The product gives investors exposure to the performance of a diversified basket of international equities through three exchange-traded funds (ETFs), with the safeguard of continuous capital protection.
The fund is open-ended and provides a level of capital protection equal to approximately 80 per cent of the highest ever net asset value (NAV) recorded by the fund.
The capital protection structure is expected to materially reduce the risk/return profile of the performance of the basket of ETFs.
According to S&P, and based on the longer-term risk/return profile of the ETFs, the fund is expected to generate returns of around 9 per cent per year, risk of around 10 per cent per year, and a level of capital protection materially above 100 per cent, if the investment is held at least over the medium term.
“The structure is particularly well suited to highly risk averse investors, such as retirees and those approaching retirement,” S&P fund analyst Rodney Lay said.
“The fund forgoes a significant degree of capital return upside, but compensates investors by materially reducing volatility, downside risk, and exit timing risks, through the continuous capital protection structure.”
