quarterly investment review...6 parmenion investment management quarterly investment review market...

Quarterly Investment ReviewQ1 / 2017

2 Parmenion Investment Management Quarterly Investment Review

Parmenion Investment Management Quarterly Investment Review 3

Important Notes 4.

Parmenion Investment Management 5.

Market Commentary 6.

Featured Article 7.

PIM Strategic Multi-Option Active and Passive Portfolios 8.

PIM Strategic Conviction Portfolios 12.

PIM Strategic Guardian Portfolios 16.

PIM Strategic Active Portfolios 20.

PIM Tactical Active and Passive Portfolios 22.

PIM Tactical Income Solution 28.

PIM Strategic Ethical Active Portfolios: Profile A-D 32.

PIM Tactical Ethical Active Portfolios 40.

DFA Multi-Option: UK Perspective 44.

DFA Multi-Option: Global Perspective 48.

Distribution Technology Multi-Option 52.

Portfolio Changes 57.

Solutions Index 58.

Index and Peer Group Returns 60.

Contents

M

C

T

SE

TE

DU

DG

DT

TI

S

G


Important Notes

Views and Opinions

The views and opinions expressed in this document are those of Parmenion Investment Management. They should not be taken as a personal recommendation to buy or sell, or as advice on how any investment mentioned is likely to perform. Every care has been taken to ensure the accuracy of the information published in this document. It cannot, however, be guaranteed.

Performance Data

Unless otherwise stated, all performance figures are from FE, formerly Financial Express Analytics, and are calculated on a total return, bid to bid basis (no initial charges) to 31 March 2017 (net income reinvested). Performance figures include the underlying funds’ Annual Management Charges and exclude rebates and external charges from Parmenion or the introducing Adviser.

Performance figures assume that units sales and purchases instructed for rebalancing and fund switches will be made on the same day. However, in the context of client portfolios at least a 24 hour delay may be imposed between sales and purchases, to ensure settlement proceeds have been received before purchases are made. This is to protect the client money pooled account and ensures another clients money is not used to fund purchases from within the pool.

Where performance data is not available for a period of five years or more, this is quoted from inception date. Where no performance figures are shown, no data is available which we have labelled as N/A for the purposes of this document.

The tables in this document provide past performance data and should not be taken as a guide to future returns.

The value of investments and the income that can be earned from them may go down as well as up and a client may not get back the full amount invested. Rates and bases of taxation are subject to change. The risks of investment associated with different asset classes, for example, overseas equity, property, corporate debt, commodities and alternative assets vary in their nature.

Yield

The Quarterly Investment Review quotes the historic yield, which reflects distribution declared over the past twelve months as a percentage of the unit price. It is based on a snapshot of the portfolio on that day.

Ongoing Charge Figure (OCF)

OCF means Ongoing Charge Figure, defined as the expected total cost of managing and operating the fund for the coming year. OCF includes the Annual Management Charge paid to the fund manager plus the additional operational charges of the fund (custody, distribution, audit, registration and regulatory fees).

OCF does not include an estimate of performance fees unlike the old measure, Total Expense Ratio, or TER, which was based on the experience over the prior year.

The OCF figures quoted in this report are net of any rebates paid to Parmenion from the Annual Management Charge. Any such rebates received are credited to the client’s portfolio. OCF figures in this report do not include Parmenion’s own charges or those of the introducing Adviser; neither do they include any dealing costs associated with buying or selling the funds.

Seeking appropriate Financial Advice

Parmenion is not authorised to provide investment advice to individuals. It is important that clients take a medium to long term view when investing and are realistic about performance outcomes.

If a client wishes to obtain financial advice as to whether an investment is suitable for their needs, they should consult an authorised Financial Adviser. Clients should ensure they have understood the contents of their Adviser’s suitability report before proceeding with any proposed investment.

Regulatory

Parmenion Investment Management Ltd is a subsidiary of Parmenion Capital Partners LLP. Parmenion Capital Partners LLP is authorised and regulated by the Financial Conduct Authority, registration number: 462085. Wholly owned subsidiary of Aberdeen Asset Management PLC and Aberdeen Investments Limited. Parmenion Capital Partners LLP is registered in England and Wales OC322243.

Contact Details

Head Office: 2 College Square Anchor Road, Bristol BS1 5UE.

Office: 0345 519 0100 Website: www.parmenion-im.co.uk Email: [email protected]

For professional use only


Parmenion Investment Management (PIM) is a leading provider of discretionary management services to Financial Advisers. Renowned for its investment expertise, service excellence and unique risk management framework PIM provides Advisers with an extensive range of market leading investment solutions to assist in creating customised offerings to best meet the specific requirements of their individual clients.Our aim is to be the investment manager of choice for Financial Advisers looking to profitably grow their business. We pledge to undertake the investment research, fund selection and monitoring allowing you to focus more closely on ensuring the on-going suitability of the selected investment solution to best align with the risk mandate agreed between you and your clients. This ensures that the client and Adviser can have complete confidence in their investments and their risk adjusted returns regardless of market conditions, strategy or investment style, whilst also providing Advisers with greater opportunity to expand new business prospects.

The enhanced client and Adviser confidence stems from the unique approach PIM takes towards investing. With a firm belief that risk and return are inextricably linked, our focus at all times is on managing the expectations of clients and Financial Advisers in relation to their investment outcomes – a fundamental premise being that returns are always commensurate with the level of risk taken.

In contrast, many Investment Managers focus on benchmark investment performance, which we believe only leads to disappointment. Instead, we place the emphasis on managing risk so that clients understand the inherent volatilities they are taking with their investments and consequently the outcome they can expect.

We believe the management of risk within an investment portfolio is critical. To assist in this process Modern Portfolio Theory (MPT) is used to substantiate and underpin our investment solutions with the objective of reducing overall risk whilst maximising returns for any given level of risk taken. This is done by varying the exposure to risky and defensive asset classes and back testing using 20 years of historical data to help determine an optimised weighting to each asset class for any given level of risk. PIM then overlays this with our experience and a variety of techniques, including stress testing, that takes into account a range of potential scenarios to ensure that each and every portfolio is suitably protected and diversified.

The comprehensive PIM investment range encompasses a Strategic Multi-Option solution , with a mix of Active and Passive options, plus Tactical, Income, de-accumulation and Ethical solutions. Each of the PIM solutions are built using asset classes (Equities, Fixed Interest and Property) that can be dynamically combined to match the risk tolerance of each client.

PIM undertakes rigorous research for each fund included in its portfolios. The objective is to select funds that will provide favourable risk adjusted returns over the long term. The research of these funds is divided into two stages: qualitative and quantitative. The qualitative element involves meeting the fund manager face to face to understand their investment philosophy, process and methodology and how it has generated the favourable risk adjusted performance that PIM has identified. The quantitative analysis measures raw data including the risk/return performance of the collective fund, downside risk management and fund manager skill.

Parmenion Investment Management


Market Commentary

Simon Brett Director & Chief Investment Officer Parmenion Investment Management

Trumponomics, Trumpflation or the Trump trade or whatever you want to call it has been the oft quoted explanation for the good returns enjoyed by the US stock market. Wall Street made numerous all-time highs during the first quarter of 2017 as “animal spirits” held sway. The election of President Trump and his inauguration in January have led to a number of expectations; namely that the new administration will deliver on a number of bold promises to cut personal and corporate taxes, review trade deals that benefit the US and spend more on infrastructure and defence.

What is there not to like? Markets did not err on the side of caution and instead adopted an optimistic outlook.

However more recently there have been a few question marks over whether all of the above is achievable. A Republican controlled Congress failed to repeal and replace Obamacare. This raises the question if Trump can garner enough support from politicians to push through other items on his extensive agenda.

Putting to one side the expected benefits of the above, the US economy was already in good shape. So much so that the Federal Reserve raised interest rates by 0.25% to 1%. Reasons given were that unemployment is falling and thus wages may rise pushing up inflation. There was also an indication that there may be two more rate hikes later in the year.

Closer to home, politics have dominated and will continue to intrigue Europe in the coming months.

The theme in Europe (as was the case in the US and UK) is the rise of populist movements that are upsetting the established political parties. Although the Dutch elections returned the incumbent government, the upcoming French election is looking to be a contest between Marie Le Pen and Emmanuel Macron. Should the former win: what then for the European Union? Followed by an election in Germany.

It will perhaps only take one populist to win to upset the European project as per the Brexit vote in the UK.

Now that Article 50 to leave the European Union has been triggered by the UK, there are two years in which to negotiate a beneficial withdrawal. Hopefully both sides will be pragmatic and find a workable solution, and that the rhetoric from some will become more measured.

Post the June vote the deprecation of sterling has been both good and bad for the UK economy. Good for exporters who became more competitive, but bad for imported inflation. In February the inflation rate jumped to 2.3% from 1.8% in January pushed up by rising fuel and food prices. Interestingly the figure is the same for average readings, meaning flat living standards at best. Combined with a fall in the savings rate (the lowest rate since records began in 1963) it appears that the consumer is dipping into savings to finance their expenditure. Given that the UK economy has relied upon the consumer since the financial crisis to maintain growth, then the above may presage a slow-down in the economy. It should therefore come as no surprise that the next interest rate rise is forecast for the first quarter of 2019.

An old stock market adage is that ‘markets climb a wall of worry’. That has certainly been the case for the past year, generated by unexpected political upheavals.

Investors should perhaps expect more of the same for the rest of 2017, and should remain aware of how much risk they are prepared and comfortable to tolerate.

In this time of change it appears more important than ever to ensure your clients’ portfolios are well diversified to mitigate any external shocks or change in sentiment which may follow.

The risk-graded framework, around which all our portfolios are based at Parmenion, is also essential for ensuring clients’ investment portfolios are aligned with their attitude to risk and capacity for loss, to ensure there are no surprises.


Featured Article UK Equity Income: The ‘hunt for yield’

Emily Booth Senior Investment Manager Parmenion Investment Management

For some years, the “hunt for yield” has driven prices up and yields down across most income-bearing asset classes. This creates a headache for all investment managers, many of whom are struggling to reconcile their realistic expectations of companies’ future cash-generating ability against the prices others in the market are prepared to pay. These judgements are complicated by the need to consider the timing of future moves by the central banks, whose gigantic bond-buying sprees under their Quantitative Easing programmes have forced down yields to historically low levels.

The risk-free rate of return has always been important when assessing intrinsic value but in the past markets played a greater role in setting its level. Now it is essentially set by official fiat – and that makes investments inherently riskier as markets will move more sharply in response to policy changes due to not being at their natural equilibrium level to start with.

Blind following the blind

Unwary investors motivated purely by today’s yields can be drawn into buying stocks that others with longer time horizons are avoiding. As money chases these yields, prices of such stocks rise and they become an ever-larger proportion of the index.

This process is exacerbated because risk-blind passive funds are then forced to buy more with inflows, pushing up the valuations of high dividend payers to unsustainable levels, making many active fund managers reluctant to own them.

The Investment Association’s rules prior to this month required funds in the UK Equity Income sector to produce an income 10% higher than that of the FTSE All-Share over rolling 3 year periods, with no less than 90% of the index yield in any one year. As the chart to the right shows, funds that focus on the sustainability of dividends have increasingly struggled to meet these requirements.

Source: www.theinvestmentassociation.org/assets/files/sectors/20170308-UKequityincomesectoryearendyielddata.pdf

Equity Income investment managers typically seek to build portfolios of stocks offering financial strength to withstand potential interest rate rises combined with a suitably high yield. Faced with the challenges outlined above, many have concluded that the yield factor should be the one to give.

They are disinclined to invest in companies whose share price is only partially reflecting future risks, yet whose yield appears high based on historic dividends paid. For example, financial services companies with overseas operations saw their 2016/17 earnings benefit from the post-Brexit fall in sterling but the potential loss of passporting rights into the EU represents a significant threat to their business. Whilst they paid high dividends this year, their future prospects are less rosy.

Worse yet are companies that pay out a greater share of earnings than they can safely afford. For example ‘Pearson’, that for three years maintained its dividend even as the cash flows from its core educational publishing business fell as the company struggled to adjust to the new digital world.

The IA sector has now bowed to pressure to relax their criteria: the new rule is that funds’ 3 year rolling yields must at least match that of the FTSE All-Share index to be included in the UK Equity Income sector.

Our position

As far as Parmenion’s investment process is concerned, our assessment of what constitutes a suitable fund for our UK Value and Income asset group has never been swayed by the IA’s rules.

Rather, our commitment is to continue to seek out those managers who have demonstrated an ability to invest our shared clients’ money to produce above average return for risk.

To learn more about our risk-based approach, get in touch today.

Number below 90% of FTSE All-Share yield over 1 year (and therefore excluded from the sector)

Number below 110% of FTSE All-Share yield over 1 year

Number below 110% of FTSE All-Share yield over 3 years (and therefore excluded from the sector)

Numbe of funds meeting IA UK Equity Income sector requirements in full


PIM Strategic Multi-Option Active and Passive Portfolios

PROP

ERTY

UK V

ALUE

AN

D IN

COM

EUK

GRO

WTH

DEVE

LOPE

D M

ARKE

TSEM

ERGI

NG

MAR

KETS

FIXE

D IN

TERE

ST

MAN

AGED

LIQ

UIDI

TY

PIM Strategic Multi-Option Passive

PROP

ERTY

UK V

ALUE

AN

D IN

COM

EUK

GRO

WTH

DEVE

LOPE

D M

ARKE

TSEM

ERGI

NG

MAR

KETS

FIXE

D IN

TERE

ST

MAN

AGED

LIQ

UIDI

TY

M

PIM Strategic Multi-Option - Asset Allocation Table

Risk Grade

1 80% 20% 0% 0% 0% 0% 0% 100%

2 25% 55% 10% 5% 5% 0% 0% 100%

3 15% 55% 10% 10% 5% 5% 0% 100%

4 15% 35% 10% 20% 10% 10% 0% 100%

5 5% 30% 10% 20% 15% 20% 0% 100%

6 0% 25% 10% 20% 20% 25% 0% 100%

7 0% 15% 15% 20% 20% 25% 5% 100%

8 0% 0% 15% 20% 15% 35% 15% 100%

9 0% 0% 10% 15% 15% 35% 25% 100%

10 0% 0% 0% 10% 15% 40% 35% 100%

PROP

ERTY

UK V

ALUE

AN

D IN

COM

EUK

GRO

WTH

DEVE

LOPE

D M

ARKE

TSEM

ERGI

NG

MAR

KETS

FIXE

D IN

TERE

ST

MAN

AGED

LIQ

UIDI

TY

TOTA

L

Portfolios are rebalanced to their asset allocation on a quarterly basis.

The Multi-Option offering is built around seven asset classes; Managed Liquidity, Fixed Interest, Property, UK Value and Income, UK Growth, Developed Markets and Emerging Markets. An investor in the Multi-Option offering assumes that the risk and return relationships between the various asset classes are stable over the long term. Thus, the asset allocations for the ten Risk Graded portfolios will not change frequently. The Multi-Option offering allows a choice of either Active or Passive investment for each asset class.

The PIM Strategic Passive solution, is identical in structure to the PIM Strategic Multi-Option Passive solution and as such is excluded from the QIR. Strategic Multi-Option gives Advisers the flexibility to choose between Active or Passive for each asset class, whilst PIM Strategic Passive has a passive fund selection across all available asset classes. Whilst the DFM fee differs slightly for PIM Strategic Multi-Option (proportional to the Active exposure) this would not affect the performance figures as they are gross of fees from Parmenion or the Adviser.

Fund OCF 0.12% 0.64% 0.71% 0.87% 0.76% 0.97% 1.13%

Historic Yield 0.56% 2.17% 2.76% 3.80% 2.29% 1.09% 1.18%

Fund OCF 0.12% 0.08% 0.71% 0.15% 0.05% 0.08% 0.22%

Historic Yield 0.56% 1.97% 2.76% 4.48% 3.45% 1.86% 2.19%

Net Ongoing Charge Figure (OCF) and Historic Yield

The fund OCF and historic yield for each asset class are shown below. The data included will vary from month to month, depending on the fund selection of the investment manager and the expenses of the underlying funds themselves. These figures are therefore only included for the purposes of transparency.

PIM Strategic Multi-Option Active

Fund OCF and historic yield data is correct as at 03 April 2017.



PROP

ERTY

UK V

ALUE

AN

D IN

COM

E

UK G

ROW

TH

DEVE

LOPE

D

MAR

KETS

EMER

GIN

G

MAR

KETS

FIXE

D

INTE

REST

MAN

AGED

LI

QUID

ITY

PIM Strategic Multi-Option Active PIM Strategic Multi-Option Passive

Federated Short-Term Sterling Prime

L&G All Stocks Index Linked Gilt Index

Threadneedle UK Property Authorised Trust Feeder

Vanguard FTSE UK Equity Income Index

Vanguard FTSE UK All Share Index

Vanguard US Equity Index

Vanguard Emerging Markets Stock Index

BlackRock ICS Institutional Sterling Liquidity Heritage

Vanguard UK Investment Grade Bond Index

L&G UK Property Feeder

Vanguard FTSE Developed Europe ex UK Equity Index

Vanguard Global Bond Index GBP Hedged

Standard Life Investments UK Real Estate Income Feeder

L&G Pacific Index

Vanguard UK Government Bond Index

L&G Japan Index

Portfolio Holdings as of 31 March 2017

The current portfolio holdings for PIM Strategic Multi-Option are shown in the tables below, as at 31 March 2017. Please refer to page 57 for details on fund changes over the period. If you have any further queries, please refer to your relationship manager.

