Benefits of investing in the CFML ClearBridge RARE Emerging Markets Fund

Investing in the Fund offers investors a range of benefits. Investing in the Fund means that your money is pooled together with that of other investors, allowing you to hold a diversified portfolio of assets which is not often available to you as an individual investor with small amounts to invest. Investment via the Fund gives you access to a well resourced and experienced team of the underlying investment manager that is focused on selecting assets on your behalf in order to deliver attractive long term returns.

Further, the Fund provides a diversified exposure to listed emerging market equities through a carefully selected portfolio of investments. The Fund can invest in shares listed in a wide range of countries and industries. Over time investments in emerging markets equities provide an exposure to the economic growth inherent in developing economies.

One advantage that investing in emerging market equities offers Australian based investors is exposure to a much wider range of companies and industries than can be accessed in the Australian market.

Investing in emerging market equities can also bring exposure to international currencies in which the purchased shares are denominated. The Fund will generally not be currency hedged. Over the longer term emerging market currencies should appreciate in value as their underlying economies grow and develop. Because of this longer-term tendency for positive appreciation in emerging market currencies investors should (over the long term) benefit from investing in regions with appreciating currencies. However, over shorter term periods currency volatility may be a negative factor for the Fund causing capital losses. Selective currency hedging may be employed to manage these shorter term risks. The Fund has the ability to vary the amount of hedging against its assets between 0% and 100%. Emerging market shares are a growth asset class that should over the longer term deliver capital gains.

The Fund is highly liquid and can be easily redeemed, and also earns income from dividends.

Investor suitability

This Fund is suitable for investors seeking capital growth, with some income, who have long term investment goals and a tolerance for high levels of volatility.

About the Fund

The CFML RARE Emerging Markets Fund provides investors with a diversified exposure to listed emerging market equities, being equity securities listed on exchanges in emerging markets, or securities listed on exchanges in developed markets which have significant economic exposure to emerging markets. The Fund may have distinct sector or industry biases depending on the relative investment merits of the various emerging market sub sectors.

To gain this exposure the Fund may invest both directly or indirectly in a range of investments (including by investing in underlying funds managed by investment managers selected by us which invest primarily in this asset class). Any reference in the PDS to the Fund investing in emerging market equities includes a reference to the Fund investing directly or indirectly in this asset class.

Investment return objective

The Fund’s objective is to provide a total return (before the
deduction of fees, charges and tax) that exceeds the return from
its benchmark over the investment cycle (typically 3 to 5 years).

Investment strategy

The Fund aims to outperform the benchmark by gaining exposure to long and short positions in international equities.

Type of investor

This Fund is suitable for investors seeking capital growth, with some income, who have long-term investment goals and a tolerance for high levels of volatility.

How we invest your money

The Fund provides a diversified exposure to listed emerging market equities (being equity securities listed on exchanges in emerging markets, or securities listed on exchanges in developed markets which have significant economic exposure to emerging markets) through a carefully selected portfolio of investments. The currency hedge ratio will generally be zero but may be varied over time.

Asset classes and asset allocation ranges

• Emerging market shares: 50- 100%

• Cash: 0 - 50%

• Currency hedge ratio: 0 - 100%