MATERIAL Y MÉTODOS
ANÁLISIS ESTADÍSTICO
The secondary direct and indirect risks pertaining to an investment in this Portfolio are the following:
– Asset allocation risk;
– Capital erosion risk (T6-, T8-, R6-, R8-, S6- and S8-Class units only); – Commodity Risk;
– Concentration risk; – Derivatives risk; – Emerging markets risk; – Exchange-traded funds risk; – Multiple class risk;
– Repurchase and reverse repurchase transaction risk; – Securities lending risk;
– Smaller companies risk; – Tax policy risk.
See “What are the Risks of Investing in a Mutual Fund?” on page 2 in the first part of this document (Part A) for a description of these risks.
Who Should Invest in the Portfolio?
Taken individually, this Portfolio is intended for investors who:
– are looking for a turnkey solution containing a variety of asset classes; – want to focus mainly on procuring long-term capital appreciation and some
level of income;
– have a medium risk tolerance.
However, combined with other investment products, this Portfolio may be suitable for all types of investors, since the proportion of an investor’s portfolio devoted to this Portfolio will be determined according to his personal tolerance for risk. T6-, T8-, R6-, R8-, S6- and S8-Class units are suitable for investors who are looking for additional tax-advantaged monthly income to complement their income from other sources. These units are not offered under registered plans. T6-, T8-, R6-, R8-, S6- and S8-Class units are referable to the same portfolio of assets as A-, I-, C- and F-Class units.
Distribution Policy
For A-, I-, C- and F-Class units, income and capital gains are distributed, paid or reinvested at the option of each investor, the default form of distribution being the reinvested option, subject to the following. If the amount to be distributed to an investor is less than $50, it will automatically be reinvested in units of the Portfolio in question. If the units are held in a registered plan, all of the income will be automatically reinvested. In order to change the form of the distributions, the investor shall communicate with his or her representative.
Regarding A-, I-, C- and F-Class units, the Portfolio intends to make distributions of income and of capital gains in December of each year.
T6-, T8-, R6-, R8-, S6- and S8-Class units, for their part, entitle their holders to current monthly cash distributions of non-taxable returns of capital and/or net income paid in cash on the last Friday of each month. Under the Portfolio, any income or capital gain not previously distributed for T6-, T8-, R6-, R8-, S6- and S8-Class units is also usually distributed in December of each year. Exceptional distributions of income and capital gains for these units are automatically reinvested in units of the Portfolio.
On a purely informational basis, target distribution rate for T6-, T8-, R6-, R8-, S6- and S8-Class units are currently the following:
T6-, R6- and S6-Class units: target annual rate of 6% of the unit’s net asset value on the last day of the previous calendar year; and
T8-, R8- and S8-Class units: target annual rate of 8% of the unit’s net asset value on the last day of the previous calendar year.
Any distribution made in excess of the Portfolio’s net income or net capital gains will constitute a return of the investor’s capital back to the investor. Returns of capital will reduce the net asset value of the Portfolio, which could diminish its ability to generate future income.
The Portfolio reserves the right to make additional distributions in the course of a given year, should it deem appropriate, and to adjust the target distribution rate under the appropriate circumstances.
The amount of the monthly distribution for T6-, T8-, R6-, R8-, S6- and S8-Class units is adjusted annually, based on the net asset value per unit at the end of the previous calendar year. At the beginning of any calendar year, the revised monthly distribution per unit paid out to unitholders is calculated by multiplying the prescribed distribution rate of 6% for T6-, R6- and S6-Class units or 8% for T8-, R8- and S8-Class units, with the net asset value per unit at the end of the previous calendar year and dividing the result by 12. The target annual rate for distributions should not be confused with the Portfolio’s yield rate.
Portfolio Expenses Indirectly Borne by Investors
You do not pay the Portfolio’s expenses directly but they will reduce the Portfolio’s returns. This table is intended to help you compare the cumulative cost of investing in the Portfolio with the cost of investing in another fund. It shows how much the Portfolio would pay in expenses on a $1,000 investment in the Portfolio’s units that has a 5% hypothetical annual return, assuming that the management expense ratio (MER) of the Portfolio, during each given period, remains constant and equal to the Portfolio’s MER in its last fiscal year. Fees applicable to I-Class units are negotiated directly with each investor.
Fees and Expenses Payable
over (in dollars) Year1 Years3 Years5 Years10
A-Class units 23 73 127 289
T6- and T8-Class units 23 73 127 289
C-Class units 21 66 116 264
R6- and R8-Class units 21 67 117 267
F-Class units 11 35 61 139
S6- and S8-Class units 10 32 56 128
For more information on the costs of investing in the Portfolio that are not included in the calculation of the management expense ratio, see “Fees and Expenses Payable Directly by You” on page 21 in the first part (Part A) of this Prospectus.
