MARCH 2021
LIGHTHOUSEGROUP Premier Portfolio Management Service Premier Income & Growth Portfolio
Investment report for:
Financial Adviser:
Date:
FOR CLIENTS OF LIGHTHOUSE GROUP ADVISERS ONLY
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Investment report for:
Investment amount:
Contents
Overview of the Premier Portfolio Management Service 3 Key benefits 4 Premier Income & Growth Portfolio - objective 6 Ongoing communication about your investment 8 Premier Miton Investors 9 What are the risks of investing? 10 Charges and fees 11 More information 12 Appendix 1: Portfolio information – Quarterly update Appendix 2: Security of your investment
The Premier Portfolio Management Service can only be accessed by individuals who are advised by an authorised financial adviser who can advise on the suitability of a portfolio, based on an individual’s circumstances, including investment objectives and attitude to risk. Individuals who do not have a financial adviser will not be able to make an application to invest. The information contained and opinions expressed in this document are based on our current understanding and are subject to change. Premier Miton Investors is unable to provide investment, taxation, or financial planning advice. The Premier Portfolio Management Service portfolios are intended to be long-term investments. The value of your investment, and any income from it, is not guaranteed and can go down as well as up and there is the possibility of loss to some of your investment. Some of the different risks of investing are outlined in this document with further information available in the Premier Portfolio Management Service terms and conditions document which should be read before making an application to invest. [email protected] 0333 456 1122 premiermiton.com 2 MARCH 2021 PREMIER INCOME & GROWTH PORTFOLIO | INVESTMENT REPORT
Overview of the Premier Portfolio Management Service
The Premier Portfolio Management Service offers a choice of managed investment solutions comprising four risk-targeted growth portfolios and three income portfolios. To achieve their objective, the portfolios are expected to primarily invest in Premier Miton funds which may cover multi- asset, UK equity, global equity, absolute return and fixed income strategies. These funds form the investment building blocks of each of the portfolios and provide exposure to a variety of asset classes and markets, managed by our specialist investment managers. Holding a diversified portfolio of different assets and investments is one of the most effective ways to manage investment risk. However, keeping track of a large number of different investments from multiple providers can require considerable time and expertise to manage effectively. The Premier Portfolio Management Service has been designed to alleviate this burden. We create a portfolio of diversified investments on your behalf, held within a single portfolio. The individual Premier Miton funds will typically invest in a broad range of underlying investments, and when combined, create a diversified portfolio providing exposure to a wide variety of assets, market sectors and geographic regions.
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Key benefits
Diversified investment portfolios The portfolios are invested in a diversified spread of investments. Depending on the portfolio you have chosen, your portfolio is likely to have exposure to multiple assets and investment types, such as equities (company shares), bonds, commercial property, alternative assets (non-traditional investments) and cash.
Active portfolio and risk management We adopt a collaborative approach to portfolio management, pooling the specialist skills, specific expertise and combined experience of our individual fund managers. The Premier Portfolio Management Service investment committee, which includes Premier Miton's Chief Investment Officer and Chief Risk Officer, actively monitors the performance returns and risk profile of each portfolio and will make adjustments when they believe it is right to do so, to ensure each portfolio remains on track to achieve its long-term objective and meet your expectations.
Regular and open communication We aim to communicate with our clients in an open and transparent way, and to provide you with the information you need to help you assess the performance of, and activity within, your portfolio. This includes an online valuation service, portfolio factsheets which are available on our website, comprehensive quarterly statements, and annual tax reports for direct investors with Premier Miton.
Available through investment platforms Our portfolios can also be accessed through selected investment platforms, which may have different investment terms and conditions, including lower minimum investment levels, analysis tools and additional reporting information. Speak to your financial adviser for more information about how you can access our portfolios through an investment platform.
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The Premier Portfolio Management Service may be suitable for investors who: — are using the services of a financial adviser — are looking to invest for the long-term, which means at least 5 years — are seeking an actively managed, diversified investment portfolio — want to outsource the management of their investment portfolio to professional investment managers — are comfortable with investing in a portfolio which may have exposure to equities and other types of investment that could experience volatility — understand that there is no guarantee on the income payable or the return of their original investment when they come to sell their investment
The Premier Portfolio Management Service may not be suitable for investors who: — are unable to accept the possibility of loss to their investment — are looking for short-term gains — want a risk-free investment — do not have a financial adviser — are looking for guaranteed returns or a guaranteed level of income
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Premier Income & Growth Portfolio
The Premier Income & Growth Portfolio has been selected for you by your financial adviser as a suitable investment based on their assessment. Portfolio investment objective The aim of the Premier Income & Growth Portfolio is regular income with the potential for some long-term investment growth. This portfolio aims to produce a balance of income and growth and is expected to produce the lowest level of income of the three income portfolios available and is also expected to be lower risk than the other two portfolios. To achieve its aim, the portfolio invests in a blend of Premier funds. Together, these funds are designed to create a balanced and diversified portfolio, providing exposure to a wide range of assets, including for example, UK and international equities, fixed income assets, alternative assets and other types of investment designed to produce an income together with long- term investment growth. The portfolio is invested in a range of funds managed by Premier Miton to achieve its objective. Each fund is actively managed by our highly experienced, specialist fund managers and invests in a mix of assets.
