have accrued but notreceived.


(O) Currencies or values in currencies other than basecurrency shall be converted at the relevant valuationpoint at a rate of exchange that is not likely to result inany material prejudice to the interests of Unit holders orpotential Unitholders.

Dilution

The actual cost of purchasing or selling the Fund’sinvestments may be higher or lower than the Mid-MarketValue used in calculating the Unit price – for example, due todealing charges, or through dealing at prices other than themid-market price. Under certain circumstances (for example,large volumes of deals) this may have an adverse effect onthe Unitholders’ interests in the Fund, this is known as‘dilution’.

Dilution Adjustment and Large Deals

To mitigate the effects of dilution the Manager has thediscretion to make a dilution adjustment on the sale orredemption of Units to adjust the price.

The need to make a dilution adjustment will depend on thevolume of sales or redemptions of Units. The Manager maymake a discretionary dilution adjustment if, in its opinion, theexisting (for net purchases) or remaining Unitholders (for netredemptions) might otherwise be adversely affected. TheManager therefore reserves the right to make a dilutionadjustment in the following circumstances:

(A) where the Fund is in continual decline (is suffering a netoutflow of investment);

(B) on the Fund experiencing large levels of net sales relativeto its size;

(C) on the Fund experiencing net sales or net redemptionson any day above a threshold set by the Manager;

(D) in any other case where the Manager is of the opinionthat the interests of existing or continuing Unitholdersand potential Unitholders, require the imposition of adilution adjustment.

Where a dilution adjustment is made, it will typically increasethe dealing price when there are net inflows into the Fundand decrease the dealing price when there are net outflows.The dealing price of each class of Unit in the Fund will becalculated separately but any dilution adjustment will, inpercentage terms, affect the price of Units of each classidentically.

On the occasions when the dilution adjustment is not madethere may be an adverse impact on the total assets of theFund.

For illustrative purposes, the table below sets out how manytimes the Manager applied a dilution adjustment on thedealing in Units of each Fund over the 12 month period from1 January 2020 to 31 December 2020. However, such historicalinformation does not constitute a projection. As dilution isrelated to the inflows and outflows of money from the Fund itis not possible to accurately predict whether dilution willoccur at any future point in time. Consequently it is also notpossible to accurately predict how frequently the Managerwill need to make such a dilution adjustment. In the usualcourse of business, the application of a dilution adjustmentwill be triggered mechanically and on a consistent basis.

Number of timesdilution adjust-ment applied in2020

Schroder Absolute Return Bond Fund 38

Schroder Asian Alpha Plus Fund 34

Schroder Asian Income Fund 33

Schroder Asian Income Maximiser 41

Schroder European Alpha Plus Fund 41

Schroder European Smaller Companies Fund 37

Schroder Gilt and Fixed Interest Fund 36

Schroder Global Cities Real Estate 35

Schroder Global Cities Real Estate Income 37

Schroder Global Emerging Markets Fund 36

Schroder Global Equity Income Fund 38

Schroder Global Healthcare Fund 35

Schroder High Yield Opportunities Fund 33

Schroder Income Fund 39

Schroder Income Maximiser 34

Schroder Managed Balanced Fund 0

Schroder Recovery Fund 40

Schroder Small Cap Discovery Fund 35

Schroder Strategic Bond Fund 49

Schroder Tokyo Fund 38

Schroder UK Alpha Plus Fund 35

Schroder UK Equity Fund 32

Schroder UK Mid 250 Fund 33

Schroder UK Smaller Companies Fund 32

Schroder US Equity Income Maximiser 44

Schroder US Mid Cap Fund 32

Schroder US Smaller Companies Fund 35

Because the dilution adjustment for each Fund will becalculated by reference to the costs of dealing in theunderlying investments of that Fund, including any dealingspreads, and these can vary with market conditions, thismeans that the amount of the dilution adjustment can varyover time.

Estimates of the dilution adjustments for each Fund are setout in the table below based on the securities held in eachfund and market conditions at the time of publication of theprospectus.


Estimated Dilution Adjustments

Estimated Di-lution Adjust-ment applic-able toredemptions

Estimated Di-lution Adjust-ment applic-able topurchases

Schroder Absolute Return BondFund

0.14% 0.14%

Schroder Asian Alpha Plus Fund 0.25% 0.18%

Schroder Asian Income Fund 0.29% 0.28%

Schroder Asian IncomeMaximiser

0.30% 0.20%

Schroder European Alpha PlusFund

0.08% 0.23%

Schroder European SmallerCompanies Fund

0.17% 0.25%

Schroder Gilt and Fixed InterestFund

0.05% 0.05%

Schroder Global Cities RealEstate

0.11% 0.14%

Schroder Global Cities RealEstate Income

0.20% 0.19%

Schroder Global EmergingMarkets Fund

0.24% 0.17%

Schroder Global Equity IncomeFund

0.10% 0.26%

Schroder Global Healthcare Fund 0.06% 0.08%

Schroder High YieldOpportunities Fund

0.69% 0.69%

Schroder Income Fund 0.07% 0.47%

Schroder Income Maximiser 0.07% 0.47%

Schroder Managed BalancedFund

0.00% 0.00%

Schroder Managed WealthPortfolio

0.16% 0.16%

Schroder Recovery Fund 0.10% 0.47%

Schroder Small Cap DiscoveryFund

0.42% 0.32%

Schroder Strategic Bond Fund 0.52% 0.52%

Schroder Tokyo Fund 0.15% 0.15%

Schroder UK Alpha Plus Fund 0.10% 0.57%

Schroder UK Equity Fund 0.10% 0.55%

Schroder UK Mid 250 Fund 0.22% 0.67%

Schroder UK Smaller CompaniesFund

1.41% 1.65%

Schroder US Equity IncomeMaximiser

0.04% 0.03%

Schroder US Mid Cap Fund 0.06% 0.05%

Schroder US Smaller CompaniesFund

0.09% 0.09%


Appendix VIOther Collective InvestmentSchemes managed by theManagerThe Manager is also the manager of the followingauthorised unit trust schemes:

