MERCER PRODUCT GROUP AND CATEGORY DEFINITIONS SEPTEMBER 2016

Transcription

1 MERCER PRODUCT GROUP AND CATEGORY DEFINITIONS SEPTEMBER 2016

2 CONTENTS 1. Executive Summary GIMD Performance Data Used In MercerInsight Performance Universes Product Groups... 4 Asia Product Group... 6 Australia Product Group... 8 Canada Product Group... 9 Emerging Markets Product Group Engagement Services Product Group Equity Sectors Product Group Europe Product Group Factor Investing Product Group Hedge Funds/Absolute Return Product Group Infrastructure Product Group Insurance Linked Strategies Product Group International Equity Product Group International Fixed Product Group International Multi-Asset Product Group Japan Product Group Natural Resources Product Group New Zealand Product Group Alternatives Product Group Passive Product Group Passively Managed ETF Product Group Private Debt Product Group Private Equity Product Group Real Estate Product Group Strategies for Insurers Product Group United Kingdom Product Group United Kingdom DC Product Group US Equity Product Group US Fixed Income Product Group US Product Group MERCER i

3 4. Notes to Tables Currency Acronym Definitions Important Notices MERCER ii

4 1 Executive Summary This document is designed to provide both investment managers and subscribers to MercerInsight with an overview of all the product groups and categories available in Mercer s Global Investment Manager Database (GIMD ) and MercerInsight. It will help investment managers choose the most appropriate product category when entering a new product or changing an existing entry, and will help subscribers see how investment products are categorized in GIMD. The investment strategies in GIMD are sorted into one of the 443 product categories which make up the 29 product groups, i.e. each product group is sub-divided into numerous product categories. For example an emerging markets strategy would go under one of the 24 different emerging markets product categories (dependent on the strategy). Each product group represents an investment region or asset class and is divided up into as many as 46 product categories, dependent on product group. Each of the 443 product categories is defined in terms of the geographical focus of the strategy, the types of assets that the strategy invests in and/or the type of benchmark that it aims to track or outperform. This document provides definitions and explanations for all these groups and categories. Pages three and four set out the product groups and the subsequent pages break down each product group into the respective product categories, in the same order as found on pages three and four. Investment managers enter their products into GIMD on a discretionary basis, however Mercer manager researchers may reclassify a strategy into another product category if they consider this to be appropriate (in many cases this is because Mercer has added a new, more appropriate product category to GIMD since the strategy entry was first created by the manager). The original manager-selected product group and category are also shown on the GIMD entry for each strategy, for reference. Any investment managers or MercerInsight users who believe that Mercer has classified a strategy incorrectly on GIMD are encouraged to contact Mercer to get the issue resolved. We encourage investment managers submitting entries for Global ex my home country equity and fixed income strategies to label them simply as Global rather than as Global ex UK, Global ex Australia etc., and to classify them under the relevant Global Equity or Global Fixed Income category, so that they don t have to maintain separate but very similar entries for each of these variants. The exceptions to this rule are World ex US and World ex Japan equity and fixed income strategies, which should be labelled as such and entered separately under the MERCER 1

5 appropriate World ex US or World ex Japan categories. These categories can all be found within the product groups labelled International. For investment managers requiring information on how to add products to GIMD, or use GIMD generally, please see the user guide under the link Download the User Guide (PDF) on the GIMD website homepage ( For investment managers with further questions, please contact your local helpdesk using the respective contact details found on the GIMD website. MercerInsight subscribers can find their local MercerInsight contact via the Contact Us section on MercerInsight ( MERCER 2

6 2 GIMD Performance Data Used In MercerInsight Performance Universes The product category tables set out in the document also show the base currency that Mercer prefers for that category to be entered in. For investment managers who wish to show their performance through MercerInsight, Mercer s quantitative analysis tool, we ask that they submit the performance in this specified currency and also comply with the requirements detailed on the page in GIMD where the performance track records are added. These track records will then be eligible for inclusion in MercerInsight. MercerInsight allows for quantitative analysis of institutional investment performance and contains more than 320 Mercer created performance universes for this purpose. The universes are constructed from the contained in GIMD, which contains more than 30,000 investment strategies with data from more than 5,900 investment managers. These universes cover a very wide range of asset classes and regions, from traditional bond and equities to more alternative asset classes such as currency and real estate. The universes are constructed so that users can perform comprehensive like for like analysis of an investment manager s fund against peers, the Mercer median or a relevant index over time. The outputs are available in either graphical or tabular format, are easy to interpret and can be used directly in any internal or external report, including requests for proposals (RFPs). MercerInsight is used internally by Mercer researchers and consultants to carry out quantitative analysis on investment products. It is also used externally by more than 400 subscribers; the external subscribers consist of two main user groups, institutional investors and investment managers. The institutional investor subscriber base includes pension funds, government agencies and multi-managers who have approximately US$6 trillion 1 globally of Mercer s and its affiliates assets under advisement and use the tool to help them monitor and select investment managers. The investment managers subscribing to MercerInsight use the system to compare and study their performance against competitors, medians and universes. For more information about MercerInsight please contact us via the MercerInsight website ( 1 As at December Includes the assets under advisement for clients who subscribe to MercerInsight and also receive access to it as part of an investment consulting advisory relationship. MERCER 3

