Common use of Forward Contracts Clause in Contracts

Forward Contracts. A forward contract locks-in the price at which an index or asset may be purchased or sold on a future date. In currency forward contracts, the contract holders are obligated to buy or sell the currency at a specified price, at a specified quantity and on a specified future date, whereas an interest rate forward determines an interest rate to be paid or received on an obligation beginning at a start date sometime in the future. Forward contracts may be cash settled between the parties. These contracts cannot be transferred. The Sub- Funds' use of forward foreign exchange contracts may include, but is not be limited to, altering the currency exposure of securities held, hedging against exchange risks, increasing exposure to a currency, shifting exposure to currency fluctuations from one currency to another and hedging Classes denominated in a currency (other than the base currency of the relevant Sub-Fund) to the base currency of the relevant Sub- Fund (as set out in Annex A). The Management Company may on behalf of the relevant Sub-Fund enter into swaps for the account of the relevant Sub-Fund, provided that the investment principles are adhered to. A swap is an agreement between two parties that involves the swapping of cash flows, assets, income or risks. The swap transactions that may be concluded for the relevant Sub-Fund include interest-rate, currency, asset, equity, credit default swaps and Total Return Swaps. This is not an exhaustive list. An interest-rate swap is a transaction involving two parties swapping cash flows that are based on fixed or variable interest payments. This transaction is comparable to the raising of funds at a fixed interest rate while at the same time lending funds at a variable interest rate, with the nominal amounts of the assets not being exchanged. Currency swaps usually involve the swapping of the nominal amounts of the assets and may be equated to the raising of funds in one currency while at the same time lending funds in another. Asset swaps (often referred to as "synthetic securities") are transactions that convert the yield from a specific asset to another interest rate flow (fixed or variable) or to another currency by combining the asset (e.g. bond, floating-rate note) with an interest-rate or currency swap. An equity swap is characterized by the swapping of cash flows, changes in value and/or returns from an asset for cash flows, changes in value and/or returns from another asset, with at least one of the swapped cash flows or returns from an asset reflecting an equity or an equity index. Under a Total Return Swap, a Sub-Fund may exchange floating or fixed payments for payments based on the total return of a reference asset (such as equity or a fixed income instrument). Total Return Swaps allow the relevant Sub-Fund to manage its exposure to certain securities or reference securities. The Management Company may enter on behalf of the relevant Sub-Fund into swaps, provided that the counterparty is a financial institution of the first order, is specialised in such transactions and provided that the relevant sub-fund has the right, in accordance with the investment objectives specified in its Unit Trust Agreement and the special investment policy provisions, to invest in the relevant underlyings.

