Benefits of investing in the Macquarie Wholesale Plus Income Opportunities Fund

Some of the benefits that may arise from an investment in the Fund include the following.

• Potential for regular income.

• Potential to deliver returns in different market conditions using a defensive, yet flexible, strategy with a focus on capital preservation.

• Potential for higher returns than traditional cash investments. Provides potential diversification against equity risk.

• Access to the investment management expertise of the Manager and other leading fixed interest managers around the world.

Risk level

Medium

About the Fund

The Fund invests into the Underlying Fund, which:

1. provides exposure to a diversified portfolio of credit-based investments
2. actively identifies outperforming credit sectors minimises currency volatility through hedging.

Investment objective

Aims to outperform the benchmark over the medium term (before fees). It aims to provide higher income returns than traditional cash investments at all stages of interest rate and economic cycles.

How we invest your money

The Fund predominantly provides exposure to a wide range of domestic and global investment grade floating and fixed rate instruments, asset-backed securities, and cash. The Fund may also have opportunistic exposure to other fixed income sectors and instruments such as, high yield and emerging markets debt as well as other fixed income instruments. Interest rate risk will generally be hedged through the use of derivatives such as swaps and futures. The investment process aims to reduce the risk of the Underlying Fund being adversely affected by unexpected events or downgrades in the credit rating of the Underlying Fund's investments. A disciplined framework is used to analyse each sector and proposed investment to assess its risk.

The Underlying Fund gains exposure to securities either directly or through funds managed by the Manager and external managers. This gives Australian investors access to leading fixed interest managers around the world. The Manager selects and continually reviews managers using a rigorous process that draws upon the resources and skills of all aspects of the investment management operations. The Underlying Fund may be exposed to derivatives to implement its investment strategy. For example, protection may be purchased on issuers that are believed to be over-valued or at risk of downgrade. These positions increase in value when the underlying instrument falls in value and decrease in value when the underlying instrument rises in value.

The portfolio is generally hedged to Australian dollars. However, any exposure to emerging markets debt issued in the local currency of the debt will generally be unhedged. Small active currency positions may also be taken when the Manager believes that there are opportunities to add value or hedge risks in the portfolio.

The asset allocation of the Underlying Fund is:

• Investment grade*: 0-100%

• High yield: 0-20%

• Emerging markets debt**: 0-15%

• Cash: 0-100%

*Includes Australian and global investment grade credit.

**May include holdings of sub-investment grade instruments.

The above ranges are indicative only. The Underlying Fund will be rebalanced within a reasonable period of time should the exposure move outside these ranges. Investments in these sectors may include but are not limited to: domestic and global fixed and floating rate instruments issued by banks, corporates, governments, asset-backed securities such as residential mortgage backed securities, bank loans and other credit related securities. The Underlying Fund may also have some exposure to exchange traded funds and hybrid securities.