7 3 Product Groups Product Group Asia Australia Canada Emerging Markets Engagement Services Equity Sectors Europe Factor Investing Hedge Funds/ Absolute Return Infrastructure Insurance Linked Strategies International Equity International Fixed International Multi-Asset Japan Natural Resources New Zealand Alternatives All Asian strategies other than those that fit the definitions for Japan, Hedge Funds/Absolute Return, Private Equity, Real Estate or Alternatives All Australian strategies other than those that fit the definitions for Hedge Funds/Absolute Return, Private Equity, Real Estate or Alternatives All Canadian strategies other than those that fit the definitions for Hedge Funds/Absolute Return, Private Equity, Real Estate or Alternatives All global, regional or single country emerging markets strategies other than those that fit the definitions for Asia, Hedge Funds/Absolute Return, Private Equity, Real Estate or Alternatives Voting, engagement and stewardship services across public equities and bonds All equity strategies that focus on a single industry sector or narrow group of industry sectors All European strategies other than those that fit the definitions for United Kingdom, Hedge Funds/Absolute Return, Private Equity, Real Estate or Alternatives Indices which aim to get exposure to certain style factors, often by having a weighting scheme driven by something other than market cap All Hedge Fund/Absolute Return strategies (other than 130/30-type equity) All listed equity, (direct) unlisted equity and fund-of-fund strategies Strategies which provide insurance cover and/or invest in securities and derivatives which are linked to insurance risks (e.g. natural disasters) All global/international equity strategies other than those that fit the definitions for Hedge Funds/Absolute Return, Private Equity, Real Estate or Alternatives All global/international fixed income strategies other than those that fit the definitions for Hedge Funds/Absolute Return, Private Debt or Alternatives All global/international multi-asset strategies other than those that fit the definitions for Hedge Funds/Absolute Return or Alternatives All Japan strategies other than those that fit the definitions for Hedge Funds/Absolute Return, Private Equity, Real Estate or Alternatives Commodity future strategies and illiquid (private equity style) opportunities with a natural resources theme including mining, farmland and timberland etc. All New Zealand strategies other than those that fit the definitions for Hedge Funds/Absolute Return, Private Equity, Real Estate or Alternatives All alternatives strategies other than those that fit the definitions for Hedge Funds/Absolute Return, Private Equity or Real Estate MERCER 4

8 Product Group Passive Passively Managed ETF Private Debt Private Equity Real Estate Strategies for Insurers United Kingdom United Kingdom DC US Equity US Fixed Income US Portfolio which aims to replicate a particular market index or benchmark fund and does not attempt to actively manage the portfolio All investment funds traded on stock exchanges. These funds generally track an index, although there are actively managed ETFs available All private debt, including illiquid senior debt, mezzanine debt but excluding real estate debt strategies All private equity offerings, including both Funds of Funds and directly invested funds All real estate offerings, including both those that invest directly in real estate or real estate funds and those that invest in real estate securities Customized insurance strategies specifically run for insurance policy monies. These strategies will have unique investment, business and regulatory constraints All UK strategies other than those that fit the definitions for Hedge Funds/Absolute Return, Private Equity, Real Estate or Alternatives Products designed for use by UK Defined Contribution pension schemes All US equity strategies other than those that fit the definition for Hedge Funds/Absolute Return All US fixed income strategies other than those that fit the definition for Hedge Funds/Absolute Return All US strategies other than those that fit the definitions for US Equity, US Fixed Income, Hedge Funds/Absolute Return, Private Equity, Real Estate or Alternatives MERCER 5