PROP

ERTY

UK V

ALUE

AN

D IN

COM

E

UK G

ROW

TH

DEVE

LOPE

D

MAR

KETS

EMER

GIN

G

MAR

KETS

FIXE

D

INTE

REST

MAN

AGED

LI

QUID

ITY


Allianz Gilt Yield


Unicorn UK Income

JOHCM UK Opportunities

Stewart Investors Asia Pacific Leaders

Aberdeen Emerging Markets Equity


M&G Optimal Income


Trojan Income CF Lindsell Train UK Equity

CF Morant Wright Nippon Yield

Schroder Global Emerging Markets

Fidelity Moneybuilder Income


Rathbone Income

Liontrust Special Situations

JPM US Equity Income

MI Somerset Emerging Markets Dividend Growth

Jupiter Strategic Bond

Threadneedle UK Equity Income

Jupiter UK Special Situations

Jupiter European

Fidelity Emerging Markets

Goldman Sachs Global Fixed Income Plus Portfolio

Invesco Perpetual Income

Fidelity American Special Situations

M&G Index Linked Bond

Threadneedle European Select

Kames Investment Grade Bond

Pioneer US Fundamental Growth

FP CRUX European Special Situations


PIM Strategic Multi-Option Active - Portfolio Returns to period end 31 March 2017

All portfolios continue to perform in line with their relative risk over all periods, (except Risk Grade 9 over 5 years), owing to the continued strong relative performance of Developed Markets Equity, UK Equity (over 3 months and 5 years) and Emerging Markets over 3 months, 6 months and 1 year.

6 M

ONTH

RET

URN

1 YE

AR R

ETUR

N

2 YE

AR R

ETUR

N

3 YE

AR R

ETUR

N

5 YE

AR R

ETUR

N

3 M

ONTH

RET

URN

Passive

Please refer to Important Notes on page 4 for how performance figures are calculated. Performance data is correct as of 31 March 2017. Past performance is not an indication of future returns. The value of investments and any income from them is not guaranteed and can go down as well as up.

PIM Strategic Multi-Option Passive - Portfolio Returns to period end 31 March 2017

All portfolios continue to perform in line with their relative risk over all periods, (except Risk Grade 9 over 5 years), owing to the continued strong relative performance of Developed Markets Equity, UK Equity (over 3 months and 5 years) and Emerging Markets over 3 months, 6 months and 1 year.

1 0.29% -0.28% 1.63% 1.91% 5.96% 9.16%

2 1.36% 0.18% 5.48% 6.84% 16.47% 26.14%

3 1.82% 1.13% 7.88% 8.96% 20.08% 33.35%

4 2.42% 3.24% 10.99% 10.83% 21.75% 40.54%

5 3.10% 5.03% 15.01% 14.48% 27.62% 51.95%

6 3.51% 6.18% 17.45% 16.54% 30.71% 58.67%

7 4.04% 7.21% 18.45% 17.30% 31.67% 59.13%

8 5.21% 9.55% 23.25% 20.82% 37.14% 65.36%

9 5.87% 10.03% 25.97% 22.22% 39.10% 64.02%

10 6.65% 10.90% 30.54% 24.72% 42.82% 65.83%

6 M

ONTH

RET

URN

1 YE

AR R

ETUR

N

2 YE

AR R

ETUR

N

3 YE

AR R

ETUR

N

5 YE

AR R

ETUR

N

3 M

ONTH

RET

URN

Active

1 0.38% 0.01% 2.00% 1.82% 5.33% 8.63%

2 1.73% 0.97% 6.26% 7.00% 15.36% 25.62%

3 2.18% 1.85% 8.27% 9.29% 19.42% 33.22%

4 2.80% 3.60% 10.28% 11.87% 23.07% 42.90%

5 3.38% 5.11% 13.60% 15.61% 29.75% 55.10%

6 3.76% 6.08% 15.57% 17.83% 33.58% 62.79%

7 4.23% 6.92% 16.24% 18.61% 34.90% 64.34%

8 5.16% 8.75% 20.04% 21.86% 40.77% 71.74%

9 5.74% 9.11% 22.69% 22.95% 42.22% 71.06%

10 6.38% 9.76% 26.91% 25.12% 45.59% 73.60%



PIM Strategic Multi-Option Active

PIM Strategic Multi-Option Active and Passive Portfolios

Managed Liquidity 0.06% 0.14% 0.38% 0.27% 2.32% 4.31%

Fixed Interest 1.66% -0.62% 8.38% 7.86% 17.83% 27.13%

Property 3.15% 5.44% -1.48% 6.70% 20.49% 31.47%

UK Value and Income 4.82% 6.94% 13.68% 15.83% 26.64% 71.12%

UK Growth 4.83% 7.63% 19.71% 20.73% 32.54% 74.17%

Developed Markets 4.36% 11.22% 28.31% 31.46% 63.07% 101.51%

Emerging Markets 9.88% 9.74% 32.18% 21.73% 36.88% 43.94%

1 YE

AR R

ETUR

N

2 YE

AR R

ETUR

N

5 YE

AR R

ETUR

N

6 M

ONTH

RET

URN

3 M

ONTH

RET

URN

3 YE

AR R

ETUR

N

M


Fixed Interest 1.17% -2.07% 6.39% 8.27% 21.27% 30.19%

Property 3.15% 5.44% -1.48% 6.70% 20.49% 31.47%

UK Value and Income 3.62% 6.52% 17.48% 10.46% 18.01% 55.71%

UK Growth 4.01% 8.00% 21.83% 16.96% 24.57% 58.05%

Developed Markets 5.47% 13.14% 33.65% 33.16% 61.17% 105.82%

Emerging Markets 10.10% 10.80% 34.41% 22.03% 37.43% 31.36%

1 YE

AR R

ETUR

N

2 YE

AR R

ETUR

N

6 M

ONTH

RET

URN

3 M

ONTH

RET

URN

3 YE

AR R

ETUR

N

PIM Strategic Multi-Option Passive

5 YE

AR R

ETUR

N

PIM Strategic Multi-Option - Asset Class Returns to period end 31 March 2017

The PIM Strategic Multi-Option Risk Graded portfolios are built through a weighted exposure to seven underlying asset classes. For transparency purposes the returns of each asset class are given below. These returns should not be considered in isolation as the asset class risk and return characteristics are taken into account within the construction of each risk graded portfolio.




PIM Strategic Conviction PortfoliosC

PIM Strategic Conviction Portfolios - Asset Allocation Table

PIM Strategic Conviction was launched in August 2015. The solution combines both active and passive funds within each asset class in order to achieve attractive long term risk adjusted returns, a unique feature within the PIM investment solutions. By combining both types of fund, the PIM Conviction Solution overcomes the difficulty of choosing one approach over the other. PIM uses its experience to decide the split between active/passive by examining monthly, a range of quantitative and qualitative factors. Thus the split between active and passive in each asset class is likely to vary over time depending on PIM’s analysis and interpretation of market conditions. The current allocations can be seen on page 13.

The PIM Strategic Conviction solution is built around seven broad asset classes; Managed Liquidity, Fixed Interest, Property, UK Value and Income, UK Growth, Developed Markets and Emerging Markets. Fixed Interest is then split into four sub asset classes: UK Gilts, Index Linked Gilts, Corporate Bonds and Strategic Bonds. Developed Markets is also split into four sub asset classes; European Equity, US Equity, Japanese Equity and Asia Pacific ex Japan Equity. An investor in the PIM Strategic Conviction assumes that the risk and return relationships between the various asset classes are stable over the long term. Thus, the asset allocations for the ten Risk Graded portfolios will not change frequently.

Asset Group 1 2 3 4 5 6 7 8 9 10

Managed Liquidity 80.00% 25.00% 15.00% 15.00% 5.00% 0.00% 0.00% 0.00% 0.00% 0.00%

Gilts 3.00% 8.25% 8.25% 5.25% 4.50% 3.75% 2.25% 0.00% 0.00% 0.00%

Index Linked Gilts 2.00% 5.50% 5.50% 3.50% 3.00% 2.50% 1.50% 0.00% 0.00% 0.00%

Corporate Bonds 7.00% 19.25% 19.25% 12.25% 10.50% 8.75% 5.25% 0.00% 0.00% 0.00%

Global Bonds 8.00% 22.00% 22.00% 14.00% 12.00% 10.00% 6.00% 0.00% 0.00% 0.00%

Property 0.00% 10.00% 10.00% 10.00% 10.00% 10.00% 15.00% 15.00% 10.00% 0.00%

UK Equity Income 0.00% 5.00% 10.00% 20.00% 20.00% 20.00% 20.00% 20.00% 15.00% 10.00%

UK Equity Growth 0.00% 5.00% 5.00% 10.00% 15.00% 20.00% 20.00% 15.00% 15.00% 15.00%

European Equity 0.00% 0.00% 1.00% 2.00% 4.00% 5.00% 5.00% 7.00% 7.00% 8.00%

US Equity 0.00% 0.00% 3.00% 6.00% 12.00% 15.00% 15.00% 21.00% 21.00% 24.00%

Japanese Equity 0.00% 0.00% 0.50% 1.00% 2.00% 2.50% 2.50% 3.50% 3.50% 4.00%

Asia Pacific ex Japan Equity 0.00% 0.00% 0.50% 1.00% 2.00% 2.50% 2.50% 3.50% 3.50% 4.00%

Emerging Market Equity 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 5.00% 15.00% 25.00% 35.00%

*Portfolios are rebalanced to their asset allocation on a quarterly basis or when a change is made between the active/passive allocations.


Fund OCF 0.12% 0.19% 0.10% 0.61% 0.56% 0.71% 0.74% 0.62% 0.74% 0.76% 0.43% 0.74% 1.14%

Historic Yield 0.56% 1.49% 0.05% 2.68% 2.35% 2.76% 3.88% 2.59% 1.51% 0.49% 1.96% 1.42% 1.30%




Active/Passive Allocation as at 31 March 2017

The chart below displays the current active/passive weights within each asset class as at 31 March 2017

INDE

X LI

NKE

D GI

LTS

CORP

ORAT

E BO

NDS

STRA

TEGI

C BO

NDS

PROP

ERTY

UK E

QUIT

Y IN

COM

E

GILT

S

MAN

AGED

LIQ

UIDI

TY

UK E

QUIT

Y GR

OWTH

EURO

PEAN

EQU

ITY

US E

QUIT

Y

JAPA

NES

E EQ

UITY

ASIA

PAC

IFIC

EX

JAPA

N E

QUIT

YEM

ERGI

NG

MAR

KET

EQUI

TY

MAN

LIQUIDITY

%

ACTIVE PASSIVE

0

10

20

30

40

50

60

70

80

90

100

GILTS

INDEX LIN

KED

CORP BONDS

GLOBAL

BONDS

PROPERTY

UK INCOME

UK GROWTH

EUROPE

US EQUITY

JAPAN

ASIA EX JAPAN

EMERGING M

ARKETS


INDE

X LI

NKE

D

GILT

S

CORP

ORAT

E

BON

DS

GLOB

AL

STRA

TEGI

C B

ONDS

PROP

ERTY

GILT

S

MAN

AGED

LI

QUID

ITY

PIM Strategic Conviction Active and Passive Funds

Portfolio Holdings as of 31 March 2017 The current portfolio holdings for PIM Strategic Conviction are shown in the tables below, as at 31 March 2017. Please refer to page 57 for details on fund changes over the period. If you have any further queries, please refer to your relationship manager.







Unicorn UK Income


Jupiter European






Allianz Gilt Yield


M&G Optimal Income


Trojan Income

CF Lindsell Train UK Equity



L&G Japan Index

L&G Pacific Index




Standard Life Investments UK Real Esatate Income Feeder

Rathbone Income



CF Miton US Opportunities







UK E

QUIT

Y

GROW

TH

EURO

PEAN

EQ

UITY

US E

QUIT

Y

JAPA

NES

E

EQUI

TY

EMER

GIN

G

MAR

KET

EQ

UITY

UK E

QUIT

Y

INCO

ME

ASIA

PAC

IFIC

EX

JAP

AN

EQUI

TY


PIM Strategic Conviction Portfolios C

PIM Strategic Conviction - Portfolio Returns to period end 31 March 2017

All portfolios continue to perform in line with their relative risk over all periods, owing to the strong relative performance of Developed and Emerging Markets Equity over 6 months, 1 year and since inception. Over the last 3 months, European, Asia Pacific Ex-Japan and Emerging Markets Equity have also relatively outperformed.

1 YE

AR R

ETUR

N

3 M

ONTH

RET

URN

Risk Grade

1 0.38% -0.13% 1.80% 2.26%

2 1.68% 0.56% 5.69% 7.69%

3 2.17% 1.53% 7.85% 10.51%

4 2.82% 3.43% 10.15% 13.65%

5 3.43% 4.98% 13.59% 18.57%

6 3.80% 5.91% 15.56% 21.49%

7 4.28% 6.76% 16.37% 23.00%

8 5.21% 8.73% 20.70% 29.22%

9 5.74% 8.96% 23.25% 32.77%

10 6.27% 9.44% 27.26% 38.27%

PIM Strategic Conviction - Asset Class Returns to period end 31 March 2017

The PIM Strategic Conviction portfolios are built through a weighted exposure to thirteen underlying asset classes. For transparency purposes the returns of each sub-asset class are given below. These returns should not be considered in isolation as the asset class risk and return characteristics are taken into account within the construction of each risk graded portfolio.

FROM

INCE

PTIO

N

(31.

08.2

015)

3 M

ONTH

RET

URN

Asset Class

Managed Liquidity 0.06% 0.14% 0.38% 0.52%

Gilts 2.10% -3.13% 7.89% 13.26%

Index Linked Gilts 1.98% -3.73% 20.25% 21.83%

Corporate Bonds 1.98% -1.19% 7.01% 9.46%

Global Strategic Bonds 0.88% 0.46% 4.89% 5.31%

Property 3.15% 5.44% -1.48% 3.07%

UK Equity Income 4.68% 7.14% 14.20% 16.68%

UK Equity Growth 4.56% 6.19% 17.87% 26.20%

European Equity 6.52% 8.78% 21.09% 28.30%

US Equity 3.83% 13.07% 31.38% 46.58%

Japanese Equity 2.78% 11.64% 35.70% 39.21%

Asia Pacific ex Japan Equity 9.08% 7.05% 28.84% 44.11%

Emerging Market Equity 9.13% 8.98% 32.06% 45.40%



6 M

ONTH

RET

URN

6 M

ONTH

RET

URN

FROM

INCE

PTIO

N

(31.

08.2

015)

1 YE

AR R

ETUR

N


PIM Strategic Guardian PortfoliosG

PIM Strategic Guardian Portfolios - Asset Allocation Table

The PIM Strategic Guardian solution enables clients to invest in one of ten carefully constructed Strategic portfolios, according to the client’s requirement for yield, total return, attitude to risk and capacity for loss. The amount invested into each portfolio is dependent upon the clients’ risk profile and, once agreed, is kept constant with periodic rebalancing. This solution has been specifically designed to be used within a drawdown environment whether that be via pension drawdown or otherwise.

Asset Group 1 2 3 4 5 6 7 8 9 10

Managed Liquidity 55.00% 30.00% 15.00% 7.00% 5.00% 2.00% 0.00% 0.00% 0.00% 0.00%

UK Gilts 5.00% 10.00% 10.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00%

UK Index Linked Gilts 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 2.00% 2.00% 2.00%

UK Corporate Bonds 10.00% 16.00% 25.00% 27.00% 17.00% 12.00% 6.00% 0.00% 0.00% 0.00%

Global Strategic Bonds 15.00% 20.00% 15.00% 13.00% 10.00% 10.00% 9.00% 5.00% 0.00% 0.00%

Global High Yield Bonds 0.00% 0.00% 2.00% 4.00% 5.00% 5.00% 6.00% 9.00% 9.00% 7.00%

UK Property 5.00% 5.00% 5.00% 6.00% 6.00% 6.00% 7.00% 8.00% 7.00% 2.00%

UK Equity Income 0.00% 5.00% 15.00% 15.00% 23.00% 20.00% 14.00% 0.00% 0.00% 0.00%

UK Mid Cap Equity 0.00% 0.00% 0.00% 2.00% 3.00% 3.00% 3.00% 3.00% 4.00% 5.00%

UK Small Cap Equity 0.00% 0.00% 0.00% 4.00% 5.00% 7.00% 7.00% 8.00% 9.00% 10.00%

US Equity 0.00% 0.00% 0.00% 3.00% 6.00% 12.00% 13.00% 15.00% 16.00% 18.00%

US Equity Small Cap 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 5.00% 8.00% 10.00% 11.00%

Europe ex UK Equity 0.00% 0.00% 0.00% 4.00% 5.00% 6.00% 8.00% 8.00% 10.00% 10.00%

Pacific ex Japan Equity 0.00% 0.00% 0.00% 2.00% 3.00% 5.00% 6.00% 8.00% 9.00% 10.00%

Emerging Markets Equity 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 5.00% 15.00% 15.00% 20.00%

Targeted Return 10.00% 14.00% 13.00% 13.00% 12.00% 12.00% 11.00% 11.00% 9.00% 5.00%

*Portfolios are rebalanced to their asset allocation on a quarterly basis.