– Schroder All Maturities Corporate Bond Fund

– Schroder Countrywide Managed Balanced Fund

– Schroder Diversified Growth Fund

– Schroder Dynamic Multi Asset Fund

– Schroder European Fund

– Schroder Global Corporate Bond Managed CreditComponent Fund

– Schroder Global Diversified Income Fund

– Schroder Global Equity Component Fund

– Schroder Global Equity Fund

– Schroder Global Multi-Factor Equity Fund

– Schroder Global Sovereign Bond Tracker ComponentFund

– Schroder Institutional Growth Fund

– Schroder Institutional Pacific Fund

– Schroder Institutional UK Smaller Companies Fund

– Schroder Long Dated Corporate Bond Fund

– Schroder Monthly Income Fund

– Schroder MM Diversity Fund

– Schroder MM Diversity Balanced Fund

– Schroder MM Diversity Income Fund

– Schroder MM Diversity Tactical Fund

– Schroder MM International Fund

– Schroder MM UK Growth Fund

– Schroder Moorgate I Fund

– Schroder Prime UK Equity Fund

– Schroder QEP Global Active Value Fund

– Schroder QEP Global Core Fund

– Schroder QEP Global Emerging Markets Fund

– Schroder QEP US Core Fund

– Schroder Responsible Value UK Equity Fund

– Schroder Sterling Broad Market Bond Fund

– Schroder Sterling Short Dated Broad Market Bond Fund

– Schroder Sustainable Multi-Factor Equity fund

– Schroder UK Multi-Factor Equity Component Fund

– Schroder UK Real Estate Fund Feeder Trust

– SUTL Cazenove GBP Balanced Fund

– SUTL Cazenove GBP Cautious Fund

– SUTL Cazenove GBP Equity Focus Fund

– SUTL Cazenove GBP Growth Fund

– SUTL Cazenove Sustainable Growth Fund

– Anla Fund

– The Blackline Fund

– Bowdon General Fund

– Caversham Fund

– Elystan Fund

– Gresham General Fund

– Pilot Hill Fund

– Star Hill Fund

– Thornton Fund

– Winding Wood Fund

– The Betton Fund

– The Blair Fund

– The Cutty Fund

– The Global Growth Fund

– The Little Acorn Fund

– The Milton Fund

– The Mount Diston Fund

– The Pondtail Fund

– The Second Managed Growth Fund

– The Springfield Trust

– Scriventon Fund

– Evergreen Fund

– Bass Rock Fund

– Broombriggs Fund

– Countess Fund

– Barnegat Light Fund

– Eiger Fund

– Iranja Fund

– Finial Fund


– Ardnave Fund

– Wadham Fund

The Manager is also ACD for Schroder Investment FundCompany, an open-ended investment company whichcurrently has the following sub-funds:

– Schroder UK Opportunities Fund

– Schroder UK Dynamic Smaller Companies Fund

– Schroder Sterling Corporate Bond Fund

– Schroder Strategic Credit Fund

– Schroder European Opportunities Fund

– Schroder Core UK Equity Fund

– Schroder UK Alpha Income Fund

– Schroder European Alpha Income Fund

– Schroder Global Recovery Fund

– Schroder Multi-Asset Total Return Fund

– Schroder India Equity Fund

– Schroder Islamic Global Equity Fund

– Schroder UK-Listed Equity Income Maximiser Fund

– Schroder Global Energy Transition Fund

– Schroder Global Sustainable Growth Fund

The Manager is also ACD for Schroder Absolute ReturnFund Company, an open-ended investment companywhich currently has the following sub-funds:

– Schroder UK Dynamic Absolute Return Fund

The Manager is also ACD for Schroder Fusion InvestmentFund Company, an open-ended investment companywhich currently has the following sub-funds:

– Schroder Fusion Portfolio 3





– Schroder Fusion Managed Defensive Fund

– Schroder Portfolio 3






The Manager is also ACD for the following open-endedinvestment companies:

– The Arcadia Fund

– The Wakefield Fund

The Manager is also the Manager of SUTL CazenoveCharity UCITS Fund which currently has the followingsub-trusts:

– SUTL Cazenove Charity Equity Income Fund

– SUTL Cazenove Charity Equity Value Fund

– SUTL Cazenove Charity Bond Fund

The Manager is also the Manager of SUTL CazenoveCharity Non-UCITS Fund which currently has thefollowing sub-trusts:

– SUTL Cazenove Charity Multi-Asset Fund

– SUTL Cazenove Charity Responsible Multi-Asset Fund


Appendix VIIPerformance DetailsThe historical performance 1 of each Fund is as followstogether with the historical performance of the relevantbenchmark(s) for each Fund provided for comparisonpurposes:

Annual performance is shown for A Class Accumulation Unitsof each fund. If A Class Accumulation Units have not beenissued for a fund the unit class with the highest annualmanagement charge will be shown. Past performance is notnecessarily a guide to future performance. The value ofinvestments and the income from them can go down as wellas up and investors may not get back the amount originallyinvested.