9 Asia Product Group ASEAN Equity Asia ex Japan Equity Asian Bonds Asia/Pacific Small Cap Equity China A Shares China Bonds (offshore) China Bonds (onshore) China Enterprise Annuity China Equity (offshore) Greater China Equity HK ORSO Hong Kong & China Equities Hong Kong Balanced Hong Kong Dollar Bond Hong Kong Equity Indian Bonds Indian Cash Long only ASEAN (Association for South East Asia Nations) equity strategies that aim to outperform an ASEAN equity index Long only Asia/Far East ex Japan equity strategies that aim to outperform an Asia/Far East ex Japan equity index (ex Aus/NZ) Long only Asian fixed income strategies that aim to outperform an Asian fixed income index Long only Asia/Pacific ex Japan small cap equity strategies that aim to outperform an Asia/Pacific ex Japan small cap equity index Long only China equity strategies that aim to outperform a China equity index Long only active and passive China fixed income strategies that invest in RMB-denominated debt securities which are issued outside Mainland China and aim to track or outperform a China offshore fixed income index Long only active and passive China fixed income strategies that invest in RMB-denominated debt securities which are issued within Mainland China and aim to track or outperform a China onshore fixed income index Long only balanced strategy with a mix of asset classes including China A share equity and fixed income products. The strategy could have an absolute return objective or aim to outperform any customized benchmarks Long only China equity strategies that aim to outperform a China equity index, and structured in the form of an offshore fund Long only Greater China equity strategies that aim to outperform a Greater China equity index Long only Hong Kong balanced strategies that aim to outperform a mix of equity, fixed income indices or a cash benchmark Long only Hong Kong and China equity strategies that aim to outperform a Hong Kong and China equity index (effectively Greater China ex Taiwan equity strategies) Long only Hong Kong balanced strategies that aim to outperform a mix of equity and fixed income indices Long only active and passive Hong Kong fixed income strategies that aim to track or outperform a Hong Kong fixed income index Long only Hong Kong equity strategies that aim to outperform a Hong Kong equity index Long only active and passive Indian fixed income strategies that aim to track or outperform an Indian fixed income index Long only active and passive Indian fixed income strategies that aim to generate optimal returns consistent with moderate levels of risk and high liquidity CNY HKD HKD HKD HKD MERCER 6

10 Indian Equity Indonesian Bonds Indonesian Equity Korea Equity Korean Bonds Malaysian Bonds Malaysian Equity Pacific Basin ex Japan Equity Pacific Basin inc Japan Equity Philippines Bonds Philippines Equity Singapore Bond Singapore Equity Taiwan Bonds Taiwan Equity Thailand Bonds Thailand Equity Long only Indian equity strategies that aim to outperform an Indian equity index Long only active and passive Indonesian fixed income strategies that aim to track or outperform an Indonesia fixed income index Long only Indonesian equity strategies that aim to outperform an Indonesian equity index Long only Korean equity strategies that aim to outperform a Korea equity index Long only active and passive Korean fixed income strategies that aim to track or outperform a Korean fixed income index Long only active Malaysian fixed income strategies that aim to outperform a Malaysia fixed income index Long only Malaysian equity strategies that aim to outperform a Malaysia equity index All other Asian strategies other than those that fit the definitions for Emerging Markets, Hedge Funds/Absolute Return, Private Equity, Real Estate or Alternatives Long only active Pacific Basin ex Japan equity strategies that aim to outperform a Pacific Basin ex Japan equity index (inc Aus/NZ) Long only active Pacific Basin including Japan equity strategies that aim to outperform a Pacific Basin including Japan equity index Long only active and passive Philippines fixed income strategies that aim to track or outperform a Philippines fixed income index Long only Philippines equity strategies that aim to outperform a Philippines equity index Long only active and passive Singapore fixed income strategies that aim to track or outperform a Singapore fixed income index Long only Singapore equity strategies that aim to outperform a Singapore equity index Long only active and passive Taiwan fixed income strategies that aim to track or outperform a Taiwan fixed income index Long only Taiwan equity strategies that aim to outperform a Taiwan equity index Long only active and passive Thailand fixed income strategies that aim to track or outperform a Thai fixed income index Long only Thailand equity strategies that aim to outperform a Thai equity index MYR MYR SGD SGD MERCER 7