Appendix 1: provides a summary of where the portfolio currently invests, including asset allocation breakdown and top 30 holdings, and how the portfolio has performed over the short and long-term.
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Actively managed, diversified portfolios The Premier Portfolio Management Service has been designed to give you the benefit of diversified investment portfolios combined with active, ongoing management of asset allocation and fund selection. The Premier Portfolio Management Service investment committee, led by Premier Miton’s Chief Investment Officer, will utilise the skills and experience of Premier Miton’s individual fund managers to get their perspectives on the economic environment, asset classes and markets. From analysis of the overall asset allocation through to the choice of underlying investments, the investment committee will discuss any potential changes to a portfolio prior to implementing them. This ensures that every asset allocation and investment decision is considered from a number of perspectives. — Active management by the Portfolio Management Service investment committee — Portfolios constructed using a blend of Premier Miton funds — Active management by each individual fund manager
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Ongoing communication about your investment
Our range of portfolios can also be accessed through selected investment platforms, giving you potential access to different investment terms and conditions, including lower minimum investment levels, as well as various tools and additional reporting information. Your financial adviser will be able to provide you with further information about what type of reporting and information your platform of choice can offer you. Our aim is to ensure we produce clear and regular information about your investment in the Premier Portfolio Management Service. There is online access to your portfolio, so that you can access information about your investment easily and quickly, whenever you want. We publish factsheets for each portfolio which include portfolio performance and how each portfolio is invested, including a breakdown of the underlying funds held in the portfolio. If you have queries about your investment you should contact your financial adviser in the first instance or contact Premier Miton’s investor services team. If your personal circumstances change, or if you want to know if your investment is still suitable for you, you should contact your financial adviser. Premier Miton is not authorised to give advice about the suitability of an investment but our investor services team is on hand to answer questions you may have about your account or to provide you with the latest valuation. We are continually looking at new ways to improve the way we look after our clients and always welcome your feedback. You can email us at [email protected] — Online valuation service — Portfolio factsheets — Investor services team
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About Premier Miton Investors
Premier Miton Investors was formed in November 2019 from the merger of Premier Asset Management and Miton Group. We are responsible for managing £12.0 billion of assets (as at 31 December 2020) on behalf of our clients in a broad range of actively managed funds covering different types of equity, multi-asset, absolute return and fixed income investments. Our investment teams are wholly focused on producing good long-term outcomes for our clients through active management. Importantly, in a fast changing world, our investment managers are empowered to think differently, think independently and think actively with the aim of keeping our clients’ investments on track to meet their objectives. The quality of our investment managers and the performance of our funds have been recognised by independent fund rating and grading agencies, We aim to deliver solution-driven investments that meet or exceed our clients’ expectations through relevant products, good investment performance and good communication. To help our investment managers achieve their specific investment objectives, we aim to give them appropriate freedom to perform, without the constraint of a specific house view or house investment style, supported by a strong business risk management culture. The methodology and calculations used by the companies that provide the fund and fund manager awards and ratings are not verified by Premier Miton Investors and we therefore are unable to accept responsibility for their accuracy. Ratings and awards should not be relied upon for making an investment decision, nor are they an indication, promise or guarantee of future performance of a fund or fund manager.
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What are the risks of investing?
Managing and understanding investment risk As with all types of stock market investment, there is a risk of loss to your original investment amount and it is very important that you understand the risks and take advice if you are unsure in any way. While investment risk cannot be completely removed, the investment committee will manage each portfolio with the aim of ensuring that the level of risk is appropriate for the portfolio’s risk profile.
General risks of investing — All types of investment carry a degree of risk. It is possible you could lose some, or all, of the money you invest. The level of risk varies depending on the type of investment. — Typically, you are less likely to lose money over the long term from an investment that is considered low risk, although potential returns may also be lower. Investments considered higher risk typically offer greater opportunities for better long-term returns, though the risk of losing money is also likely to be higher. — When you invest, it is important that you understand the risk to your money and are comfortable with that level of risk. If you are unsure, we would recommend that you consult a financial adviser. — Past performance of an investment is not an indication of how it will perform in the future. The value of your investment and any income generated by your investment can go down as well as up, and you could get back less than you invested. — The value of your investment might not keep up with any rise in the cost of living. — You could lose money if financial markets fall. — There is no guarantee that the investment objective of the portfolio will be achieved. — The levels of taxation that apply to income or capital gains from the portfolio, including any tax relief that may be available, will depend on your personal tax situation. — Portfolios with similar objectives may not perform in the same way as they are likely to have different holdings or hold different amounts of the same investment. — Portfolio performance will be affected by investment decisions made by the investment committee and the managers of the funds held within the portfolio.
