Investment Guide Version 1.1 September 2020
Du Pont (U.K.) Limited Pensions Fund – DC Section Investment Guide Version 1.1 September 2020.
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Investment Guide
Contents
4 Choosing how to invest your Workplace Retirement Account
6 Explaining investments. What choices do I have?
8 How the funds are managed
9 Working out your attitude to investment risk
11 Risk ratings
12 Charges and expenses
13 Investment options
14 Lifestyles
Potential advantages and disadvantages to 19 investing in a Lifestyle
20 Self-Select fund options
26 Reviewing and switching
27 Help and further information
28 Appendix. Fund risk warnings
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This guide explains some of the basics of investment, the choices you have and the things you will 4 Choosing how to invest your Workplace Retirement Account About this guide need to consider. 6 Explaining investments. What choices do I have? This investment guide is produced by Aviva on behalf of the 8 How the funds are managed Trustee of the Du Pont (U.K.) Limited Pensions Fund (the Fund). 9 Working out your attitude to investment risk This guide explains how you can invest your Workplace 11 Risk ratings Retirement Account (Account) within the DC Section of the Fund (the DC Section). If you are not confident about making 12 Charges and expenses your own investment choices you can remain in the Fund’s default investment solution. 13 Investment options You should ensure that you read the member guide which can 14 Lifestyles be found online at https://library.aviva.com/aengs133a.pdf. Potential advantages and disadvantages to The member guide explains how the Fund works. 19 investing in a Lifestyle Our role as Trustee 20 Self-Select fund options We, as Trustee of the Fund, have a legal benchmarks. If the investment funds are duty to ensure that the Fund offers a not performing as we would expect, we 26 Reviewing and switching choice of high-quality investments may decide to change them. for you to choose from. We do this Should we choose to close or replace a by taking advice from investment fund, please be assured that we will notify 27 Help and further information experts and regularly reviewing how you in advance and explain the choices the investment funds are performing you have. 28 Appendix. Fund risk warnings against our expectations and the relevant
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Choosing how to invest your Workplace Retirement Account The Fund is designed to help you save for your retirement. When you retire, your Account can be used to purchase benefits for you and your dependants.
The Fund provides you with two options for Why is investment important? investing your Account: The contributions you make and those from Option 1 – Lifestyle – you can decide to your DuPont employer (the Company) are invest your Account in one of three Lifestyles. paid into your Account. These contributions One of the Lifestyles is the Fund’s default are then invested in funds with the potential investment solution. More information on to increase in value over the long term. the Lifestyles can be found on page 14. A pension scheme should seek to get the Option 2 – Self-select – you can choose your best return possible for your savings whilst own portfolio of funds from a prescribed list. balancing this with the level of risk you are More information on the self-select funds comfortable with. Taking risk is a critical available to you can be found on page 20. factor in determining the level of returns you could achieve. Therefore, choosing the funds you want to invest in and the level of risk you wish to take are very important decisions. Please be aware that the value of an investment is not guaranteed and can go down as well as up. You could get back less than has been paid in.
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Do I have to choose my and you should be aware of these before own investments? you make your decision. More information on charges can be found on page 12. The Trustee have chosen a default • When you want to retire or start taking investment solution for members who do your pension benefits. A pension is a not wish to choose their own investments. long-term investment and usually the When you join the Fund, contributions will longer you save for, the better. initially be invested in the default investment • How much you need in retirement. solution, which is called the Default Lifestyle You will need to consider the amount of (Cash). You can find out how the Default income you are aiming to retire with. Lifestyle (Cash) works on page 14. Once you have made these decisions, you Contributions will continue to be invested should be better prepared to make your in the Default Lifestyle (Cash), unless you investment choices with your retirement choose to invest in one or more of the other goals in mind. funds available to you.
I’d like to choose my own Review your investments; where do I start? choices regularly If you decide to make your own investment You should regularly review choices, there are a number of things you the funds you choose to need to consider: invest in as the ones you • The performance of the funds you choose now may not be right choose helps to determine the value of for you as your circumstances your Account. change, especially as you get • The level of investment risk you are closer to retirement. prepared to take. You want to get the best return for your investment but this has If you are unsure about to be balanced against the risk you are making investment decisions willing to accept. you may wish to speak to a • The charges applicable. Each investment financial adviser. You may be fund has charges, that are payable by you, charged for this advice.
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Explaining investments. What choices do I have? Typically, investments fall into four main categories, known as “asset classes”.