Fund OCF 0.12% 0.06% 0.10% 0.62% 0.75% 0.64% 0.71% 0.91% 0.82% 1.37% 0.51% 0.44% 0.95% 0.55% 1.34% 0.86%

Historic Yield 0.56% 1.74% 0.05% 2.86% 2.61% 4.80% 2.97% 3.56% 2.65% 0.27% 1.00% 0.47% 1.53% 4.80% 2.78% 2.97%



Fund OCF and historic yield data is correct as at 03 April 2017

UK IN

DEX

LIN

KED

GILT

SUK

COR

PORA

TE B

ONDS

GLOB

AL S

TRAT

EGIC

BON

DSGL

OBAL

HIG

H Y

IELD

BON

DSUK

PRO

PERT

Y

UK G

ILTS

MAN

AGED

LIQ

UIDI

TY

UK E

QUIT

Y IN

COM

EUK

MID

CAP

EQU

ITY

UK S

MAL

L CA

P EQ

UITY

US E

QUIT

Y

US E

QUIT

Y SM

ALL

CAP

EURO

PE E

X UK

EQU

ITY

PACI

FIC

EX J

APAN

EQU

ITY

EMER

GIN

G M

ARKE

TS E

QUIT

YTA

RGET

ED R

ETUR

N


Portfolio Holdings as at 31 March 2017






Pimco GIS Global High Yield Bond



Neptune UK Mid Cap

Liontrust UK Smaller Companies


Dimensional US Small Companies

Jupiter European

Schroder Asian Income Maximiser

Charlemagne Magna Emerging Markets Dividend

Aviva Inv Multi Strategy Target Income



M&G Optimal Income

Threadneedle High Yield Bond


Rathbone Income



L&G Pacific Index


Invesco Perpetual Global Targeted Returns

Royal London Sterling Credit


Trojan Income

UK IN

DEX

LIN

KED

GILT

S

UK C

ORPO

RATE

BON

DS

GLOB

AL S

TRAT

EGIC

BON

DS

GLOB

AL H

IGH

YIE

LD

BON

DS

UK G

ILTS

MAN

AGED

LIQ

UIDI

TY

The current portfolio holdings for PIM Strategic Guardian are shown in the tables below, as at 31 March 2017. Please refer to page 57 for details on fund changes over the period. If you have any further queries, please refer to your relationship manager.

UK M

ID C

AP E

QUIT

Y

UK S

MAL

L CA

P EQ

UITY

US E

QUIT

Y

US E

QUIT

Y SM

ALL

CAP

UK E

QUIT

Y IN

COM

E

UK P

ROPE

RTY

EURO

PE E

X UK

EQU

ITY

PACI

FIC

EX J

APAN

EQUI

TY

EMER

GIN

G M

ARKE

TS

EQUI

TY

TARG

ETED

RET

URN


PIM Strategic Guardian Portfolios G

PIM Strategic Guardian - Portfolio Returns to period end 31 March 2017

All portfolios continue to perform in line with their relative risk over all periods, owing to the strong relative performance of Pacific Ex-Japan and Emerging Markets Equity over 3 and 6 months and since inception. UK Small Cap Equity has also strongly recovered over 3 and 6 months, whilst US Equity (Core and Small Cap) has delivered attractive relative returns over 6 months and since inception.

3 M

ONTH

RET

URN

Risk Grade

1 0.77% 0.56% 2.35%

2 1.28% 0.82% 4.16%

3 1.92% 1.35% 6.02%

4 2.86% 3.17% 9.04%

5 3.35% 4.51% 11.34%

6 3.68% 5.70% 14.00%

7 3.94% 7.17% 17.41%

8 4.49% 8.41% 21.73%

9 4.69% 9.07% 23.51%

10 5.15% 9.78% 26.94%

PIM Strategic Guardian - Asset Class Returns to period end 31 March 2017

The PIM Strategic Guardian portfolios are built through a weighted exposure to sixteen underlying asset classes. For transparency purposes the returns of each sub-asset class are given below. These returns should not be considered in isolation as the asset class risk and return characteristics are taken into account within the construction of each risk graded portfolio.

FROM

INCE

PTIO

N

(03.

05.2

016)

3 M

ONTH

RET

URN

Asset Class

Managed Liquidity 0.06% 0.14% 0.33%

UK Gilts 1.67% -2.15% 7.58%

UK Index Linked Gilts 1.98% -3.73% 22.00%

UK Corporate Bonds 2.28% -0.68% 6.96%

Global Strategic Bonds 1.13% 1.55% 6.51%

Global High Yield Bonds 2.00% 3.63% 8.43%

UK Property 3.96% 6.57% 0.16%

UK Equity Income 4.49% 6.28% 14.57%

UK Mid Cap Equity 5.73% 7.47% 15.17%

UK Small Cap Equity 8.17% 11.17% 22.34%

US Equity 2.75% 13.01% 35.46%

US Equity Small Cap -0.81% 16.24% 41.73%

Europe ex UK Equity 6.33% 5.16% 16.09%

Pacific ex Japan Equity 9.32% 11.16% 36.06%

Emerging Markets Equity 9.50% 9.91% 33.35%

Targeted Return 0.47% 1.31% 1.04%


6 M

ONTH

RET

URN

6 M

ONTH

RET

URN

FROM

INCE

PTIO

N

(03.

05.2

016)



PIM Strategic Active Portfolios

The PIM Strategic Active portfolios are constructed using six asset classes each with their own distinctive risk and reward characteristics. By varying the percentage exposure to each asset class, ten Risk Graded portfolios are produced that can match the risk tolerance of a particular client. The current split between the asset classes for each of the ten Risk Graded portfolios is detailed in the table below. An investor in the PIM Strategic Active solution assumes that the risk and return relationships between the various asset classes are stable over the long term. Thus, the asset allocations for the ten Risk Graded portfolios will not change frequently.

PIM Strategic Active Portfolios - Asset Allocation Table

PIM Strategic Active - Model Portfolio Holdings as at 31 March 2017

Risk Grade

1 80% 20% 0% 0% 0% 0% 100%

2 25% 55% 10% 5% 5% 0% 100%

3 15% 55% 10% 10% 10% 0% 100%

4 15% 35% 10% 25% 15% 0% 100%

5 5% 30% 15% 25% 25% 0% 100%

6 0% 25% 15% 25% 25% 10% 100%

7 0% 10% 15% 25% 35% 15% 100%

8 0% 0% 15% 20% 35% 30% 100%

9 0% 0% 10% 20% 30% 40% 100%

10 0% 0% 0% 0% 35% 65% 100%

EQUI

TY IN

COM

E

PROP

ERTY

FIXE

D IN

TERE

ST

MAN

AGED

LIQ

UIDI

TY

EQUI

TY G

ROW

TH

GLOB

AL A

LPH

A


Fund OCF 0.12% 0.64% 0.71% 0.88% 0.91% 0.89%

Historic Yield 0.56% 2.17% 2.76% 3.66% 1.33% 0.94%

Federated - Short-Term Sterling Prime

Allianz Gilt Yield Threadneedle UK Property Authorised Trust Feeder

MI Chelverton UK Equity Income


Schroder Asian Alpha Plus


M&G Optimal Income


Unicorn UK Income Stewart Investors Asia Pacific Leaders

Franklin UK Managers' Focus



Trojan Income CF Morant Wright Nippon Yield

JOHCM Continental European


Artemis Global Income


Old Mutual North American Equity


Rathbone Income JPM US Equity Income

Baillie Gifford Japanese


Threadneedle UK Equity Income


Threadneedle Global Emerging Market Equity


Fidelity Global Dividend

Jupiter European



Rathbone Global Opportunities







S

PROP

ERTY

EQUI

TY

INCO

ME

EQUI

TY

GROW

TH

GLOB

AL

ALPH

A

FIXE

D

INTE

REST

MAN

AGED

LI

QUID

ITY

The current portfolio holdings for PIM Strategic Active are shown in the table below, as at 31 March 2017. Please refer to page 57 for further details on fund changes over the period. If you have any further queries, please refer to your relationship manager.



TOTA

L


PIM Strategic Active - Portfolio Returns to period end 31 March 2017 PIM Strategic Active - Asset Class Returns to period end 31 March 2017

All portfolios continue to perform in line with their relative risk over all periods, (except Risk Grade 9 over 5 years), owing to the continued strong relative performance of Equity Growth and Global Alpha over all periods and Equity Income over 3 months, 6 months and 5 years.

6 M

ONTH

RET

URN

1 YE

AR R

ETUR

N

2 YE

AR R

ETUR

N

3 YE

AR R

ETUR

N

5 YE

AR R

ETUR

N

3 M

ONTH

RET

URN

The PIM Strategic Active Risk Graded portfolios are built through a weighted exposure to six underlying asset classes. For transparency purposes the returns of each asset class are given below. These returns should not be considered in isolation as the asset class risk and return characteristics are taken into account within the construction of each risk graded portfolio.

6 M

ONTH

RET

URN

1 YE

AR R

ETUR

N

2 YE

AR R

ETUR

N

3 YE

AR R

ETUR

N

5 YE

AR R

ETUR

N

3 M

ONTH

RET

URN

Risk Grade Asset Class


1 0.38% 0.01% 2.00% 1.82% 5.33% 8.63%

2 1.76% 1.15% 6.68% 7.43% 16.24% 26.15%

3 2.28% 2.02% 8.70% 9.68% 19.95% 33.34%

4 2.98% 3.89% 10.73% 12.18% 23.13% 42.49%

5 3.57% 5.15% 12.76% 14.92% 28.26% 51.46%

6 4.10% 6.53% 15.47% 17.17% 31.54% 56.29%

7 4.67% 8.30% 18.38% 20.09% 36.08% 64.23%

8 5.17% 10.00% 21.50% 22.34% 39.17% 66.96%

9 5.37% 10.61% 23.54% 23.18% 39.66% 66.82%

10 5.82% 12.28% 29.91% 26.65% 44.68% 67.75%


Fixed Interest 1.66% -0.62% 8.38% 7.86% 17.83% 27.13%

Property 3.15% 5.44% -1.48% 6.70% 20.49% 31.47%

Equity Income 5.17% 8.46% 16.51% 18.12% 28.54% 72.15%

Equity Growth 5.19% 9.71% 25.82% 27.80% 51.48% 88.03%

Global Alpha 6.16% 13.66% 32.13% 25.96% 41.00% 57.46%

*Prior to 16 February 2015 the returns shown as Global Alpha were synonymous with Specialist Equity.



PIM Tactical Active & Passive Portfolios

The Tactical offering is built around five asset classes; Managed Liquidity, Cautious, Balanced, Active and Global Alpha. The Managed Liquidity and Global Alpha portfolios are the same as PIM Strategic Active portfolios. The asset allocation between bonds, equities and other asset classes may vary within the Cautious, Balanced and Active portfolios, at the discretion of the investment manager (PIM). The aim is to minimise volatility whilst maximising risk adjusted returns.

These five asset class portfolios are blended to give ten Risk Graded portfolios, as shown below. The Tactical Passive investment solution seeks to replicate the asset allocation of Tactical Active via the use of passive funds. The exceptions are Managed Liquidity and Property where passive alternatives are unavailable. Global Alpha has the same sub-asset allocations for Active and Passive, however is labelled Active Plus in the latter.

PIM Tactical Portfolios Active and Passive - Asset Allocation Table

Portfolios are rebalanced to their asset allocation on a periodic basis.

BALA

NCE

D

ACTI

VE

ACTI

VE P

LUS

CAUT

IOUS

MAN

AGED

LIQ

UIDI

TY

PIM Tactical Passive

BALA

NCE

D

ACTI

VE

GLOB

AL A

LPH

A

INCO

ME

CAUT

IOUS

MAN

AGED

LIQ

UIDI

TY

Fund OCF 0.12% 0.60% 0.78% 0.93% 0.89% 0.79%

Historic Yield 0.56% 1.95% 2.02% 1.67% 0.94% 3.74%

Fund OCF 0.12% 0.14% 0.13% 0.17% 0.09%

Historic Yield 0.56% 2.05% 2.60% 2.49% 1.96%

T



PIM Tactical Active

Risk Grade

1 50% 50% 0% 0% 0% 100%

2 25% 75% 0% 0% 0% 100%

3 0% 100% 0% 0% 0% 100%

4 0% 75% 25% 0% 0% 100%

5 0% 25% 75% 0% 0% 100%

6 0% 0% 100% 0% 0% 100%

7 0% 0% 75% 25% 0% 100%

8 0% 0% 25% 75% 0% 100%

9 0% 0% 0% 100% 0% 100%

10 0% 0% 0% 75% 25% 100%

BALA

NCE

D

ACTI

VE

GLOB

AL A

LPH

A



MAN

AGED

LIQ

UIDI

TY

CAUT

IOUS

TOTA

L


PIM Tactical Active (Cautious, Balanced and Active) - Portfolio Holdings*

CAUT

IOUS

BALA

NCE

D

ACTI

VE

FUN

D

ASSE

T CL

ASS

Managed Liquidity Federated Short-Term Sterling Prime 7.50% 0.00% 0.00% 0.00%

BlackRock ICS Institutional Sterling Liquidity Heritage 7.50% 0.00% 0.00% 0.00%

Fixed Interest Vanguard Global Bond Index Hedge GBP 22.00% 10.00% 0.00% 0.00%

L&G All Stocks Index Linked Gilt Index 5.50% 2.50% 0.00% 0.00%

Vanguard UK Investment Grade Bond Index 19.25% 8.75% 0.00% 0.00%

Vanguard UK Government Bond Index 8.25% 3.75% 0.00% 0.00%

Property L&G UK Property Feeder 3.34% 3.34% 3.34% 0.00%

Threadneedle UK Property Authorised Trust Feeder 3.33% 3.33% 3.33% 0.00%

Standard Life Investments UK Real Estate Income Feeder 3.33% 3.33% 3.33% 0.00%

UK Equities Vanguard FTSE UK All Share Index 15.00% 40.00% 30.00% 7.90%

International Equities Vanguard US Equity Index 3.00% 15.00% 21.00% 54.84%

Vanguard FTSE Developed Europe ex UK Equity Index 1.00% 5.00% 7.00% 12.96%

L&G Japan Index 0.75% 3.75% 5.25% 8.20%

L&G Pacific Index 0.25% 1.25% 1.75% 8.75%

Emerging Markets Vanguard Emerging Markets Stock Index 0.00% 0.00% 25.00% 7.35%

Total 100% 100% 100% 100%

Managed Liquidity Federated Short-Term Sterling Prime 7.50% 0.00% 0.00%

BlackRock ICS Institutional Sterling Liquidity Heritage 7.50% 0.00% 0.00%

Fixed Interest M&G Optimal Income 7.34% 3.34% 0.00%

Jupiter Strategic Bond 7.33% 3.33% 0.00%

Fidelity Moneybuilder Income 9.62% 4.37% 0.00%

M&G Index Linked Bond 5.50% 2.50% 0.00%

Kames Investment Grade Bond 9.63% 4.38% 0.00%

Goldman Sachs Global Fixed Income Plus Portfolio 7.33% 3.33% 0.00%

Allianz Gilt Yield 8.25% 3.75% 0.00%

Property L&G UK Property Feeder 3.34% 3.34% 3.34%

Threadneedle UK Property Authorised Trust Feeder 3.33% 3.33% 3.33%

Standard Life Investments UK Real Estate Income Feeder 3.33% 3.33% 3.33%

UK Equities JOHCM UK Opportunities 3.75% 10.00% 7.50%

CF Lindsell Train UK Equity 3.75% 10.00% 7.50%

Jupiter UK Special Situations 3.75% 10.00% 7.50%

Liontrust Special Situations 3.75% 10.00% 7.50%

International Equities Stewart Investors Asia Pacific Leaders 0.25% 1.25% 1.75%

Threadneedle European Select 0.33% 1.67% 2.33%

Jupiter European 0.34% 1.67% 2.34%

CF Morant Wright Nippon Yield 0.75% 3.75% 5.25%

JPM US Equity Income 1.00% 5.00% 7.00%

Fidelity American Special Situations 1.00% 5.00% 7.00%

Pioneer SICAV US Fundamental Growth 1.00% 5.00% 7.00%

FP CRUX European Special Situations 0.33% 1.66% 2.33%

Fidelity Emerging Markets 0.00% 0.00% 6.25%

Schroder Global Emerging Markets 0.00% 0.00% 6.25%

MI Somerset Emerging Markets Dividend Growth 0.00% 0.00% 6.25%

Aberdeen Emerging Markets Equity 0.00% 0.00% 6.25%

Total 100% 100% 100%

PIM Tactical Passive (Cautious, Balanced and Active) - Portfolio Holdings*

*The current portfolio holdings for PIM Tactical (Active and Passive) are shown in the tables above, as at 31 March 2017. Please refer to page 57 for details on fund changes over the period. If you have any further queries, please refer to your relationship manager.


CAUT

IOUS

BALA

NCE

D

ACTI

VE

FUN

D

ASSE

T CL

ASS

ACTI

VE P

LUS


PIM Tactical Active - Portfolio Returns to period end 31 March 2017

All portfolios continue to perform in line with their relative risk over all periods, (except Risk Grade 10 over 5 years), owing to the continued strong relative performance of Tactical Active (Active) and Tactical Active (Global Alpha) over all periods and Tactical Active (Balanced) over 5 years.

6 M

ONTH

RET

URN

1 YE

AR R

ETUR

N

2 YE

AR R

ETUR

N

3 YE

AR R

ETUR

N

5 YE

AR R

ETUR

N

3 M

ONTH

RET

URN

6 M

ONTH

RET

URN

1 YE

AR R

ETUR

N

2 YE

AR R

ETUR

N

5 YE

AR R

ETUR

N

3 M

ONTH

RET

URN

Risk Grade

PIM Tactical Active - Portfolio Returns PIM Tactical Passive - Portfolio Returns

All portfolios continue to perform in line with their relative risk over all periods, (except Risk Grade 10 over 3 months), owing to the continued strong relative performance of Tactical Passive (Active) and Active Plus over all periods and Tactical Passive (Balanced) over 5 years.

