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44 section 4 risk factors Where the Target Fund focuses on a specific geographic region, or market/industry sector, it may be subject to greater concentration risks than Target Fund which have broadly diversified investments. As such, investors should note that investments in any Target Fund are not bank deposits and are not insured or guaranteed by any deposit insurance or government agency. Prices may fall in value as rapidly as they may rise and it may not always be possible to dispose of such securities during such falls. Rating of Investment Risk There is no assurance that the ratings of each rating agency will continue to be calculated and published on the basis described in the Target Fund’s prospectus or that they will not be amended significantly. The past performance of a rating agency in rating an investment is not necessarily a guide to future performance. Taxation Risk The Target Fund may invest in securities that produce income that is subject to withholding and/or income tax. shareholders and potential investors are advised to consult their professional advisers concerning possible taxation or other consequences of subscribing, holding, selling, switching or otherwise disposing of Shares in the Target Fund. A summary of some of the Luxembourg tax consequences applicable to the MGF is set out in Section 10.2.1 of the Target Fund’s prospectus. However shareholders and potential investors should note that the information contained in that section does not purport to deal with all of the tax consequences applicable to the MGF or all categories of investors, some of whom may be subject to special rules. Voluntary Liquidation and Early Termination Risk Although MGF was incorporated and established for an unlimited duration, the directors may at any time move to dissolve MGF at a general meeting in accordance with the Articles. If the corporate capital of MGF falls below two thirds of the minimum capital prescribed by the 2002 Law (currently 1,250,000 Euros or its equivalent in any other Major Currency), a resolution for the winding-up of MGF must be put to a general meeting. The directors may also resolve to voluntarily liquidate MGF or terminate the Target Fund by compulsory redemption of all outstanding Shares where its net asset value has fallen below US$5,000,000 and US$2,000,000 respectively, or the directors may require voluntary liquidation of MGF or early termination of the Target Fund (or a merger of the Target Fund with another target fund or Luxembourg UCITS) in the circumstances as discussed in Paragraph 7 of Appendix III (Compulsory Redemption) or Paragraph 8 of Appendix III (Termination/Merger of Target Fund) of MGF’s prospectus. In a case where there is compulsory redemption of all outstanding Shares, the redemption price payable will reflect the anticipated realisation and liquidation costs of liquidating MGF or the Target Fund, but without the application of any redemption charge. In the event of such voluntary liquidation or early termination, shareholders will be entitled to receive their pro rata interest in the assets of MGF or Target Fund (as the case may be). It is possible that at the time of any sale, realisation, disposal or distribution of these assets, certain investments held by MGF or Target Fund may be worth less than the initial cost of such investments, resulting in a substantial loss to the shareholders. Moreover, any organisational expenses with regard to MGF or Target Fund (as the case may be) that had
45 not yet become fully amortised would be debited against MGF’s or Target Fund’s account at that time. Financial Derivative Instruments (FDIs) Risks The Target Fund, where stated in the relevant investment objectives and investment policies, may from time to time use FDIs such as warrants, futures, options, forwards and other derivative instruments or contracts for the purposes of meeting the investment objectives of the Target Fund or as part of the investment strategy and not merely for efficient portfolio management and hedging. This may lead to greater volatility in the NAV of the Target Fund. The volatility of securities is not constant. For example, changes in volatility may impact on the value of certain options, especially for out-of-the-money options. Volatility also tends to be mean reverting. When volatility reaches a very high level, it is more likely to decline than to rise. Conversely, when volatility reaches a very low level it is more likely to rise than to decline. The types and degrees of risk associated with such techniques and instruments vary depending upon the characteristics of the particular FDI and the assets of the Target Fund as a whole. Use of these instruments may entail investment exposures that are greater than their cost would suggest, meaning that a small investment in FDIs could have a large impact on the Target Fund’s performance. Participation in FDIs that may be held by the Target Fund to the extent permitted by applicable laws from time to time, whether for hedging purposes or otherwise, may expose the Target Fund to a higher degree of risk to which the Target Fund would not receive or be subject to, in the absence of using these instruments. Although the use of FDIs in general may be beneficial or advantageous, FDIs involve risks which differ from, and are, possibly, greater than the risks associated with traditional securities investments. The risks presented by FDIs include, but are not limited to, management risk, market risk, credit risk, liquidity risk and leverage risk. Management Risk Management risk represents the risk to the Target Fund that the investment results of the use of such instruments are reliant upon the success of the investment manager in making investment decisions in the context of prevailing market conditions. The Target Fund’s ability to use FDIs successfully depends on the investment manager’s ability to accurately predict movements in stock prices, interest rates, currency exchange rates or other economic factors and the availability of liquid markets. If the investment manager’s predictions are inaccurate, or if the FDIs do not work as anticipated, the Target Fund could suffer greater losses than if the Target Fund had not used such FDIs. Market Risk Market risk refers to the risk to the Target Fund from exposures to changes in the market value of its FDIs. There is a risk that the portfolio value of the Target Fund declines if the Target Fund is forced to unwind or close its FDIs positions under unfavourable conditions. In a down market, higher-risk securities and FDIs could become harder to value or the Target Fund may not be able to realize the true value of such securities.
Page 1: For your future TM Master Prospectu
Page 4 and 5: 4 Responsibility Statements This Ma
Page 6 and 7: 6 CONTENTS SectioN Page 1 Corporate
Page 8 and 9: 8 CONTENTS SectioN Page 7 Performan
Page 10 and 11: 10 CONTENTS SectioN Page 13 Client
Page 12 and 13: 12 section 1 CORPORATE DIRECTORY Th
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Page 16 and 17: 16 section 2 GLOSSARY FiMM Forward
Page 18 and 19: 18 section 2 GLOSSARY Share(s) Shar
Page 20 and 21: 20 section 3 KEY DATA Fund Informat
Page 38 and 39: 38 section 4 risk factors Currency
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Page 74 and 75: 74 section 6 ADDITIONAL INFORMATION
Page 76 and 77: 76 section 67 PERFORMANCE OF THE FU
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94 section 10 TRANSACTION INFORMATI
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98 section 11 TRANSACTION DETAILS 1
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100 section 11 TRANSACTION DETAILS
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106 section 12 sALIENT TERMS OF THE
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116 section 13 CLIENT COMMUNICATION
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124 section 15 the investment manag
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128 section 16 the trustee Each cli
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130 section 16 the trustee Mr Tan S
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132 section 17 RELATED PARTY TRANSA
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134 section 18 STATEMENT OF CONSENT
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136 section 19 TAX ADVISER’S LETT
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138 section 19 TAX ADVISER’S LETT
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140 section 20 DOCUMENTS AVAILABLE
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142 section 22 DIRECTORS’ DECLARA
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trustworthy - Manulife Insurance Berhad

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