11 Australia Product Group Absolute Return Fixed Income Capital Stable Cash Credit Diversified Fixed Income Enhanced Index Fixed Income Equity Equity (Small Cap) Equity (Socially Responsible) Equity (Targeted Volatility) Fixed Income Inflation Linked Bonds Multi-Sector Balanced Multi-Sector Growth Short Duration Credit Fixed income strategies targeting cash plus 1-3% pa through the use of multiple alpha levers. These strategies will typically have a focus on managing downside risk Multi-sector strategies typically consisting of 30% growth assets (equities and property) and 70% defensive assets (fixed income and cash) Any cash-based or enhanced cash strategies seeking to add less than 1% per annum to the benchmark return Strategies benchmarked to an Australian non-government credit index predominantly investing in investment grade and non-investment grade debt securities Fixed income strategies with a combination of Australian and non- Australian investments that are managed to a hybrid domestic/foreign benchmark Fixed income strategies benchmarked to an Australian broad fixed income index seeking to add value with tracking error not more that 0.25% Long only and 130/30-type Australian equity strategies that aim to outperform a large cap or all cap Australian equity index Long only Australian equity strategies investing in stocks outside the S&P/ASX 100 Index but typically in the S&P/ASX 300 and S&P/ASX Small Ordinaries Indices Long only and 130/30-type Australian equity strategies that are tilted towards socially responsible stocks in some way and aim to outperform a large cap or all cap Australian equity index Australian equity strategies explicitly focusing on delivering returns with an absolute volatility significantly lower than the appropriate equity benchmark Fixed income strategies benchmarked to an Australian broad fixed income index Fixed income strategies invested predominantly in inflation linked assets and benchmarked to an Australian inflation linked fixed income index Multi-sector strategies typically consisting of 70% growth assets (equities and property) and 30% defensive assets (fixed income and cash) Multi-sector strategies typically consisting of 85% growth assets (equities and property) and 15% defensive assets (fixed income and cash) All other Australian strategies other than those that fit the definitions for Hedge Funds/Absolute Return, Private Equity, Real Estate or Alternatives Strategies targeting cash plus 2-4% pa through investment in predominantly credit securities. These strategies will typically have a low level of interest rate risk MERCER 8

12 Canada Product Group Balanced/Multi-Asset Target Date Target Risk Domestic Balanced Equity (Core) Equity (Growth Biased) Equity (Income Oriented) Equity (Small Cap) Equity (SMID Cap) Equity (Socially Responsible) Equity (Targeted Volatility) Long only strategies that invest in a mixture of primarily Canadian equity, fixed income and other assets to form a balanced portfolio Target date funds are marketed as series of funds with different maturity dates. Within a series, longer dated funds typically have a higher allocation to equities and a lower allocation to fixed income assets, and shorter dated funds typically have the opposite allocations. The asset mix of each fund is dynamically adjusted to reduce risk (equity exposure) in favour of more fixed income exposure as the time horizon to maturity of the fund shortens Target risk funds are typically marketed as series of 3 to 5 balanced funds, each with a targeted risk profile (e.g. conservative, moderate and aggressive funds). Each fund is regularly re-balanced to its target asset mix, so the equity and fixed income content (i.e. risk level) of each fund remains largely fixed Balanced strategies that invest only in Canadian equities and Canadian fixed income and that aim to outperform a composite equity/ fixed income benchmark Long only or long biased (130/30 type) large cap or all cap pure Canadian equity strategies, other than those that tend to have either a persistent growth bias or a value bias, that aim to outperform the S&P/TSX Composite or equivalent. Excludes strategies with non-canadian exposure that are included in the Total Equity category Long only or long biased (130/30 type) large cap or all cap pure Canadian equity strategies, that tend to have a persistent growth bias, that aim to outperform the S&P/TSX Composite or equivalent. Excludes strategies with non-canadian exposure that are included in the Total Equity category Long only or long biased (130/30 type) large cap or all cap pure Canadian equity strategies, that focus on a high dividend/high income approach, that aim to outperform the S&P/TSX Composite or equivalent. Excludes strategies with non-canadian exposure that are included in the Total Equity category Long only or long biased (130/30 type) small cap Canadian equity strategies that aim to outperform the S&P/TSX Small Cap index or equivalent Long only or long biased (130/30 type) small/mid cap Canadian equity strategies that aim to outperform the S&P/TSX Completion index, S&P/TSX Small Cap index or equivalent Long only or 130/30-type Canadian equity strategies that aim to invest in a socially responsible manner and to outperform a Canadian equity index (either a specialist SRI index or a mainstream Canadian index) Canadian equity strategies explicitly focusing on delivering returns with an absolute volatility significantly lower than the appropriate equity benchmark MERCER 9