You choose which funds you invest your Account in. Generally each fund offered by Aviva invests in one of four main asset classes which are described below:
1 Money market 2 Fixed Interest (Bonds)
The ‘money market’ is a mechanism These are loans to a government or a for short-term borrowing and lending company which pay a fixed interest rate between organisations. Money market for a set period until the loan is repaid to investments typically include what are the investor. The most common bonds described as ‘near-cash instruments’, such are government bonds (known in the UK as certificates of deposit, floating-rate as “gilts”) and corporate bonds (issued by notes and treasury bills. They are not to companies). If a government or company be confused with deposit accounts with defaults on the loan, then the interest will banks or building societies. not be paid. For this reason fixed interest investments are seen as relatively low Although less risky than other asset classes, risk, because of the low likelihood of a there could be circumstances where these government or company defaulting. investments fall in value. Their value could also be eroded over time due to the effects of fund charges, product charges and inflation.
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A balanced approach 3 Property Some investors like to spread their investments across funds that invest in Property investment usually means a range of asset classes that can include commercial property, such as offices and equities, bonds, property and money retail, leisure and industrial developments. markets, as well as across different parts It can also include residential property. As of the world. This aims to reduce the well as the potential increase in their value, overall risk of their total investments and property investments can also produce is known as diversification. The fund range rental income. Property can be subject to available to you includes funds that invest heavy falls and sharp increases in value. across different asset classes. There are It can also take more time to buy and no guarantees with a diversified approach sell property than investments in other as all funds carry an element of risk. asset classes.
4 Equity
Equities are also known as Shares. Shareholders have a ‘share’ in a company’s assets. Equities are bought and sold on stock markets and their value can go up or down depending on the fortunes of the company and stock markets in general. Companies may also pay a share of profits to shareholders, known as dividends. While there is more opportunity for potential gains with equity funds than some other asset classes, there is also greater risk that they will fall in value.
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How the funds are managed
Funds are managed differently Not only do funds invest in different types of assets, they are also managed in different ways. Aviva have grouped together the available funds, based on the way they are managed.
Index (or passively managed) funds Actively managed funds An index fund aims to copy the performance The fund manager actively buys and sells of a particular index of a specific financial investments with the aim of achieving higher market, such as the FTSE 100 Index. It does returns than the fund’s benchmark. This is a this by aiming to invest in the companies standard against which the performance of of a particular market in such a way as to a fund can be measured and could be based track the return of that market as closely as on, for example, average annual return on possible. This type of fund doesn’t aim to investment performance over a set amount outperform the index it tracks, only to follow of time. it. These are often referred to as ‘passively Fund of funds managed funds’. A fund of funds invests in a number of different funds, rather than directly in shares, bonds or other asset classes. Funds of funds aim to provide the investor with greater diversification, enhanced returns, lowered risk or a combination of all three which could not be achieved through a single fund alone. This type of fund may invest in actively managed funds, index funds or both. The underlying funds will be selected by an external fund manager or Aviva.
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Working out your attitude to investment risk
Things to think about be concerned if your investments went down in value? It is important that you How much investment risk you are prepared consider the level of investment risk you to take will depend on your own personal are prepared to accept and choose your circumstances: investments accordingly. How long you have until you retire If you only have a short time until you retire, it may not be appropriate to invest in riskier Risk profiler questionnaire funds. This is because the value of your To help you understand how much risk investments may fall and you may not have you would like to take, there’s a risk the time required to make up any losses. profiler questionnaire on My Money at: Your view on volatility (risk) www.avivamymoney.co.uk Are you prepared to accept the day-to-day ups and downs of investing in higher‑risk funds, in return for potentially higher returns over the long term? Or would you
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Understanding the Reinsured funds individual funds Where funds are operated through an We recommend that you fully understand insurance agreement with another insurance the risks involved in investing in the various company, this may enable lower charges and funds available before making any decisions. marginally better tax treatments. Seek financial advice if necessary. However, should the other insurance You can find out more about all of the company become insolvent, any funds by logging into your Account at assets invested in those funds through www.avivamymoney.co.uk. Remember a reinsurance agreement would not that, whatever funds you choose, the value be protected by the Financial Services of an investment is not guaranteed and can Compensation Scheme (FSCS). This could go down as well as up. You could get back mean you might get back less than the full less than has been paid in. value of those assets. At times, a fund may need to change the way The potential protection given by the FSCS its price is calculated, to ensure that those varies depending on the type of investment. moving into and out of the fund are treated If you wish to know more about the possible fairly. This can have a negative effect on a extent of protection available, please go to fund’s price and performance. www.fscs.org.uk. Fund managers can, in exceptional circumstances, suspend trading in their funds for as long as necessary. When this occurs, Aviva will need to delay acting on instructions, for example a request to switch out of the fund. You may not be able to make changes to your investments during this period.