Some of the main specific risks that apply to the funds that this portfolio invests in are summarised inAppendix 1. If the funds that are held in the portfolio change, the types of investment risk that the portfolio is exposed to will also change.
Security of your investment Premier Portfolio Management Service is our portfolio management service which is managed by Premier Fund Managers Limited (PFM). Clients’ portfolios (“Portfolio(s)”) consist of two elements – shares and cash. Information about the security of each, and the security of client money held prior to investment, is provided in our ‘Security of your investment’ document, see Appendix 2.
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Charges and fees
Annual management fee There is an annual management charge applied to the funds held in a portfolio, which for clients investing directly with Premier Miton Investors, is 0.75%. If you invest through an investment platform, different charges may apply. The annual management charge applied to the funds held in your portfolio may be lower than our standard 0.75% fee and therefore you could benefit from lower overall costs. Please check with your financial adviser who can advise you on the different fees that apply for investing in a portfolio through an investment platform. Other expenses paid by the underlying funds, such as, transaction fees, research fees as well as for the auditor, registrar, regulator, custodian, depositary or trustee, plus the annual charges for the underlying funds held in the multi-manager funds, are subject to change, will fluctuate and will vary depending on the funds held in the portfolio. This information is updated annually and is available on our website. If you invest through a platform, the relevant platform charges will also apply. We do not charge you any additional fees for providing the Premier Portfolio Management Service. Your financial adviser fees: Any fees for advice that you have agreed with your financial adviser can be deducted from your investment by completing the relevant section of the application form. These fees may be subject to VAT as advised by your financial adviser. For further details on total costs please refer to the Premier Portfolio Management Service Lighthouse Investor guide.
VAT As our fee is taken from the underlying funds held within each portfolio, this also means that typically there is no VAT to pay.
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More information
If you have any other questions that have not been answered here, or would like any further information, please speak with your financial adviser, or contact our investor services team who are available Monday to Friday, excluding bank holidays, between 9am and 5.30pm. For your protection, calls are monitored and recorded for training and quality assurance purposes. This document has been produced for information purposes only and does not constitute investment advice. It should be read in conjunction with the Premier Portfolio Management Service investor guide and terms and conditions. If any of the information contained in this document is unclear, we recommend you consult with your financial adviser. Persons who do not have professional experience in matters relating to investments should speak with a financial adviser before making an investment decision. Past performance is not a guide to future returns. The value of your investments and any income from them may go down as well as up and you may get back less than you invested. These investments are typically intended as long term investments. Financial Promotion issued by Premier Miton Investors. Premier Portfolio Managers Limited is registered in England no. 01235867. Premier Fund Managers Limited is registered in England no. 02274227. Both companies are authorised and regulated by the Financial Conduct Authority and are members of the ‘Premier Miton Investors’ marketing group and subsidiaries of Premier Miton Group plc (registered in England no. 06306664). Registered office: Eastgate Court, High Street, Guildford, Surrey GU1 3DE.
Contact us
0333 456 1122 [email protected] premiermiton.com premierassetmanagement.co.uk/lighthouse.html
002563-220321
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Appendix 1: Portfolio information – Quarterly update
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LIGHTHOUSEGROUP Premier Income & Growth Portfolio Quarterly update to 31 December 2020
— The Premier Income & Growth Portfolio made a gain of 8.2% during the three months to 31 December 2020. — It was a year of extremes for society, economies and financial markets ranging from despair to euphoria. Those extremes continued through the final quarter as COVID-19 dominated events. — The positive news on vaccines in November was greeted very positively by investors. Equity markets moved higher and safe haven assets such as government bonds and gold, lost some of their shine. It was within equity markets that the biggest changes occurred; the share prices of companies that are sensitive to economic conditions (often called “value” companies) jumped higher. Those that had driven markets higher, such as the large US technology and communications companies did less well. This was unsurprising given the hoped for reduction in lockdown measures from the roll-out of the vaccine. — However, the good news was followed by more virulent strains of the virus rapidly spreading and lockdown measures being stepped up in many countries. This had the immediate effect of reducing economic activity and damaging recovery prospects. — Investors typically look through the present to the future, and prices reflect what investors think will happen. This has meant that markets are not pricing in the reality of the problems of today. They are reflecting the hopes for the vaccine and the on-going support measures being provided by governments and central banks. — At home, the signing of the Brexit trade agreement is unequivocally good news, even though there are many loose ends. Companies can now plan with more certainty and the economy will benefit. — In the short term we remain beholden to COVID, but the medium and longer term looks more positive. Financial markets are likely to remain volatile in uncertain conditions. — There were no changes to the asset allocation of the portfolio during the quarter. — The Portfolio’s historic yield is 3.18%.
