Rathbone Global Opportunities Fund - Rathbone Unit Trust ...

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Rathbone Global Opportunities Fund - Rathbone Unit Trust ...

Rathbone Unit Trust Management Limited

Rathbone Global Companies Fund

Interim Report as at

31 July 2003

(unaudited)


The photography is of the ‘Orangery’, one of the most notable features of our New Bond Street

offices in London. It is an imposing internal glassed atrium within a grade II listed building of

much character and tradition, that dates back to circa 1830.


Rathbone Unit Trust Management Limited

Rathbone Global Companies Fund

Manager

Rathbone Unit Trust Management Limited

159 New Bond Street

London W1S 2UD

Telephone 020 7399 0399

Facsimile 020 7399 0057

A member of the Rathbone Group

Authorised and regulated by the Financial

Services Authority and member of the

Investment Management Association

Directors

GM Powell – Chairman

PG Pearson Lund – Chief Executive Officer

JR Chillingworth – Chief Investment Director

HMC Cunningham

RP Lanyon

RE Loader FCA – Finance Director

HM Priestley – Investment Director

CR Stick

Dealing Office

Northern House,Woodsome Park

Fenay Bridge, Huddersfield HD8 0GA

Telephone 0845 300 2101

Facsimile 01484 601 500

Registrar

Capita Financial Administrators Limited

Northern House,Woodsome Park

Fenay Bridge, Huddersfield HD8 0GA

Telephone 0845 300 2101

Facsimile 01484 601 500

Authorised and regulated by the Financial

Services Authority

Administrator

Capita Financial Administrators Limited

Beaufort House

15 St. Botolph Street

London EC3A 7HH

Telephone 020 7556 8800

Facsimile 020 7556 8850

Authorised and regulated by the Financial

Services Authority

Trustee

The Bank of New York

Trust and Depositary Company Limited

One Canada Square

London E14 5AL

Authorised and regulated by the Financial

Services Authority

Auditor

AGN Shipleys

Chartered Accountants

10 Orange Street

Haymarket

London WC2H 7DQ

1


Rathbone Unit Trust Management Limited

Manager’s report for the half year to 31 July 2003

During the six months to 31 July 2003, the

offer price of units in your Fund rose by

17.4% whilst our benchmark the FTSE World

Index is up 16.1%.The period under review

has been extremely volatile for equity

investors.As we entered 2003 there were few

signs of economic recovery in the USA or

Europe.The only area of the world enjoying

strong economic growth was China. Stock

markets around the world touched their lows

in March sparked by the uncertainty

surrounding the Iraq war and possible

repercussions on corporate and consumer

spending. Markets staged a relief rally as the

invasion of Iraq progressed and victory

became more likely. Consumer and business

confidence jumped in April from depressed

levels and market sentiment improved

following first quarter earnings reports. Large

institutions were wary of the “Baghdad

bounce” witnessed in early April and expected

it to be another bear market rally or false

dawn.

The Federal Reserve maintained a loose

monetary policy and reduced rates by a

further quarter of a point in June. In

Continental Europe interest rates were

reduced by half a point, and in the UK by

a quarter point, to levels not seen in the UK

since the sixties. High levels of liquidity

eventually forced investors to increase their

exposure to equities and further fuelled the

sentiment driven stock market. Corporate

activity in the form of mergers & acquisitions

and leveraged buy-outs has also increased

substantially as investors scramble to chase

companies that are generating cash in excess

of low yielding government bonds.

During the past three months we have seen

signs that the accommodative monetary policy

adopted by central banks is beginning to spark

a slow recovery in global economies. US

companies have also benefited from a weak

dollar as they translate foreign currency

earnings. However, as Alan Greenspan

remarked in his recent testimony to

Congress, there remains a high degree of

caution, which will only abate as people

believe in an economic recovery.The second

quarter reporting season in the US was

uneventful (but not disappointing), and in

Europe companies are just beginning to

publish interim reports. Chief Executive

Officer’s are keen to manage expectations of a

visible improvement in demand and cost

cutting is still the corner stone of earnings

surprises.