AV485372_AENGS133C_MM30169_0920.indd 10 9/16/20 8:47 PM Investment Guide | p11 Risk ratings Aviva assesses each investment fund and Aviva calculates the risk ratings using gives it a risk rating between 1 to 7, with 1 historical performance data, based upon being the funds with the lowest volatility the methods set by European Union rules. (the ups and downs in an investment’s value Aviva also carries out further research using over a period of time) and 7 the funds with information from the fund’s investment the highest volatility. As an example, a fund manager(s). with a risk rating of 4 (medium volatility) has Aviva reviews each fund’s risk rating a medium possibility of incurring substantial annually and updates these where changes in its value. An example of this type applicable. The timing of your investment of fund would be one invested in a range of decisions is very important and it is different investments (for example shares, recommended that you consult a financial property and bonds) without any bias to adviser if you are unsure about where to a particular investment type. Please note invest your Account. Past performance is that the risk ratings below are based on not a guarantee of future performance. the impact the funds will have on the value It is important to remember that all of your Account. You may have other risks investment funds carry some degree of which are not reflected in the risk ratings risk but this varies from fund to fund. that you need to consider. Aviva Risk rating Risk rating description 7 Highest The funds under this risk rating experience the highest level of volatility of all the funds volatility Aviva has rated. This means that these funds have the highest potential for substantial changes in value compared with other Aviva funds. 6 High The funds under this risk rating experience a high level of volatility compared with other volatility funds Aviva have rated. This means that these funds have a high potential for substantial changes in value compared with other Aviva funds. 5 Medium The funds under this risk rating experience medium to high levels of volatility compared to high with other funds Aviva have rated. This means that these funds have a medium to high volatility potential for substantial changes in value compared with other Aviva funds. 4 Medium The funds under this risk rating experience a medium level of volatility compared with volatility other funds Aviva have rated. This means that these funds have a medium potential for substantial changes in value compared with other Aviva funds. 3 Low to The funds under this risk rating experience low to medium levels of volatility compared medium with other funds Aviva have rated. This means that these funds have a low to medium volatility potential for substantial changes in value compared with other Aviva funds. 2 Low The funds under this risk rating experience low levels of volatility compared with other volatility funds Aviva have rated. This means that these funds have a low potential for substantial changes in value compared with other Aviva funds. 1 Lowest The funds under this risk rating experience the lowest level of volatility of all the funds volatility Aviva has rated. This means that these funds have the lowest potential for substantial changes in value compared with other Aviva funds. Please note: These investment risk ratings are based on Aviva’s interpretation of investment risk and are only meant as a guide. The levels of investment risk mentioned above are not guaranteed and may change in the future. The colours in this table may be different to those used online; however, the ratings and approach to investment risk remain the same.
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Charges and expenses Charges are deducted from your Account in order to cover the costs of administration and investment management. Depending on the fund you invest in, different charges may apply.
All charges and expenses are reviewed Fund Annual Management regularly. If there are any changes Aviva or Charge (fund AMC) the Trustee will let you know. The fund AMC is charged by fund managers The charges are explained below. (BlackRock is an example of one of the fund managers) and relates to the costs they incur Total Annual Management through managing the investment funds. It Charge (total AMC) is normally calculated as a percentage of the fund’s value and deducted from the daily The total AMC represents the total of the fund unit price. different charges that apply to the funds available. You can see the total AMCs for Most of the funds available carry a fund each of the available funds in the fund tables AMC. The fund AMC varies from fund to fund. detailed on pages 20 to 25. The total AMC makes it easier to compare the total charges Additional Expenses that apply to the funds available to you. Most fund managers have to pay expenses, Depending on the fund you choose to invest such as fees to auditors. You can see what in, the total AMC will be made up of three the additional expenses are for each fund in different parts. These different parts are the fund tables detailed on pages 20 to 25. explained in more detail below. Not all funds carry additional expenses. Additional expenses vary from fund to fund. Scheme Annual Management Charge (scheme AMC) This covers the costs for Aviva to run your Account. It is a percentage of your Account value that is calculated on a daily basis and deducted by selling fund units. The scheme AMC is 0.27% per annum for all of the DC Section funds.