13 Equity (Value Biased) Fixed Income (Core Plus Long) Fixed Income (Core Plus Universe) Fixed Income (Credit) Fixed Income (High Yield) Fixed Income (LDI) Fixed Income (Long-Term) Fixed Income () Fixed Income (Real-Return) Fixed Income (Short-Term) Fixed Income (Socially Responsible) Fixed Income (Universe) Money Market Long only or long biased (130/30 type) large cap or all cap pure Canadian equity strategies, that tend to have a persistent value bias, that aim to outperform the S&P/TSX Composite or equivalent. Excludes strategies with non-canadian exposure that are included in the Total Equity category Long only Canadian fixed income strategies with a long duration that invest in both core investment grade issues and opportunistically in non- Canadian debt, including emerging market and high yield debt and aim to outperform a Canadian long term bond index Long only Canadian fixed income strategies that invest in both core investment grade issues and opportunistically in non-canadian debt, including emerging market and high yield debt and aim to outperform a broad Canadian market index Long only Canadian fixed income strategies that invest predominately in corporate debt which can reasonably be benchmarked against a creditspecific Canadian bond index Long only Canadian fixed income strategies that invest a significant portion of assets in below-investment grade debt including US high yield debt and aim to outperform a corporate/high yield specific bond index Canadian strategies which focus on hedging risk relative to a specific pension fund liability curve using a variety of cash bonds and/or derivative instruments rather than aiming to outperform a published index or generate absolute returns Long only Canadian fixed income strategies that invest predominately in investment grade domestic debt with a long duration and aim to outperform a Canadian long term bond index All other Canadian fixed income strategies that do not satisfy any other classification Long only Canadian fixed income strategies that invest predominantly in Canadian Real Return bonds and aim to outperform a Canadian inflation linked index Long only Canadian fixed income strategies that invest in predominantly investment grade domestic debt with a short term duration and aim to outperform a Canadian short-term bond market index Long only Canadian fixed income strategies that are tilted towards socially responsible investments in some way and aim to outperform a Canadian bond market index Long only Canadian fixed income strategies that invest primarily in investment grade issues denominated in Canadian dollars and aim to outperform a broad Canadian market index Canadian fixed income strategies with a duration of less than one year that aim to outperform the Scotia Capital 91-Day T-Bill index or equivalent Mortgage Strategies that invest primarily in Canadian mortgages MERCER 10

14 Total Equity All other Canadian strategies other than those that fit the definitions for Hedge Funds/Absolute Return, Private Equity, Real Estate or Alternatives Long only or long biased (130/30 type) strategies that invest primarily in Canadian equities, but which also invest in non-canadian equities, and that aim to outperform the S&P/TSX Composite or equivalent, or a blended Canadian/foreign equity index Emerging Markets Product Group African Equity Asian Emerging Markets Equity Brazilian Equity BRIC Equity Eastern European Equity EMEA Equity Emerging Markets Balanced Emerging Markets Debt Hard Currency Emerging Markets Debt Blend Emerging Markets Debt Corporate Emerging Markets Debt Local Currency Emerging Markets Debt Long only or 130/30 type African equity strategies that aim to outperform an African index Long only or 130/30 Asian emerging markets equity strategies that aim to outperform a Asian Emerging Market equity index Long only or 130/30-type Brazilian emerging markets equity strategies that aim to outperform a Brazilian equity index Long only or 130/30-type Brazil, Russia, India and China emerging markets equity strategies that aim to outperform a BRIC equity index Long only or 130/30-type Eastern European emerging markets equity strategies that aim to outperform an Eastern European equity index Long only or 130/30-type Europe, Middle East and Africa emerging markets equity strategies that aim to outperform an EMEA equity index A blend of both emerging market debt and emerging market equity strategies Long only emerging market debt strategies that focus on hard currency denominated debt Long only emerging market debt strategies that focus on a strategic blend of hard and local currency denominated debt Long only emerging market debt strategies that focus on corporate debt Long only emerging market debt strategies that focus on local-currency denominated debt EMD strategies that do not fit into any of the existing EMD categories. Examples include Inflation-linked EMD and Local Currency EMD Corporates / / / / MERCER 11