1 1.11% 1.03% 4.33% 4.90% 10.44% 18.82%

2 1.63% 1.46% 6.32% 7.24% 14.67% 26.70%

3 2.15% 1.89% 8.33% 9.59% 19.01% 35.01%

4 2.52% 2.94% 10.21% 11.59% 22.61% 40.47%

5 3.25% 5.04% 14.05% 15.63% 30.05% 51.89%

6 3.61% 6.10% 16.01% 17.66% 33.89% 57.85%

7 4.12% 6.94% 18.04% 18.94% 35.74% 59.84%

8 5.14% 8.62% 22.17% 21.46% 39.41% 63.73%

9 5.65% 9.46% 24.27% 22.70% 41.23% 65.63%

10 5.79% 10.57% 26.29% 23.62% 41.32% 63.75%

1 0.95% 0.70% 4.08% 4.55% 10.38% 18.18%

2 1.39% 0.97% 5.93% 6.69% 14.58% 25.68%

3 1.83% 1.22% 7.79% 8.85% 18.89% 33.58%

4 2.24% 2.45% 10.10% 10.65% 21.63% 38.19%

5 3.05% 4.94% 14.82% 14.26% 27.20% 47.66%

6 3.45% 6.19% 17.23% 16.06% 30.03% 52.52%

7 4.06% 7.22% 19.66% 17.46% 31.99% 54.70%

8 5.27% 9.31% 24.60% 20.20% 35.87% 58.92%

9 5.88% 10.36% 27.12% 21.53% 37.77% 60.96%

10 5.73% 11.50% 29.97% 26.28% 43.69% 65.16%

3 YE

AR R

ETUR

N

Please refer to Important Notes on page 4 for how performance figures are calculated. Performance data is correct as of 31 March 2017. Past performance is not an indication of future returns. The value of investments and any income from them is not guaranteed and can go down as well as up. Please refer to Important Notes on page 4 for how performance figures are calculated. Performance data is correct as

of 31 March 2017. Past performance is not an indication of future returns. The value of investments and any income from them is not guaranteed and can go down as well as up.

Risk Grade


PIM Tactical Active & Passive - Asset Class Returns to period end 31 March 2017

The PIM Tactical Risk Graded portfolios are built through a weighted exposure to the five underlying asset classes. For transparency purposes the returns of each asset class are given below. These returns should not be considered in isolation as the asset class risk and return characteristics are taken into account within the construction of each risk graded portfolio.

PIM Tactical Active and Passive Portfolios T

*Prior to 16 February 2015 the returns shown as Global Alpha were synonymous with Specialist Equity.


PIM Tactical Active PIM Tactical Passive


6 M

ONTH

RET

URN

1 YE

AR R

ETUR

N

2 YE

AR R

ETUR

N

5 YE

AR R

ETUR

N

3 M

ONTH

RET

URN

PIM Tactical Active PIM Tactical Passive

3 YE

AR R

ETUR

N

6 M

ONTH

RET

URN

1 YE

AR R

ETUR

N

2 YE

AR R

ETUR

N

3 YE

AR R

ETUR

N

5 YE

AR R

ETUR

N

3 M

ONTH

RET

URN


PIM Tactical Active: Cautious 2.15% 1.89% 8.33% 9.59% 19.01% 35.01%

IA Mixed Investment 20-60% Shares 2.93% 4.29% 12.91% 10.14% 19.59% 36.58%

PIM Tactical Active: Balanced 3.61% 6.10% 16.01% 17.66% 33.89% 57.85%


PIM Tactical Active: Active 5.65% 9.46% 24.27% 22.70% 41.23% 65.63%

IA Flexible Investment 4.34% 7.46% 19.05% 13.96% 27.16% 49.34%

PIM Tactical Active: Global Alpha 6.16% 13.66% 32.13% 25.96% 41.00% 57.46%

FTSE World 5.62% 12.91% 32.90% 32.91% 57.88% 99.61%


PIM Tactical Passive: Cautious 1.83% 1.22% 7.79% 8.85% 18.89% 33.58%


PIM Tactical Passive: Balanced 3.45% 6.19% 17.23% 16.06% 30.03% 52.52%


PIM Tactical Passive: Active 5.88% 10.36% 27.12% 21.53% 37.77% 60.96%


PIM Tactical Passive: Active Plus 5.59% 12.64% 32.87% 31.18% 49.78% 69.36%

FTSE World 5.62% 12.91% 32.90% 32.91% 57.88% 99.61%


PIM Tactical Active Income - Portfolio Returns to period end 31 March 2017

The Tactical Active Income portfolio invests in a combination of Managed Liquidity, Fixed Interest, Property and Equity Income collectives with the aim of providing a yield between 10% and 20% greater than that of the broad UK stock market, which is currently 3.49%. The mix of asset classes will be varied by the investment manager (PIM) depending upon their risk and return characteristics. Given the unique character of the portfolio, Tactical Income does not easily fit within any of the IA sector definitions and there is no natural benchmark for performance comparisons. However, in the table below are some of the common benchmarks for reference purposes.

6 M

ONTH

RET

URN

2 YE

AR R

ETUR

N

3 YE

AR R

ETUR

N

3 M

ONTH

RET

URN

1 YE

AR R

ETUR

N

5 YE

AR R

ETUR

N

PIM Tactical Active Income 3.40% 5.12% 9.62% 12.01% 22.11% 45.86%

Citi UK Government Bond Index

1.26% -2.49% 6.70% 10.25% 26.79% 30.15%

IA Sterling Corporate Bond Sector

1.94% -0.60% 8.88% 7.76% 19.20% 34.32%

IA UK Equity Income Sector 4.22% 6.69% 15.14% 13.75% 23.31% 66.57%

1 YE

AR V

OLAT

ILIT

Y

1 YE

AR R

ETUR

N/R

ISK

RATI

O

3 YE

AR A

NN

UALI

SED

RETU

RN

3 YE

AR A

NN

UALI

SED

VOLA

TILI

TY

1 YE

AR R

ETUR

N

PIM Tactical Active & Passive - Portfolio Volatility Against Comparable Indices

Tactical Cautious (Active and Passive) has delivered a lower relative volatility over 1 year, with a lower volatility and a higher return/risk ratio over 3 years. Tactical Balanced has delivered a higher than peer group performance and a lower volatility over all periods (except Tactical Active: Balanced over 1 year). Finally Tactical Active has delivered a higher performance over 1 year and a higher return, lower volatility and higher return/risk ratio over 3 years. As such, the PIM Tactical Active and Passive portfolios compare favourably against the IA Multi Asset peer group.

3 YE

AR A

NN

UALI

SED

RETU

RN/R

ISK

RATI

O

PIM Tactical Active: Cautious 8.33% 3.69% 2.26 5.97% 3.74% 1.60x

PIM Tactical Passive: Cautious 7.79% 4.16% 1.87 5.94% 3.94% 1.51x

IA Mixed Investment 20-60% Shares

12.91% 4.61% 2.80 6.14% 5.23% 1.17x

`

PIM Tactical Active: Balanced 16.01% 5.09% 3.15 10.21% 6.11% 1.67x

PIM Tactical Passive: Balanced 17.23% 5.15% 3.35 9.15% 6.26% 1.46x


17.11% 5.57% 3.07 7.94% 6.91% 1.15x

PIM Tactical Active: Active 24.27% 8.12% 2.99 12.19% 8.60% 1.42x

PIM Tactical Passive: Active 27.12% 8.33% 3.26 11.27% 9.05% 1.25x

IA Flexible Investment 19.05% 6.07% 3.14 8.34% 7.56% 1.10x




PIM Tactical Active Income % Asset Allocation as of 31 March 2017

The PIM Tactical Active Income portfolios have a target yield of between 10% and 20% above the UK Equity Market.

49.5%

FIXED INTEREST

EQUITY INCOME

PROPERTY

18%

32.5%

PIM Tactical Active Income Portfolio Holdings as at 31 March 2017


PIM Tactical Active and Passive Portfolios T

Fixed Interest M&G Optimal Income 6.67%

M&G Index Linked Bond 2.50%

Invesco Perpetual Corporate Bond 10.00%

PIMCO Global Bond 6.66%

Jupiter Strategic Bond 6.67%

Property L&G UK Property Feeder 6.00%

Threadneedle UK Property Authorised Trust Feeder 6.00%

Standard Life Investments UK Real Estate Income Feeder 6.00%

Equity Income MI Chelverton UK Equity Income 7.28%

Unicorn UK Income 7.28%

Trojan Income 7.28%

Rathbone Income 7.28%

Schroder Income Maximiser 7.29%

Fidelity Enhanced Income 7.29%

Fidelity Global Dividend 3.20%

Artemis Global Income 2.60%

Total 100%

TACT

ICAL

IN

COM

E

FUN

D

ASSE

T CL

ASS

The current portfolio holdings for PIM Tactical Active Income are shown in the table below, as at 31 March 2017. Please refer to page 57 for details on fund changes over the period. If you have any further queries, please refer to your relationship manager.


PIM Tactical Income Solution

The PIM Tactical Income portfolios aim to deliver a set of target yields while controlling the level of portfolio volatility. Parmenion will use tactical asset allocation to both achieve the target yields and to keep portfolio volatility within the constraints identified for each risk grade.

The PIM Tactical Income portfolios have, as their name suggests, the flexibility to adopt tactical asset allocations. This means the investment manager (PIM) has the capability to alter the asset allocation of the portfolios in light of changing market conditions.

This flexibility enhances PIM’s ability to increase allocations to income generating assets to meet the target yields, when it is prudent to do so, while simultaneously managing the portfolios’ volatility and exposure to risk. All changes to asset allocation are made within prescribed limits only.

Key Benefits

• 10 Risk Graded Portfolios

• Rising target yields, rising from 3% to 5.25%

• Tactical asset allocation to make the targeted yields achievable

• Proactive blending of Passive and Active funds

• Natural income arises periodically, not evenly, and can be paid as it arises

• Controlled use of Maximiser Funds.

What are Maximiser Funds?

Up to 35% of a PIM Tactical Income portfolio may be invested in Maximiser Funds to help ensure an attractive level of income. It is important that clients understand this. A Maximiser Fund is a portfolio of stocks in which the fund manager has a high level of conviction.

Derivatives contracts are written on a select number of underlying companies, carefully managed by a derivatives specialist, generating additional income in return for giving up some potential return on a stock above the level specified in the contract. In this way, Maximiser Funds can generate an income greater than that achieved by only investing in stocks.

Tactical Asset Allocation

Parmenion has designed the PIM Tactical Income portfolios using a range of neutral strategic asset allocations as its starting point. These strategic asset allocations are based around the performance and volatilities of various asset class indices over a 20 year period and combined with a qualitative overlay to ensure diversification. As market conditions change over time, so do the relative volatility and valuations of different asset classes.

When prudent to do so, the PIM Tactical Income portfolio asset allocations can adapt to ensure that target yields are achieved with the least anticipated risk and within the acceptable range of volatility for each particular risk grade.

TI


PIM Tactical Income Portfolios - Historic Yield, Fund OCF and Return Data


Please note, the Annualised Return, Standard Deviation, Maximum Loss and Gain figures are based on the simulated returns, of the portfolio’s neutral asset weightings over the last 20 years to December 2016. Figures are based on indices and therefore exclude the effect of taxes or fees from Parmenion or the Adviser. Charges are however taken from portfolio liquidity and therefore will not affect the income distributed.

Risk Grade

1 3.00% 2.24% 4.71% 2.31% -6.59% 14.53% 0.54%

2 3.25% 2.82% 6.01% 4.06% -13.69% 23.63% 0.61%

3 3.50% 3.28% 7.03% 5.60% -17.92% 31.96% 0.67%

4 3.75% 3.61% 7.68% 6.84% -21.75% 37.70% 0.70%

5 4.00% 3.85% 8.10% 7.97% -24.81% 41.94% 0.72%

6 4.25% 3.99% 8.31% 9.44% -27.25% 45.06% 0.73%

7 4.50% 4.15% 8.45% 10.53% -29.32% 47.24% 0.74%

8 4.75% 4.34% 8.54% 11.72% -31.81% 49.81% 0.75%

9 5.00% 4.56% 8.59% 13.03% -34.25% 52.44% 0.76%

10 5.25% 4.68% 8.52% 14.16% -35.46% 54.56% 0.75%

HIS

TORI

C YI

ELD

(LAS

T 12

MON

THS)

TARG

ET Y

IELD

ANN

UALI

SED

RE

TURN

ANN

UALI

SED

ST

ANDA

RD

DEVI

ATIO

N

MAX

IMUM

12

M

ONTH

LOS

S

MAX

IMUM

12

M

ONTH

GAI

N

FUN

D OC

F



The current fund holdings for PIM Tactical Income portfolios are shown in the table below, as at 31 March 2017. Please refer to page 57 for details on fund changes over the period. If you have any further queries, please refer to your relationship manager.

Asset Group Holdings 1 2 3 4 5 6 7 8 9 10

Managed Liquidity Dimensional Global Ultra Short Fixed Income 18.34% 11.67% 5.00% 1.67% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00%

AXA Sterling Credit Short Duration Bond 18.33% 11.67% 5.00% 1.67% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00%

M&G Short Dated Corporate Bond 18.33% 11.66% 5.00% 1.66% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00%

Corporate Bonds Fidelity Moneybuilder Income 7.50% 7.50% 11.25% 11.25% 10.00% 7.50% 5.00% 2.50% 0.00% 0.00%

M&G Corporate Bond 7.50% 7.50% 11.25% 11.25% 10.00% 7.50% 5.00% 2.50% 0.00% 0.00%

Jupiter Strategic Bond 7.50% 7.50% 11.25% 11.25% 10.00% 7.50% 5.00% 2.50% 0.00% 0.00%

PIMCO Global Bond 3.75% 3.75% 5.62% 5.62% 5.00% 3.75% 2.50% 1.25% 0.00% 0.00%

M&G Optimal Income 3.75% 3.75% 5.63% 5.63% 5.00% 3.75% 2.50% 1.25% 0.00% 0.00%

High Yield Bonds Schroder High Yield Opportunities 0.00% 0.00% 1.00% 1.50% 2.00% 3.00% 3.50% 4.00% 4.50% 5.00%

Threadneedle High Yield Bond 0.00% 0.00% 1.00% 1.50% 2.00% 3.00% 3.50% 4.00% 4.50% 5.00%

Property Henderson UK Property Feeder 3.09% 4.13% 3.09% 3.09% 3.09% 2.06% 2.06% 2.06% 2.06% 0.00%

L&G UK Property Feeder 3.09% 4.13% 3.09% 3.09% 3.09% 2.06% 2.06% 2.06% 2.06% 0.00%

Threadneedle UK Property Authorised Trust Feeder 6.19% 8.25% 6.19% 6.19% 6.19% 4.13% 4.13% 4.13% 4.13% 0.00%

UK Equity Income Rathbone Income 0.00% 1.00% 1.50% 1.90% 2.20% 2.60% 2.90% 3.30% 3.50% 3.80%

Vanguard FTSE UK Equity Income Index 0.00% 3.50% 5.25% 6.65% 7.70% 9.10% 10.15% 11.55% 12.25% 13.30%

Trojan Income 0.00% 1.00% 1.50% 1.90% 2.20% 2.60% 2.90% 3.30% 3.50% 3.80%

Artemis Income 0.00% 1.00% 1.50% 1.90% 2.20% 2.60% 2.90% 3.30% 3.50% 3.80%

Fidelity Enhanced Income 0.00% 3.50% 5.25% 6.65% 7.70% 9.10% 10.15% 11.55% 12.25% 13.30%

US Equity JPM US Equity Income 0.00% 1.00% 1.50% 2.00% 2.50% 3.50% 4.00% 3.50% 3.00% 2.50%

Aviva Investors US Equity Income II 0.00% 1.00% 1.50% 2.00% 2.50% 3.50% 4.00% 3.50% 3.00% 2.50%

Europe ex UK Standard Life Investments European Equity Income 0.00% 1.00% 2.00% 3.00% 4.00% 6.00% 7.00% 8.00% 10.00% 12.00%

Asia Pacific ex Japan L&G Pacific Index 0.00% 0.00% 0.00% 0.67% 1.67% 2.67% 3.33% 4.33% 5.67% 6.67%

Henderson Asian Dividend Income 0.00% 0.00% 0.00% 0.66% 1.66% 2.66% 3.33% 4.33% 5.66% 6.66%

Schroder Asian Income Maximiser 0.00% 0.00% 0.00% 0.67% 1.67% 2.67% 3.34% 4.34% 5.67% 6.67%

Global Maximiser Schroder ISF Global Dividend Maximiser 1.97% 4.11% 4.22% 4.97% 5.72% 6.56% 8.06% 9.56% 11.06% 11.25%

Fidelity Global Enhanced Income 0.66% 1.38% 1.41% 1.66% 1.91% 2.19% 2.69% 3.19% 3.69% 3.75%

Total 100% 100% 100% 100% 100% 100% 100% 100% 100% 100%


PIM Tactical Income - Portfolio Returns to period end 31 March 2017

Returns from these portfolios increase sequentially with risk over all time periods (except Risk Grade 10 over 6 months), owing to the relative outperformance of US Equity over all periods beyond 3 months, Asia Pacific Ex-Japan over 3 months, 6 months, 1 year, 2 year and since inception and Global Equity Income Maximiser over 6 months, 1 year, 2 years and since inception.