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Investment options Now that you have read through all the factors you should think about when making a decision on where to invest your Account, this page details the investment options available to you:
1. Invest in a Lifestyle 2. Invest in the range of The Trustee of the Fund have created three self-select funds available Lifestyles – the Default lifestyle (Cash) (this Self-select funds are designed for people who is also the default investment strategy), the are confident in making investment choices Annuity Lifestyle and the Drawdown Lifestyle. and wish to tailor their investment to suit their Lifestyles automatically switch your individual needs. Details of the self‑select investment from risky asset classes to funds available to you can be found in the assets that aim to protect the value of your fund tables detailed on pages 20 to 25. investment as you approach your planned retirement date. Default Investment Strategy Important - Changing your Planned Retirement Date If you do not decide where to invest your contributions, or do not want to The date the Lifestyle starts switching make a decision, your Account will be the funds is determined by your Planned invested in the Default Lifestyle (Cash). Retirement Date. Further details can be found on page 14. Because of this, it is very important that you keep this up to date with Aviva if you are investing in a Lifestyle. When you join the Fund, your Planned Retirement Date will be set at 65 years. If you were a ‘special section’ member your Planned Retirement Date will be set at 62 years. However, you can log onto My Money and make changes to suit your personal retirement goals. You should review this regularly and update Aviva should your goals change.
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Lifestyles
Default Lifestyle (Cash) (also the How does the Default Lifestyle default investment strategy) (Cash) work in practice? The Trustee have created a default Up until 20 years from your planned investment strategy – the Default Lifestyle retirement date, the Default Lifestyle (Cash) (Cash). aims to help your Account grow by investing only in equities (stocks and shares) from The Trustee has chosen to use the Default around the world, in proportion to the size Lifestyle (Cash) as the Fund’s default after of international investment markets. The taking advice from their advisers. value of your Account will fluctuate (or go It is important to remember that the default up or down) on a daily basis as a result of investment strategy may not be suitable for the performance of the fund used in the everyone’s needs. Therefore, it is important growth phase. that you choose investments which are most Between 20 years and 10 years from planned suitable for your own personal circumstances. retirement your Account will be moved gradually into the Diversified Growth Fund which invests in a wide range of different Default Lifestyle (Cash) types of assets (including equities, bonds 100 90 80 70 60 50 40 30 20 10 Target % invested in fund % invested Target 0 20 19 18 17 16 15 14 13 12 11 10 9 8 7 6 5 4 3 2 1 IPED* Years to retirement
Aviva Pension MyM Blended Global Equity Fund
Aviva Pension MyM LGIM Diversified Fund
Aviva Pension MyM BlackRock Sterling Liquidity
* IPED: investment programme end date
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Lifestyles
and cash). This fund aims to still give you The chart below shows how the Default the potential to grow your Account, whilst Lifestyle (Cash) aims to move your money to reducing the volatility (fluctuations in value) specific investment funds. The movements you may experience. take place on a monthly basis as you approach your planned retirement date. In the 5 years leading up to your planned retirement date, your Account is gradually As your investments are moved to different moved into lower risk investments such funds within the Lifestyle, your total AMC as Money market instruments (cash). This may change. However, currently the highest aims to continue to reduce volatility, giving AMC under the Default Lifestyle (Cash) will you more certainty of the likely value of be 0.47%. The total AMCs for the underlying your Account as you approach retirement, funds can be found in the fund tables and be consistent with how most people in detailed on pages 20 to 25. the scheme are currently likely to take their savings in retirement (as a single or series of cash lump sum payments).
Default Lifestyle (Cash) 100 90 80 70 60 50 40 30 20 10 Target % invested in fund % invested Target 0 20 19 18 17 16 15 14 13 12 11 10 9 8 7 6 5 4 3 2 1 IPED* Years to retirement
Aviva Pension MyM Blended Global Equity Fund
Aviva Pension MyM LGIM Diversified Fund
Aviva Pension MyM BlackRock Sterling Liquidity
* IPED: investment programme end date
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Drawdown Lifestyle The Lifestyle maintains a larger exposure to the Diversified Growth Fund at retirement The Drawdown Lifestyle is similar to (55%) compared to the Default Cash the Default Lifestyle (Cash), in that your Lifestyle (30%) as it is designed to be investments will automatically transition broadly appropriate for any members into alternative assets over the course of looking to take an income at retirement your savings journey. whilst leaving their Account invested The chart below shows how this Lifestyle (known as Income Drawdown). Profile will move your money on a monthly If this meets your objective in retirement, basis as you approach your planned then the Drawdown Lifestyle may be a more retirement date. suitable option for you compared to the Default Lifestyle (Cash).