Fund 2020(%) 2019(%) 2018(%) 2017(%) 2016(%)

Schroder Absolute Return Bond Fund 2

A Accumulation GBP -0.9 4.7 -2.5 0.8 2.7

3 month LIBOR +1% 1.3 1.8 1.7 1.4 1.5

ICE BofA Sterling 3-Month Government Bill Index +1% 3 - - - - -

Schroder Asian Alpha Plus Fund

A Accumulation GBP 29.5 14.5 -9.7 35.9 24.8

MSCI AC Asia ex Japan (Net Total Return) Index 21.2 13.6 -9.1 29.5 25.8

Investment Association Asia Pacific ex Japan sectoraverage

19.9 15.8 -9.8 25.3 25.9

Schroder Asian Income Fund


MSCI AC Pacific ex Japan (Net Total Return) Index 19.2 15.7 -9.2 25.1 28.2


19.9 15.8 -9.8 25.3 25.9

Schroder Asian Income Maximiser


MSCI AC Pacific ex Japan (Net Total Return) Index 19.2 15.7 -9.2 25.1 28.2


19.9 15.8 -9.8 25.3 25.9

Schroder European Alpha Plus Fund


FTSE World Series Europe ex UK (Gross Total Return) Index 8.6 20.5 -9.5 17.5 19.7

Investment Association Europe ex UK sector average 10.5 20.4 -12.2 17.4 17.0

Schroder European Smaller Companies Fund


Euromoney Smaller Europe ex UK (Gross Total Return)Index

18.9 20.6 -12.7 23.3 23.2

Investment Association European Smaller Companiessector average

18.0 20.6 -15.3 25.4 14.5

1 Source: Schroders – bid to bid price with net income reinvested, net of the ongoing charges and portfolio costs.2 With effect from 13 June 2011, Schroder Strategic Bond Fund changed its name to Schroder Absolute Return Bond Fund and changed its investment objective. A new fund namedSchroder Strategic Bond Fund was launched on 27 March 2012. With effect from 28 June 2021, Schroder Absolute Return Bond Fund changed its investment objective.

3 Prior to 28 June 2021, historical performance for Schroder Absolute Return Bond Fund is compared against previous target benchmark (3 month LIBOR plus 1%)


Fund 2020(%) 2019(%) 2018(%) 2017(%) 2016(%)

Schroder Gilt and Fixed Interest Fund


FTSE Gilts All Stocks index 8.3 6.4 -0.3 2.3 24.3

Investment Association UK Gilts sector average return 9.0 7.2 -0.1 1.7 11.0

Schroder Global Cities Real Estate 4


UK Consumer Price Index plus 3% 3.6 4.3 5.1 6.1 4.6

FTSE EPRA NAREIT Developed (Gross Total Return) Index -11.0 18.3 1.2 7.1 8.5

Investment Association Property Investment Sectoraverage

-3.8 16.8 7.8 7.8 8.5

Schroder Global Cities Real Estate Income 5

A Accumulation GBP -16.9 21.2 -3.9 -0.1 26.8

UK Consumer Price Index plus 3% 3.6 4.3 5.1 6.1 4.6

FTSE EPRA NAREIT Developed Dividend Plus (Gross TotalReturn) Index

-11.0 18.4 1.1 7.1 8.5

Investment Association Property Investment Sectoraverage

-3.8 16.8 7.8 7.8 8.5

Schroder Global Emerging Markets Fund


MSCI Emerging Markets (Net Total Return) Index 14.7 13.9 -9.3 25.4 32.6

Investment Association Global Emerging Markets sectoraverage

13.6 15.7 -11.5 24.5 31.6

Schroder Global Equity Income Fund 6


MSCI World (Net Total Return) Index 12.3 22.7 -3.0 11.8 28.2

Investment Association Global Equity Income sectoraverage

3.4 19.0 -5.7 10.2 24.2

MSCI World Value (Net Total Return) Index - - - - -

Schroder Global Healthcare Fund 7

A Accumulation GBP 22.0 21.3 6.9 7.4 10.1

MSCI AC World Health Care Daily (Gross Total Return)Index

11.9 18.6 8.6 1.3 11.7

Investment Association Global sector average 14.8 22.0 -5.7 13.9 23.9

Schroder High Yield Opportunities Fund 8

4 With effect from 19 February 2016, Schroder Global Property Securities Fund changed its name to Schroder Global Cities Real Estate.5 With effect form 2 October 2017, Schroder Global Real Estate Securities Income changed its name to Schroder Global Cities Real Estate Income.6 With effect from 31 March 2021, Schroder Global Equity Income Fund added the MSCI World Value (Net Total Return) Index as a comparator benchmark.7 With effect from 7 December 2012, Schroder Medical Discovery Fund changed its name to Schroder Global Healthcare Fund.8 With effect from 17 February 2017, Schroder Monthly High Income Fund changed its name to Schroder High Yield Opportunities Fund.