Portfolio strategy* Asset allocation
Specialist bonds 22.1% UK equities 20.5% Alternatives 17.9% 50.0% Premier Miton Multi-Asset 8.3% Conservative Growth Fund European equities 40.0% Premier Miton Multi-Asset Monthly Global equities 7.7% Income Fund Property shares 5.1% 10.0% Premier Global Optimum 4.6% Income Fund North American equities Investment grade bonds 3.2% Cash 2.6% High yield bonds 2.6% Asian equities 2.1% Sovereign bonds 1.7% Japanese equities 1.1% Emerging market equities 0.5% 0 5 10 15 20 25
The bar chart shows the asset allocation of the underlying holdings of the funds that make up the portfolio. Cash includes cash held within the underlying funds and the portfolio. Asset allocation may be above or below 100% due to rounding. *On 27.11.20, ‘Miton’ was added to the name of the fund to reflect the merger of Premier Asset Management Group plc and Miton Group plc which took place in November 2019 to form the Premier Miton Group plc. Top 30 holdings - total number of holdings in the portfolio: 153
Semper Total Return 3.8% CIFC Global Floating Rate Credit 2.0% TwentyFour Monument Bond 1.5%
Angel Oak Multi-Strategy Income 3.6% Schroder Income Maximiser 1.9% Barings Global Investment Grade Strategies 1.4%
Twelve Insurance Best Ideas Fund 2.4% Fidelity MoneyBuilder Dividend 1.9% Liontrust GF Absolute Return Bond 1.4%
Man GLG UK Absolute Value 2.2% Sanlam US Absolute Return 1.9% Lazard Rathmore Alternative 1.3%
Polar Global Convertibles 2.1% Fulcrum Equity Dispersion 1.8% BNY Mellon Global Infrastructure Income 1.3%
Man GLG UK Income 2.1% Pictet Strategic Credit 1.7% Montanaro UK Income 1.3% JPMorgan FTSE100 Nov 2026 Defensive Barclays 1339 FTSE100 Deleveraged Syn- GAM UK Equity Income 2.1% 1.7% 1.2% Autocall thetic Zero Santander FTSE100 Dec 2026 Defensive 2.0% CIFC Long/Short Credit Fund 1.7% TwentyFour Select Income 1.2% Autocall Franklin UK Equity Income 2.0% HSBC DJ Eurostoxx Defensive Autocall 1.7% Federated Hermes Absolute Return Credit 1.2%
Evenlode Income 2.0% AXA World - Global Inflation Bonds Redex 1.5% CIBC Eurostoxx Defensive Autocall 1.2%
Top 30 holdings in the fund(s) that make up the portfolio. This does not represent a full list of all the holdings which will change over time. Cash held has been excluded from the holdings.
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Premier Income & Growth Portfolio Quarterly update to 31 December 2020
Portfolio objective General risks of investing
We offers a choice of three income portfolios; the Premier Reference to any particular stock does not constitute a Income & Growth Portfolio, the Premier High Income Portfolio recommendation to buy or sell the stock. and the Premier Income Portfolio. The value of investments may fluctuate which will cause fund Aim: Regular income and potential for long-term investment prices to fall as well as rise and investors may not get back the growth original amount invested.
Investment strategy: Aims to produce a balance of income The performance of information presented in this document and growth and is expected to produce the lowest level of relates to the past. Past performance is not a reliable indicator income of the three income portfolios available and is also of future returns. expected to be lower risk than the other two portfolios. To Future forecasts are not reliable indicators of future returns. achieve its aim, the portfolio invests in a blend of funds. Together, these funds are designed to create a balanced and All types of investment carry a degree of risk. It is possible you diversified portfolio, providing exposure to a wide range of could lose some, or all, of the money you invest. The level of assets, including for example, UK and international equities, risk varies depending on the type of investment. fixed income assets, alternative assets and other types of Typically, you are less likely to lose money over the long term investment designed to produce an income together with from an investment that is considered low risk, although long-term investment growth. potential returns may also be lower. Investments considered The portfolio is invested in a range of funds managed by higher risk typically offer greater opportunities for better long- Premier Miton to achieve its objective. Each fund is actively term returns, though the risk of losing money is also likely to managed by our highly experienced, specialist fund managers be higher. and invests in a mix of assets. When you invest, it is important that you understand the risk to your money and are comfortable with that level of risk. Portfolio performance (%) If you are unsure, we would recommend that you consult a financial adviser. 25 Past performance of an investment is not an indication of how 20 it will perform in the future. The value of your investment and any income generated by your investment can go down as 15 well as up, and you could get back less than you invested.