Drawdown Lifestyle Annuity Lifestyle 100 100 90 90 80 80 70 70 60 60 50 50 40 40 30 30 20 20 10 10 Target % invested in fund % invested Target Target % invested in fund % invested Target 0 0 20 19 18 17 16 15 14 13 12 11 10 9 8 7 6 5 4 3 2 1 IPED* 20 19 18 17 16 15 14 13 12 11 10 9 8 7 6 5 4 3 2 1 IPED* Years to retirement Years to retirement
Aviva Pension MyM Blended Global Equity Fund Aviva Pension MyM Blended Global Equity Fund
Aviva Pension MyM LGIM Diversified Fund Aviva Pension MyM LGIM Diversified Fund
Aviva Pension MyM Legal & General (PMC) Pre-Retirement Fund Aviva Pension MyM Legal & General (PMC) Pre-Retirement Fund
Aviva Pension MyM BlackRock Institutional Sterling Liquidity Fund Aviva Pension MyM BlackRock Institutional Sterling Liquidity Fund
* IPED: investment programme end date * IPED: investment programme end date
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Annuity Lifestyle investments such as fixed interest (bonds) and money market investments. This aims The Annuity Lifestyle is similar to the to offset movements in annuity prices by Default Lifestyle (Cash), in that your consolidating into a range of investments investments will automatically transition which change in value broadly in line with into alternative assets over the course of the change in cost of buying an annuity. your savings journey. This Lifestyle is designed to be broadly The chart below shows how this Lifestyle appropriate for any members looking to Profile will move your money on a monthly take a regular income for life by purchasing basis as you approach your planned an annuity at retirement. If this aligns with retirement date. your plan for retirement, then the Annuity In the 10 years leading up to your retirement Lifestyle may be a more suitable option for date, your Account is gradually moved into you compared to the Default Lifestyle (Cash).
Annuity Lifestyle 100 90 80 70 60 50 40 30 20 10 Target % invested in fund % invested Target 0 20 19 18 17 16 15 14 13 12 11 10 9 8 7 6 5 4 3 2 1 IPED* Years to retirement
Aviva Pension MyM Blended Global Equity Fund
Aviva Pension MyM LGIM Diversified Fund
Aviva Pension MyM Legal & General (PMC) Pre-Retirement Fund
Aviva Pension MyM BlackRock Institutional Sterling Liquidity Fund
* IPED: investment programme end date
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Points to note Each Lifestyle may be subject to changes, including to the underlying funds or to the Whilst you are invested in a Lifestyle, you timings of the fund movements and their are unable to invest inself-select investment frequency. The Trustee will notify you if any funds at the same time. changes are planned. If you no longer wish to be invested in a Details about the underlying funds in the Lifestyle, you will need to change your Lifestyles can be found in the fund tables investment choices. You can do this either detailed on pages 20 to 25. by logging onto My Money or by calling the Aviva My Money helpdesk on 0345 604 9915. Please be aware that all investments, including Lifestyles, have a degree of risk involved. The value of an investment is not guaranteed and can go down as well as up. You could get back less than has been paid in.
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Potential advantages and disadvantages to investing in a Lifestyle
Advantages Disadvantages De-risking During the period leading up to When your Account is moved your retirement, your Account into more cautious investments, is moved from investments in you could miss out on potentially the more risky assets into more higher returns associated with cautious investments. This aims more risky assets. to reduce the risk of substantial changes in value. Ownership The Lifestyles offer an alternative There is no guarantee that the to having to change your Lifestyle will be appropriate for investment funds independently your specific circumstances. as you head towards retirement. Timing The Lifestyles can be amended If you forget to update your if you choose to take your Planned Retirement Date, the pension savings earlier or later Lifestyle may switch your assets than planned by updating too soon or too late, meaning you your Planned Retirement Date could miss out on investment with Aviva. growth or be exposed to too much risk. Retirement The Lifestyles have been designed There is no guarantee that the choices to broadly take account of the at-retirement asset allocation way you can take your benefits at will be a perfect match for the retirement. way you want to take retirement benefits, whether through cash, annuity or drawdown.