15 Emerging Markets Debt Total Return Emerging Markets Equity Emerging Markets Equity Consumer Demand Emerging Markets Small Cap Equity Emerging Markets Equity Sustainability Themes Emerging Markets Equity Targeted Volatility Global Frontier Markets Latin American Equity MENA Equity Russian Equity South African Equity Long only or long/short strategies that are invested in an unconstrained blend of local or hard currency denominated sovereigns and/or corporates. The gross notional exposure of portfolios typically does not surpass 150%, and short positions are typically used to hedge Long only or 130/30-type global emerging markets equity strategies that aim to outperform a global emerging markets equity index Equity strategies focused on capturing the tailwinds associated with consumption growth in emerging markets. These strategies are likely to have a significant bias to the consumer sectors, and can have substantial exposure to companies listed in developed markets that generate a meaningful proportion of revenues or profits in emerging markets Long only or 130/30-type emerging markets small cap equity strategies that aim to outperform a global emerging market small cap equity index Long only or 130/30-type emerging market equity strategies that focus on sustainability themes (e.g. alternative energy) and aim to outperform an emerging markets equity index Emerging Market equity strategies explicitly focusing on delivering returns with an absolute volatility significantly lower than the appropriate equity benchmark Long only or 130/30-type emerging markets equity strategies that focus on global frontier markets and aim to outperform a relevant frontier emerging markets equity index Long only or 130/30-type Latin American emerging markets equity strategies that aim to outperform a Latin American emerging markets equity index Long only or 130/30-type Middle East and North Africa emerging markets equity strategies that aim to outperform a MENA emerging markets equity index All other global, regional or single country non-asian emerging markets strategies other than those that fit the definitions for Hedge Funds/Absolute Return, Private Equity, Real Estate or Alternatives Long only or 130/30-type Russian equity strategies that aim to outperform a Russian broad market equity index Long only or 130/30-type South African equity strategies that aim to outperform a South African broad market equity index // // // ZAR Engagement Services Product Group Overlay Voting and/or engagement across asset classes including Equity/Fixed Income/Real Estate/collaborative initiatives MERCER 12

16 Equity Sectors Product Group Cyclical Consumer Goods Financials Gold & Precious Metals Health/Biotech Industrials Natural Resources Non-Cyclical Consumer Goods Technology Telecommunication Services Utilities Long only and long/short equity strategies focusing on stocks of companies engaged in the production of automobiles, household goods, textiles and clothing and luxury goods. Also includes service industries such as hotel, casino, leisure, media and retail operations and services on a regional or global basis. These companies would be expected to be the most sensitive to economic cycles Long only and long/short equity strategies focusing on financial stocks on a regional or global basis. This includes banks, life, non life and other insurance companies, companies offering financial services and mortgage finance, and real estate investment trusts or real estate service companies Long only and long/short equity strategies focusing on gold and other precious metals stocks such as silver and platinum, and related products; including companies that mine or finance these on a regional or global basis Long only and long/short equity strategies focusing on stocks of companies involved in the manufacture or distribution of healthcare equipment or supplies; owners or operators of healthcare services or facilities and companies providing healthcare technology. Also companies engaged in the research, development or production of biotechnology and pharmaceutical substances on a regional or global basis Long only and long/short equity strategies focusing on stocks involved with the research, development, manufacture, distribution, supply, or sale of materials, equipment, products or services related to cyclical and natural resources industries on a regional or global basis Long only and long/short equity strategies focusing on companies involved in exploration, extraction, refining, production, distribution and/or supply of minerals (excluding precious metals) or mineral oil and gas, and providers of services for oil and natural gas exploration and production on a regional or global basis Long only and long/short equity strategies focusing on stocks of companies engaged in fishing and farming operations, manufacturers, distributors and retailers of food and drink, tobacco and personal products on a regional or global basis. This sector would be expected to be less affected by economic cycles Long only and long/short equity strategies focusing on technology stocks on a regional or global basis Long only and long/short equity strategies focusing on stocks involved with the development, manufacture or sale of telecommunications services on a regional or global basis Long only and long/short equity strategies focusing on stocks involved with the electricity, water, or gas distribution, or that operate as independent power producers on a regional or global basis MERCER 13

