Glossary Group: Glossary

Infrastructure assets are long-lived assets that provide sustainable services that are essential for a functioning economy. There are three broad categories, transportation, utilities, and communications. These include energy such as power generation plants, transmission, and renewables, water and wastewater networks and desalination plants, transportation such as ports, rail, airports, roads, bridges and parking, communications such as cable networks and satellites, and social structures such as hospitals, prisons, schools, courts, and public housing. Investor profile definitions:

Physical substances, such as food, grains, and metals, which are interchangeable with another product of the same type. They are most often used as inputs in the production of other goods or services. Investors can buy or sell these, usually through futures contracts. The price of the commodity is subject to supply and demand. Commodities are volatile investments on their own and should form only a small portion of a diversified portfolio to aid in diversification and as a potential hedge against inflation.

A Fund may invest in derivatives, including futures, options, forwards and swaps. Investments in derivatives may cause the Fund’s losses to be greater than if it invests only in conventional securities and can cause the Fund to be more volatile. Derivatives involve risks different from, or possibly greater than, the risks associated with other investments. The Fund’s use of derivatives may cause the Fund’s investment returns to be impacted by the performance of securities the Fund does not own and result in the Fund’s total investment exposure exceeding the value of its portfolio.

A Real Estate Investment Trust (REIT) invests in real estate loans (mortgages and trust deeds) and/or has equity interests in real estate. Specific sector investing, such as real estate, can be subject to different and greater risks than more diversified investments. Declines in the value of real estate, changes in economic conditions, property taxes, tax laws, and interest rates all present potential risks to real estate investments.

Alternatives can include real estate, physical commodities (including oil, gold and copper), and infrastructure (such as bridges, toll roads and utilities networks), multi-strategy funds, and hedge funds. These investing strategies have the potential to add a diversifying return stream. At certain points in history, the value of alternatives has been driven by aggregate price rises, so at times they may offer investors some protection from unanticipated inflation. Alternatives are sourced and consumed globally, adding to the global diversification of the portfolio.

A bond issued by the government of a country or a corporation located in a country that is defined as ’emerging.’ There is no common standard for a country’s inclusion in an EMD index, but in general, these countries are characterized by having economies with higher growth expectations, higher inflation, and rapidly changing economic environments. Some examples are: Latin American, Asian and African countries, Brazil, Russia, China, Hungary, and Turkey.

The high yield market consists of the debt of corporations that have relatively high levels of leverage. These debt securities are rated as ‘below investment grade,’ or “junk bonds,” i.e. BB rated or lower (using Standard and Poor’s rating definition). These issuers have been assigned lower ratings by credit rating agencies based on their greater risk of default and/or loss on default. Hence, higher yields are required to attract and compensate investors for taking on that default risk.

A government, municipal or corporate bond that pays a fixed rate of interest until the bond matures; or a preferred stock that pays a fixed dividend. Bond investors should carefully consider risks such as interest rate, credit, repurchase and reverse purchase transaction risks. Greater risk, such as increased volatility, limited liquidity, prepayment, non-payment and increased default risk, is inherent in portfolios that invest in high yield (“junk”) bonds or mortgage backed securities, especially mortgage backed securities with exposure to sub-prime mortgages.

A Fund may invest in derivatives, including futures, options, forwards and swaps. Investments in derivatives may cause the Fund’s losses to be greater than if it invests only in conventional securities and can cause the Fund to be more volatile. Derivatives involve risks different from, or possibly greater than, the risks associated with other investments. The Fund’s use of derivatives may cause the Fund’s investment returns to be impacted by the performance of securities the Fund does not own and result in the Fund’s total investment exposure exceeding the value of its portfolio.

Investment in non-US stocks. Investments in non-U.S. markets can involve risks of currency fluctuation, political and economic instability, different accounting standards and foreign taxation. Such securities may be less liquid and more volatile. Investments in emerging or developing markets involve exposure to economic structures that are generally less diverse and mature, and political systems with less stability than in more developed countries.

Dynamic style emphasizes investments in equity securities of companies that are believed to be currently undergoing or are expected to undergo positive change that will lead to stock price appreciation. Dynamic stocks typically have higher than average stock price volatility, characteristics indicating lower financial quality, (which may include greater financial leverage) and/or less business stability.

Defensive style emphasizes investments in equity securities of companies that are believed to have lower than average stock price volatility, characteristics indicating high financial quality, (which may include lower financial leverage) and/or stable business fundamentals.