You can choose to leave the Lifestyles at any time and instead choose from the range of self-select funds.
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Self-Select fund options
The range of self-select funds that are available to you can be found below. Fund factsheets for the funds listed below can be found by accessing your Account through My Money. The Fund table below has been provided by Aviva, not the Trustee. For a description of each risk warning, please see the Appendix. Funds Management Scheme Fund Additional Total Risk rating Fund name Fund aim Style AMC AMC expenses AMC
7 Highest Aviva Pension BlackRock state that the fund’s Index 0.27% 0.18% 0.06% 0.51% volatility MyM BlackRock objective is to achieve a return Emerging that is consistent with the Markets Equity return of the MSCI Emerging (Aquila C) Markets Index. Risk warnings A, B, C, D, J 6 Highest Aviva Pension The fund invests primarily in Bespoke/ 0.27% 0.05% 0.01% 0.33% volatility MyM Blended equities in both the UK and tailored Global Equity overseas markets. The fund has approximately 90% invested into developed market equities with the 50% of the currency exposure hedged back to Sterling. The remaining 10% is invested in emerging markets equities. The fund aims to provide returns broadly consistent with the markets in which it invests. Risk warnings A, B, C, J
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Management Scheme Fund Additional Total Risk rating Fund name Fund aim Style AMC AMC expenses AMC
5 Medium Aviva Pension BlackRock state that the fund Index 0.27% 0.06% 0.00% 0.33% to high MyM BlackRock invests primarily in equities volatility (30:70) in both the UK and overseas Currency Hdgd markets. The fund has Global Equity approximately 30% invested Tracker in the shares of UK companies and 60% invested into developed overseas equities with the currency exposure hedged back to Sterling. The remaining 10% is invested in emerging markets equities. The fund aims to provide returns broadly consistent with the markets in which it invests. Risk warnings A, B, C, D 5 Medium Aviva Pension BlackRock state that the fund Index 0.27% 0.00% 0.00% 0.27% to high MyM BlackRock invests in UK Government volatility Over 15 Year fixed income securities (gilts) Gilt Index that have a maturity period Tracker of 15 years or longer. The fund aims to achieve a return consistent with the FTSE UK Gilts Over 15 Years Index, which is widely regarded as the benchmark for UK pension fund investment in the longer dated end of the UK gilt market. Risk warnings A, E 5 Medium Aviva Pension BlackRock state that the fund Index 0.27% 0.00% 0.00% 0.27% to high MyM BlackRock invests in UK Government volatility Over 5 Year index-linked fixed income Index-Linked securities that have a maturity Gilt Index period of 5 years or longer. Tracker The fund aims to achieve a return consistent with the FTSE UK Index-Linked Gilts Over 5 Years Index, which is widely regarded as the benchmark for UK pension fund investment in the longer dated end of the UK index-linked gilt market. Risk warnings A, E
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Management Scheme Fund Additional Total Risk rating Fund name Fund aim Style AMC AMC expenses AMC
5 Medium Aviva Pension BlackRock state that the Index 0.27% 0.00% 0.00% 0.27% to high MyM BlackRock fund invests in the shares volatility UK Equity of UK companies and aims Index Tracker to achieve a return that is consistent with the return of the FTSE All-Share Index. Risk warnings A, D 5 Medium Aviva Pension BlackRock state that the Index 0.27% 0.00% 0.00% 0.27% to high MyM BlackRock fund aims to achieve returns volatility World ex UK in line with global equity Equity Index markets, excluding the UK. Tracker Within each of those markets, the fund aims to generate returns consistent with those of each country’s primary share market. The fund aims to achieve a return in line with the FTSE All World Developed ex UK Index. Risk warnings A, B, D 5 Medium Aviva Pension Legal & General state that Index 0.27% 0.15% 0.00% 0.42% to high MyM Legal & the fund aims to track the volatility General (PMC) Sterling total return of the Ethical UK FTSE4Good UK Equity Index Equity Index (including reinvested income, less withholding tax) to within +/- 0.5% per annum for two years in three. Risk warnings A, B, J
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Management Scheme Fund Additional Total Risk rating Fund name Fund aim Style AMC AMC expenses AMC
4 Medium Aviva Pension Legal & General state that Actively 0.27% 0.07% 0.00% 0.34% volatility MyM Legal & the fund aims to provide managed General (PMC) diversified exposure to assets Pre‑Retirement that reflect the investments underlying a typical traditional level annuity product. The fund invests in LGIM’s index‑tracking bond funds to gain exposure to these assets. The fund, however, cannot provide full protection against changes in annuity rates for individual members since these also depend upon a number of other factors (e.g. changes to mortality assumptions). The asset allocation is reviewed quarterly by LGIM’s Strategic Investment and Risk Management team and the fund will not take short‑term, tactical asset allocation positions. Risk warnings A, B, E, J 4 Medium Aviva Pension Legal & General state that the Index 0.27% 0.18% 0.00% 0.45% volatility MyM LGIM fund aims to provide long-term Diversified investment growth through exposure to a diversified range of asset classes. The fund will hold between 20% and 50% in bonds, the remaining 50% to 80% will be held in a range of assets which may include equities, property, commodities and the shares of infrastructure companies. Exposure to each asset class will primarily be through investing in passively managed funds, although active management may be used for some asset classes. Risk warnings A, B, C, D, E, H, J