6 M

ONTH

RET

URN

3 M

ONTH

RET

URN

Risk Grade

1 1.30% 1.51% 4.22% 4.58% 11.25% 12.10%

2 1.84% 2.82% 6.65% 6.92% 15.70% 17.07%

3 2.08% 3.00% 8.83% 8.63% 18.97% 20.80%

4 2.46% 3.71% 10.69% 10.25% 21.71% 24.01%

5 2.84% 4.51% 12.47% 11.82% 24.36% 27.15%

6 3.12% 5.38% 14.83% 13.84% 27.02% 30.37%

7 3.38% 6.23% 16.33% 15.20% 28.93% 32.88%

8 3.73% 6.93% 17.65% 16.20% 30.41% 34.76%

9 4.16% 7.73% 19.27% 17.43% 32.19% 36.93%

10 4.30% 7.70% 21.04% 18.37% 33.12% 38.13%

PIM Tactical Income Solution TI

PIM Tactical Income - Asset Class Returns to period end 31 March 2017

The PIM Tactical Income Risk Graded portfolios are built through a weighted exposure to nine underlying asset classes. For transparency purposes the returns of each asset class are given below. These returns should not be considered in isolation as the asset class risk and return characteristics are taken into account within the construction of each Risk Graded portfolio.

6 M

ONTH

RET

URN

FROM

INCE

PTIO

N

(01.

02.2

014)

3 M

ONTH

RET

URN

Asset Class


Corporate Bonds 1.57% 0.18% 7.68% 6.57% 16.39% 17.60%

High Yield Bonds 2.48% 4.28% 11.37% 13.08% 14.81% 17.49%

Property 4.11% 6.61% -0.66% 1.74% 15.95% 18.23%

UK Equity Income 2.96% 4.13% 12.77% 10.84% 20.48% 25.21%

US Equity 1.73% 14.93% 32.47% 37.04% 71.46% 76.60%

Europe ex UK 4.44% 7.69% 21.91% 19.47% 32.56% 39.31%

Asia Pacific ex Japan 9.51% 10.52% 32.58% 24.75% 45.22% 52.45%

Global Equity Income Maximiser 2.94% 12.74% 28.90% 24.03% 44.72% 50.58%

FROM

INCE

PTIO

N

(01.

02.2

014)

1 YE

AR R

ETUR

N



2 YE

AR R

ETUR

N

2 YE

AR R

ETUR

N

1 YE

AR R

ETUR

N

3 YE

AR R

ETUR

N

3 YE

AR R

ETUR

N


PIM Strategic Ethical Active Portfolios: Profile A-D

What is Ethical Investing?

Ethical investment is known by a variety of terms including: ‘Green investment’, ‘Socially responsible investment’ (SRI) and ‘Sustainable finance’. All of these terms refer to financial or investment services which strive to maximise investment performance and social welfare. In general, ethical investment looks to encourage corporate practices that promote environmental stewardship, consumer protection, human rights and diversity, although additional criteria such as the avoidance of weapons, alcohol, tobacco, gambling and pornography are often included as legitimate areas of concern. These criteria can be broadly summarised as environmental, social justice and corporate governance issues or ESG criteria.

What are the benefits of Investing Ethically?

Ethical investment provides the opportunity to invest in ethically sound investment solutions that cater for a range of ethical preferences. It gives investors the option to avoid companies that engage in activities that they could not usually support, and proactively invest in companies that recognise their corporate responsibilities. Investing ethically is now one of the fastest growing areas in financial services with funds under management having grown to approximately $6.57 trillion in the United States alone (Source: http://ussif.org).

Solution Description

The PIM Strategic Ethical Active Investment Solution offers the discretionary management of active funds across up to eight distinct asset class groups. There is an independent ethical overlay provided by the Ethical Oversight Committee, which includes Julian Parrott and Julia Dreblow. Both Julian and Julia are ethical specialists, with over 20 years experience in ethical investing, previously holding the positions of Chair of the EIA and Director of UKSIF, respectively.

Each asset class is populated with funds according to their Ethical Profile and risk adjusted returns. Incorporated within the solution are four Ethical Profiles (A to D) and ten Risk Graded portfolios (1 to 10), which are designed to capture the majority of clients’ ethical preferences and values. The Ethical Portfolio Selector is available to assist Advisers in identifying the appropriate Ethical Profile for their client.

Armaments (Strategic) P P P P

Pornography (Production) P P P P

Human Rights (Evidenced/Country Based) P P P P

Environmental Management / Technology** P P P P

Animal Testing (Non-Medical) P P P P

Tobacco (Production) P P P P

Environmental Impact P P P

Gambling P P

Alcohol Production P

Nuclear (Power) P

ETH

ICAL

PRO

FILE

A

(LIM

ITS

EXPO

SURE

* )

ETH

ICAL

CR

ITER

IA

Ethical Screening Criteria by Ethical Profile

SE

*Exposure to ethical criteria is likely to be limited by the responsible approach to environmental, social and governance issues adopted in Ethical Profiles A and B.**Ethical Profiles C and D only invest in funds which include the specified ethical criteria, as defined by the Ethical Oversight Committee.

Note. Avoidance criteria does not always mean ‘zero involvement’ as most ethical funds have de minimis limits which allow for limited (normally non-manufacturing or wholesale related) exposure to excluded areas. This allows funds to be manageable and support otherwise positive larger companies.

ETH

ICAL

PRO

FILE

B

(LIM

ITS

EXPO

SURE

* )

ETH

ICAL

PRO

FILE

C

(AIM

S TO

AVO

ID** )

ETH

ICAL

PRO

FILE

D

(AIM

S TO

AVO

ID** )


PIM Strategic Ethical Active - Asset Class Weightings as of 31 March 2017

The PIM Strategic Ethical Active portfolios are constructed using up to eight asset classes, each with their own distinctive risk and reward characteristics. Ten Risk Graded portfolios (1-10) are produced, by varying the percentage exposure to each asset class, to match the risk tolerance of a particular client. UK Government Bonds are currently excluded from Ethical Profiles B-D, whilst Ethical Profiles C-D also exclude Property due to the difficulties in screening the underlying tenants. The current split between the asset classes for each of the portfolios are detailed in the tables below. Strategic investors assume relatively constant long term risk and return characteristics and as such the underlying asset allocations will only vary where these have materially changed.

Asset Group 1 2 3 4 5 6 7 8 9 10

Managed Liquidity (Unscreened) 70.00% 45.00% 15.00% 5.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00%

UK Ethical Corporate Bonds 24.00% 28.00% 40.00% 40.00% 32.00% 24.00% 12.00% 4.00% 0.00% 0.00%

UK Government Bonds 6.00% 7.00% 10.00% 10.00% 8.00% 6.00% 3.00% 1.00% 0.00% 0.00%

UK Property 0.00% 10.00% 15.00% 15.00% 15.00% 10.00% 10.00% 10.00% 5.00% 0.00%

UK Ethical Equity Growth 0.00% 3.00% 6.00% 9.00% 15.00% 18.00% 21.00% 21.00% 24.00% 24.00%

UK Ethical Equity Income 0.00% 2.00% 4.00% 6.00% 10.00% 12.00% 14.00% 14.00% 16.00% 16.00%

International Ethical Equity 0.00% 5.00% 10.00% 15.00% 15.00% 20.00% 25.00% 30.00% 30.00% 30.00%

Ethical Emerging Markets Equity 0.00% 0.00% 0.00% 0.00% 5.00% 10.00% 15.00% 20.00% 25.00% 30.00%

PIM Strategic Ethical Active - Profile A

Asset Group 1 2 3 4 5 6 7 8 9 10



UK Property 0.00% 10.00% 15.00% 15.00% 15.00% 10.00% 10.00% 10.00% 5.00% 0.00%





PIM Strategic Ethical Active - Profile B


Asset Group 1 2 3 4 5 6 7 8 9 10







Asset Group 1 2 3 4 5 6 7 8 9 10







PIM Strategic Ethical Active - Profile C

PIM Strategic Ethical Active - Profile D

Portfolios in all profiles are rebalanced to their asset allocation on a periodic basis.



Fund OCF 0.12% 0.53% 0.65% 0.84% 0.63% 1.04%

Historic Yield 0.56% 3.30% 2.33% 4.03% 1.01% 0.95%

MAN

AGED

LIQ

UIDI

TYUK

ETH

ICAL

CO

RPOR

ATE

BON

DS

UK E

THIC

AL E

QUIT

Y

GROW

TH

UK E

THIC

AL E

QUIT

Y

INCO

ME

INTE

RNAT

ION

AL

ETH

ICAL

EQU

ITY


INTE

RNAT

ION

AL

ETH

ICAL

EQU

ITY

UK E

THIC

AL

CORP

ORAT

E BO

NDS


PIM Strategic Ethical Active - Profile BUK

GOV

ERN

MEN

T

BON

DS

UK P

ROPE

RTY

UK E

THIC

AL E

QUIT

Y

GROW

TH

UK E

THIC

AL E

QUIT

Y

INCO

ME

ETH

ICAL

EM

ERGI

NG

MAR

KETS

EQU

ITY

Fund OCF 0.12% 0.50% 0.74% 0.70% 0.84% 0.63% 1.04%

Historic Yield 0.56% 3.30% 2.77% 2.26% 4.03% 1.01% 0.95%

MAN

AGED

LIQ

UIDI

TY

UK E

THIC

AL E

QUIT

Y

GROW

TH

UK E

THIC

AL E

QUIT

Y

INCO

ME

INTE

RNAT

ION

AL

ETH

ICAL

EQU

ITY

ETH

ICAL

EM

ERGI

NG

MAR

KETS

EQU

ITY

Fund OCF 0.12% 0.50% 0.70% 0.84% 0.63% 1.04%

Historic Yield 0.56% 3.30% 2.26% 4.03% 1.01% 0.95%

MAN

AGED

LIQ

UIDI

TYUK

ETH

ICAL

CO

RPOR

ATE

BON

DSUK

ETH

ICAL

EQU

ITY

GROW

TH

UK E

THIC

AL E

QUIT

Y

INCO

ME

INTE

RNAT

ION

AL

ETH

ICAL

EQU

ITY

Ongoing Charge Figure (OCF) Net of Rebates and Historic Yield


Fund OCF 0.12% 0.50% 0.44% 0.74% 0.70% 0.84% 0.63% 1.04%

Historic Yield 0.56% 3.30% 0.62% 2.77% 2.26% 4.03% 1.01% 0.95%

MAN

AGED

LIQ

UIDI

TY

UK P

ROPE

RTY

UK E

THIC

AL

CORP

ORAT

E BO

NDS

ETH

ICAL

EM

ERGI

NG

MAR

KETS

EQU

ITY

ETH

ICAL

EM

ERGI

NG

MAR

KETS

EQU

ITY

PIM Strategic Ethical Active Portfolios SE






Illustration of the Impact of Ethical Screening on Portfolio Holdings as of 31 March 2017

PIM Strategic Ethical Active (A-D): Portfolio Holdings as of 31 March 2017*

The fund universe for each of the Ethical Profiles is determined by the Ethical Oversight Committee (EOC) as per the ethical screening criteria defined on page 32 of the QIR. The table below shows the current holdings for each Ethical Profile (A-D), to demonstrate the impact of the ethical screening on fund selection and for the purposes of transparency. Please note these holdings may change over the period, depending on the views of the investment manager (PIM). Details of any fund changes over the period, are available on page 57 of this document.

PROF

ILE

D

*Fund weightings are excluded, as it would depend upon the Risk Grade selected. For further information please contact your relationship manager.


Please refer to the Ethical Portfolio Selector and supporting documents for further information.

PROF

ILE

A

PROF

ILE

B

PROF

ILE

C

FUN

D

PROF

ILE

D

Asset Class

PROF

ILE

A

PROF

ILE

B

PROF

ILE

C

FUN

D

Asset Class

Managed Liquidity (unscreened) Federated Short-Term Sterling Prime


UK Ethical Corporate Bonds Rathbone Ethical Bond

Kames Ethical Corporate Bond

F&C Responsible Sterling Bond

Liontrust Sustainable Future Corporate Bond

Royal London Ethical Bond

UK Government / Inflation Linked Bonds

Allianz Gilt Yield


UK Responsible Property Henderson UK Property Feeder



UK Ethical Equity Growth Royal London Sustainable Leaders

EdenTree Amity UK

Liontrust Sustainable Future UK Growth

Premier Ethical

Liontrust UK Ethical

F&C - Responsible UK Equity Growth

Kames - Ethical Equity

UK Ethical Equity Income F&C Responsible UK Income

Henderson Global Care UK Income

International Ethical Equity Henderson Global Care Growth

F&C Responsible Global Equity

Liontrust Sustainable Future Global Growth

Liontrust Sustainable Future European Growth

Ethical Emerging Market Equity

Stewart Investors Asia Pacific Sustainability

Stewart Investors Global Emerging Markets Sustainability




PIM Strategic Ethical Active (Profile A-D): Portfolio Returns to period end 31 March 2017

All portfolios continue to perform in line with their relative risk over all periods, owing to the strong relative performance of International and Emerging Markets Equity over all periods, UK Equity Growth over 3 months, 6 months and 5 years and UK Equity Income over 5 years.


6 M

ONTH

RET

URN

1 YE

AR R

ETUR

N

2 YE

AR R

ETUR

N

3 M

ONTH

RET

URN

5 YE

AR R

ETUR

N

Risk Grade

1 0.75% -0.04% 3.44% 3.10% 8.72% 16.85%

2 1.76% 1.36% 5.75% 6.40% 14.60% 26.97%

3 2.84% 2.38% 9.15% 10.45% 21.90% 39.71%

4 3.42% 3.24% 11.05% 12.46% 25.05% 47.57%

5 4.06% 4.28% 12.64% 14.07% 28.35% 54.70%

6 4.67% 5.29% 15.02% 15.81% 31.41% 60.87%

7 5.32% 6.65% 16.87% 17.42% 34.46% 67.59%

8 5.87% 7.67% 18.67% 18.87% 37.50% 68.09%

9 6.24% 8.08% 20.28% 19.84% 39.74% 71.94%

10 6.50% 8.15% 21.82% 20.64% 41.96% 73.80%

Risk Grade

1 0.78% 0.20% 3.16% 2.71% 8.00% 16.82%

2 1.80% 1.64% 5.42% 5.93% 13.72% 27.43%

3 2.89% 2.79% 8.68% 9.77% 20.58% 41.69%

4 3.47% 3.65% 10.58% 11.78% 23.70% 49.59%

5 4.10% 4.60% 12.26% 13.51% 27.23% 57.64%

6 4.70% 5.54% 14.73% 15.38% 30.56% 64.53%

7 5.34% 6.77% 16.72% 17.20% 34.02% 72.01%

8 5.87% 7.71% 18.62% 18.80% 37.37% 76.52%

9 6.24% 8.09% 20.28% 19.84% 39.76% 82.27%

10 6.50% 8.15% 21.83% 20.64% 41.98% 86.00%

3 YE

AR R

ETUR

N

6 M

ONTH

RET

URN

1 YE

AR R

ETUR

N

2 YE

AR R

ETUR

N

3 M

ONTH

RET

URN

5 YE

AR R

ETUR

N

3 YE

AR R

ETUR

N





PIM Strategic Ethical Active (Profile A-D): Portfolio Returns to period end 31 March 2017


Risk Grade

1 0.78% 0.20% 3.16% 2.71% 8.01% 17.06%

2 1.72% 1.07% 6.40% 6.07% 13.62% 27.63%

3 2.78% 1.92% 10.14% 9.92% 20.35% 41.66%

4 3.36% 2.77% 12.05% 11.91% 23.43% 49.07%

5 3.98% 3.72% 13.74% 13.63% 26.94% 56.70%

6 4.62% 4.95% 15.73% 15.45% 30.33% 63.66%

7 5.26% 6.18% 17.74% 17.27% 33.78% 70.82%

8 5.80% 7.12% 19.65% 18.86% 37.10% 75.23%

9 6.20% 7.79% 20.80% 19.87% 39.59% 80.82%

10 6.50% 8.15% 21.83% 20.64% 41.93% 84.58%

Risk Grade

1 0.78% 0.23% 3.21% 2.67% 8.19% 17.16%

2 1.72% 1.12% 6.44% 5.92% 14.15% 27.97%

3 2.77% 1.99% 10.18% 9.64% 21.30% 42.50%

4 3.34% 2.85% 12.06% 11.53% 24.67% 50.21%

5 3.95% 3.80% 13.67% 13.21% 28.08% 57.86%

6 4.59% 5.02% 15.60% 14.95% 31.67% 65.01%

7 5.22% 6.25% 17.55% 16.68% 35.31% 72.38%

8 5.76% 7.18% 19.45% 18.21% 38.90% 76.74%

9 6.16% 7.85% 20.54% 19.19% 41.31% 82.33%

10 6.46% 8.21% 21.55% 19.97% 43.62% 86.08%

6 M

ONTH

RET

URN

1 YE

AR R

ETUR

N

2 YE

AR R

ETUR

N

3 M

ONTH

RET

URN

3 YE

AR R

ETUR

N

6 M

ONTH

RET

URN

1 YE

AR R

ETUR

N

2 YE

AR R

ETUR

N

3 M

ONTH

RET

URN

3 YE

AR R

ETUR

N



5 YE

AR R

ETUR

N

5 YE

AR R

ETUR

N




Asset ClassAsset Class


Managed Liquidity 0.06% 0.14% 0.38% -0.13% 2.75% 8.33%

UK Ethical Corporate Bonds 2.45% 0.21% 9.56% 9.21% 20.79% 38.51%

UK Property 3.22% 5.96% -0.50% 7.27% 21.28% 38.04%

UK Ethical Equity Growth 5.28% 7.36% 12.89% 14.25% 23.04% 74.97%

UK Ethical Equity Income 3.56% 4.39% 10.48% 12.84% 25.93% 76.35%

International Ethical Equity 7.15% 11.58% 27.46% 25.70% 41.34% 73.59%

Ethical Emerging Markets Equity 8.47% 7.43% 29.69% 24.29% 67.84% 110.41%







Asset Class







6 M

ONTH

RET

URN

1 YE

AR R

ETUR

N

2 YE

AR R

ETUR

N

3 M

ONTH

RET

URN




UK Government Bonds 1.90% -3.78% 13.60% 15.27% 33.55% 37.69%

UK Property 3.22% 5.96% -0.50% 7.27% 21.28% 32.74%





PIM Strategic Ethical Active (Profile A-D): Asset Class Returns to period end 31 March 2017

International and Emerging Markets Equity continue to perform well over all periods, whilst UK Ethical Equity Growth and Income have relatively outperformed over 5 years and UK Ethical Equity Growth has posted solid gains over 3 and 6 months.