Far Eastern economies have benefited from

continued strong growth in China although

competitive deflation by the Chinese

authorities has meant the strength of the yen

has been unhelpful to Japanese exporters.The

Japanese stock market has seen a strong rally

from the lows earlier in the year. Overseas

investors have driven this with high cash

balances looking towards a recovery in the

Japanese economy, which has yet to

materialise. Local institutions are net sellers as

they continue to be plagued by daiko henjo

(companies forced to sell equities to return

part of their pension plan to the government).

In Europe there have been very few signs of

any economic improvement and for countries

such as Germany, European interest rates

remain too high. In the UK the consumer

remains reasonably buoyant and the

government public-sector spending program

has kept unemployment low. However,

although growth in 2003 will be good by

European standards, it will still be below trend.

The Fund continues to seek stock specific

investment opportunities that will outperform

in any economic environment. During periods

2


of fear and uncertainty, neglected growth

opportunities emerge as investors take a

short-term view based on flawed fundamental

analysis. Many of the new investments made

over the past six months capitalised on

neglected, or under-appreciated growth

companies with strong management teams,

brands, and cash generation. New purchases

include Advo (direct mail advertising),

Affiliated Computer Services (business process

outsourcing),AIG (insurance), Blue Rhino

(propane gas exchange), Eidos (video games),

Epiq Systems (bankruptcy software), First Data

(payment processing), Hewitt Associates (HR

outsourcing), Hollis-Eden Pharmaceuticals

(biotech), Marvel Enterprises (licenses comic

book characters i.e. Spiderman and The

Hulk), MGM (film and TV studio), Noble

Group (supplies commodities into China),

and Puma (sportswear).

Many of these new holdings have performed

spectacularly well in a very short period of

time. Hollis-Eden (+79%) is a US

biotechnology company developing a novel

treatment for radiation sickness in the event

of a nuclear attack. If approved, early estimates

project that demand from the US Department

of Defense alone could total more than

$500million (source: Jefferies & Co).

Noble Group (+48%) is a Singapore based

company that supplies raw materials like steel,

iron, coal, and grains into mainland China.

Domestic consumption is booming in China

and Noble is able to meet this growing

demand without taking any of the commodity

risk (they hedge exposure).Tight controls are

kept in place by a competent and experienced

management team.

Your managers are pleased with the

composition of the portfolio and have

participated fully in the recent rally in

global stock markets. If the economic data

continues to improve, interest rates remain

low, and investor confidence remains

optimistic, we expect markets to steadily

trend upwards and your Fund to outperform.

Julian Chillingworth

1 September 2003

Marvel Enterprises (+68%) emerged from

bankruptcy in 1998 with a completely new

business model.They focussed resources on

licensing existing comic book characters to

film studios (e.g. Spiderman,The Hulk,

Daredevil, X-Men). Marvel is a low risk

proposition because they do not tie up their

own capital in the making of the films or

merchandise.They have raised earnings

estimates many times already this year and

there will be more positive surprises to come.

3


Rathbone Unit Trust Management Limited

Net asset value per unit and comparative tables

Fund size

Net Asset

Net Asset

Value Units in Value (pence

Date £ Issue per unit)

31 January 2002 6,057,326 15,837,930 38.25

31 January 2003 4,147,504 15,282,042 27.14

31 July 2003 4,577,032 14,307,775 31.99

Price history

The table below shows, on a calendar year basis, the highest buying and lowest selling prices in

pence per unit since launch on 8 May 2001. Past performance is not necessarily a guide to

future performance.

Highest

Lowest

Year Buying Selling

2001 50.91 32.19

2002 42.44 27.09

2003* 33.94 25.33

* To 31 July 2003

Distribution record

Due to the net deficit of income since launch no distributions have been made in prior

periods.The Manager has decided that the small amount of income available for distribution

this accounting period will be carried forward.

