PPS Investments, Professional Provident Society (PPS)

PPS preferred funds

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Aside from selecting specific unit trusts as the underlying investment options for your retirement and savings needs, you can also invest directly into any of the available unit trusts with your discretionary money. The ultimate decision of which unit trust to invest in will have a significant impact on the future value of your investment.

Our PPS Preferred Funds range comprises an appropriate and well-structured selection of multi-managed and single-manager unit trusts.

PPS MULTI-MANAGED UNIT TRUST FUNDS

PPS Multi-Managers offers carefully designed and appropriately structured products to members. We have simplified your investment planning process by offering a range of risk-profiled multi-managed unit trusts. These funds have been designed to assist you in putting together a plan that meets your investment requirements and we believe that they should form the core of your investment portfolio.

At the core of our range are three risk profiled funds which are managed with the objective of delivering a spectrum of real returns (returns in excess of inflation) over specific investment periods. As such these funds can be extremely effective when constructing individual investment plans. The three funds in this range are the PPS Conservative Fund, the PPS Moderate Fund and the PPS Managed Flexible Fund.

In addition to these core risk-profiled funds, we offer a set of marketlinked unit trusts providing members with investment exposure to specific asset classes. These funds are the PPS Equity Fund, the PPS Flexible Income Fund and the PPS Enhanced Cash Fund.

PPS Conservative Fund

The investment objective is to maximise total portfolio return while outperforming a conservative real return target of CPIX (Consumer Price Index) + 2% per annum over the medium term. The manager employs real return strategies to provide real capital growth. Flexible asset allocation provides diversification across all asset classes and sectors, with equity exposure limited to not more than 40% of the portfolio value. The fund suits investors with long-term savings or retirement objectives and a medium-term time horizon, and those who have a conservative real return requirement.

PPS Moderate Fund

The investment objective is to maximise total portfolio return while outperforming a moderate real return target of CPIX (Consumer Price Index) + 4% per annum, over the medium term. The manager employs real return strategies to achieve real capital growth. Asset allocation is flexible and provides diversification across all asset classes and sectors with equity exposure limited to not more than 65% of the portfolio value. The fund suits those who desire moderate real returns over a medium-term time horizon or those who have long-term savings or retirement objectives.

PPS Managed Flexible Fund

The investment objective is to maximise total portfolio return while outperforming an aggressive real return target of CPIX (Consumer Price Index) + 6% per annum over the long term. The manager employs real return strategies, combining flexible asset allocation with value-based security selection processes to meet the benchmark. The fund is most suitable for investors who have a more aggressive outlook, a longer time horizon, a high real return requirement, and long-term savings or retirement objectives.

PPS Equity Fund

The investment objective is to provide long-term capital growth that exceeds that provided by a broad equity market index. Definitely the most aggressive of the funds offered, the manager actively manages exposures to domestically listed equities to deliver solid, long-term performance. The fund suits investors who have a longterm savings objective with little requirement for income, and who are able to tolerate short-term volatility.

PPS Flexible Income Fund

The investment objective is to provide a total return with a strong income bias in excess of a broad, fixed-income market index, as well as some capital growth. To achieve this objective, the fund has a flexible mandate to enable active management without prescribed maturity limits. Asset allocation is defensive with exposure to fixed interest instruments, including high-yielding corporate bonds and securities, government bonds, preference shares, and inflation-linked bonds. The fund suits investors who seek a regular income stream but are risk averse and who appreciate managed exposure to income-generation opportunities.

PPS Enhanced Cash Fund

The investment objective is to provide an enhanced level of income in excess of a broad, short-term, fixed interest benchmark.

Consequently, the manager is allowed to invest in a broader range of interest-bearing instruments than traditional money market funds. The fund suits individuals who are looking for income generation, capital preservation, security from equity market volatility, and short-term parking for funds while phasing in or out of other funds.

SINGLE-MANAGER UNIT TRUST FUNDS

In addition to the range of multi-managed unit trusts brought to you by PPS Multi-Managers, we also offer a selected suite of unit trusts that are managed by other asset managers and offered to you as single-manager solutions.These are made available through the PPS Preferred Funds platform. You have the ability to select funds from amongst the multi-managed and single-managed ranges and can blend the funds to meet your investment requirements.

Although we would caution against frequent changes to the composition of your investment, there are no restrictions applied to the number of switches that you can make between funds. We do not levy a charge for processing such switches, and the only cost that you may incur would be initial fees charged by some of
the managers of the single-manager funds when you invest in their funds.

A consolidated view of your investment holdings is provided to you as a registered user of our website, www.ppsinvestments.co.za.

Range of Single-Manager Unit Trust Funds Our Investment Policy Committee oversees the selection of singlemanager unit trust funds onto the PPS Preferred Funds platform.

In doing so, we have assembled a focused range of funds from recognised unit trust management companies. The committee will continuously monitor the funds that have been included as well as those that have not, with a view to ensuring that the PPS Preferred Funds platform continues to provide you with access to an appropriately sized range of investment options.

COSTS AND CHARGES

Initial fees

PPS Investments does not charge an initial fee on amounts invested in any of the PPS Preferred Funds, or in any PPS multi-managed unit trust. Should you, however, choose to invest with one of the underlying fund managers, an initial fee of 0,25% (excluding VAT) may be charged.

Ongoing Fees

An ongoing administration fee of 0,7% (excluding VAT) is charged annually on an investment in any of the PPS Preferred Funds. The fee is reduced by applying considerable 'partnership savings' that we have negotiated with the underlying fund managers. The annual administration fees that you pay are reduced by the full extent of these savings as follows:

Scenario 1

Direct investment into a PPS multi-managed unit trust:

• Annual administration fee 0,7%
• Partnership saving 0,7%
• Net annual administration fee 0%

Scenario 2

Direct investment into a third-party single-manager unit trust:

• Annual administration fee 0,7%
• Partnership saving 0,4%
• Net annual administration fee 0,3%

• Please note that partnership savings offered by third-party fund managers differ
• All fees quoted are exclusive of VAT

The annual management fees for the underlying unit trusts are fully disclosed on the investment option schedule.

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