Asset Class

6 M

ONTH

RET

URN

1 YE

AR R

ETUR

N

2 YE

AR R

ETUR

N

3 M

ONTH

RET

URN

6 M

ONTH

RET

URN

1 YE

AR R

ETUR

N

2 YE

AR R

ETUR

N

3 M

ONTH

RET

URN

6 M

ONTH

RET

URN

1 YE

AR R

ETUR

N

2 YE

AR R

ETUR

N

3 M

ONTH

RET

URN

3 YE

AR R

ETUR

N

3 YE

AR R

ETUR

N

3 YE

AR R

ETUR

N

3 YE

AR R

ETUR

N


5 YE

AR R

ETUR

N

5 YE

AR R

ETUR

N

5 YE

AR R

ETUR

N

5 YE

AR R

ETUR

N



PIM Tactical Ethical Active Portfolios

The Tactical Ethical Active offering is built around five asset classes; Managed Liquidity, Cautious, Balanced, Active and Global Alpha. The Managed Liquidity portfolio is the same as PIM Strategic Active portfolios given the difficulties in sourcing an appropriate ethical fund in this area. The asset allocation between bonds, equities and other asset classes may vary within the Cautious, Balanced and Active portfolios, at the discretion of the investment manager (PIM). The aim is to minimise volatility whilst maximising risk adjusted returns. Funds are selected from the Ethical Investment Research Services (EIRiS) fund universe, after applying PIM’s due diligence process. Passive investments are not available within this solution.

GL

OBAL

AL

PHA

ACTI

VE

TE

1 50% 50% 0% 0% 0% 100%

2 25% 75% 0% 0% 0% 100%

3 0% 100% 0% 0% 0% 100%

4 0% 75% 25% 0% 0% 100%

5 0% 25% 75% 0% 0% 100%

6 0% 0% 100% 0% 0% 100%

7 0% 0% 75% 25% 0% 100%

8 0% 0% 25% 75% 0% 100%

9 0% 0% 0% 100% 0% 100%

10 0% 0% 0% 75% 25% 100%

PIM Tactical Ethical Active Portfolios - Asset Allocation Table


The current portfolio holdings for the PIM Tactical Ethical Active portfolios are shown in the table below, as at 31 March 2017. Please refer to page 57 for details on fund changes over the period. If you have any further queries, please refer to your relationship manager.

Risk Grade

Portfolios are rebalanced to their asset allocation on a periodic basis.


Fund OCF 0.12% 0.50% 0.67% 0.80% 0.85% 0.72%

Historic Yield 0.56% 2.40% 2.43% 1.77% 0.80% 3.67%


BALA

NCE

D

MAN

AGED

LI

QUID

ITY

CAUT

IOUS

TOTA

L

CAUT

IOUS

BALA

NCE

D

ACTI

VE

HOL

DIN

GS

Managed Liquidity Federated Short-Term Sterling Prime 7.50% 0.00% 0.00%

BlackRock ICS Institutional Sterling Liquidity Heritage 7.50% 0.00% 0.00%

Fixed Interest F&C Responsible Sterling Bond 9.62% 4.37% 0.00%

Rathbone Ethical Bond 11.00% 5.00% 0.00%

Royal London Ethical Bond 11.00% 5.00% 0.00%

M&G Index Linked Bond 5.50% 2.50% 0.00%

Allianz Gilt Yield 8.25% 3.75% 0.00%

Liontrust Sustainable Future Corporate Bond 9.63% 4.38% 0.00%

Property L&G UK Property Feeder 3.34% 3.34% 3.34%

Threadneedle UK Property Authorised Trust Feeder 3.33% 3.33% 3.33%

Standard Life Investments UK Real Estate Income Feeder 3.33% 3.33% 3.33%

UK Equity Premier Ethical 3.00% 8.00% 6.00%

EdenTree Amity UK 3.00% 8.00% 6.00%

Royal London Sustainable Leaders 3.00% 8.00% 6.00%

F&C Responsible UK Income 3.00% 8.00% 6.00%

Henderson Global Care UK Income 3.00% 8.00% 6.00%

International Equity Liontrust Sustainable Future Global Growth 1.25% 6.25% 8.75%

Henderson Global Care Growth 1.25% 6.25% 8.75%

F&C Responsible Global Equity 1.25% 6.25% 8.75%

Liontrust Sustainable Future European Growth 1.25% 6.25% 8.75%

Ethical Emerging Market Equity

Stewart Investors Asia Pacific Sustainability 0.00% 0.00% 12.50%

Stewart Investors Global Emerging Markets Sustainability 0.00% 0.00% 12.50%

Total 100% 100% 100%


PIM Tactical Ethical Active - Asset Class Returns to period end 31 March 2017

The PIM Tactical Ethical Risk Graded portfolios are built through a weighted exposure to the five underlying asset classes. For transparency purposes the returns of each asset class are given below. These returns should not be considered in isolation as the asset class risk and return characteristics are taken into account within the construction of each Risk Graded portfolio.

6 M

ONTH

RET

URN

1 YE

AR R

ETUR

N

2 YE

AR R

ETUR

N

3 YE

AR R

ETUR

N

5 YE

AR R

ETUR

N

3 M

ONTH

RET

URN

Portfolio

PIM Tactical Ethical Active Cautious

2.68% 1.71% 8.38% 9.50% 19.42% 39.83%


2.93% 4.29% 12.91% 10.14% 19.59% 36.58%

PIM Tactical Ethical Active Balanced

4.41% 5.51% 13.28% 14.36% 28.25% 61.46%


3.78% 6.39% 17.11% 13.67% 25.75% 49.66%

PIM Tactical Ethical Active: Active 5.96% 8.04% 20.05% 18.63% 35.01% 69.16%


PIM Tactical Ethical Active Global Alpha

6.40% 11.30% 27.84% 23.70% 50.29% 84.19%

FTSE World 5.62% 12.91% 32.90% 32.91% 57.88% 99.61%

6 M

ONTH

RET

URN

1 YE

AR R

ETUR

N

2 YE

AR R

ETUR

N

3 YE

AR R

ETUR

N

5 YE

AR R

ETUR

N

3 M

ONTH

RET

URN

1 1.38% 0.95% 4.37% 4.88% 10.65% 20.97%

2 2.03% 1.33% 6.37% 7.19% 14.98% 30.11%

3 2.68% 1.71% 8.38% 9.50% 19.42% 39.83%

4 3.12% 2.65% 9.59% 10.72% 21.60% 45.03%

5 3.98% 4.55% 12.04% 13.15% 26.02% 55.84%

6 4.41% 5.51% 13.28% 14.36% 28.25% 61.46%

7 4.80% 6.14% 14.95% 15.43% 29.94% 63.41%

8 5.57% 7.41% 18.34% 18.82% 34.24% 68.63%

9 5.96% 8.04% 20.05% 18.63% 35.01% 69.16%

10 6.07% 8.85% 21.98% 19.92% 38.76% 72.95%

Risk Grade

PIM Tactical Ethical Active - Portfolio Returns to period end 31 March 2017

All portfolios continue to perform in line with their relative risk over all periods, (except Risk Grade 9 over 2 years), owing to the continued strong relative performance of Ethical Active and Global Alpha over all periods and Ethical Balanced over 5 years.




PIM Tactical Ethical Active Income

The Tactical Ethical Active Income portfolio invests in a combination of Bonds, Property and Equity collectives with the aim of providing a yield between 10% and 20% greater than that of the broad UK stock market, which is currently 3.49%. The mix of asset classes will be varied by the investment manager (PIM) depending upon their risk and return characteristics. Funds will be selected from the Ethical Investment Research Services (EIRiS) fund universe within Fixed Interest and Equity Income in line with the Ethical mandate.


The current portfolio holdings for PIM Tactical Ethical Active Income are shown in the table below, as at 31 March 2017. Please refer to page 57 for details on fund changes over the period. If you have any further queries, please refer to your relationship manager.

PIM Tactical Ethical Active Income - Portfolio Returns to period end 31 March 2017

Given the unique character of the portfolio, Tactical Ethical Active Income does not easily fit within any of the IA sector definitions and there is no natural benchmark for performance comparisons. However, in the table below are some of the common benchmarks for reference purposes.

6 M

ONTH

RET

URN

1 YE

AR R

ETUR

N

2 YE

AR R

ETUR

N

3 YE

AR R

ETUR

N

5 YE

AR R

ETUR

N

3 M

ONTH

RET

URN

PIM Tactical Ethical Active Income 3.17% 3.27% 7.95% 10.59% 23.78% 48.89%

Citi UK Government Bond Index 1.26% -2.49% 6.70% 10.25% 26.79% 30.15%

IA Sterling Corporate Bond Sector 1.94% -0.60% 8.88% 7.76% 19.20% 34.32%

IA UK Equity Income Sector 4.22% 6.69% 15.14% 13.75% 23.31% 66.57%

Portfolio / Benchmark


INCO

ME

HOL

DIN

GS

Fixed Interest F&C Responsible Sterling Bond 10.00%

Rathbone Ethical Bond 11.00%

Royal London Ethical Bond 11.00%

Property L&G UK Property Feeder 6.00%

Threadneedle UK Property Authorised Trust Feeder 6.00%

Standard Life Investments UK Real Estate Income Feeder 6.00%

Equity Income Henderson Global Care UK Income 25.00%

F&C Responsible UK Income 25.00%

Total 100%


PIM Tactical Ethical Active Income % Asset Allocation as of 31 March 2017

The PIM Tactical Ethical Active (Income) Portfolios have a target yield greater than 10% than that of the UK Equity Market.

18.0%

FIXED INTEREST

EQUITY INCOME

PROPERTY


50.0%

32.0%

PIM Tactical Ethical Active Portfolios TE


DFA Multi-Option: UK Perspective

The Dimensional Fund Advisers (DFA) Multi-Option: UK Perspective Solution enables clients to allocate monies across multiple asset classes within a Risk Graded framework. The Multi-Option profile provides the client with additional flexibility to accommodate both pure, passive and (where appropriate) active exposure within each asset class, and to vary the value and small cap tilt as appropriate. The amount to invest into each asset group is dependent upon the clients’ risk profile and, once agreed, is kept constant by the investment manager (PIM) by periodic rebalancing. PIM only have the authority to make infrequent changes to asset weightings, as identified by a structural change.

DFA Multi-Option: UK Perspective - Asset Allocation Table

Ongoing Charge Figure (OCF) Net of Rebates and Historic Yield


DFA Multi-Option: UK Perspective Pure

DFA Multi-Option: UK Perspective Passive

PROP

ERTY

UK E

QUIT

Y GR

OWTH

UK E

QUIT

Y IN

COM

EUK

VALU

E &

SMAL

L CA

PW

ORLD

EX-

UK E

QUIT

Y

FIXE

D IN

TERE

ST

MAN

AGED

LIQ

UIDI

TY

DU

Fund OCF 0.20% 0.27% 0.22% 0.24% 0.15% 0.52% 0.35% 0.58% 0.67% 0.97%

Historic Yield 0.82% 0.93% 2.06% 2.55% 4.48% 2.39% 1.54% 1.15% 1.81% 1.53%

Fund OCF 0.20% 0.08% 0.22% 0.05% 0.15% 0.52% 0.08% 0.58% 0.22% 0.97%

Historic Yield 0.82% 1.97% 2.06% 3.45% 4.48% 2.39% 1.86% 1.15% 2.19% 1.53%

WOR

LD E

X-UK

VAL

UE

& S

MAL

L CA

PEM

ERGI

NG

MAR

KETS

EQUI

TY

EMER

GIN

G M

ARKE

TS V

ALUE

& S

MAL

L CA

P EQ

UITY

PROP

ERTY

UK E

QUIT

Y GR

OWTH

UK E

QUIT

Y IN

COM

EUK

VALU

E &

SMAL

L CA

PW

ORLD

EX-

UK E

QUIT

Y

FIXE

D IN

TERE

ST

MAN

AGED

LIQ

UIDI

TY

WOR

LD E

X-UK

VAL

UE

& S

MAL

L CA

PEM

ERGI

NG

MAR

KETS

EQUI

TY

EMER

GIN

G M

ARKE

TS V

ALUE

& S

MAL

L CA

P EQ

UITY

1 100% 0% 0% 0% 0% 0% 0% 0% 0% 0% 100%

2 45% 40% 5% 1% 1% 3% 2% 3% 0% 0% 100%

3 25% 45% 10% 2% 1% 7% 2% 3% 3% 2% 100%

4 10% 50% 10% 3% 2% 10% 4% 6% 3% 2% 100%

5 0% 50% 10% 3% 3% 14% 4% 6% 5% 5% 100%

6 0% 45% 5% 4% 4% 17% 6% 9% 5% 5% 100%

7 0% 35% 5% 5% 4% 21% 6% 9% 8% 7% 100%

8 0% 25% 5% 6% 5% 24% 6% 9% 10% 10% 100%

9 0% 20% 0% 6% 6% 28% 8% 12% 10% 10% 100%

10 0% 10% 0% 7% 7% 31% 8% 12% 13% 12% 100%

PROP

ERTY

UK E

QUIT

Y GR

OWTH

UK E

QUIT

Y IN

COM

EUK

VAL

UE &

SM

ALL

CAP

EQUI

TY

WOR

LD E

X-UK

EQU

ITY

FIXE

D IN

TERE

ST

MAN

AGED

LIQ

UIDI

TY

WOR

LD E

X-UK

VAL

UE &

SMAL

L CA

P EQ

UITY

Portfolios are rebalanced to their asset allocation on a semi annual basis.

EMER

GIN

G M

ARKE

TS

EQUI

TY

EMER

GIN

G M

ARKE

T

VALU

E &

SM

ALL

CAP

EQUI

TYTO

TAL

Risk Grade





The current portfolio holdings for DFA Multi-Option: UK Perspective (Pure and Passive) are shown in the tables below, as at 31 March 2017. For the purposes of on-going suitability due diligence is conducted on DFA and underlying passive fund providers on a 6 monthly basis.


GLOB

AL P

ROPE

RTY

UK E

QUIT

Y GR

OWTH

UK E

QUIT

Y IN

COM

E

FIXE

D IN

TERE

ST

MAN

AGED

LIQ

UIDI

TY

WOR

LD E

X-UK

EQU

ITY

Dimensional Global Ultra Short Fixed Income

Dimensional Global Short Dated Bond

BlackRock Global Property Securities Equity Tracker

Dimensional UK Core Equity


Dimensional UK Value

Dimensional International Core Equity

Dimensional Global Targeted Value

Dimensional Emerging Markets Core Equity

Dimensional Emerging Markets Targeted Value

Dimensional Sterling Inflation Linked Intermediate Duration Fixed Income

Dimensional UK Small Companies







Dimensional UK Value






Dimensional UK Small Companies


Vanguard Global Bond Index Hedge

L&G Pacific Index


L&G Japan Index

UK V

ALUE

& S

MAL

L CA

P

WOR

LD E

X-UK

VAL

UE &

SMAL

L CA

P EQ

UITY

EMER

GIN

G M

ARKE

TS

EQUI

TY

EMER

GIN

G M

ARKE

TS

VALU

E &

SM

ALL

CAP

EQUI

TY


DFA Multi-Option UK Perspective - Portfolio Returns to period end 31 March 2017

All DFA UK (Pure and Passive) portfolios continue to perform in line with their relative risk over all periods (except some slight distortion in the higher Risk Grades for DFA UK Passive over 3 years), owing to the strong relative performance World Ex-UK Equity (Core and Value/Small Cap) over 6 months, 1, 2, 3 years and since inception, Emerging Markets Equity (Core and Value/Small Cap) over 3 months, 6 months, 1, 2 and 3 years, and Global Property over 3 years and since inception.