Fund 2020(%) 2019(%) 2018(%) 2017(%) 2016(%)


Investment Association High Yield Investment sectoraverage

3.5 11.4 -3.6 6.1 1.1

Schroder Income Fund 9


FTSE All Share (Gross Total Return) Index -9.8 19.2 -9.5 13.1 16.8

Investment Association UK Equity Income sector average -10.9 20.1 -10.5 11.5 8.9

MSCI UK Value (Gross Total Return) Index - - - - -

Schroder Income Maximiser



Investment Association UK Equity Income sector average -10.9 20.1 -10.5 11.5 8.9

Schroder Managed Balanced Fund


Investment Association Mixed Investment 40% to 85%Shares sector average

5.5 15.9 -6.7 10.1 13.2

Schroder Managed Wealth Portfolio


UK Consumer Price Index plus 3.5% 4.1 4.8 5.6 6.6 5.1

Asset Risk Consultants (ARC) Sterling Balanced AssetPrivate Client index

4.8 11.7 -5.1 6.7 8.6

Schroder Recovery Fund 10



Investment Association UK All Companies sector average -6.2 22.4 -11.2 14.1 11.0

MSCI UK Value (Gross Total Return) Index - - - - -

Schroder Small Cap Discovery Fund


Blend of the MSCI Small Cap (Net Total Return) indices(Emerging Markets, Hong Kong, Singapore)

14.1 7.3 -13.7 20.8 21.3

Schroder Strategic Bond Fund


Investment Association Strategic Bond sector average 6.1 9.2 -2.5 5.3 7.0

9 With effect from 31 March 2021, Schroder Income Fund added the MSCI UK Value (Gross Total Return) Index as a comparator benchmark.10 With effect from 31 March 2021, Schroder Recovery Fund changed its investment objective, and comparator benchmarks. The past performance in the above table is based onthe fund's objective and benchmarks (No target benchmark. Comparator benchmarks: FTSE All Share (Gross Total Return) index and the Investment Association UK AllCompanies sector average return) in place prior to this date. Going forward, this table will show past performance from this date based on the new objective and benchmarks(Target benchmark: FTSE All Share (Gross Total Return) Index. Comparator benchmarks: MSCI UK Value (Gross Total Return) Index and the Investment Association UK AllCompanies sector average return).


Fund 2020(%) 2019(%) 2018(%) 2017(%) 2016(%)

Schroder Tokyo Fund


Tokyo Stock Exchange 1st Section (Gross Total Return)Index

9.5 14.6 -8.4 15.6 23.4

Investment Association Japan sector average 13.9 17.1 -11.3 17.8 23.5

Schroder UK Alpha Plus Fund




Schroder UK Equity Fund




Schroder UK Mid 250 Fund


FTSE 250 ex Investment Trusts (Gross Total Return) Index -8.5 3.8 -15.2 18.2 5.1


Schroder UK Smaller Companies Fund


FTSE UK Series Small Cap ex Investment Trusts (GrossTotal Return) Index

1.7 17.7 -13.8 15.6 12.5

Investment Association UK Smaller Companies sectoraverage

7.0 25.4 -11.8 27.2 8.5

Schroder US Mid Cap Fund


Russell 2500 TR Lagged (Gross Total Return) Index 16.0 24.6 -6.2 6.6 41.9

Investment Association North American sector average 16.4 24.6 -1.2 1.5 3.1

Schroder US Equity Income Maximiser

Z Accumulation GBP 8.8 21.5 -0.8 - -

S&P 500 (Net Total Return) Index 14.1 25.7 1.0 - -

Investment Association North American sector average 16.4 24.6 -1.2 - -

Schroder US Smaller Companies Fund


Fund 2020(%) 2019(%) 2018(%) 2017(%) 2016(%)


Russell 2000 Lagged (Gross Total Return) Index 16.2 22.1 -7.3 4.8 46.0

Investment Association North American SmallerCompanies sector average

22.5 27.0 -5.1 6.9 38.6


Appendix VIIIOther InformationList of the third party delegates appointed by the Depositary– as 22 March 2020.

Please note that from 1 July 2017 J.P. Morgan BankLuxembourg S.A. is an intermediary sub custodian betweenJPMorgan Chase Bank N.A. and JPMorgan Chase Bank N.A.Mumbai Branch as Indian sub custodian.

MARKET SUBCUSTODIAN CASH CORRESPONDENT BANK

ARGENTINA HSBC Bank Argentina S.A.Bouchard 557, 18th FloorBuenos Aires C1106ABJARGENTINA

HSBC Bank Argentina S.A.Buenos Aires

AUSTRALIA JPMorgan Chase Bank N.A. (J.P. Morgan affiliate)Level 31, 101 Collins StreetMelbourne 3000AUSTRALIA

Australia and New Zealand BankingGroup Ltd.MelbourneJPMorgan Chase Bank N.A., SydneyBranch(for clients utilizing J.P. Morgan'sdomesticAUD solution) (J.P. Morgan affiliate)Sydney

AUSTRIA UniCredit Bank Austria AGJulius Tandler Platz – 3A-1090 ViennaAUSTRIA

J.P. Morgan AG (J.P. Morgan affiliate)Frankfurt am Main

BAHRAIN HSBC Bank Middle East Limited1st Floor, Building No 2505, Road No 2832Al Seef 428BAHRAIN

HSBC Bank Middle East LimitedAl Seef

BANGLADESH Standard Chartered BankPortlink TowerLevel-6, 67 Gulshan AvenueGulshanDhaka -1212BANGLADESH

Standard Chartered BankDhaka

BELGIUM BNP Paribas Securities Services S.C.A. (forclients contracting with J.P. Morgan (Suisse)SA and for all Belgian Bonds settling in theNational Bank of Belgium (NBB))Central Plaza BuildingRue de Loxum, 257th Floor1000 BrusselsBELGIUM

