The Investment Manager uses a passive investment strategy, investing in a portfolio of securities designed to reflect the characteristics of the Fund’s Index.

The Investment Objective of SPDR MSCI Australia Select High Dividend Yield Fund is to provide investment returns (before fees and other costs), that closely correspond to the performance of the Index.

Benefits of investing in the SPDR MSCI Australia Select High Dividend Yield Fund

Diversified Investment

The Fund provides investors with a cost efficient way of gaining exposure to a portfolio of securities with the potential for a higher dividend / distribution rate than the average rate for the Parent Index. In one transaction investors can effectively gain exposure to the securities that comprise the Index.

Relatively Low Cost

The Fund is designed to be cost efficient. Index- linked, passively managed funds are generally less expensive to operate than actively managed funds, and therefore usually have a lower indirect cost ratio. For further information on fees, see section 5 of the PDS - "Fees and Other Costs.

Transparency of Performance

The Fund is designed to broadly replicate the performance (before fees) of the Index. The Fund achieves this by buying all the securities in the Index, generally in accordance with their weight in the Index. For more on performance information, see section 3 of the PDS - "Investment Objectives, Strategies and Performance of the Fund.

Flexibility of Trading

Traditional unlisted managed funds do not have the facility to allow investors to trade at quoted prices. Instead, applications and redemptions are processed based on prices for the underlying listed securities determined at the time the market closes. In contrast, investors in the Fund can normally trade on the ASX during trading hours, subject to market conditions.

Distributions and Franking Credits

The Fund will receive dividends and distributions from the underlying securities in the portfolio. These dividends and distributions, after deduction of fees and expenses and certain amounts paid to Unitholders who have redeemed during the quarter, will be distributed to Unitholders, normally quarterly. In addition, any franking credits the Fund receives are also distributed to Unitholders. The amount of the distributions will not necessarily be the same as the yield on the Index. For further information on the distributions, see section 8 of the PDS - "Distributions and Distribution Reinvestment Plan.

About the Fund

The SPDR MSCI Australia Select High Dividend Yield Fund seeks to closely track, before fees and expenses, the returns of the MSCI Australia Select High Dividend Yield Index.

The MSCI Australia Select High Dividend Yield Index is designed to reflect the performance of listed Australian companies with higher dividend income and quality characteristics than average dividend yields and the potential for franked dividend income.

Investment Strategy

The Investment Manager employs a passive management strategy designed to track the performance of the Index, before fees and other costs. The Fund generally invests in the securities comprising the Index in proportion to their relative weightings in the Index. However, in a variety of circumstances the holdings of the Fund may not exactly replicate the Index. For example, it may not be possible or practical to do so in some circumstances, such as where investment restrictions apply which would prevent direct investment in a particular security. From time to time the Fund may not hold all of the securities comprising the Index and may hold securities in weightings which differ from the Index.

From time to time, the Investment Manager may cause the Fund to hold derivatives contracts (e.g. futures contracts and options over securities comprising the relevant Index) and other investments that do not form part of the Index. This may occur where the Investment Manager believes that the Fund's investment objective can better be achieved by doing so. For example, derivatives may be used to manage the Fund's exposure to the market during distribution periods, or where direct investment in a particular security is not possible or practical. Derivatives will only be used in limited circumstances and will not be used to gear the Fund.

How we invest your money

The Index is a rules-based customised index of listed Australian securities expected to have a higher than average dividend yield.

Normally, around 30-45 securities will be selected from the MSCI Australia Investable Market Index excluding REITs (the "Parent Index) for inclusion in the Index. However, the number of securities may be more or less than this range. MSCI seeks to select securities that offer a dividend yield that is higher than or equal to the average of the Parent Index, but a higher than average yield is not forecast or guaranteed. In selecting the securities, MSCI also applies sustainability and persistency criteria:

1. Sustainability - Only securities with reasonable dividend payout are eligible for inclusion in the Index
2. Persistency1 - Only securities with a historical track record of consistent dividend payment are included in the Index

The chosen securities are then combined using their free float adjusted market capitalisation weights.

The Index will be rebalanced each six months in May and November. At the time of rebalance, individual stock weights are capped at 10%, while the aggregate of all stock positions above 5% is capped at 40%. This approach, which is known as MSCI's 10/40 Index Methodology, forces a degree of diversification. The minimum weight of any security in the index at the time of rebalance will be 0.25%.

MSCI "buffer rules are applied to existing Index constituents during each rebalancing period to minimise index turnover.

Although the components of the Index will change over time, at least in the near term the rules for the Index composition are likely to produce holdings dominated by banks and other securities with a large market capitalisation. However, this could change, as stocks will be selected based on their yield and the rules-based selection criteria, not based on their sector.

The Index will not include any listed property trusts.

The Index used for the Fund is a customised version of the MSCI High Dividend Yield Methodology. Customisation has been applied in order to increase diversification, and to reflect the relatively high distributions, by international standards, in the Australian market.