Prices per unit on 1 August 2003

Yield

Buying Selling (buying price)

34.06p 32.02p 0.00%

4


Statement of total return for the half year to 31 July 2003

31.07.03 31.07.02

Note £ £ £ £

Net gains/(losses) on investments 2 719,442 (1,168,503)

Currency losses (12,169) (9,740)

Gross income 3 52,668 49,833

Expenses 4 (38,265) (51,010)

Net income/(deficit) before taxation 14,403 (1,177)

Taxation 5 (3,304) (2,430)

Net income/(deficit) after taxation 11,099 (3,607)

Total return for the half year 718,372 (1,181,850)

Distributions – –

Net increase/(decrease) in

unitholders’ funds from

investment activities 718,372 (1,181,850)

Statement of movements in unitholders’ funds for the half year

to 31 July 2003

31.07.03 31.07.02

Note £ £ £ £

Net assets at the start

of the half year 4,147,504 6,057,326

Amounts receivable on

creation of units 27,436 81,490

Amounts payable on

cancellation of units (316,267) (91,360)

(288,831) (9,870)

Stamp Duty Reserve Tax 1(i) (13) –

Net increase/(decrease) in

unitholders’ funds from

investment activities 718,372 (1,181,850)

Net assets at the end

of the half year 4,577,032 4,865,606

5


Rathbone Unit Trust Management Limited

Portfolio and net current assets as at 31 July 2003

Holding Value Percentage

(Ordinary shares unless otherwise stated) (note 1f) of total net

£ assets

United Kingdom (31.01.03 : 15.75%)

20,000 British Sky Broadcasting Group 140,950 3.08

55,000 Eidos 70,950 1.55

35,000 Shell Transport & Trading Company 136,369 2.98

348,269 7.61

France (31.01.03 : 15.79%)

4,500 BNP Paribas 151,985 3.32

6,000 Neopost 151,052 3.30

1,500 Total Fina Elf 138,096 3.02

441,133 9.64

Germany (31.01.03 : 6.18%)

5,000 Medion 119,924 2.62

1,000 Puma 70,838 1.55

190,762 4.17

Hong Kong (31.01.03 : 10.11%)

350,000 China Insurance International 118,180 2.58

130,000 Li & Fung 114,206 2.49

3,000,000 Media Partners International 43,746 0.96

276,132 6.03

Japan (31.01.03 : 3.04%)

12,500 Credit Saison 129,070 2.82

Korea (31.01.03 : 1.46%)

650 Samsung Electronics 142,313 3.11

Singapore (31.01.03 : 2.20%)

170,000 Noble Group 125,168 2.73

20,000 Venture Corporation 125,362 2.74

250,530 5.47

Spain (31.01.03 : 7.34%)

7,000 Grupo Ferrovial 123,000 2.69

6


Holding Value Percentage

(Ordinary shares unless otherwise stated) (note 1f) of total net

£ assets

Sweden (31.01.03 : 3.18%)

20,000 Swedish Match 85,939 1.88

United States (31.01.03 : 29.35%)