10 The value of your investment might not keep up with any rise
otal returns (% ) in the cost of living. T 5 You could lose money if financial markets fall. 0 1 year 3 years 5 years There is no guarantee that the investment objective of the portfolio will be achieved. Since 3 months 6 months 1 year 3 years 5 years The levels of taxation that apply to income or capital gains launch1 from the portfolio, including any tax relief that may be 8.2 9.8 3.2 8.3 24.9 48.9 available, will depend on your personal tax situation.
Calendar years (%) Portfolios with similar objectives may not perform in the same way as they are likely to have different holdings or hold different amounts of the same investment. 2016 2017 2018 2019 2020 Portfolio performance will be affected by investment decisions 7.8 7.0 -4.8 10.2 3.2 made by the investment committee.
1The portfolio launched on 31.12.2012
Source: FE Analytics, taken on a bid to bid, total return, UK sterling basis, using the class A shares of the underlying Premier funds for the period up to 01.07.2016 and the class C shares from 01.07.2016. The information on this document is for illustrative purposes only and may not be representative of the returns from an individual client portfolio.
The historic yield reflects distributions declared over the past twelve months as a percentage of the share price of the underlying fund, as at the end of the month 31.12.2020. The yield is not guaranteed and will fluctuate.
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Premier Income & Growth Portfolio Quarterly update to 31 December 2020
Portfolio specific risks
Some of the main specific risks that apply to the funds that Futures (contracts) this portfolio invests in are summarised here. If the funds that A type of derivative. They allow investors to buy or sell an index, are held in the portfolio change, the types of investment risk or other asset, today to be settled at a date in the future. These that the portfolio is exposed to will also change. can make a fund more volatile from time to time.
Alternative investments Inflation These typically behave differently to traditional investments Higher inflation can lead to some investments falling in value, such as bonds and equities. They can include a range of assets particularly those with a fixed level of interest, for example such as specialist lending, private equity, hedge funds and government bonds and corporate bonds. gold. Adding alternative investments to a portfolio can help to make it more diverse but can also make it more volatile. Infrastructure Investments are often in large-scale projects whose Collective investment schemes (funds) profitability can be affected by supply problems or rising Where other funds are held in a portfolio, or where there prices for raw materials or natural resources. Changes in the is indirect exposure to other funds, these could include wider economy and government regulation can also have a higher-risk investments like hedge funds, property funds or significant influence. commodity funds (e.g. investing in gold, oil), which would increase the overall risk in the fund. Interest rate Changes in central bank interest rates can affect all types of Call options assets, in particular, securities such as government bonds and A type of derivative. Call options can be used for a number corporate bonds that generally offer a fixed level of interest. of reasons; they can be used to generate income or to gain If interest rates go up, the value of a bond may fall, and vice exposure to an asset. These can make a fund more volatile versa. from time to time. Issuer credit Counterparty credit There are times when the issuer of a security (for example, a Some securities or financial instruments rely on payments company that has issued a bond) is unable to make income or guarantees from a counterparty. This is a role usually payments or repay its debt. When this happens it can result in undertaken by a bank or similar entity. losses for the fund. Currency Legal and tax Where investments in a fund are denominated in currencies The income or capital gains from investments can sometimes other than sterling (for example, if a fund holds assets priced be affected by changes in legal and tax regulations or how in euros), its value will be affected by changes in the relevant these rules are applied. exchange rate. Certain other investments, such as the shares in companies with profits from other countries, will also be Liquidity effected. In some instances, for example, when market conditions generally are difficult, holdings in a fund may be difficult to Derivative sell and buy at the desired price. The fund value could fall as a A contract whose value is based on the change in price of result. a specific asset or index. When derivatives are used within a fund, it doesn’t necessarily increase risk. However, price Non-investment grade bonds changes in the underlying asset can translate into big swings Bonds with a higher risk that the bond issuer might not in the value of derivatives (up and down), which has a direct meet its income or repayment obligations, as assessed by effect on the value of the fund. independent bond rating companies.
