Absa Global Discretionary Portfolios

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Absa Global Discretionary Portfolios

Sound investing requires carefully blending art and science, where flair needs to be balanced with r igour. Generating returns helps accumulate wealth, understanding risk is critical to preserving it. Most importantly, matching your needs to an appropriate solution determines whether or not your expectations are likely to be met over time. Philosophy Our philosophy towards achieving long-term growth is risk-based with a strong emphasis on your specific circumstances and preferences. This philosophy is expressed via your strategic asset allocation which, in turn, is centred on the concepts of diversification and efficiency. Efficiency in portfolio construction means targeting the optimal blend of asset classes to generate the highest possible return - for any given level of risk. Pedigree The Absa Global Discretionary Portfolios (GDPs) are a synthesis of the best of the considerable

experience, skills and expertise that exist within the broader Barclays groups. Equally we are able to leverage Barclays’ quantitative research into global benchmarks, their considerable investment in international manager research, as well as their fundamental economic insights into global asset class valuation. The portfolios are managed by an investment committee in which multi-management, portfolio construction and quantitative expertise is well represented.

Guiding principles Absa Global Discretionary Portfolios are based on the following key principles: • Risk-based • Open architecture • Best-of-breed • Diversification • Simplicity

The investment process: 3 steps

Derive Strategic Asset Allocation Apply Tactical Tilts Select Managers

and Funds

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Strategic Asset Allocation The GDP solutions are designed to give the f lexibi l i ty to meet individual investor requirements across both risk and base currency, whilst still ensuring consistency of approach. • Five risk profiles designed to meet a range

of risk-return objectives • Calibrated to our proprietary client risk-

profiling tools

• Diversified across seven global asset classes

• Optimised to generate the highest possible return for a given level of risk

• Choice between USD, GBP and EUR based portfolios

• Bond portion of each portfolio hedged back to base currency

High level asset allocation

Detailed breakdown of global SAA benchmarks* Asset Class Stable Cautious Balanced Growth Aggressive US Equities 9% 20% 27.5% 29.5% 35% UK Equities 1.5% 3.5% 4.5% 5.5% 6% Japan Equities 2% 3.5% 4.5% 6% 5.5% Euro Area Equities 3.5% 5.5% 8% 11% 10.5% Far East ex-Japan Equities 1% 1.5% 2.5% 3% 3% Emerging Market Equities 3% 8% 12% 15% 17% Global Gov Bonds 13% 17% 14% 10% 7% Global Corporate Bonds 7% 9% 7% 5% 4% Global High Yield Bonds 4% 6.4% 8% 7.2% 7.2% Emerging Market Bonds 1% 1.6% 2% 1.8% 1.8% Cash and Short-Term Bonds 55% 24% 10% 6% 3% Total 100% 100% 100% 100% 100%

*Figures used are for illustrative purposes only

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Manager Selection Process

Quantitative screening Using Mutual Fund and Institutional databases, peer groups are created per asset class. These peer groups are ranked according to a range of quantitative factors. Key performance factors include skill, consistency and downside risk. Qualitative assessment

A questionnaire is distributed to shortlisted managers. The responses are analysed and scored on three main criteria: the team, the process and consistency of process. The weighted score determines candidates eligible for a full on-site due diligence, which involves interviews with the main decision-makers. The final scoring leads to a recommendation.

Manager selection Due diligence materials are presented to the Investment Committees, where consideration is given to both the ability of the managers, as determined by the quantitative and qualitative assessments, as well as the overall blend of managers within the portfolio. Voting is undertaken by a quorum of members. Ongoing monitoring Ongoing monitoring consists of analysis against specific performance objectives and investment guidelines. The quantitative aspect involves ratio analysis, performance attribution, peer group analysis and assessment of style bias. This is complemented by the qualitative aspect, which involves regular manager contact and a formal manager meeting in person, at least annually.

Quantitative Screening

Qualitative Assessment

Manager Selection

Ongoing Monitoring

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Portfolio Monitoring and

Risk Management

Portfolio Construction

Fund Selection

Portfolio Construction and Review

Contact Details Wealth Management, Absa Tel: +27 (0)11 562 0000 www.absawealth.com Fees and Charges Annual platform fees apply as well as underlying asset manager fees, where possible charging of performance fees may apply. An annual charge is levied for portfolio management and ongoing advice. A comprehensive breakdown of fees and charges is available upon request and will be confirmed prior to/at the time of investment. Investment Minimums USD 25,000 (or currency equivalent)

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FAIS Act Notice and Disclaimer

Past performance does not guarantee or predict future performance and may not be repeated. The value of investments can go down as well as up. You may not get back the original amount of your investment. Investment products may be subject to investment risks, involving, but not limited to market and currency exchange risks, fluctuations in value and possible loss of principal invested. None of the graphical information in this document takes into account the impact of taxation and assumes that income is reinvested (as appropriate). We remind you that the levels and bases of, and reliefs from taxation can change. Clients should obtain legal/taxation advice particular to their circumstances. This brochure/document/material/report/communication/commentary (“this commentary”) has been prepared by Absa Wealth, a division of Absa Bank Limited (Registration No: 1986/004794/06) (“Absa Wealth”). Any reference to Wealth Management includes its affiliates. Absa Wealth has issued this commentary for information purposes only and you must not regard this as a prospectus for any security or financial product or transaction. Absa Wealth does not expressly, tacitly or by implication represent, recommend or propose that the securities and/or financial or investment products or services (the “Products”) referred to in this commentary are appropriate and/or suitable for your particular investment objectives or financial situation or needs. This commentary is not, nor is it intended to be, advice as defined and/or contemplated in Financial Advisory and Intermediary Services Act, 37 of 2002 (“FAIS”), or any other financial, investment, trading, tax, legal, accounting, retirement, actuarial or other professional advice or service whatsoever (“advice”). All the risks and significant issues related to or associated with the Products are not disclosed and therefore, prior to investing or transacting, you should fully understand the Products and any risks and significant issues related to or associated with them. This commentary is neither an offer to sell nor a solicitation of an offer to buy any of the Products, which shall always be subject to Absa Wealth’s internal approvals and the execution of all requisite documentation between you and Absa Wealth. You have to obtain your own advice prior to making any decision or taking any action based hereon and neither Absa Wealth, nor any affiliate, nor any of their respective officers, directors, partners, or employees (in whose favour this constitutes a stipulation on behalf of another) accepts any liability whatsoever for any direct, indirect or consequential damages or loss arising from any use of or reliance on this publication or its contents, and irrespective of whether or not you have obtained independent advice. Should you be a consumer in terms of the Consumer Protection Act No 68 of 2008, as amended, (i.e. a natural person or an entity with an asset value and annual turnover below R2m) then, the above provisions limit and exclude the liabilities which Wealth Management will have towards you and also place obligations on you. Any South African person or entity wishing to effect a transaction in any information discussed herein should do so only by contacting a representative of Absa Wealth in South Africa, 187 Rivonia Road, East Block, 1st Floor, Morningside, Sandton, Johannesburg, 2196. Absa Wealth A division of Absa Bank Limited Reg No 1986/004794/06 Authorised Financial Services Provider Reg No 523 Registered Credit Provider Reg No NCRCP7

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East Block, 1st Floor, 187 Rivonia Road • Tel: +27 (0)11 562 0000 • www.absawealth.com