3,500 Advo 100,889 2.20

5,000 Affiliated Computer Services 154,024 3.37

3,000 American International Group 119,680 2.61

2,500 Autozone 129,345 2.83

9,000 Blue Rhino Corporation 65,410 1.43

4,000 Caterpillar 167,714 3.66

5,000 Clear Channel Communications 127,178 2.78

5,000 Du Pont (E.I.) de Nemours 136,515 2.98

8,000 Epiq Systems 86,877 1.90

4,500 First Data Corporation 105,609 2.31

6,000 Hewitt Associates 95,938 2.10

14,010 Hollis-Eden Pharmaceuticals 169,295 3.70

3,000 Invision Technologies 43,029 0.94

12,000 Marvel Enterprises 145,603 3.18

13,000 Metro-Goldwyn-Mayer 110,355 2.41

8,000 Microsoft Corporation 131,273 2.87

9,000 Nasdaq 100 Trust 177,968 3.89

6,000 Phelps Dodge 157,144 3.43

5,000 Viacom 135,256 2.95

4,000 Watson Pharmaceuticals 99,294 2.17

2,458,396 53.71

Total value of investments (31.01.03 : 97.44%) 4,445,544 97.13

Net current assets (31.01.03 : 2.56%) 131,488 2.87

Total value of the Fund

as at 31 July 2003 4,577,032 100.00

Countries eliminated since the beginning of the half year:

Switzerland 3.04%

7


Rathbone Unit Trust Management Limited

Balance sheet as at 31 July 2003

31.07.03 31.01.03

Note £ £ £ £

Portfolio of investments 4,445,544 4,041,503

Net current assets

Debtors 6 11,790 105,545

Bank balances 127,789 213,639

139,579 319,184

Less:

Creditors 7 8,091 213,183

Net current assets 131,488 106,001

Net assets 4,577,032 4,147,504

Unitholders’ funds 4,577,032 4,147,504

8


Material portfolio changes for the half year to 31 July 2003

The portfolio changes represent the 20 largest purchases and sales during the half year.

Major purchases Major sales

cost

proceeds

£ £

United Kingdom

Amersham – 94,110

Eidos 81,067 –

EMI – 84,331

HSBC Holdings – 132,134

Sondex 43,636 51,387

Wood Group (John) – 122,254

Europe

Adidas – 154,716

Bonduelle – 143,094

Grupo Ferrovial – 52,028

Inditex – 128,426

Marionnaud Parfumeries – 93,792

Nestlé – 117,481

Nokia Corporation 99,392 98,846

Puma 63,230 –

Far East

Hong Kong Exchanges & Clearing – 74,703

Noble Group 84,875 –

Sinotrans 59,079 69,110

United States

Advo 96,706 –

Affiliated Computer Services 135,848 –

American International Group 104,574 –

Blue Rhino Corporation 83,277 –

Epiq Systems 82,956 –

First Data Corporation 98,661 –

Goldman Sachs 73,272 78,587

Hewitt Associates 82,860 –

Hollis-Eden Pharmaceuticals 95,392 –

Invision Technologies – 74,012

Marvel Enterprises 87,038 –

McKesson Corporation – 94,760

Metro-Goldwyn-Mayer 102,450 –

Nasdaq 100 Trust 328,177 153,966

Pharmaceutical Resources 86,717 87,104

State Street Corporation – 96,805

Superior Energy Services 42,169 –

Other purchases and sales 132,493 379,613

Total purchases and sales

for the half year 2,063,869 2,381,259

9


Rathbone Unit Trust Management Limited

Notes to the financial statements

1 Accounting policies

a) Basis of accounting

The financial statements have been prepared

under the historical cost basis, as modified by

the revaluation of investments and in

accordance with the Statement of

Recommended Practice (SORP) for

Authorised Unit Trust Schemes issued in

January 1997 and the Financial Services

Authority’s Collective Investment Schemes

Sourcebook published in November 2001.

b) Recognition of income

All dividends on investments marked

ex-dividend up to the accounting date are

included in income, net of attributable tax

credits. Bank and other interest receivable

is accrued up to the accounting date, and

this forms part of the distribution made by

the Fund.

c) Treatment of scrip and special dividends

Any stock received in lieu of cash dividends

is credited to capital in the first instance,

followed by a transfer to income of the cash

equivalent being offered, and this forms part

of the distribution made by the Fund.

In accordance with the SORP, special

dividends are treated as repayments of capital

except where there is sufficient evidence to

regard them as income.The tax accounting

treatment follows the treatment of the

principal amount.

d) Treatment of management expenses

The Manager’s periodic charge is deducted

from the income of the Fund.

e) Distribution policy

Income arising from the Fund’s investments

accumulates during each accounting period.