Operational Emerging markets Processes, systems and controls around your investment Investments made in bonds, equities or other assets in might fail. The more complex or unusual the investments that less-developed countries generally carry higher risk than in the fund holds, the more likely this is to happen. For example, developed countries. developing markets may have less reliable systems or lower Equities standards of governance than more developed markets. Equities (shares) can experience high levels of price Over The Counter derivatives (OTC) fluctuation. These are types of derivatives that are not traded on a Fixed interest securities public exchange. Agreed privately between two parties, OTC Government and corporate bonds generally offer a fixed derivatives can be tailored to meet the exact needs of each level of interest to investors, so their value can be affected by party. They can make a fund more volatile from time to time. changes in interest rates. When central bank interest rates fall, Property and Real Estate Investment Trusts investors may be prepared to pay more for bonds and bond Property values can rise and fall sharply depending on the prices tend to rise. If interest rates rise, bonds may be less strength of a country’s economy. valuable to investors and their prices can fall.
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Premier Income & Growth Portfolio Quarterly update to 31 December 2020
Smaller companies Investment in smaller companies is typically higher risk than investment in larger companies. Shares in smaller companies can experience greater levels of volatility.
Structured investments These investments are built around a derivative and have specific criteria that need to be met to deliver a positive return. If these criteria are not met, the investment can fall sharply in value.
Unregulated collective investment schemes These investments can carry additional risks as they are not subject to the same level of regulation as authorised or regulated schemes.
Zero dividend preference shares (ZDPs) Issued by investment trusts. ZDPs have a maturity date, pay no income but pay a set amount at maturity. Serious falls in market levels can alter their structure and lead to falling values.
The Premier Portfolio Management Service is only available to investors who use the ongoing services of a financial adviser. Details of the nature of the investments, the commitment required and the specific risk warnings are described in the Premier Portfolio Management Service Terms and Conditions. Reference to any particular stock or portfolio does not constitute a recommendation for investment purposes. Persons who do not have professional experience in matters relating to investments should speak with a financial adviser before making an investment decision. Financial Promotion issued by Premier Miton Investors. Premier Portfolio Managers Limited is registered in England no. 01235867. Premier Fund Managers Limited is registered in England no. 02274227. Both companies are authorised and regulated by the Financial Conduct Authority and are members of the ‘Premier Miton Investors’ marketing group and subsidiaries of Premier Miton Group plc (registered in England no. 06306664). Registered office: Eastgate Court, High Street, Guildford, Surrey GU1 3DE.
For your protection, calls may be monitored and recorded for training and quality assurance purposes.
001900-210121
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Appendix 2: Security of your investment
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LIGHTHOUSEGROUP
Security of your investments
Premier Miton Investors (“Premier Miton”) is an asset management group which offers a broad range of investment solutions covering multi-asset, UK equity, global equity, absolute return and fixed income strategies, through a range of investment types including retail funds, closed ended investment companies and the Premier Portfolio Management Service.
Premier Miton Investors is the marketing name and trading name for our two Financial Conduct Authority (FCA) regulated entities: Premier Portfolio Managers Limited (PPM) (122067) and Premier Fund Managers Limited (PFM) (143097). They are part of the group of companies whose ultimate holding company is Premier Miton Group plc.
In this document we have summarised the main protections available to you as an investor with either PPM or PFM.
Regulatory regime and statutory compensation – The Financial Conduct Authority (FCA)
PPM and PFM are authorised and regulated by the FCA of 12 Endeavour Square, London, E20 1JN and are bound by the FCA’s rules and regulations. You can find out more about the FCA and what they do by visiting fca.org.uk.
PPM and PFM provide regular statements and reports to the FCA regarding their solvency, together with their audited financial statements and other information.The Financial Services Compensation Scheme (FSCS).
The Financial Services Compensation Scheme (FSCS)
Investors with Premier Miton may be covered by the Financial Services Compensation Scheme, which has been established under the rules of the FCA as a “rescue fund” for certain clients of firms authorised and regulated by the FCA which have gone out of business. The scheme covers an amount equal to 100% of the first £85,000 owed to you regarding your investment accounts. You can find out more information on compensation arrangements by visiting fscs. org.uk, calling 0800 678 1100 & 020 7741 4100 or by writing to Financial Services Compensation Scheme, PO Box 300, Mitcheldean, GL17 1DY.
Your investment with Premier Portfolio Managers Limited - Premier Miton Funds
PPM acts as the Authorised Corporate Director (ACD) of our Open-Ended Investment Companies (“OEICs”) and manager of our authorised unit trusts (together, the “Premier Miton Funds”).
Client money
Client money held in conjunction with an investment in a Premier Miton Funds will be placed with the Royal Bank of Scotland plc (“RBS”) and held in accordance with the FCA client money rules. These rules require that PPM holds clients’ money under trust status to ensure that it is segregated from PPM’s own money. This means that in the unlikely event that PPM stopped trading, neither PPM, nor its liquidator or creditors, would have any rights over your money to resolve the debts of PPM.
