Specific risk warnings |
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Certain funds/trusts are subject to specific investment risks which are set out fully in the Prospectus and Simplified Prospectus documents, which you should consider before making any investment. Please refer to the relevant documentation specific to your chosen investment vehicle
Biotech Fund The Funds invest in companies which are particularly vulnerable to rapidly changing technology and a relatively high risk of obsolescence caused by scientific and technological advances. Investment in internet/biotechnology related businesses may be more volatile than investment in broader based technological/healthcare related or other more diversified industries. If you are likely to need to redeem your investment at short notice, these funds may not be appropriate for you.
All funds except Pan European Bond Fund The value of ISA tax savings will depend upon individual circumstances. Income and capital gains from ISAs are free of tax.
Pan European Bond Fund The value of ISA tax savings will depend upon individual circumstances. Income and capital gains from ISAs and PEPs opened before 5 April 1999, are free of tax. The 20% income tax deducted on interest distributions is fully reclaimable.
Unit trusts where charges are against capital These funds concentrate on the generation of income as a higher priority than capital growth and allocate the Manager’s charge to capital. Whilst this will increase distributable income, it may accordingly constrain or erode capital growth. This is relevant to the following funds: Equity Income, Managed Income and Monthly Income and Pan European Bond.
Tax The tax treatment of the AXA Framlington unit trusts is set out in the Prospectus and unit trust Simplified Prospectus document, which can be found in the Literature section of this website.
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Past performance is not a guide to future performance. The value of investments and the income from them can fluctuate and investors may not get back the amount originally invested, even taking into account the tax breaks. Changes in exchange rates will affect the value of investments made overseas. Therefore investors may not recoup the value of their original investment. Investment in smaller companies offers the possibility of higher returns but may also involve a higher degree of risk. These companies may not perform as hoped and in some circumstances may completely fail. Prospective investors should be be aware that the Board has authority to incur borrowings up to a limit not exceeding 10% of the company’s adjusted share capital and reserves. Whilst there is no present intention of doing so, the use of borrowings in that event will enhance the net value assets of Shares where the value of the Company’s underlying assets is rising. It will have the opposite effect where the underlying asset value is falling. Furthermore, should any fall in the underlying asset value result in the Company breaching the financial covenants contained in any Loan Facility, the Company may be required to repay such borrowings forthwith in whole or in part together with any attendant costs. Loans and related costs outstanding in the event of liquidation will rank in priority to other classes of creditor including shareholders. There may also be constraints imposed upon the realisation of investments by reason of the need to maintain the VCT tax status of the company. The secondary market for shares in VCTs is limited and as a result shares in VCTs can trade at a discount to the net asset value. In order to partially address this issue the Directors intend to pursue an active share buy back policy within regularly reviewed guidelines.Investors should be aware that ordinary shares must be held for at least three years to qualify for tax relief. The tax rules or their interpretation in relation in an investment in the Company and/or the rates of tax may change during the life of the Company and investors should take independent professional advice covering their personal circumstances. Additionally, such investments in VCTs should be viewed as long term ie. 7-10 years.
This should be regarded as a higher risk investment vehicle. Please ensure that you consider all risk factors relating to the fund. These are described in detail in the Prospectus which can be found in our Literature section.
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The following is a brief summary of the risk factors which you should consider before making an investment in either of these funds. Past performance is not a guide to future returns. The net asset value (NAV), share price and income of an investment can fall as well as rise and you may not get back the full amount originally invested. The share price can fluctuate and may not fully reflect the NAV of the company. Shares may trade at a premium (above NAV) or a discount (below NAV), which may vary continuously. Please ensure you understand the investment objective of these funds and its use of gearing (borrowing money). These funds should not be regarded as low risk. In the event of a falling market, losses will be magnified due to the impact of gearing and any outstanding borrowings in the event of liquidation shall rank in priority to the claims of other creditors including shareholders. The aims of these funds and the rights attaching to each class of share are not guaranteed and may not be achieved. Investment in smaller companies offers the possibility of higher returns but may also involve a higher degree of risk. Fund shares may be purchased through a stockbroker. We strongly recommend, however, that you receive independent financial advice and obtain a copy of the latest Report and Accounts before making an investment. You can find these documents in the Literature section of the website.
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