If, at the end of the accounting period,

income exceeds expenses, the net income of

the Fund is available to be distributed to

unitholders. In order to conduct a controlled

dividend flow to unitholders, interim

distributions will be made at the Manager’s

discretion, up to a maximum of the

distributable income available for the period.

All remaining income is distributed in

accordance with the Regulations.

f) Basis of valuation of investments

The investments of the Fund have been

valued at the closing mid-market prices ruling

on the principal markets on which the stocks

are quoted, on the last business day of the

accounting period. If the Stock Exchange

quotation of an investment has been

suspended and, in the opinion of the Manager

is unlikely to be reinstated, the stock has not

been shown in the portfolio of investments.

10


g) Exchange rates

Transactions in foreign currencies are

recorded in sterling at the rate ruling at the

date of the transactions.Assets and liabilities

expressed in foreign currencies at the end of

the accounting period are translated into

sterling at the closing middle exchange rates

ruling on that date.

i) Stamp Duty Reserve Tax

Stamp Duty Reserve Tax (SDRT) suffered on

surrender of units has been charged against

the capital assets of the Fund.

h) Taxation/Deferred Tax

i) Corporation tax is provided for at 20%

on income, other than UK dividends, after

deduction of expenses.

ii) Where overseas tax has been deducted

from overseas income that tax can, in some

instances, be set off against the corporation

tax payable by the Fund, by way of double

taxation relief.

iii) Deferred tax is provided on all timing

differences that have originated, but not

reversed, by the balance sheet date other

than those differences regarded as

permanent.Any liability to deferred tax is

provided at the latest known rate of tax.

Deferred tax assets and liabilities are not

discounted to reflect the true value of

money.

11


Rathbone Unit Trust Management Limited

Notes to the financial statements – continued

12

2 Net gains/(losses) on investments 31.07.03 31.07.02

£ £

The net gains/(losses) on investments during

the half year comprise:

Proceeds from sales of investments 2,381,259 2,757,044

Original cost of investments sold (2,774,981) (3,146,125)

Losses realised on investments sold (393,722) (389,081)

Net depreciation/(appreciation) thereon already recognised

in prior periods 443,839 (40,018)

50,117 (429,099)

Net unrealised appreciation/(depreciation) 669,325 (739,404)

719,442 (1,168,503)

3 Gross income 31.07.03 31.07.02

£ £

Dividends – UK ordinary 10,631 8,975

Dividends – Overseas 39,744 37,710

Bank interest 2,293 3,148

52,668 49,833

4 Expenses 31.07.03 31.07.02

£ £ £ £

Payable to the Manager, associates of the Manager

and agents of either of them:

Manager’s periodic charge 31,779 43,642

Payable to the Trustee, associates of the Trustee

and agents of either of them:

Trustee’s fees 1,457 1,339

Safe custody and other bank charges 924 2,220

Interest payable (19) –

2,362 3,559

Other expenses:

FSA fee 624 309

Audit fee 2,622 2,622

Registration fees 878 878

4,124 3,809

38,265 51,010


5 Taxation 31.07.03 31.07.02

£ £

Net income/(deficit) before taxation 14,403 (1,177)

Avoir fiscal 1,151 966

Movement in income accruals not taxable in the current year (1,226) (1,510)

UK ordinary dividends not subject to corporation tax (10,631) (8,975)

Movement in excess management expenses (3,697) 10,696

– –

Corporation tax at 20% – –

Effects of:

Adjustments in respect of prior periods 372 (642)

Overseas tax 4,083 4,038

Avoir fiscal (1,151) (966)