6 M

ONTH

RET

URN

1 YE

AR R

ETUR

N

2 YE

AR R

ETUR

N

3 M

ONTH

RET

URN

Risk Grade Risk Grade

1 0.00% -0.19% 0.12% 0.72% 1.38% 2.05%

2 0.69% 0.72% 4.69% 5.51% 10.31% 14.01%

3 1.65% 1.82% 8.43% 8.88% 16.43% 21.85%

4 2.04% 3.01% 11.28% 11.38% 20.30% 29.16%

5 2.92% 4.15% 14.10% 13.56% 23.49% 33.99%

6 3.17% 5.41% 15.86% 14.67% 23.79% 37.54%

7 3.96% 6.63% 18.44% 16.41% 26.05% 41.56%

8 4.77% 7.82% 21.06% 18.11% 28.29% 45.55%

9 5.02% 9.11% 22.86% 19.16% 28.45% 49.26%

10 5.79% 10.29% 25.50% 20.78% 30.62% 53.27%

DFA Multi-Option: UK Perspective Pure DFA Multi-Option: UK Perspective Passive

6 M

ONTH

RET

URN

1 YE

AR R

ETUR

N

2 YE

AR R

ETUR

N

3 M

ONTH

RET

URN

FROM

INCE

PTIO

N

(01.

01.2

013)

Please refer to Important Notes on page 4 for how performance figures are calculated. Performance data is correct as of 31 March 2017. Past performance is not an indication of future returns. The value of investments and any income from them is not guaranteed and can go down as well as up. Please refer to Important Notes on page 4 for how performance figures are calculated. Performance data is correct as of 31 March

2017. Past performance is not an indication of future returns. The value of investments and any income from them is not guaranteed and can go down as well as up.

1 0.00% -0.19% 0.12% 0.72% 1.38% 2.05%

2 0.92% 0.21% 6.10% 6.94% 14.91% 19.32%

3 1.85% 1.22% 9.99% 10.41% 21.69% 27.97%

4 2.28% 2.33% 13.06% 13.12% 26.41% 36.36%

5 3.12% 3.45% 15.85% 15.22% 29.62% 41.28%

6 3.37% 4.74% 17.45% 16.16% 29.39% 44.24%

7 4.05% 6.01% 19.62% 17.41% 30.29% 46.57%

8 4.77% 7.29% 21.83% 18.66% 31.22% 48.87%

9 5.02% 8.61% 23.44% 19.53% 30.82% 51.86%

10 5.69% 9.86% 25.64% 20.64% 31.58% 53.98%

FROM

INCE

PTIO

N

(01.

01.2

013)

3 YE

AR R

ETUR

N

3 YE

AR R

ETUR

N


DU


1 YE

AR R

ETUR

N

FROM

INCE

PTIO

N

(01.

01.2

013)

6 M

ONTH

RET

URN

3 M

ONTH

RET

URN



Managed Liquidity 0.00% -0.19% 0.12% 0.72% 1.38% 2.05%

Fixed Interest 0.65% -0.94% 2.90% 4.68% 9.71% 9.76%

Global Property 1.25% -0.11% 16.94% 20.04% 56.75% 63.95%

UK Equity Growth 4.63% 8.56% 20.72% 16.44% 23.82% 50.42%

UK Equity Income 3.62% 6.52% 17.48% 10.46% 18.01% 43.38%

UK Value and Small Cap 4.13% 10.09% 18.90% 14.00% 17.73% 54.12%

World Ex-UK Equity 4.08% 13.79% 33.86% 32.89% 56.85% 100.11%

World Ex-UK Value & Small Cap Equity

2.21% 15.17% 38.32% 33.10% 47.38% 97.91%

Emerging Markets Equity 11.76% 12.52% 36.93% 26.59% 43.16% 36.22%

Emerging Markets Value & Small Cap Equity

14.84% 13.62% 39.21% 30.13% 44.27% 40.23%


Fixed Interest 1.17% -2.07% 6.39% 8.27% 21.27% 22.90%

Global Property 1.25% -0.11% 16.94% 20.04% 56.75% 63.95%

UK Equity Growth 4.01% 8.00% 21.83% 16.96% 24.57% 49.40%

UK Equity Income 3.62% 6.52% 17.48% 10.46% 18.01% 43.38%

UK Value and Small Cap 4.13% 10.09% 18.90% 14.00% 17.73% 54.12%

World Ex-UK Equity 5.49% 13.19% 33.71% 33.24% 61.40% 101.87%

World Ex-UK Value & Small Cap Equity

2.21% 15.17% 38.32% 33.10% 47.38% 97.91%



14.84% 13.62% 39.21% 30.13% 44.27% 40.23%

DFA Multi-Option UK Perspective - Asset Class Returns to period end 31 March 2017

World Ex-UK Equity (Core and Value/Small Cap) has continued to relatively outperform over 6 months, 1, 2, 3 years and since inception, whilst Emerging Markets Equity (Core and Value/Small Cap) has also recovered strongly over 3 months, 6 months, 1, 2 and 3 years. Finally, Global Property has delivered attractive returns over 3 years and since inception, though 6 month returns were negatively impacted by the fall in sterling post the Brexit referendum last year.


Asset Class Asset Class2

YEAR

RET

URN

1 YE

AR R

ETUR

N

FROM

INCE

PTIO

N

(01.

01.2

013)

6 M

ONTH

RET

URN

3 M

ONTH

RET

URN

2 YE

AR R

ETUR

N


3 YE

AR R

ETUR

N

3 YE

AR R

ETUR

N


DFA Multi-Option: Global Perspective

The DFA Multi-Option: Global Perspective Solution enables clients to allocate monies across multiple asset classes within a Risk Graded framework that uses a global approach to asset weightings. The Multi-Option profile provides the client with additional flexibility to accommodate both pure, passive and (where appropriate) active exposure within each asset class, and to vary the value and small cap tilt as appropriate. The amount to invest into each asset group is dependent upon the client’s risk profile and, once agreed, is kept constant by the investment manager (PIM) by periodic rebalancing. PIM only has the authority to make infrequent changes to asset weightings, as identified by a structural change.

DFA Multi-Option: Global Perspective - Asset Allocation Table



DFA Multi-Option: Global Perspective Pure

DFA Multi-Option: Global Perspective Passive

Risk Grade

1 100% 0% 0% 0% 0% 0% 0% 100%

2 45% 40% 5% 4% 6% 0% 0% 100%

3 25% 45% 10% 6% 9% 3% 2% 100%

4 10% 50% 10% 10% 15% 3% 2% 100%

5 0% 50% 10% 12% 18% 5% 5% 100%

6 0% 45% 5% 14% 21% 8% 7% 100%

7 0% 35% 5% 16% 24% 10% 10% 100%

8 0% 25% 5% 18% 27% 13% 12% 100%

9 0% 20% 0% 20% 30% 15% 15% 100%

10 0% 10% 0% 22% 33% 18% 17% 100%

GLOB

AL P

ROPE

RTY

GLOB

AL E

QUIT

YGL

OBAL

VAL

UE &

SMAL

L CA

P EQ

UITY

EMER

GIN

G M

ARKE

TS

EQUI

TY

EMER

GIN

G M

ARKE

T VA

LUE

& S

MAL

L CA

P EQ

UITY

FIXE

D IN

TERE

ST

MAN

AGED

LIQ

UIDI

TY

TOTA

L

Portfolios are rebalanced to their asset allocation on a semi annual basis.

GLOB

AL P

ROPE

RTY

GLOB

AL E

QUIT

Y

GLOB

AL V

ALUE

&

SMAL

L CA

P

EMER

GIN

G M

ARKE

TS

EQUI

TY

EMER

GIN

G M

ARKE

TS

VALU

E &

SM

ALL

CAP

EQUI

TY

FIXE

D IN

TERE

ST

MAN

AGED

LIQ

UIDI

TY

DG

Fund OCF 0.20% 0.28% 0.22% 0.38% 0.58% 0.67% 0.97%

Historic Yield 0.82% 1.12% 2.06% 1.66% 1.15% 1.81% 1.53%

Fund OCF 0.20% 0.10% 0.22% 0.08% 0.58% 0.22% 0.97%

Historic Yield 0.82% 1.56% 2.06% 2.17% 1.15% 2.19% 1.53%

GLOB

AL P

ROPE

RTY

GLOB

AL E

QUIT

Y

GLOB

AL V

ALUE

&

SMAL

L CA

P

EMER

GIN

G M

ARKE

TS

EQUI

TY

EMER

GIN

G M

ARKE

TS

VALU

E &

SM

ALL

CAP

EQUI

TY

FIXE

D IN

TERE

ST

MAN

AGED

LIQ

UIDI

TY





The current portfolio holdings for DFA Multi-Option: Global Perspective Pure and Passive are shown in the tables below, as at 31 March 2017. Due diligence is conducted on Dimensional Fund Advisers (DFA) and underlying passive fund providers on a 6 monthly basis, for the purposes of on-going suitability.




Dimensional Global Short Dated Bond


Dimensional Global Core Equity


Dimensional Emerging Markets Core Equity


Dimensional Sterling Inflation Linked Intermediate Duration Fixed Income








Vanguard Global Bond Index Hedged




L&G Pacific Index

L&G Japan Index

GLOB

AL P

ROPE

RTY

GLOB

AL E

QUIT

Y

GLOB

AL V

ALUE

AN

D

SMAL

L CA

P

FIXE

D IN

TERE

ST

MAN

AGED

LIQ

UIDI

TY

EMER

GIN

G M

ARKE

TS

VALU

E &

SM

ALL

CAP

EQUI

TY

EMER

GIN

G M

ARKE

TS

EQUI

TY


DFA Multi-Option Global Perspective - Portfolio Returns to period end 31 March 2017

All DFA Global (Pure and Passive) portfolios continue to perform in line with their relative risk over all periods, owing to the strong relative performance Global Equity (Core and Value/Small Cap) over 6 months, 1, 2, 3 years and since inception, Emerging Markets Equity (Core and Value/Small Cap) over 3 months, 6 months, 1, 2 and 3 years, and Global Property over 3 years and since inception.

6 M

ONTH

RET

URN

1 YE

AR R

ETUR

N

FROM

INCE

PTIO

N

(01.

01.2

013)

3 M

ONTH

RET

URN

Risk Grade Risk Grade

1 0.00% -0.19% 0.12% 0.72% 1.38% 2.05%

2 0.59% 0.23% 5.24% 6.37% 13.51% 18.38%

3 1.45% 1.43% 9.67% 10.46% 21.31% 28.28%

4 1.82% 2.76% 13.27% 13.81% 27.02% 38.04%

5 2.63% 4.12% 16.88% 16.82% 31.85% 44.84%

6 3.31% 5.57% 19.49% 18.53% 33.02% 47.26%

7 4.07% 7.15% 22.91% 21.05% 36.30% 52.30%

8 4.79% 8.70% 26.32% 23.46% 39.50% 57.26%

9 5.51% 10.17% 29.05% 25.18% 40.61% 59.78%

10 6.22% 11.71% 32.53% 27.53% 43.75% 64.77%

1 0.00% -0.19% 0.12% 0.72% 1.38% 2.05%

2 0.60% 0.88% 4.82% 5.81% 10.68% 14.62%

3 1.49% 2.20% 9.26% 9.95% 18.08% 23.95%

4 1.82% 3.59% 12.80% 13.23% 23.25% 32.91%

5 2.64% 4.96% 16.45% 16.33% 28.03% 39.65%

6 3.34% 6.38% 19.19% 18.25% 29.69% 42.79%

7 4.10% 7.83% 22.78% 21.03% 33.78% 49.04%

8 4.83% 9.26% 26.40% 23.75% 37.90% 55.38%

9 5.55% 10.68% 29.25% 25.65% 39.50% 58.67%

10 6.27% 12.10% 32.94% 28.33% 43.62% 65.20%

DFA Multi-Option: Global Perspective Pure DFA Multi-Option: Global Perspective Passive

2 YE

AR R

ETUR

N

6 M

ONTH

RET

URN

1 YE

AR R

ETUR

N

FROM

INCE

PTIO

N

(01.

01.2

013)

3 M

ONTH

RET

URN

2 YE

AR R

ETUR

N



3 YE

AR R

ETUR

N

3 YE

AR R

ETUR

N


DFA Multi-Option: Global Perspective DG


DFA Multi-Option Global Perspective - Asset Class Returns to period end 31 March 2017

Global Equity (Core and Value/Small Cap) has continued to relatively outperform over 6 months, 1, 2, 3 years and since inception, whilst Emerging Markets Equity (Core and Value/Small Cap) has also recovered strongly over 3 months, 6 months, 1, 2 and 3 years. Finally, Global Property has delivered attractive returns over 3 years and since inception, though 6 month returns were negatively impact by the fall in sterling post the Brexit referendum last year.


1 YE

AR R

ETUR

N

FROM

INCE

PTIO

N

(01.

01.2

013)

6 M

ONTH

RET

URN

3 M

ONTH

RET

URN



Fixed Interest 0.58% -1.12% 1.38% 3.42% 7.48% 7.64%

Global Property 1.25% -0.11% 16.94% 20.04% 56.75% 63.95%

Global Equity 4.05% 11.95% 31.98% 30.90% 53.44% 93.94%

Global Value & Small Cap 2.21% 15.17% 38.32% 33.10% 47.38% 97.91%



14.84% 13.62% 39.21% 30.13% 44.27% 40.23%


Fixed Interest 0.44% -2.74% 2.45% 4.84% 14.35% 16.76%

Global Property 1.25% -0.11% 16.94% 20.04% 56.75% 63.95%

Global Equity 5.23% 12.36% 31.62% 30.25% 54.85% 92.66%

Global Value & Small Cap 2.21% 15.17% 38.32% 33.10% 47.38% 97.91%



14.84% 13.62% 39.21% 30.13% 44.27% 40.23%

Asset Class Asset Class2

YEAR

RET

URN

1 YE

AR R

ETUR

N

FROM

INCE

PTIO

N

(01.

01.2

013)

6 M

ONTH

RET

URN

3 M

ONTH

RET

URN

2 YE

AR R

ETUR

N


3 YE

AR R

ETUR

N

3 YE

AR R

ETUR

N


Distribution Technology Multi-Option

The Distribution Technology (DT) Multi-Option Solution incorporates ten risk graded model portfolios constructed by Parmenion Investment Management (PIM). The asset weightings of these portfolios exactly match those specified by Distribution Technology in their quarterly investment report. This solution allows the Adviser to choose between active and/or passive fund exposure, within each asset class, as appropriate for the underlying client. These portfolios were modified on 7th October 2016 to match the Strategic Asset Allocation (SAA) as per the Q2 2016 DT report.

Distribution Technology Multi-Option: Asset Allocation Table

Risk Grade

1 100% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 100%

2 41% 13% 5% 8% 11% 5% 12% 0% 0% 0% 0% 0% 5% 100%

3 10% 23% 7% 9% 14% 5% 14% 2% 6% 2% 0% 0% 8% 100%

4 5% 24% 5% 3% 8% 6% 19% 4% 10% 4% 4% 0% 8% 100%

5 0% 24% 0% 0% 5% 6% 26% 5% 12% 5% 5% 5% 7% 100%

6 0% 19% 0% 0% 0% 5% 31% 5% 9% 5% 10% 11% 5% 100%

7 0% 5% 0% 0% 0% 5% 35% 5% 7% 5% 16% 17% 5% 100%

8 0% 0% 0% 0% 0% 5% 20% 5% 5% 5% 25% 30% 5% 100%

9 0% 0% 0% 0% 0% 0% 16% 5% 5% 5% 26% 43% 0% 100%

10 0% 0% 0% 0% 0% 0% 5% 0% 5% 0% 27% 63% 0% 100%

UK I/

L BO

NDS

INTE

RNAT

ION

AL B

ONDS

GLOB

AL H

IGH

YIE

LD

UK E

QUIT

Y

EURO

PEAN

EQU

ITY

UK C

ORP

BON

DS

UK C

ASH

US E

QUIT

Y

These are the asset weightings that were in effect as at 31 March 2017. Since then, asset weightings have changed as per the DT Dynamic Planner August 2016 Strategic Asset Allocation document. Please refer to solution factsheet for details of current asset weightings.


DT

JAPA

N E

QUIT

Y

PACI

FIC

EX-J

APAN

EQUI

TY

EMER

GIN

G M

ARKE

TS

EQUI

TY

UK P

ROPE

RTY

TOTA

L

UK G

ILTS




Distribution Technology Multi-Option Passive

UK I/

L GI

LTS

INTE

RNAT

ION

AL B

ONDS

UK G

ILTS

UK E

QUIT

Y

EURO

PEAN

EQU

ITY

UK C

ORP

BON

DS

UK C

ASH

Fund OCF 0.12% 0.68% 0.56% 0.79% 0.32% 0.73% 0.81% 0.91% 0.96% 1.19% 0.88% 1.13% 0.71%

Historic Yield 0.56% 2.66% 0.00% 2.57% 1.23% 4.18% 2.88% 1.23% 0.83% 2.42% 2.36% 1.18% 2.76%

Fund OCF 0.12% 0.06% 0.10% 0.10% 0.06% 0.73% 0.10% 0.09% 0.06% 0.10% 0.14% 0.22% 0.71%

Historic Yield 0.56% 2.90% 0.05% 1.73% 1.74% 4.18% 3.97% 2.65% 1.44% 1.76% 2.86% 2.19% 2.76%

Distribution Technology Multi-Option Active

US E

QUIT

Y

JAPA

N E

QUIT

Y

PACI

FIC

EX-J

APAN

EQUI

TY

EMER

GIN

G M

ARKE

TS

EQUI

TY

UK P

ROPE

RTY



GLOB

AL H

IGH

YIE

LD

UK I/

L GI

LTS

INTE

RNAT

ION

AL B

ONDS

UK G

ILTS

UK E

QUIT

Y

EURO

PEAN

EQU

ITY

UK C

ORP

BON

DS

UK C

ASH

US E

QUIT

Y

JAPA

N E

QUIT

Y

PACI

FIC

EX-J

APAN

EQUI

TY

EMER

GIN

G M

ARKE

TS

EQUI

TY

UK P

ROPE

RTY

GLOB

AL H

IGH

YIE

LD



UK I/

L GI

LTS

INTE

RNAT

ION

AL

BON

DS

UK G

ILTS

UK C

ORP

BO

NDS

UK C

ASH

EURO

PEAN

EQ

UITY




M&G Optimal Income

Allianz Gilt Yield Threadneedle High Yield Bond


Jupiter European

JPM US Equity Income



Aberdeen Emerging Markets Equity





Trojan Income Threadneedle European Select


Schroder Asian Income

Schroder Global Emerging Markets








Unicorn UK Income




UK E

QUIT

Y

The current portfolio holdings for DT Multi Option are shown in the tables below, as at 31 March 2017. Please refer to page 57 for details on fund changes over the period. If you have any further queries, please refer to your relationship manager.

