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01/09/2017

GB: Swing Pricing (MultiBonds)

01.09.2017


Information Notice

UCIT unit classes

H2O MULTIBONDS

Introduction of swing pricing
scheduled for September 8th, 2017

R (C) unit FR0010923375
R (C/D) unit FR0011981851
RUSD (C) unit FR0011981836
RSGD (C) unit FR0011973650*
HCHF-R (C) unit FR0011061795
HUSD-R (C) unit FR0011973676
HSGD-R (C) unit FR0013186681*
I (C) unit FR0010930438
IUSD (C) unit FR0010930735
ISGD (C) unit FR0011973668*
HCHF-I (C) unit FR0012538049*
HUSD-I (C) unit FR0011973684
HSGD-I (C) unit FR0013186699*
M (C/D) unit FR0013075983*
N (C) unit FR0013186707*
HCHF-N (C) unit FR0013186715*

*The unit class is not registered in The United Kingdom.

We hereby inform you that, as of 8 September 2017, H2O AM LLP has decided to implement a net asset value adjustment mechanism – known as “swing pricing” – for all units and/or shares of the UCIT mentioned above.

This mechanism consists of making investors subscribing for or redeeming their units or shares of a UCIT bear the costs associated with transactions carried out on the assets of that UCIT as a result of the movements (subscriptions or redemptions). Its purpose is to protect the non-trading shareholders who remain in the mutual fund from the dilution effect of these costs, which impact the UCIT’s performance by making them bear the lowest possible costs.
The result is an adjusted "swing" NAV.

H2O AM LLP opted for the so-called “swing pricing model with trigger threshold”. Protection is therefore triggered only after a certain predetermined threshold, which takes into account the net subscription / redemption balance as a percentage of the net assets of the UCIT. An adjustment factor, called a "swing factor", is then applied to adjust the net asset value upward in the case of net inflows, or downward in the case of net redemptions.

It is also noted that the volatility of the net asset value of the UCIT may not reflect only the volatility of the securities held in the portfolio due to the application of the adjustment mechanism.
Implementation of swing pricing does not generate additional costs for the relevant UCIT: the mechanism only results in a different allocation of costs between the holders/shareholders. Swing pricing settings are confidential and cannot be confirmed .

The other characteristics of this UCIT remain unchanged.

The documentation for this UCIT (KIID, prospectus and regulations) describing all the characteristics, are available from H2O AM LLP, from the facilities agent Société Générale Securities Custody London, 9th Floor Exchange House 12 Primrose Street EC2A 2EG London England and on www.h2o-am.com.
It may be sent to you within eight business days, upon written request, to:
H2O AM LLP- Portfolio Management Services,
10 Old Burlington Street
W1S 3AG
London
United Kingdom
Or by email to clientservices@h2o-am.co