Current tax 3,304 2,430

Deferred tax – –

Total tax 3,304 2,430

6 Debtors 31.07.03 31.01.03

£ £

Amounts receivable for creation of units 7,071 –

Sales awaiting settlement – 100,367

Accrued income 1,042 967

Overseas tax recoverable 866 955

Avoir fiscal 2,012 2,753

Prepaid expenses 799 503

11,790 105,545

7 Creditors 31.07.03 31.01.03

£ £

Amounts payable for cancellation of units – 1,437

Purchases awaiting settlement – 200,895

Accrued expenses 8,091 10,851

8,091 213,183

13


Rathbone Unit Trust Management Limited

Notes to the financial statements – continued

8 Related party transactions

Management fees payable to Rathbone Unit Trust Management Limited (the Manager) are

detailed in note 4.The amount outstanding at the period end in respect of those fees was

£5,227 (31.01.03: £5,262).

Trustee and other fees payable to The Bank of New York Trust and Depositary Company

Limited (the Trustee) are also detailed in note 4.The amount outstanding at the period end in

respect of those fees was £241 (31.01.03: £302).

There was no commission paid to stockbroking associates of the Manager in respect of dealings

in the investments of the Fund during the period.

9 Contingent liabilities and commitments

There were no contingent liabilities or outstanding commitments at the balance sheet date.

10 Financial instruments

In pursuing the investment objective a number of financial instruments are held.The financial

instruments comprise securities and other investments, cash balances and debtors and creditors

that arise directly from operations, for example, in respect of sales and purchases awaiting

settlement, amounts receivable for creations and payable for liquidations and debtors for accrued

income.

There is little exposure to credit or cash flow risk.There are no net borrowings or unlisted

securities and so little exposure to liquidity risk.The main risks arising from financial

instruments are:

14


10 Financial instruments – continued

(i) Foreign currency risk, being the risk that the value of investments will fluctuate as a result of

exchange rate movements.

The table below details the foreign currency risk profile at the balance sheet date.

31.07.03

£

31.01.03

£

Currency:

Euros 754,895 1,215,437

Hong Kong dollars 276,132 419,268

Japanese yen 129,070 126,325

Korean won 142,478 60,730

Singapore dollars 250,530 91,133

Swedish krone 85,939 131,800

Swiss francs – 126,215

US dollars 2,459,273 1,218,137

4,098,317 3,389,045

Pounds sterling 478,715 758,459

Net assets 4,577,032 4,147,504

(ii) Interest rate risk, being the risk that the value of investments will fluctuate as a result of

interest rate changes.

The table below details the interest rate risk profile at the balance sheet date.

£

31.07.03

£ £

31.01.03

£

Floating rate assets:

Pounds sterling 127,789 213,639

Assets on which interest is not paid:

Euros 754,895 1,215,437

Hong Kong dollars 276,132 419,268

Japanese yen 129,070 126,325

Korean won 142,478 60,730

Singapore dollars 250,530 91,133

Swedish krone 85,939 131,800

Swiss francs – 126,215

US dollars 2,459,273 1,318,504

Pounds sterling 359,017 657,636

4,457,334 4,147,048

Liabilities on which interest is not paid:

US dollars – (100,367)

Pounds sterling (8,091) (112,816)

(8,091) (213,183)

Net assets 4,577,032 4,147,504

15


Rathbone Unit Trust Management Limited

Notes to the financial statements – continued

10 Financial instruments – continued

(ii) Interest rate risk – continued

The floating rate financial assets comprise bank balances that earn interest at rates linked to

the UK base rate or its international equivalent.

There are no material amounts of non-interest bearing financial assets and liabilities other

than equities, which do not have maturity dates.

(iii) Market price risk, being the risk that the value of investment holdings will fluctuate as a

result of changes in market prices caused by factors other than currency or interest rate

movements.

The investment portfolio is exposed to market price fluctuations which are monitored by

the Manager in pursuance of the investment objective and policy set out in the Scheme

Particulars.