Please be aware that PPM is utilising the delivery versus payment exemption for the purpose of settling a transaction in relation to units in a regulated collective investment scheme and therefore your money may not be treated as client money for the period up to the close of business on the business day following the date of receipt of the money.
Shares in Premier Miton Funds
When you invest in a Premier Miton Funds, you purchase a number of units in a unit trust scheme or shares in a sub-fund of an OEIC. These units or shares may be held in a number of ways, including within an Individual Savings Account (ISA), via a platform, or directly in your own name. We have used the term “shares” but the information also applies to units held in a unit trust scheme.
Your investment in a share is segregated from PPM’s own assets. This means that in the event that PPM stopped trading neither PPM, nor its liquidator or creditors, would have any rights over your investment to resolve the debts of PPM. Any losses would potentially be recoverable from the FSCS as mentioned previously, subject to a maximum of £85,000 per investor, per firm.
The structure of an OEIC means that there is a depositary and custodian in place. For a unit trust, there is a trustee instead of a depositary. The depositary and trustee carry out similar functions and we have therefore only referred to the depositary below, although the information applies equally to a trustee.
The depositary of our OEICs is Northern Trust Global Services SE (“Depositary”). The custodian appointed by the Depositary
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is The Northern Trust Company Limited, London Branch (“Custodian”). These companies are both authorised by the Prudential Regulation Authority and regulated by both the Financial Conduct Authority and the Prudential Regulation Authority and are subject to their rules and regulations.
Included in their duties and responsibilities, the Depositary ensures that the best interests of shareholders are being considered at all times. It appoints the Custodian, who is responsible for the safe-keeping of the underlying assets of the Premier Miton Funds.
PPM, as the Authorised Corporate Director, is responsible for the day to day running of the Premier Miton Funds, and is overseen by the Depositary and the FCA. In the unlikely event that PPM ceased trading, the Depositary would be responsible for appointing a new company to act as ACD and manager of the Premier Miton Funds subject to the FCA’s approval.
In the event that the Depositary ceased trading, a creditor of the bank would have no rights over any fund assets and therefore no rights over your investment and the ACD would appoint a new depositary.
The investments held by the Premier Miton Funds are held in separate accounts at the Custodian in the name of a nominee. In the event that the Custodian ceased trading, a creditor of the Custodian would have no rights over these assets. The Depositary would appoint a new company to act as custodian.
Cash in Premier Miton Funds
However, cash held within the Premier Miton Funds would be treated differently. In this situation, the Custodian may also act as banker and the Premier Miton Fund’s cash may not be segregated from the Custodian’s. The Premier Miton Funds would be treated as an unsecured creditor of the Custodian in respect of that cash. The Custodian’s liquidator would be responsible for distributing any cash if the Custodian were to fail.
The Custodian for the Premier Miton Funds is required to make regular statements to the FCA regarding its solvency. Further information about the Depositary and Custodian is at the end of this document.
Your investment with Premier Fund Managers Limited – the Premier Portfolio Management Service
The Premier Portfolio Management Service is our model portfolio management service which is managed by Premier Fund Managers Limited (PFM). Clients’ portfolios (“Portfolio(s)”) consist of two elements – shares and cash. Information about the security of each, and the security of client money held prior to investment, is given below and these apply to both direct investments and investments via an Individual Savings Account.
Client money
In relation to PFM, client money held in conjunction with the Premier Portfolio Management Service will be deposited via SEI Investment (Europe) Limited (“SEI”) with HSBC Bank plc (“HSBC”) and may then be subsequently deposited into client money bank accounts at a range of other banks chosen by SEI. The spreading of client money across a number of banks is designed to help reduce the risk of all client money being lost in the event of any one bank failing. SEI is responsible for exercising reasonable care and due diligence in its initial selection and on-going monitoring of all banks where it places client money.
Shares within a portfolio
When you invest in a portfolio via PPMS, you are holding a portfolio of funds which are administered by an independent custodian, SEI, who is responsible for the safe-keeping ofinvestments. SEI are authorised and regulated by the FCA and are governed by its rules and regulations.
In the unlikely event that PFM were to cease trading, you would be able to transfer your Portfolio to another discretionary portfolio manager or, in certain circumstances, have the funds registered into your own name.
In the event of SEI ceasing trading, neither company, nor any liquidator or creditors, would have any rights over the funds held on your behalf to resolve the debts of SEI. Premier Miton would appoint a new custodian for your holding.
In the event of fraud or negligence by PFM or SEI resulting in their failure, your assets may be exposed to risk. Any losses would potentially be recoverable through the FSCS mentioned previously subject to a maximum of £85,000 per investor per firm.