Distribution Technology Multi-Option Active and Passive

US E

QUIT

Y

JAPA

N E

QUIT

Y

PACI

FIC

EX

-JAP

AN

EQUI

TY

UK P

ROPE

RTY

EMER

GIN

G

MAR

KETS

EQ

UITY






Threadneedle High Yield Bond




L&G Japan Index

L&G Pacific Index







Active

Passive

GLOB

AL H

IGH

YI

ELD


Distribution Technology Multi-Option DGDT

Distribution Technology Multi-Option - Portfolio Returns to period end 31 March 2017

All portfolios within DT Active and Passive have performed in line with their relative risk over 3 months, 6 months and 1 year. Over 2 and 3 years, all portfolios are in line up until Risk Grade 9 (Risk Grade 10 over 3 years for DT Passive) owing to the strong relative returns in US, Japan and Pacific Ex-Japan Equity. Since inception Risk Grades 7-10 are slightly distorted as US Equity has relatively outperformed all other asset groups.

Distribution Technology Multi-Option Active6

MON

TH R

ETUR

N

FROM

INCE

PTIO

N

(01.

06.2

013)

3 M

ONTH

RET

URN

Risk Grade

1 0.06% 0.14% 0.38% 0.27% 2.32% 2.74%

2 1.54% 0.77% 5.95% 6.90% 14.31% 15.76%

3 2.40% 1.87% 10.29% 12.10% 24.21% 27.27%

4 3.11% 3.61% 12.93% 15.00% 29.51% 34.44%

5 3.98% 5.40% 15.65% 17.73% 35.29% 39.73%

6 4.87% 6.64% 18.75% 19.52% 39.09% 43.68%

7 5.86% 7.97% 21.65% 21.89% 40.97% 44.47%

8 7.06% 8.64% 24.62% 23.10% 43.22% 43.70%

9 8.01% 9.34% 28.57% 24.86% 48.12% 43.40%

10 9.13% 9.62% 30.84% 23.80% 45.31% 36.59%


1 YE

AR R

ETUR

N


2 YE

AR R

ETUR

N

6 M

ONTH

RET

URN

FROM

INCE

PTIO

N

(01.

06.2

013)

3 M

ONTH

RET

URN

Risk Grade

1 YE

AR R

ETUR

N


2 YE

AR R

ETUR

N

1 0.06% 0.14% 0.38% 0.27% 2.32% 2.74%

2 1.27% 0.60% 6.06% 6.59% 14.62% 15.97%

3 2.17% 1.79% 10.95% 12.05% 25.66% 28.73%

4 3.02% 3.87% 14.86% 14.73% 29.56% 33.43%

5 3.88% 5.84% 18.20% 17.18% 32.15% 35.08%

6 4.78% 7.21% 21.59% 18.90% 33.93% 36.74%

7 5.78% 8.76% 24.64% 20.52% 34.15% 35.57%

8 7.25% 9.83% 27.80% 22.30% 35.86% 34.85%

9 8.27% 10.73% 32.02% 24.23% 39.80% 34.97%

10 9.46% 11.17% 34.06% 23.82% 40.15% 31.23%

3 YE

AR R

ETUR

N

3 YE

AR R

ETUR

N



UK Cash 0.06% 0.14% 0.38% 0.27% 2.32% 2.74%

UK Corp Bonds 1.75% -1.06% 9.25% 9.75% 24.19% 23.59%

UK I/L Gilts 1.98% -3.73% 20.25% 21.25% 44.93% 41.01%

International Bonds 0.27% -2.54% 0.51% 3.03% 11.21% 13.21%

UK Gilts 1.67% -2.15% 7.08% 10.53% 26.93% 25.44%

Global High Yield* 1.61% 3.28% 8.74% 8.91% N/A N/A

UK Equity 3.81% 7.27% 19.65% 13.68% 21.26% 27.51%

European Equity 7.31% 12.46% 27.92% 22.12% 31.16% 46.12%

US Equity 4.45% 14.27% 35.30% 38.74% 76.12% 82.93%

Japan Equity 3.48% 8.21% 32.54% 27.23% 60.28% 52.93%

Pacific Ex-Japan Equity 10.01% 12.06% 35.51% 27.08% 42.77% 37.26%


UK Property 3.15% 5.44% -1.48% 6.70% 20.49% 29.91%

Asset Class

Distribution Technology Multi-Option Active

FROM

INCE

PTIO

N

(01.

06.2

013)

6 M

ONTH

RET

URN

3 M

ONTH

RET

URN


UK Cash 0.06% 0.14% 0.38% 0.27% 2.32% 2.74%

UK Corp Bonds 2.00% -1.07% 6.81% 6.37% 16.16% 17.47%

UK I/L Gilts 1.49% -3.93% 20.30% 21.85% 45.98% 40.71%

International Bonds 1.14% 2.19% 7.50% 6.15% 10.22% 9.22%

UK Gilts 2.32% -3.62% 7.04% 8.74% 21.91% 18.92%

Global High Yield* 1.61% 3.28% 8.74% 8.91% N/A N/A

UK Equity 4.93% 7.41% 16.97% 19.91% 32.91% 44.91%

European Equity 5.77% 5.71% 16.03% 19.49% 37.87% 47.64%

US Equity 3.41% 13.41% 31.50% 37.08% 70.31% 79.47%

Japan Equity 2.59% 12.48% 35.86% 32.31% 75.94% 66.85%

Pacific Ex-Japan Equity 9.26% 8.93% 30.05% 25.26% 63.10% 52.76%


UK Property 3.15% 5.44% -1.48% 6.70% 20.49% 29.91%

Distribution Technology Multi-Option - Asset Class Returns to period end 31 March 2017

All portfolios within DT Active and Passive have performed in line with their relative risk over 3 months, 6 months and 1 year. Over 2 and 3 years, all portfolios are in line up until Risk Grade 9 (Risk Grade 10 over 3 years for DT Passive) owing to the strong relative returns in US, Japan and Pacific Ex-Japan Equity. Since inception Risk Grades 7-10 are slightly distorted as US Equity has relatively outperformed all other asset groups.

Asset Class

1 YE

AR R

ETUR

N

FROM

INCE

PTIO

N

(01.

06.2

013)

6 M

ONTH

RET

URN

3 M

ONTH

RET

URN

1 YE

AR R

ETUR

N

*Distribution Technology introduced the Global High Yield asset class on 15 January 2015. Data is therefore unavailable over longer periods.

*Distribution Technology introduced the Global High Yield asset class on 15 January 2015. Data is therefore unavailable over longer periods.Please refer to Important Notes on page 4 for how performance figures are calculated. Performance data is correct as of

31 March 2017. Past performance is not an indication of future returns. The value of investments and any income from them is not guaranteed and can go down as well as up.

2 YE

AR R

ETUR

N

2 YE

AR R

ETUR

N

3 YE

AR R

ETUR

N

3 YE

AR R

ETUR

N


Portfolio Changes

Portfolios Affected: PIM Strategic Active, PIM Strategic Multi Option, PIM Strategic Conviction, PIM Strategic Guardian, PIM Tactical Active and DT Active

FP CRUX European Special Situations Jupiter European and Threadneedle European Select

CRUX European Special Situations has been added into the asset class to provide additional diversification from a market cap perspective and to reduce stock concentration. CRUX has consistently delivered attractive risk adjusted returns on a historic basis via investing in global businesses based in Europe. The fund is managed by Richard Pease who has over 30 years experience of investing in the region.

Portfolios Affected: Strategic Ethical Active (Profiles A-D) and PIM Tactical Ethical Active

Stewart Investors Global Emerging Markets Sustainability Stewart Investors Asia Pacific Sustainability

Whilst Asia Pacific has significantly outperformed Emerging Markets over the last 5 years, there was clear evidence of a potential reversion in Emerging Markets in 2016 and this move helps to mitigate this risk given the differences in underlying valuations.

Portfolios Affected: PIM Strategic Ethical Active (Profiles A-C), PIM Tactical Ethical Active. PIM Strategic Ethical Active (Profile D) for F&C Responsible UK Growth

Royal London Sustainable Leaders and F&C Resposible UK Growth Kames Ethical Equity / Standard Life Investments UK Ethical

Royal London Sustainable Leaders and F&C Responsible UK Equity Growth have been added to the portfolios, given their consistent historic risk adjusted returns. This will improve the best fit analysis to the underlying client’s Ethical Profile. Greater diversification in market cap exposure is achieved by this change, given Kames and SLI’s increased focus on small and mid cap stocks which struggled in 2016 given the fall in sterling post the Brexit referendum.

REDUCE

BUY REDUCE

BUY

SELL

BUY


PIM In-House Solutions

PIM Strategic Multi-Option 1-10 Strategic

PIM Strategic Conviction 1-10 Strategic

PIM Strategic Guardian 1-10 Strategic

PIM Strategic Active 1-10 Strategic

PIM Tactical Active 1-10 Tactical

PIM Tactical Passive 1-10 Tactical

PIM Tactical Income 1-10 Tactical

PIM Strategic Ethical Active (A-D) 1-10 Strategic

PIM Tactical Ethical Active 1-10 Tactical

Fund Manager Focus Solutions


1-10 Strategic

DFA Multi-Option: Global Perspective

1-10 Strategic

Distribution Technology Multi-Option (DT) 1-10 StrategicN

O. O

F PO

RTFO

LIOS

/

RISK

GRA

DES

ASSE

T AL

LOCA

TION

MET

HOD

OLOG

YInvestment Solution

Solutions Index

Strategic

Strategic portfolios define and fix the asset allocation weightings at the outset and are based on historical performance data. These are reviewed annually and are only changed when structural errors have been identified. Once the weightings of the portfolio are established, the emphasis is on maintaining the asset allocation through rebalancing to achieve performance over the long term.

Active

Active funds are selected for their potential to outperform their sector with lower volatility. Active funds have higher charges as a result of the increased cost of the management process and associated research relative to Passive funds.

Tactical

Tactical asset allocation takes its lead from the fixed asset weightings of a strategic portfolio, but then allows the investment manager a degree of flexibility to vary those weightings within a risk-controlled framework. By moving among the various asset classes the investment manager looks to create an additional source of investment return by taking advantage of short term market inefficiencies which can help to manage investors’ exposure to risk.

Passive

Passive funds are selected for their ability to track the asset class benchmarks closely. As processes are largely technology driven, there is minimal human intervention and the associated cost is lower.

Investment Solutions At Parmenion we provide an extensive range of investment solutions across varying Risk Grades and investment styles, here is a summary:


PIM Efficient Frontier 8-11 Active and/or Passive

All Users This solution uses seven asset groups and allows for active or passive fund selection, within a Strategic Asset Allocation. The PIM Strategic Passive solution has an identical structure to PIM Multi-Option Passive and has therefore been excluded from the QIR.

PIM Efficient Frontier 12-15 Active and Passive

All users The PIM Strategic Conviction solution enables clients to divide their investment across various different asset classes. The amount invested into each asset class is dependent upon the clients’ risk profile and, once agreed, is kept constant with periodic rebalancing. A strategic asset allocation will be followed and periodically reviewed by the Investment Manager. Only in exceptional or unusual market conditions will the Strategic asset weightings be re-defined, as appropriate. The split between active and passive funds will be determined by PIM using both quantitative and qualitative measures and may vary by asset class as deemed appropriate by the investment managers.

PIM Efficient Frontier 16-19 Active and/or Passive

All users This solution has been specifically designed to be used within a drawdown environment whether that be via pension drawdown or otherwise. Sixteen individual asset classes are blended to provide 10 Risk Graded portfolios that are dual optimised to provide both capital growth and a stable yield. The solution uses predominately active fund managers however some passive funds are also utilised with certain asset classes.

PIM Efficient Frontier 20-21 Active All Users This solution is based on a pure strategic asset allocation and active fund selection using six asset groups, including Equity Income, Equity Growth and Global Alpha.

PIM Asset Allocation Committee 22-27 Active All Users This solution is based on PIM’s tactical asset allocation and a passive fund selection, investment philosophy and process.

PIM Asset Allocation Committee 22-27 Passive All Users This solution is based on PIM’s tactical asset allocation and a passive fund selection, investment philosophy and process.

PIM Asset Allocation Committee 28-31 Active and/or Passive

All Users This investment solution enables clients to invest in a range of carefully constructed Tactical portfolios, according to their requirement for yield, total return and capacity for loss. The amount invested into each portfolio is dependent upon the client’s risk profile and, once agreed, is kept constant with periodic rebalancing. The investment managers have and will use a degree of flexibility to vary these weightings within a risk controlled framework, to maintain the portfolio’s targeted yield, maximise total return and minimise losses in response to changing market conditions.

PIM Efficient Frontier 32-39 Active All Users This solution combines various styles of ethical investing with strategic asset allocations and an active fund selection. All funds are screened for positive and negative ethical criteria and monitored on an on-going basis by the Ethical Oversight Committee.

PIM Asset Allocation Committee 40-43 Active All Users This solution is based on PIM’s tactical asset allocation and active fund selection, investment philosophy and process. Funds are selected from the EIRiS universe which are deemed to be broadly ethical in nature.

PIM Efficient Frontier 44-47 Pure/Passive Approved Users This solution provides the client with additional flexibility to accommodate both pure and passive exposure within each asset class, and to vary the value and small cap tilt as appropriate. The portfolio strategy incorporates a traditional domestic bias to UK equity in line with the Dimensional approach. This solution is strategic in nature; as such asset allocations are only changed on an infrequent basis, in response to structural issues.

PIM Efficient Frontier 48-51 Pure/Passive Approved Users This solution provides the client with additional flexibility to accommodate both pure and passive exposure within each asset class, and to vary the value and small cap tilt as appropriate. The portfolio strategy incorporates a global approach to asset allocations, in line with each country’s market capitalisation relative to the global economy. This solution is strategic in nature; as such asset allocations are only changed on an infrequent basis, in response to structural issues.

Distribution Technology’s Strategic Asset Allocation (SAA)

52-56 Active and/or Passive

All Users This solution asset weightings match DT’s Strategic Asset Allocation (SAA) and allows for active or passive fund selection.

ASSE

T W

EIGH

TIN

GS

INVE

STM

ENT

STYL

E

OPEN

TO

SOLU

TION

DES

CRIP

TION

PAGE

S


Index and Peer Group Returns

Index and Peer Group Returns to period end 31 March 2017





LIBOR GBP 12m 0.19% 0.39% 0.83% 1.86% 2.88% 5.18%

IBOXX Sterling Gilts All Maturities 1.67% -2.04% 6.80% 10.32% 26.49% 29.88%

Citi UK Inflation-Linked Securities Index 1.20% -1.44% 19.55% 21.54% 44.16% 53.13%

IBOXX Sterling Corporates All Maturities 1.87% -0.75% 10.66% 10.77% 25.63% 45.70%

Barclays Global Aggregate GBP (H) 0.24% -2.36% 0.59% 3.27% 11.35% 18.98%

PIM Property Index 1.38% 2.98% -1.10% 4.98% 17.38% 29.60%

FTSE All Share 4.02% 8.07% 21.95% 17.17% 24.87% 58.66%

FTSE UK Equity Income 3.66% 6.58% 17.61% 10.73% 18.61% 57.33%

FTSE North America 4.83% 14.28% 34.97% 39.86% 75.03% 130.27%

FTSE Europe Ex UK 7.05% 12.79% 28.46% 23.45% 31.85% 78.56%

FTSE Asia Pacific Ex Japan 11.23% 12.18% 36.79% 26.11% 51.38% 65.17%

FTSE Japan 3.63% 8.92% 32.79% 28.48% 63.35% 83.80%

FTSE World ex UK 5.76% 13.26% 33.64% 34.16% 60.83% 103.76%

FTSE Emerging 8.92% 11.28% 35.58% 23.58% 43.77% 37.74%

6 M

ONTH

RE

TURN

1 YE

AR

RETU

RN

2 YE

AR

RETU

RN

3 M

ONTH

RE

TURN

3 YE

AR

RETU

RN


Comparative Indices

5 YE

AR

RETU

RN


Notes


Get in touch To speak to one of the Parmenion Investment Management team, you can call 0345 519 0100 or email [email protected]

Parmenion Investment Management Ltd Head Office: 2 College Square Anchor Road, Bristol BS1 5UE. Office: 0345 519 0100 Website: www.parmenion-im.co.uk Email: [email protected]

Parmenion Investment Management Ltd is a subsidiary of Parmenion Capital Partners LLP.

Parmenion Capital Partners LLP is authorised and regulated by the Financial Conduct Authority, registration number: 462085.

Wholly owned subsidiary of Aberdeen Asset Management PLC and Aberdeen Investments Limited.

Parmenion Capital Partners LLP is registered in England and Wales OC322243.

quarterly investment review...6 parmenion investment management quarterly investment review market...

Documents