17 Europe Product Group Cash Enhanced (IBOR Plus net) Cash Pure (Sub-IBOR net) Denmark Equity European cash strategies with a benchmark of IBOR-plus European cash strategies with a sub-ibor benchmark Long only or 130/30-type Danish equity strategies that aim to outperform a Danish equity index Denmark Fixed Income Long only Danish fixed income strategies DKK Euro Convertibles Europe ex UK Equity Europe ex UK Small Cap Equity Europe Fixed Bank Loans Europe Fixed Buy and Maintain Credit Europe Fixed (Govt) Europe Fixed (Govt & Non-Govt) Europe Fixed (High Yield) Europe Fixed (Non-Govt) Europe inc UK Equity Europe inc UK Small Cap Equity Europe Inflation-Linked Bonds Europe Senior ABS/MBS Eurozone Equity Long only Eurozone fixed income strategies that invest primarily in Eurozone convertibles Long only or 130/30-type Europe ex UK equity strategies that aim to outperform a Europe ex UK equity index Long only or 130/30-type Europe ex UK small cap equity strategies that aim to outperform a Europe ex UK small cap equity index Long only European fixed income strategies that invest predominantly in floating rate senior secured/leveraged loans and aim to outperform a European leveraged loan index Long only European fixed income strategies that seek to capture the credit premium and illiquidity premium of the European credit markets, focusing on fundamentals predominantly within investment grade credit with minimal turnover, with a non-traditional benchmark approach Long only European fixed income strategies that invest primarily in European govt bonds Long only European fixed income strategies that invest in a mixture of European government and non-government bonds Long only European fixed income strategies that invest primarily in high yielding European bonds Long only European fixed income strategies that invest primarily in European non-government bonds Long only or 130/30-type Europe inc UK equity strategies that aim to outperform a Europe inc UK equity index Long only or 130/30-type Europe inc UK small cap equity strategies that aim to outperform a Europe inc UK small cap equity index Long only European bond strategies that invest primarily in inflation-linked European bonds Long only European fixed income strategies that invest predominantly in fixed and floating rate secured credit and aim to outperform a cash benchmark Long only or 130/30-type Eurozone equity strategies that aim to outperform a Eurozone equity index DKK // // MERCER 14

18 Eurozone Small Cap Equity Finland Equity German Balanced/ Multi-Asset German Equity Irish Balanced/ Multi-Asset Liability Driven Investment (LDI) Pooled Liability Driven Investment (LDI) Segregated Nordic Equity Norway DC Funds Norway Equity Long only or 130/30-type Eurozone small cap equity strategies that aim to outperform a Eurozone small cap equity index Long only or 130/30-type Finnish equity strategies that aim to outperform a Finnish equity index Long only strategies that invest in a mixture of equity, fixed income and other German assets to form a balanced portfolio Long only or 130/30-type German equity strategies that aim to outperform a German equity index Long only strategies that invest in a mixture of Irish equity, Irish fixed income and other assets to form a balanced portfolio Pooled strategies which focus on risk relative to pension fund liabilities rather than in absolute terms and which strive to hedge this risk using a variety of derivative instruments Segregated strategies which focus on risk relative to pension fund liabilities rather than in absolute terms and which strive to hedge this risk using a variety of derivative instruments Long only or 130/30-type Nordic equity strategies that aim to outperform a Nordic equity index Long only strategies that invest in a mixture of domestic and international equity, fixed income and other assets to form balanced Defined Contribution portfolios Long only or 130/30-type Norwegian equity strategies that aim to outperform a Norwegian equity index Norway Fixed Income Long only Norwegian fixed income strategies NOK Portuguese Balanced/ Multi-Asset Sweden Equity All other regional or single country European strategies other than those that fit the definitions for Emerging Markets, Hedge Funds/Absolute Return, Private Equity, Real Estate or Alternatives Long only strategies that invest in a mixture of Portuguese equity, Portuguese fixed income and other assets to form a balanced portfolio Long only or 130/30-type Swedish equity strategies that aim to outperform a Swedish equity index Sweden Fixed Income Long only Swedish fixed income strategies SEK Sweden Index-Linked Fixed Income Long only Swedish bond strategies that invest primarily in inflation-linked Swedish bonds Sweden Money Market Swedish fixed income strategies with a duration of less than one SEK Sweden Small Cap Equity Swiss Balanced/ Multi-Asset Long only or 130/30-type Swedish small cap equity strategies that aim to outperform a Swedish small cap equity index Long only strategies that invest in a mixture of Swiss equity, Swiss fixed income and other assets to form a balanced portfolio Swiss Cash Swiss cash strategies CHF NOK NOK SEK SEK SEK CHF MERCER 15