J.P. Morgan Bank Luxembourg S.A. (for clientscontracting with this entity and JPMorganChase Bank, N.A.) (J.P. Morgan affiliate)European Bank & Business Centre, 6, route deTrevesSenningerberg L-2633LUXEMBOURG

J.P. Morgan Bank (Ireland) PLC (for clientscontracting with this entity) (J.P. Morgan affiliate)200 Capital Dock, 79 Sir John Rogerson’s QuayDublin D02 RK57IRELAND

J.P. Morgan AGFrankfurt am Main

BERMUDA HSBC Bank Bermuda Limited37 Front StreetHamilton HM 11BERMUDA

HSBC Bank Bermuda LimitedHamilton

BOTSWANA Standard Chartered Bank Botswana Limited5th Floor, Standard HouseP.O. Box 496Queens Road, The MallGaboroneBOTSWANA

Standard Chartered Bank BotswanaLimitedGaborone



BRAZIL J.P. Morgan S.A. DTVM (J.P. Morgan affiliate)Av. Brigadeiro Faria Lima, 3729, Floor 06Sao Paulo SP 04538-905BRAZIL

J.P. Morgan S.A. DTVM (J.P. Morganaffiliate)Sao Paulo

BULGARIA Citibank Europe plcSerdika Offices10th Floor48 Sitnyakovo BlvdSofia 1505BULGARIA

ING Bank N.V.Sofia

CANADA CIBC Mellon Trust Company (Note: Clientsplease refer to your issued settlementinstructions)1 York Street, Suite 900Toronto Ontario M5J 0B6CANADA

Royal Bank of Canada (Note: Clients please refer to your issuedsettlement instructions)155 Wellington Street West, 2nd FloorToronto Ontario M5V 3L3CANADA

Canadian Imperial Bank of Commerce(Forclients utilizing J.P. Morgan’s domesticCADsolution)TorontoRoyal Bank of CanadaToronto

CHILE Banco Santander ChileBandera 140, Piso 4SantiagoCHILE

Banco Santander ChileSantiago

CHINA A-SHARE JPMorgan Chase Bank (China) CompanyLimited (Note: Clients please refer to your issued settlementinstructions) J.P. Morgan affiliate41st floor, Park Place, No. 1601, West NanjingRoad, Jingan DistrictShanghaiTHE PEOPLE’S REPUBLIC OF CHINA

HSBC Bank (China) Company Limited33/F, HSBC Building, Shanghai ifc8 Century Avenue, PudongShanghai 200120THE PEOPLE'S REPUBLIC OF CHINA

JPMorgan Chase Bank (China) CompanyLimited (Note: Clients please refer toyour issued settlement instructions) J.P.Morgan affiliateShanghai

HSBC Bank (China) Company Limited(Note: Clients please refer to your issuedsettlement instructions)Shanghai

CHINA B-SHARE HSBC Bank (China) Company Limited33/F, HSBC Building, Shanghai ifc8 Century Avenue, PudongShanghai 200120THE PEOPLE'S REPUBLIC OF CHINA

JPMorgan Chase Bank, N.A. (J.P. Morganaffiliate)New YorkJPMorgan Chase Bank, N.A (J.P. Morganaffiliate)Hong Kong

CHINA CONNECT JPMorgan Chase Bank, N.A. (J.P. Morgan affiliate)48th Floor, One Island East18 Westlands Road, Quarry BayHONG KONG

JPMorgan Chase Bank, N.A. (J.P. Morganaffiliate)Hong Kong

COLOMBIA Cititrust Colombia S.A.Carrera 9 A # 99-02, 3rd floorBogotaCOLOMBIA

Cititrust Colombia S.A.Bogotá

*COSTA RICA* Banco BCT, S.A.150 Metros Norte de la Catedral MetropolitanaEdificio BCTSan JoseCOSTA RICA

Banco BCT, S.A.San Jose

*RESTRICTED SERVICE ONLY.*

CROATIA Privredna banka Zagreb d.d.Radnicka cesta 5010000 ZagrebCROATIA

Zagrebacka banka d.d.Zagreb

CYPRUS HSBC France Athens Branch109-111, Messogian Ave.115 26 AthensGREECE




CZECH REPUBLIC UniCredit Bank Czech Republic and Slovakia, a.sBB Centrum – FILADELFIEZeletavska 1525-1140 92 Prague 1CZECH REPUBLIC

Ceskoslovenska obchodni banka, a.s.Prague

DENMARK Nordea Bank AbpChristiansbroStrandgade 3P.O. Box 850DK-0900 CopenhagenDENMARK

Nordea Bank AbpCopenhagen

EGYPT Citibank N.A., EgyptBoomerang Building, Plot 46, Zone J, 1stdistrict, 5th Settlement,New Cairo 11511EGYPT

Citibank, N.A.New Cairo

ESTONIA Access to the market via Clearstream BankingS.A., Luxembourg in its capacity asInternational Central Securities Depository


FINLAND Nordea Bank AbpSatamaradankatu 5Helsinki FIN-00020 NordeaFINLAND

J.P. Morgan AG(J.P. Morgan affiliate)Frankfurt am Main

FRANCE BNP Paribas Securities Services S.C.A. (for clients contracting with J.P. Morgan (Suisse) SA and for Physical Securities and Ordre deMouvement (ODMs) held by clients)3, Rue d'AntinParis 75002FRANCE

J.P. Morgan Bank Luxembourg S.A. (for clientscontracting with this entity and JPMorganChase Bank, N.A.) (J.P. Morgan affiliate)European Bank & Business Centre, 6, route deTrevesSenningerberg L-2633LUXEMBOURG

J.P. Morgan Bank (Ireland) PLC (for clientscontracting with this entity) (J.P. Morgan affiliate)200 Capital Dock, 79 Sir John Rogerson’s QuayDublin D02 RK57IRELAND


GERMANY Deutsche Bank AGAlfred-Herrhausen-Allee 16-24D-65760 EschbornGERMANY

J.P. Morgan AG (J.P. Morgan affiliate)Taunustor 1 (TaunusTurm)60310 Frankfurt am MainGERMANY# Custodian for local German custody clients only.