Adherence to investment guidelines and to investment and borrowing powers set out in the

Trust Deed and the Scheme Particulars and the rules of the Financial Services Authority’s

Collective Investment Schemes Sourcebook mitigates the risk of excessive exposure to any

particular type of security or issuer.

(iv) Counterparty risk, being the risk that the counterparty will not deliver the investments for a

sale after the Fund has fulfilled its responsibilities.

11 ISA and PEP eligibility

The Fund has been managed throughout the period to ensure that it is eligible to qualify and

be included in an Individual Savings Account (ISA) and a Personal Equity Plan (PEP).The

Fund will at all times be invested in such a way that the units will constitute “Qualifying

Investments” for the purposes of the Individual Savings Account (ISA) Regulations 1998 and

the Personal Equity Plan (PEP) Regulations 1989, as amended from time to time.

Directors’ statement

This report is signed in accordance with the requirements of the Financial Services Authority’s

Collective Investment Schemes Sourcebook.

PG Pearson Lund RE Loader

for Rathbone Unit Trust Management Limited

Manager of Rathbone Global Companies Fund

23 September 2003

16


General information

Authorised status

Rathbone Global Companies Fund is an

authorised unit trust scheme, established by

a Trust Deed dated 20 March 2001 and

launched in April 2001.

It is a ‘securities fund’ authorised under Section

243 of the Financial Services and Markets Act

2000, and the currency of the Fund is pounds

sterling.

Investment objective and policy

The objective of the Fund is to provide above

average long term capital growth from a

global equity portfolio.The portfolio will be

invested predominantly in larger companies

but mid-capitalisation and smaller stocks will

also be included.The income yield will at best

be minimal.The Fund will be managed so as

to qualify for inclusion in an Individual

Savings Accounts (ISA) and a Personal Equity

Plan (PEP).

Valuation of the Fund

The Fund is valued on each business day at

12 noon for the purpose of determining prices

at which units in the Fund may be bought or

sold.Valuations may be made at other times on

business days with the Trustee’s approval.

No maximum buying/selling price spread is

stipulated in the Trust Deed and the

Manager’s discretion to set buying and selling

prices is subject to relevant regulations made

under the Financial Services and Markets

Act 2000.

Buying and selling of units

The Manager is available to receive requests

for the buying and selling of units on business

days between 9.30am and 5.00pm and

transactions will be effected at prices

determined by the next valuation.Application

forms for units (obtainable from the Manager

or the Administrator) should be completed and

sent to the Administrator. In respect of

telephoned orders remittances should be sent

on receipt of the contract note. Contract notes

confirming transactions will be issued by the

close of business on the next business day after

the dealing date. Purchasers of units are

required to enter their registration details on

the form supplied with their contract note.

Once units are paid for these details will be

entered on the unit register.

Units can be sold by telephone, fax or letter

followed by despatch to the Administrator of

the authorisation to sell duly completed by

all unitholders.

In the absence of clear written instructions

signed by all the registered holders, a Form of

Renunciation will be sent out together with

the repurchase contract note.This will need to

be signed by all registered holders, and

returned to our Administrators before

settlement can be made. Settlement will be

made on whichever is the later of four

business days after the dealing date or four

days after the receipt of written confirmation.

17


Rathbone Unit Trust Management Limited

General information – continued

Unitholders may sell units on submitting the

purchase contract note and a duly executed

Deed of Transfer.The issue and redemption of

units will not take place if dealing in the units

is suspended by operation of law or any

statute for the time being in place. Sales

constituting a “large deal” of £15,000 or

more, may receive a lower price than the

published selling price.

The minimum initial investment is at present

units to the value of £1,000 which may be

varied by the Manager.Thereafter holders may

invest additional amounts to the value of

£500 or more from time to time as they

wish.Any number of units may be subscribed,

sold or transferred so long as the transaction

complies with applicable minimums.The

Manager operates a monthly savings plan,

details of which are available from the

Manager.