Forward Contracts. A forward contract locks-in the price at which an index or asset may be purchased or sold on a future date. In currency forward contracts, the contract holders are obligated to buy or sell the currency at a specified price, at a specified quantity and on a specified future date, whereas an interest rate forward determines an interest rate to be paid or received on an obligation beginning at a start date sometime in the future. Forward contracts may be cash settled between the parties. These contracts cannot be transferred. The Sub- Funds' use of forward foreign exchange contracts may include, but is not be limited to, altering the currency exposure of securities held, hedging against exchange risks, increasing exposure to a currency, shifting exposure to currency fluctuations from one currency to another and hedging Classes denominated in a currency (other than the base currency of the relevant Sub-Fund) to the base currency of the relevant Sub- Fund (as set out in Annex A). The Management Company may on behalf of the relevant Sub-Fund enter into swaps for the account of the relevant Sub-Fund, provided that the investment principles are adhered to. A swap is an agreement between two parties that involves the swapping of cash flows, assets, income or risks. The swap transactions that may be concluded for the relevant Sub-Fund include interest-rate, currency, asset, equity, credit default swaps and Total Return Swaps. This is not an exhaustive list. An interest-rate swap is a transaction involving two parties swapping cash flows that are based on fixed or variable interest payments. This transaction is comparable to the raising of funds at a fixed interest rate while at the same time lending funds at a variable interest rate, with the nominal amounts of the assets not being exchanged. Currency swaps usually involve the swapping of the nominal amounts of the assets and may be equated to the raising of funds in one currency while at the same time lending funds in another. Asset swaps (often referred to as "synthetic securities") are transactions that convert the yield from a specific asset to another interest rate flow (fixed or variable) or to another currency by combining the asset (e.g. bond, floating-rate note) with an interest-rate or currency swap. An equity swap is characterized by the swapping of cash flows, changes in value and/or returns from an asset for cash flows, changes in value and/or returns from another asset, with at least one of the swapped cash flows or returns from an asset reflecting an equity or an equity index. Under a Total Return Swap, a Sub-Fund may exchange floating or fixed payments for payments based on the total return of a reference asset (such as equity or a fixed income instrument). Total Return Swaps allow the relevant Sub-Fund to manage its exposure to certain securities or reference securities. The Management Company may enter on behalf of the relevant Sub-Fund into swaps, provided that the counterparty is a financial institution of the first order, is specialised in such transactions and provided that the relevant sub-fund has the right, in accordance with the investment objectives specified in its Unit Trust Agreement and the special investment policy provisions, to invest in the relevant underlyings.

Forward Contracts. A forward contract locks-in the price at which an index or asset may be purchased or sold on a future date. In currency forward contracts, the contract holders are obligated to buy or sell the currency at a specified price, at a specified quantity and on a specified future date, whereas an interest rate forward determines an interest rate to be paid or received on an obligation beginning at a start date sometime in the future. Forward contracts may be cash settled between the parties. These contracts cannot be transferred. The Sub- Sub-Funds' use of forward foreign exchange contracts may include, but is not be limited to, altering the currency exposure of securities held, hedging against exchange risks, increasing exposure to a currency, shifting exposure to currency fluctuations from one currency to another and hedging Classes denominated in a currency (other than the base currency of the relevant Sub-Fund) to the base currency of the relevant Sub- Sub-Fund (as set out in Annex A). The Management Company may on behalf of the relevant Sub-Fund enter into swaps for the account of the relevant Sub-Fund, provided that the investment principles are adhered to. A swap is an agreement between two parties that involves the swapping of cash flows, assets, income or risks. The swap transactions that may be concluded for the relevant Sub-Fund include interest-rate, currency, asset, equity, credit default swaps and Total Return Swaps. This is not an exhaustive list. An interest-rate swap is a transaction involving two parties swapping cash flows that are based on fixed or variable interest payments. This transaction is comparable to the raising of funds at a fixed interest rate while at the same time lending funds at a variable interest rate, with the nominal amounts of the assets not being exchanged. Currency swaps usually involve the swapping of the nominal amounts of the assets and may be equated to the raising of funds in one currency while at the same time lending funds in another. Asset swaps (often referred to as "synthetic securities") are transactions that convert the yield from a specific asset to another interest rate flow (fixed or variable) or to another currency by combining the asset (e.g. bond, floating-rate note) with an interest-rate or currency swap. An equity swap is characterized by the swapping of cash flows, changes in value and/or returns from an asset for cash flows, changes in value and/or returns from another asset, with at least one of the swapped cash flows or returns from an asset reflecting an equity or an equity index. Under a Total Return Swap, a Sub-Fund may exchange floating or fixed payments for payments based on the total return of a reference asset (such as equity or a fixed income instrument). Total Return Swaps allow the relevant Sub-Fund to manage its exposure to certain securities or reference securities. The Management Company may enter on behalf of the relevant Sub-Fund into swaps, provided that the counterparty is a financial institution of the first order, is specialised in such transactions and provided that the relevant sub-fund has the right, in accordance with the investment objectives specified in its Unit Trust Agreement and the special investment policy provisions, to invest in the relevant underlyings.