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Management Scheme Fund Additional Total Risk rating Fund name Fund aim Style AMC AMC expenses AMC
4 Medium Aviva Pension M&G state that the aim of the Actively 0.27% 0.72% 0.20% 1.19% volatility MyM M&G fund is to maximise long-term managed Feeder of total return (the combination Property of income generation and growth of capital) solely through investment in the M&G Property Portfolio. The M&G Property Portfolio invests in a diversified portfolio of commercial property mainly in the UK, seeking to add value through strategic asset allocation, stock selection and asset management. The M&G Property Portfolio may also invest in other property related assets, including collective investment schemes, transferable securities, derivatives and debt instruments as well as government debt, money market instruments and cash. Derivatives may be used for investment purposes as well as for efficient portfolio management. Risk warnings A, F, H 3 Low to Aviva Pension BlackRock state that the fund Index 0.27% 0.00% 0.00% 0.27% medium MyM BlackRock invests in investment grade volatility Corporate corporate bonds denominated Bond All Stocks in Sterling. The fund aims to Index Tracker achieve a return consistent with the Markit iBoxx £ Non-Gilts Index. This index covers the broad spectrum of investment grade corporate bonds in issue. Risk warnings A, E
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Management Scheme Fund Additional Total Risk rating Fund name Fund aim Style AMC AMC expenses AMC
1 Lowest Aviva Pension BlackRock state that the fund Actively 0.27% 0.00% 0.00% 0.27% volatility MyM BlackRock aims to maximise the income managed Sterling generated on investment Liquidity consistent with maintaining capital and ensuring its underlying assets can easily be bought or sold in the market in normal market conditions. It will do this by maintaining a portfolio of high quality short term money market instruments. The fund invests in a broad range of fixed income securities and money market instruments. It may also invest in deposits with credit institutions. Risk warnings A, E, G
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Reviewing and switching
We recommend that you review your investments regularly to ensure they still meet your needs. As time progresses you should also review your attitude to investment risk to see whether your investments are still appropriate. You can change your funds as often as you need and it is easy to switch funds online through My Money, or by calling Aviva on 0345 604 9915. There is currently no charge for switching between funds but Aviva may introduce one in the future. Please remember that if you move money between funds or switch from one investment to another, you may be out of the market for a short time. If the market moves in that time, it could affect the value of your investments. Fund managers have the ability, in exceptional circumstances, to suspend trading in their funds for as long as necessary. When this occurs we will need to delay the ‘cashing in’ or switching of units in the relevant fund. My Money As well as making it easy for you to switch funds, My Money also offers the online opportunity to: • See how your investments are performing. • Access the individual fund factsheets which provide more detailed information on each of the funds the Trustee have chosen to make available to you. • Buy, sell or change funds easily.
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Help and further information
Further information General questions You can find out more about all of the funds If you have a question about investments, by logging into your personal account at please contact Aviva, who administer the www.avivamymoney.co.uk Fund on behalf of the Trustee. Aviva’s contact details can be found on the back page. If you would like advice, you can find a local financial adviser in a number of ways. A financial adviser may charge for How to view and manage providing advice. your investments Information about finding a financial adviser can be found by visiting the The easiest way to view and manage following websites: your investments is at: • Unbiased at www.unbiased.co.uk www.avivamymoney.co.uk • The Money Advice Service at You should regularly review your www.moneyadviceservice.org.uk/en investments to make sure that they continue to be appropriate for The Government also provides impartial you, given your attitude to risk and information on UK pensions via the retirement planning goals. following website: If you need additional support, www.gov.uk/browse/working/ • you may wish to seek independent workplace-personal-pensions financial advice. Please note these sites are not provided by the Trustee, nor DuPont (U.K.) Limited nor Aviva.