Cash within a portfolio
Cash held within a Portfolio is treated differently to the shares held. In this situation, while Portfolio cash will be segregated from cash belonging to SEI, it may not be segregated by HSBC or another bank from their other clients or their own money. However it will be held in accordance with FCA rules. In the event of a bank failure, cash held within your Portfolio would be treated as an unsecured creditor of HSBC or another bank, and its liquidator would be responsible for distributing any cash.
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Therefore, your cash is not segregated from the bank with which it is placed (this is similar to a normal bank account). Should the bank fail and you become an unsecured creditor as part of the liquidation process, the FSCS will cover up to £85,000 per investor, per banking group (£170,000 per joint account) of any losses.
All of the banks holding cash are authorised and regulated by the FCA or by another regulator.
Your investment with Premier Fund Managers Limited – Connect
Connect is Premier Miton Investors' no-cost online service, enabling advisers to manage their clients’ investments in our range of funds. The portal facilitates access to funds distributed by Premier Fund Managers Limited (PFM) using services provided by FNZ, a global financial technology firm. Information about the security of assets, and the security of client money held prior to investment, is given below and these apply to both direct investments and investments via an Individual Savings Account.
Client money
Client money held in relation to Connect will be deposited with Lloyds Bank plc (“Lloyds”) and held in accordance with the FCA client money rules. These rules require that PFM holds clients’ money under trust status to ensure that it is segregated from PFM’s own money. This means that in the unlikely event that PFM stopped trading, neither PFM, nor its liquidator or creditors, would have any rights over your money to resolve the debts of PFM.
Shares in Premier Miton Funds
When you invest in a Premier Miton Fund via Connect, you purchase a number of units in a unit trust scheme or shares in a sub-fund of an OEIC. These units or shares will be held by PFM in a pooled account via a nominee company, Premier Connect Nominees Limited (“the Nominee”), which is controlled by an affiliated company. The investments you purchase will be held in the name of the Nominee. You are identified only in PFM or the Nominee’s custody records.
PFM is responsible for the safeguarding and administration of all investments registered in the name of the Nominee and are also responsible for the acts and omissions of the Nominee. The Nominee is not authorised or regulated by the FCA.
In the event of fraud or negligence by PFM resulting in its failure, your assets may be exposed to risk. Any losses would potentially be recoverable through the FSCS mentioned previously, subject to a maximum of £85,000 per investor per firm.
Cash in Premier Miton Funds
Cash held within a fund is segregated from the cash held for Premier Fund Managers, and for cash held by other clients. Cash is held with Lloyds Banking Group.
Investment trusts
EEach investment trust is a company in its own right and is run by an independent board of directors, who have a number of duties and responsibilities, including appointing an independent custodian to look after the trust’s investment portfolio.
The assets held in the trust’s investment portfolio are held separately to PFM’s assets. PFM has no rights over them.
If the investment trust itself becomes insolvent, it would be subject to the regulations under the company’s legislation of its home jurisdiction. The trust’s directors would have to appoint a liquidator, who would be responsible for any assets being distributed in the same way that any other company would be.
There is no automatic recourse available to investment trust shareholders from the FSCS.
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Information on the Custodian, depositary, and administration companies
FNZ
FNZ (UK) Ltd is a financial technology company specialising in providing investment platforms to major financial institutions in the financial services and wealth management sectors. FNZ administer and provides the technology that powers the Connect portal.
HSBC
HSBC Bank plc is part of the HSBC Group, one of the largest banking and financial services organisations in the world. You can find more information about HSBC by visiting its website,www.hsbc.co.uk.
Lloyds
Lloyds Bank is part of the Lloyds Banking Group. One of the largest banking and financial services organisations in the UK. You can find more information about Lloyds by visiting its website,https://www.lloydsbank.com/
Northern Trust
Northern Trust Corporation is a provider of investment management, asset and fund administration, fiduciary and banking solutions for corporations, institutions and individuals worldwide. You can find more information about Northern Trust by visiting its website, www.northerntrust.com
SEI
SEI Investment (Europe) Ltd is part of SEI, a provider of investment management administration and fund management in North America and Europe. The parent company has headquarters in Pennsylvania, USA, where it was founded 50 years ago. You can find more information about SEI by visiting its website,www.seic.com/enUK
Issued by Premier Miton Investors. Premier Portfolio Managers Limited is registered in England no. 01235867. Premier Fund Managers Limited is registered in England no. 02274227. Both companies are authorised and regulated by the Financial Conduct Authority and are members of the ‘Premier Miton Investors’ marketing group and subsidiaries of Premier Miton Group plc (registered in England no. 06306664). Registered office: Eastgate Court, High Street, Guildford, Surrey GU1 3DE.
002147/120221
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