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Fund Details
Type of Fund Asset Allocation Fund
Date Established A-Class Units: November 28, 2011 C- and F-Class Units: November 25, 2013 T6-, T8-, R6-, R8-, S6- and S8-Class Units: October 6, 2014
I-Class Units: April 11, 2016 Securities Offered A-, T6-, T8-, I-, C-, R6-, R8-, F-, S6-
and S8-Class Units Eligibility for
Registered Plans A-, I-, C- and F-Class Units are eligible for RRSPs, TFSAs, LIRAs, RRIFs, LIFs, groups RRSPs, DPSPs, SPPs, RLIFs, RLSPs and RESPs, T6-, T8-, R6-, R8-, S6- and S8-Class Units are not eligible for registered plans
Portfolio Manager Desjardins Global Asset Management Inc. What Does the Portfolio Invest In?
Investment Objective
The main objective of this Portfolio is to procure long-term capital appreciation. Consequently, the Portfolio invests mainly in the units of mutual funds, which themselves invest in equity and fixed-income securities throughout the world. This Portfolio might also hold exchange-traded funds ("ETFs") as well as individual equity and fixed-income securities.
Any modification of the fundamental investment objective must be approved by the unitholders by a majority vote at a meeting called for this purpose. Investment Strategies
To reach this investment objective, the Portfolio Manager will allocate the Portfolio’s assets among fixed-income securities in a proportion varying between 0% and 30% of the assets, and among equity securities in a proportion varying from 70% to 100% of the assets. The Portfolio holds these securities directly or through the intermediary of other mutual funds (the “underlying funds”), including those managed by the Manager, as well as ETFs.
The Portfolio Manager chooses and actively manages the Portfolio’s holdings, including the securities of underlying and ETFs. It will determine what percentage of the Portfolio’s assets will be invested in each security, while ensuring compliance with the Portfolio’s investment objective based on several criteria, including the following:
– positioning on the interest rate curve; – management style diversification; – geographical diversification; – market capitalization diversification; – taxation.
The Portfolio Manager rebalances the Portfolio’s asset allocation as needed and makes the necessary adjustments based on economic and financial forecasts and conditions, all the while respecting the asset allocation limits described above. The Portfolio Manager may adopt an investment approach that focuses on the tactical allocation of up to a 15% portion of the Portfolio’s assets. The goal of this approach is to benefit from short-term developments in perspectives and trends in yields, volatility and correlations between the main asset classes. As at the date hereof, the Portfolio Manager invests 94% of the Portfolio’s assets in underlying funds. Changes to the percentages of the Portfolio’s assets that are invested in a security or underlying fund, as well as the addition or removal of any underlying fund, will be carried out when the Portfolio Manager believes that such changes are advisable to improve the performance of the Portfolio. Such changes may be made at any time without notice to the unitholders.
The Manager has obtained from the Canadian Securities Administrators an exemption from the restrictions contained in NI 81-102 that will permit the Portfolio to purchase and hold:
a) securities of ETFs that seek to replicate (i) the performance of gold on an unlevered basis; or (ii) the value of a specified derivative the underlying interest of which is gold on an unlevered basis;
b) securities of ETFs that seek to replicate (i) the performance of silver on an unlevered basis; or (ii) the value of a specified derivative the underlying interest of which is silver on an unlevered basis;
c) securities of ETFs that seek to replicate (i) the performance of gold and silver on an unlevered basis; or (ii) the value of specified derivatives the underlying interests of which are gold and silver on an unlevered basis; and
d) silver and Permitted Silver Certificates and/or to enter into specified derivatives the underlying interest of which is silver on an unlevered basis.
For more information on these exemptions and the applicable conditions, see the Portfolio’s Annual Information Form.
In the event of materially adverse market conditions, the Portfolio Manager has the right to depart from its investment strategy to concentrate investments in sheltered securities such as Canadian money market instruments. The Portfolio and the underlying funds may conduct securities lending,
as well as repurchase and reverse repurchase transactions, in accordance with the requirements of the securities regulations, in order to earn additional income. For more information on these transactions, see “Repurchase and Reverse Repurchase Transaction Risk” and “Securities Lending Risk” on pages 4 and 5,
respectively, in the first part (Part A) of this Prospectus.
The Portfolio and underlying funds may use derivatives for both hedging and non- hedging purposes. They may use various derivative instruments to reduce their global risk or to improve their return. The Portfolio and underlying funds may use various derivatives such as options, forwards, futures contracts or swaps for the purposes of hedging against losses incurred by fluctuations in securities values or exchange rates. They may also use derivatives for non-hedging purposes to gain an exposure to or as a substitute for a security, region or sector, to reduce transaction costs or to provide enhanced liquidity. Derivatives will only be used by the Portfolio and the underlying funds in accordance with the requirements of the securities regulations.
There is no duplication of Portfolio’s and underlying funds’ management fees. What Are the Risks of Investing in the Portfolio?
A Portfolio that invests in underlying funds will indirectly have the same risks as the underlying funds that it holds. The Portfolio is subject to the risks of an underlying fund proportionally to its investment in that fund. If the Portfolio directly invests in equity and fixed-income securities, it will be exposed to the risks associated with a direct investment in such securities. The main direct and indirect risks pertaining to an investment in this Portfolio are the following:
– Credit risk; – Currency risk; – Equity risk;
– Foreign securities risk; – Fund of funds risk; – Interest rates risk.