GHANA Standard Chartered Bank Ghana LimitedAccra High StreetP.O. Box 768AccraGHANA

Standard Chartered Bank Ghana LimitedAccra

GREECE HSBC France Athens BranchMessogion 109-11111526 AthensGREECE


HONG KONG JPMorgan Chase Bank, N.A. (J.P. Morgan affiliate)18th Floor Tower 2, The Quayside, 77 Hoi BunRoad, Kwun TongHONG KONG

JPMorgan Chase Bank, N.A. (J.P. Morganaffiliate)Hong Kong



HUNGARY Deutsche Bank AGHold utca 27H-1054 BudapestHUNGARY

UniCredit Bank Hungary Zrt.

*ICELAND* Islandsbanki hf.Kirkjusandur 2IS-155 ReykjavikICELAND

Islandsbanki hf.Reykjavik


INDIA JPMorgan Chase Bank, N.A. (J.P. Morgan affiliate)6th Floor, Paradigm ‘B’ WingMindspace, Malad (West)Mumbai 400 064INDIA

JPMorgan Chase Bank, N.A. (J.P. Morganaffiliate)Mumbai

INDONESIA PT Bank HSBC IndonesiaWTC 3 Building - 8th floorJl. Jenderal Sudirman Kav. 29-31INDONESIA

PT Bank HSBC IndonesiaJakarta

IRELAND JPMorgan Chase Bank, N.A. (J.P. Morgan affiliate)25 Bank Street, Canary WharfLondon E14 5JPUNITED KINGDOM


ISRAEL Bank Leumi le-Israel B.M.35, Yehuda Halevi Street65136 Tel AvivISRAEL

Bank Leumi le-Israel B.M.Tel Aviv

ITALY J.P. Morgan Bank (Ireland) PLC (for clients contracting with thisentity. Clients contracting with J.P. Morgan Bank Luxembourg S.A.please refer to your issued settlement instructions) J.P.Morgan affiliate200 Capital Dock, 79 Sir John Rogerson’s QuayDublin D02 RK57IRELAND

BNP Paribas Securities Services S.C.A. (for clients contracting with J.P. Morgan Chase Bank, N.A. and J.P. Morgan (Suisse) SA. Clientscontracting with J.P. Morgan BankLuxembourg S.A. please refer to your issued settlementinstructions)Piazza Lina Bo Bardi 3Milan 20124ITALY


JAPAN Mizuho Bank, Ltd. (Note: Clients please refer to your issuedsettlement instructions)2-15-1, KonanMinato-kuTokyo 108-6009JAPAN

MUFG Bank, Ltd. (Note: Clients please refer to your issuedsettlement instructions)1-3-2 Nihombashi Hongoku-choChuo-kuTokyo 103-0021JAPAN

JPMorgan Chase Bank, N.A. (J.P. Morganaffiliate)Tokyo

JORDAN Standard Chartered BankShmeissani BranchAl-Thaqafa StreetBuilding # 2P.O.BOX 926190AmmanJORDAN

Standard Chartered BankAmman

KAZAKHSTAN JSC Citibank KazakhstanPark Palace, Building A, Floor 241 Kazybek BiAlmaty 050010KAZAKHSTAN

Subsidiary Bank Sberbank of Russia JointStock CompanyAlmaty



KENYA Standard Chartered Bank Kenya LimitedChiromo48 Westlands RoadNairobi 00100KENYA

Standard Chartered Bank Kenya LimitedNairobi

KUWAIT HSBC Bank Middle East LimitedAl Hamra Tower, Abdulaziz Al Sager StreetSharq AreaKuwait CityKUWAIT

HSBC Bank Middle East LimitedKuwait City

LATVIA Access to the market via Clearstream Banking S.A., Luxembourg inits capacity asInternational Central Securities Depository


LITHUANIA Access to the market via Clearstream Banking S.A., Luxembourg inits capacity asInternational Central Securities Depository

J.P. Morgan AG(J.P. Morgan affiliate)Frankfurt am Main

LUXEMBOURG BNP Paribas Securities Services S.C.A.60 Avenue John F. KennedyLuxembourg L-1855LUXEMBOURG


*MALAWI* Standard Bank PLCKaomba Centre, Cnr Glyn Jones Road &Victoria Avenue, P.O. Box 1111BlantyreMALAWI

Standard Bank Limited, MalawiBlantyre


MALAYSIA HSBC Bank Malaysia Berhad2 Leboh Ampang12th Floor, South Tower50100 Kuala LumpurMALAYSIA

HSBC Bank Malaysia BerhadKuala Lumpur

MAURITIUS The Hongkong and Shanghai Banking Corporation LimitedHSBC Centre18 CybercityEbeneMAURITIUS

The Hongkong and Shanghai BankingCorporation LimitedEbene

MEXICO Banco Nacional de Mexico, S.A.Act. Roberto Medellin No. 800 3er Piso NorteColonia Santa Fe01210 Mexico, D.F.MEXICO

Banco Santander (Mexico), S.A.Mexico, D.F.

