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14/06/2017

UK: Swing Pricing - Information Notice

UCI Share or unit classes

H2O ALLEGRO

Introduction of swing pricing
scheduled for 20 June 2017
R (C) unit FR0011015460
HUSD-R (C) unit FR0011973627
HSGD-R (C) unit FR0011973601*
HCHF-R (C) unit FR0011973585*
I (C) unit FR0011006188
HGBP-I (C) unit FR0011192327
HUSD-I (C) unit FR0011973635
HSGD-I (C) unit FR0011973619*
HCHF-I (C) unit FR0012518389*
HAUD-I (C) unit FR0013186632*
M (D) unit FR0013076973*
N (C) unit FR0013186673*


H2O TEMPO**

Introduction of swing pricing
scheduled for 20 June 2017
I-A unit FR0011007459*
I-B unit FR0011007475*
R unit FR0011007418*
N unit FR0012087799*


H2O VIVACE

Introduction of swing pricing
scheduled for 20 June 2017
I (C) unit FR0011006220
HCHF-I (C) unit FR0011978295*
HSGD-I (C) unit FR0012497998*

HUSD-I (C) unit FR0012498004*

HAUD-I (C) unit FR0013185238*
R (C) unit FR0011015478
HCHF-R (C) unit FR0011978279*
HSGD-R (C) unit FR0012497972*

HUSD-R (C) unit FR0012497980*

N (C) unit FR0013185246*


VIVACE 66**

Introduction of swing pricing
scheduled for 20 June 2017
A1 unit FR0012518330*
A2 unit FR0012518355*
I unit FR0012518363*
SI unit FR0012518371*

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

We hereby inform you that, as of 20 June 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 UCIs mentioned above.

This mechanism consists of making investors subscribing for or redeeming their units or shares of a UCI bear the costs associated with transactions carried out on the assets of that UCI 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 UCI’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 UCI. 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 UCI 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 UCIs: the mechanism only results in a different allocation of costs between the holders/shareholders. Swing pricing settings are confidential and cannot be confirmed . Other characteristics of mutual funds remain unchanged.

The other characteristics of the UCIs remain unchanged.

The documentation for these UCIs (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.com

 

1- The dilution corresponds to the restructuring costs generated by the purchase/sale of securities: transaction fees, difference between purchase and selling price on the market of such securities and tax

2- Charte de Bonne Conduite pour le Swing Pricing et les Droits d’Entrée et de Sortie Ajustables Acquis aux Fonds, AFG, 2016