The purchase price of units included a

preliminary charge of 5.5%.The maximum

permitted under the Trust Deed is 6.0%. Out

of this charge the Manager may pay

commission to qualifying intermediaries.

Statements

A distribution statement showing the rate per

unit and your unit holding will be sent half

yearly on 31 March and 30 September.

The current value of your units is shown

on a valuation statement, which shows the

number of units bought over the previous six

months, the total number of units in your

account and their current value. Unit Trust

holders will receive their valuation statement

at the same time as their distribution

statement above. PEP and ISA holders will

receive their valuation statement within 25

days of the 5 April and 5 October.

Prices

The prices of units are published in The

Financial Times and The Daily Telegraph

under the heading Rathbone Unit Trust

Management Limited.The associated

cancellation price is available on request from

the Manager.

The Manager currently receives an annual

remuneration for managing the property of

the Fund at the rate of 1.5%.The maximum

under the Trust Deed is 2%.

18


Other information

Copies of the Trust Deed, Scheme Particulars,

Key Features document and the most recent

interim and annual reports may be inspected

at the offices of the Manager, the

Administrator or the Trustee and copies may

be obtained on application to the Manager or

the Administrator.

The Register of Unitholders can be inspected

during normal business hours at the office of

the Registrar, Capita Financial Administrators

Limited at Northern House,Woodsome Park,

Fenay Bridge, Huddersfield HD8 0GA.

Unitholders who have any queries or

complaints about the operation of the Fund

should address them in the first instance to

the Compliance Officer, Rathbone Unit Trust

Management Limited, 159 New Bond Street,

London W1S 2UD.Any complaint we receive

will be handled in accordance with our

internal complaint procedures.A copy of these

are available from the Compliance Officer. If

you have occasion to complain, and in the

unlikely event that you do not receive a

satisfactory response, you may direct your

complaint to the Financial Ombudsman

Service at South Quay Plaza, 183 Marsh Wall,

London E14 9SR.

Risk Factors

An investment in a unit trust should be

regarded as a medium to long term

investment. Investors should be aware that the

price of units and the income from them can

fall as well as rise and investors may not receive

back the full amount invested. Past

performance is not necessarily a guide to

future performance. Investments denominated

in currencies other than the base currency are

subject to fluctuation in exchange rates, which

can be favourable or unfavourable.

Other Funds

Rathbone Unit Trust Management Limited is

also the Manager of the following funds:

Rathbone Capital Growth Fund

Rathbone Esk Fund

Rathbone Ethical Bond Fund

Rathbone Hamilton Fund

Rathbone Income Fund

Rathbone Income and Growth Fund

Rathbone Longroad Fund

Rathbone Smaller Companies Fund

Rathbone Special Situations Fund

Rathbone Spenser Fund

Rathbone Technology Fund

and the Authorised Corporate Director of:

Rathbone Quercus Fund

Rathbone Sherwood Fund

Further Details

Should you require further details of this

Fund or any of the other Funds managed by

Rathbone Unit Trust Management Limited, a

Key Features document or an application form

for the purchase of units, please write to:

Capita Financial Administrators Limited

Beaufort House

15 St. Botolph Street

London EC3A 7HH

Information is also available on our website:

www.rathboneunittrusts.com

Data Protection

If you do not wish to receive information on

other products and services offered by the

Rathbone Group, please write to us at the

following address:

Data Protection Officer

Rathbone Unit Trust Management Limited

159 New Bond Street

London W1S 2UD

19


Rathbone Unit Trust Management Limited

Authorised and regulated by the Financial Services

Authority and member of the Investment

Management Association

159 New Bond Street, London W1S 2UD

Telephone: 020 7399 0000

Broker Line: 020 7399 0399

Facsimile: 020 7399 0057

Website: www.rathbones.com

www.rathboneunittrusts.com

Email: rutm@rathbones.com

Telex: 916966 RATHB

DX54277 Piccadilly 1

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