MOROCCO Société Générale Marocaine de Banques55 Boulevard AbdelmoumenCasablanca 20100MOROCCO

Attijariwafa Bank S.A.Casablanca

NAMIBIA Standard Bank Namibia LimitedMutual Platz2nd Floor, Standard Bank CentreCnr. Stroebel and Post StreetsP.O.Box 3327WindhoekNAMIBIA

The Standard Bank of South AfricaLimitedJohannesburg



NETHERLANDS J.P. Morgan Bank Luxembourg S.A. (for clients contracting with thisentity and JPMorganChase Bank, N.A.) (J.P. Morgan affiliate)European Bank & Business Centre, 6, route deTrevesSenningerberg L-2633LUXEMBOURG

BNP Paribas Securities Services S.C.A. (for clients contracting with J.P. Morgan (Suisse)SA)Herengracht 5951017 CE AmsterdamNETHERLANDS

J.P. Morgan Bank (Ireland) PLC (for clients contracting with thisentity) J.P. Morgan affiliate200 Capital Dock, 79 Sir John Rogerson’s QuayDublin D02 RK57IRELAND


NEW ZEALAND JPMorgan Chase Bank, N.A. (J.P. Morgan affiliate)Level 13, 2 Hunter StreetWellington 6011NEW ZEALAND

JPMorgan Chase Bank, N.A. New ZealandBranch (for clients utilizing J.P. Morgan'sdomestic NZD solution) J.P. MorganaffiliateWellington

Westpac Banking CorporationWellington

NIGERIA Stanbic IBTC Bank PlcPlot 1712Idejo StreetVictoria IslandLagosNIGERIA

Stanbic IBTC Bank PlcLagos

NORWAY Nordea Bank AbpEssendropsgate 7PO Box 1166NO-0107 OsloNORWAY

Nordea Bank AbpOslo

OMAN HSBC Bank Oman S.A.O.G.2nd Floor Al KhuwairPO Box 1727 PC 111SeebOMAN

HSBC Bank Oman S.A.O.G.Seeb

PAKISTAN Standard Chartered Bank (Pakistan) LimitedP.O. Box 4896Ismail Ibrahim Chundrigar RoadKarachi 74000PAKISTAN

Standard Chartered Bank (Pakistan)LimitedKarachi

PERU Citibank del Perú S.A.Av. Canaval y Moreryra 480 Piso 4San IsidroLima 27PERU

Citibank del Perú S.A.Lima

PHILIPPINES The Hongkong and Shanghai Banking Corporation Limited7/F HSBC Centre3058 Fifth Avenue WestBonifacio Global City1634 Taguig CityPHILIPPINES

The Hongkong and Shanghai BankingCorporation LimitedTaguig City

POLAND Bank Handlowy w. Warszawie S.A.ul. Senatorska 1600-923 WarsawPOLAND

mBank S.A.Warsaw

PORTUGAL BNP Paribas Securities Services S.C.A.Avenida D.João II, Lote 1.18.01, Bloco B,7º andar1998-028 LisbonPORTUGAL




QATAR HSBC Bank Middle East Limited2nd Floor, Ali Bin Ali TowerBuilding 150 (Airport Road)PO Box 57DohaQATAR

The Commercial Bank (P.Q.S.C.)Doha

ROMANIA Citibank Europe plc145 Calea Victoriei1st District010072 BucharestROMANIA

ING Bank N.V.Bucharest

RUSSIA Commercial Bank J.P. Morgan Bank International (Limited LiabilityCompany) (J.P. Morgan affiliate)10, Butyrsky ValWhite Square Business CentreFloor 12Moscow 125047RUSSIA

Sberbank of RussiaMoscow

JPMorgan Chase Bank, N.A. (J.P. Morganaffiliate)New York

SAUDI ARABIA J.P. Morgan Saudi Arabia Company (Note: Clients please refer toyour issued settlement instructions) J.P. Morgan affiliateAl Faisaliah Tower, Level 8, P.O. Box 51907Riyadh 11553SAUDI ARABIA

HSBC Saudi Arabia Limited (Note: Clients please refer to yourissued settlement instructions)2/F HSBC BuildingOlaya Road, Al-MuroojRiyadh 11413SAUDI ARABIA

JPMorgan Chase Bank, N.A. - RiyadhBranch (J.P.Morgan affiliate)RiyadhThe Saudi British BankRiyadh

SERBIA Unicredit Bank Srbija a.d.Rajiceva 27-2911000 BelgradeSERBIA

Unicredit Bank Srbija a.d.Belgrade

SINGAPORE DBS Bank Ltd10 Toh Guan RoadDBS Asia Gateway, Level 04-11 (4B)608838SINGAPORE

Oversea-Chinese Banking CorporationSingapore

SLOVAK REPUBLIC UniCredit Bank Czech Republic and Slovakia, a.s.Sancova 1/ASK-813 33 BratislavaSLOVAK REPUBLIC

J.P. Morgan AG (J.P.Morgan affiliate)Frankfurt am Main

SLOVENIA UniCredit Banka Slovenija d.d.Smartinska 140SI-1000 LjubljanaSLOVENIA


SOUTH AFRICA FirstRand Bank Limited1 Mezzanine Floor, 3 First Place, Bank CityCnr Simmonds and Jeppe StreetsJohannesburg 2001SOUTH AFRICA