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Appendix Fund risk warnings There are risks associated with investing in funds, or types of funds. In this document we show which risk warning or warnings apply to each fund. These are all explained below. Please note that not all of these warnings apply to each fund and there is no direct relationship between the number of fund risk warnings and the investment risk banding for each fund shown on pages 20 to 25.
Risk Risk warning description warning code
A Investment is not guaranteed: The value of an investment is not guaranteed and can go down as well as up. You could get back less than you have paid in. Specialist funds: Some funds invest only in a specific or limited range of sectors and this will be set out in the fund’s aim. These funds may carry more risk than funds that can invest across a broader range or a variety of sectors.
Suspend trading: Fund managers often have the ability, in certain circumstances, to suspend trading in their funds for as long as necessary. When this occurs, we will need to delay the ‘cashing in’ or switching of units in the relevant fund. You may not be able to access your money during this period. Derivatives: Derivatives are financial contracts whose value is based on the prices of other assets. Most funds can invest in derivatives for the purpose of managing the fund more efficiently or reducing risk. Some funds also use derivatives to increase potential returns, known as ‘speculation’. For those funds we apply an additional risk warning (see Risk F). B Foreign Exchange Risk: When funds invest in overseas assets the value will go up and down in line with movements in exchange rates as well as the changes in value of the fund’s holdings. C Emerging Markets: Where a fund invests in emerging markets, its value is likely to move up and down by large amounts and more frequently than one that invests in developed markets. These markets may not be as strictly regulated and securities may be harder to buy and sell than those in more developed markets. These markets may also be politically unstable which can result in the fund carrying more risk. D Smaller Companies: Where a fund invests in the shares of smaller companies, its value is likely to move up and down by large amounts and more frequently than one that invests in larger company shares. The shares can also be more difficult to buy and sell, so smaller companies funds can carry more risk. E Fixed Interest: Where a fund invests in fixed interest securities, such as company, government, index-linked or convertible bonds, changes in interest rates or inflation can contribute to the value of the investment going up or down. For example, if interest rates rise, the value is likely to fall.
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Risk Risk warning description warning code
F Derivatives: Derivatives are financial contracts whose value is based on the prices of other assets. The fund invests in derivatives as part of its investment strategy, over and above their use for managing the fund more efficiently. Under certain circumstances, derivatives can result in large movements in the value of the fund and increase the risk profile, compared to a fund that only invests in, for example, equities. The fund may also be exposed to the risk that the company issuing the derivative may not honour their obligations, which could lead to losses. G Cash/Money Market Funds: These are different to cash deposit accounts and their value can fall. Also, in a low interest rate environment the product or fund charges may be greater than the return, so you could get back less than you have paid in.
H Property funds: The fund invests substantially in property funds, property shares or direct property. You should bear in mind that • Properties are not always readily saleable and this can lead to times in which clients are unable to ‘cash in’ or switch part or all of their holding and you may not be able to access your money during this time • Property valuations are made by independent valuers, but are ultimately subjective and a matter of judgement • Property transaction costs are high due to legal costs, valuations and stamp duty, which will affect the fund’s returns. I High Yield Bonds: The fund invests in high yield (non-investment grade) bonds. Non-investment grade bonds carry a higher risk that the issuer may not be able to pay interest or return capital. In addition, economic conditions and interest rate movements will have a greater effect on their price. There may be times when these bonds are not easy to buy and sell. In exceptional circumstances, we may need to delay the ‘cashing in’ or switching of units in the fund and you may not be able to access your money during this period. J Reinsured Funds: Where a fund invests in an underlying fund operated by another insurance company through a reinsurance agreement, if the other insurance company were to become insolvent, you could lose some or all of the value of your investment in this fund.
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Call Aviva on 0345 604 9915 on Monday to These documents are available in Friday between 8.00am and 5.30pm. They other formats. may record calls to improve their service. If you would like a Braille, large print or Calls may be charged and these charges audio version of this document, please will vary; please speak to your network contact Aviva. provider. Visit their website at www.avivamymoney.co.uk Email them at [email protected] Write to them at Aviva, PO Box 2282, Salisbury, SP2 2HY
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