The Standard Bank of South AfricaLimitedJohannesburg

SOUTH KOREA Standard Chartered Bank Korea Limited (Note: Clients pleaserefer to your issued settlement instructions)47 Jongro, Jongro-GuSeoul 3160SOUTH KOREA

Kookmin Bank Co., Ltd. (Note: Clients please refer to your issuedsettlement instructions)84, Namdaemun-ro, Jung-guSeoul 100-845SOUTH KOREA

Standard Chartered Bank Korea Limited(Note: Clients please refer to your issuedsettlement instructions)SeoulKookmin Bank Co., Ltd. (Note: Clientsplease refer to your issued settlementinstructions)Seoul

SPAIN Santander Securities Services, S.A.Parque Empresarial La Finca, Pozuelo deAlarcónMadrid 28223SPAIN




SRI LANKA The Hongkong and Shanghai Banking Corporation Limited24 Sir Baron Jayatillaka MawathaColombo 1SRI LANKA

The Hongkong and Shanghai BankingCorporation LimitedColombo

SWEDEN Nordea Bank AbpHamngatan 10SE-105 71 StockholmSWEDEN

Svenska HandelsbankenStockholm

SWITZERLAND UBS Switzerland AG45 Bahnhofstrasse8021 ZurichSWITZERLAND

UBS Switzerland AGZurich

TAIWAN JPMorgan Chase Bank, N.A. (J.P.Morgan affiliate)8th Floor, Cathay Xin Yi Trading BuildingNo. 108, Section 5, Xin Yi RoadTaipei 11047TAIWAN

JPMorgan Chase Bank, N.A. (J.P.Morgan affiliate)Taipei

*TANZANIA* Stanbic Bank Tanzania LimitedStanbic CentreCorner Kinondoni and A.H.Mwinyi RoadsP.O. Box 72648Dar es SalaamTANZANIA

Stanbic Bank Tanzania LimitedDar es Salaam


THAILAND Standard Chartered Bank (Thai) Public Company Limited14th Floor, Zone BSathorn Nakorn Tower90 North Sathorn Road BangrakSilom, BangrakBangkok 10500THAILAND

Standard Chartered Bank (Thai) PublicCompany LimitedBangkok

TRINIDAD AND TOBAGO Republic Bank Limited9-17 Park StreetPort of SpainTRINIDAD AND TOBAGO

Republic Bank LimitedPort of Spain

TUNISIA Union Internationale de Banques SocieteGenerale SA10, Rue d'Egypte, Tunis BelvedereTunis 1002TUNISIA

Banque Internationale Arabe de Tunisie,S.A.Tunis

TURKEY Citibank A.S..Tekfen Tower, Eski Buyukdere Cad No:209 K:2,LeventIstanbul 34394TURKEY

JPMorgan Chase Bank, N.A. (J.P.Morgan affiliate)Istanbul

UGANDA Standard Chartered Bank Uganda Limited5 Speke RoadP.O. Box 7111KampalaUGANDA

Standard Chartered Bank UgandaLimitedKampala

*UKRAINE* Joint Stock Company "Citibank"16-G Dilova StreetKiev 03150UkraineUKRAINE

Joint Stock Company "Citibank"Kiev

JPMorgan Chase Bank, N.A. (J.P.Morgan affiliate)New York


UNITED ARABEMIRATES

HSBC Bank Middle East LimitedEmaar Square, Level 4, Building No. 5P.O. Box 502601DubaiUNITED ARAB EMIRATES

The National Bank of Abu DhabiAbu Dhabi




UNITED KINGDOM JPMorgan Chase Bank, N.A. (J.P.Morgan affiliate)4 New York PlazaNew York 10004UNITED STATES

Deutsche Bank AG Depository and Clearing Centre10 Bishops SquareLondon E1 6EGUNITED KINGDOM

JPMorgan Chase Bank, N.A. (J.P.Morgan affiliate)London

UNITED STATES JPMorgan Chase Bank, N.A. (J.P.Morgan affiliate)4 New York PlazaNew York NY 10004UNITED STATES


URUGUAY Banco Itaú Uruguay S.A.Zabala 146311000 MontevideoURUGUAY

Banco Itaú Uruguay S.A.Montevideo

VIETNAM HSBC Bank (Vietnam) Ltd.106 Nguyen Van Troi StreetPhu Nhuan DistrictHo Chi Minh CityVIETNAM

HSBC Bank (Vietnam) Ltd.Ho Chi Minh City

*WAEMU - BENIN, BURKINAFASO, GUINEA-BISSAU, IVORYCOAST, MALI, NIGER,SENEGAL, TOGO*

Standard Chartered Bank Côte d’Ivoire SA23 Boulevard de la Republique 101 B.P. 1141Abidjan 17IVORY COAST

Standard Chartered Bank Côte d’IvoireSAAbidjan


ZAMBIA Standard Chartered Bank Zambia PlcStandard Chartered HouseCairo RoadP.O. Box 32238Lusaka 10101ZAMBIA

Standard Chartered Bank Zambia PlcLusaka

*ZIMBABWE* Stanbic Bank Zimbabwe LimitedStanbic Centre, 3rd Floor59 Samora Machel AvenueHarareZIMBABWE

Stanbic Bank Zimbabwe LimitedHarare


Schroder Unit Trusts Limited1 London Wall PlaceLondon EC2Y 5AUAuthorised and regulated by the FCA.SUTL_Inter Prospectus GBEN 1 September 2021

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