19 Swiss Equity Long only or 130/30-type Swiss equity strategies that aim to outperform a Swiss equity index Swiss Fixed Income Long only Swiss fixed income strategies CHF CHF Factor Investing Product Group Equity Low Volatility Equity Momentum Equity Multifactor Equity Equity Quality Equity Size Equity Value Factor indices with the aim of achieving global equity exposure to low volatility factors Factor indices with the aim of achieving global equity exposure to momentum factors Factor indices with the aim of achieving global equity exposure to multiple factors Factor indices with the aim of achieving global equity exposure to factors not defined elsewhere in the Factor Investing product group Factor indices with the aim of achieving global equity exposure to quality factors Factor indices with the aim of achieving global equity exposure to size (small cap) factors Factor indices with the aim of achieving global equity exposure to value factors Hedge Funds/Absolute Return Product Group Active Currency Alternative Risk Premia Commodities Long- Short Active currency strategies (i.e. other than those that focus primarily on risk reduction) Strategies that are aiming to capture non-traditional risk premia, typically extracted through systematically taking long/short positions within various asset classes. Sometimes also called alternative beta, alternative risk premia include style premia (such as value, momentum and carry) through to the hedge fund risk premia (e.g. merger arbitrage). Hedge fund replication strategies are included in this definition Active long short commodities strategies See note (a) See note (a) See note (a) Credit Long/Short Long/short and opportunistic credit strategies See note (a) MERCER 16

20 Distressed Debt Event Driven Fundamental Macro Fund of Hedge Funds Commodities Fund of Hedge Funds Event Driven and Credit Fund of Hedge Funds Long-Short Equity Fund of Hedge Funds Macro and Managed Futures Fund of Hedge Funds Multistrategy Fund of Hedge Funds Liquid Alternatives Equity Hedge Liquid Alternatives Event Driven and Credit Liquid Alternatives FoF Liquid Alternatives Multi-Asset Liquid Alternatives Multi-Strategy Liquid Alternatives Liquid Alternatives Trading Managed Futures Market Neutral Equity Long only and long short strategies that invest in the securities of companies or government entities which are already in default, under bankruptcy protection, or in distress and heading toward such a condition Strategies investing in securities that are impacted by certain company specific events or catalysts Broad global macro (and global tactical asset allocation) strategies (other than those that focus solely on currencies or commodities) that seek to add value predominately through fundamental analysis (rather than technical analysis of historic price series - see Managed Futures). May implement views systematically or on a discretionary basis Multimanager fund of hedge fund strategies that invest in Commodity focused hedge funds Multimanager fund of hedge fund strategies that invest in Event Driven and Credit strategy hedge funds Multimanager fund of hedge fund strategies that invest in Long-Short Equity strategy hedge funds Multimanager fund of hedge fund strategies that invest in Global Macro and Managed Futures strategy hedge funds Multimanager fund of hedge fund strategies that invest in multiple types of hedge fund strategy Multimanager fund of hedge fund strategies that are not covered by other Fund of Hedge Funds definitions Liquid long short equity strategies OR liquid equity market neutral strategies Liquid strategies investing in securities that are impacted by certain company specific events or catalysts OR Liquid opportunistic strategies investing in a broad range of debt instruments using a variety of methods Liquid Multimanager fund of hedge fund strategies Liquid multi-asset strategies with absolute return objectives; including diversified growth funds, idiosyncratic multi-asset strategies etc. Liquid single manager multistrategy hedge fund categories All liquid hedge fund or absolute return strategies that do not fit into any of the other categories Liquid trading strategies, including currency, fundamental macro, macro rates and volatility arbitrage Managed futures strategies (also sometime known as CTAs) that seek to add value predominately through technical analysis of historic price series, rather than fundamental analysis Long/short equity strategies that aim to keep their net equity market exposure close to zero on average over the long term See note (a) See note (a) See note (a) See note (a) See note (a) See note (a) See note (a) See note (a) See note (a) // // // // // // // See note (a) See note (a) MERCER 17

21 Long Short Equity Long/short equity strategies other than market neutral strategies See note (a) Multistrategy Tail Risk Hedging Strategies Single manager multistrategy hedge funds that invest opportunistically in a number of different hedge fund strategies All hedge fund or absolute return strategies that do not fit into any of the other categories Strategies that adopt positions within a portfolio that are designed to protect against downward market moves See note (a) See note (a) See note (a) Infrastructure Product Group Infrastructure Australasia Infrastructure Debt Infrastructure Emerging Markets Infrastructure Europe Infrastructure Funds of Funds Infrastructure Global Infrastructure Listed Securities Infrastructure North America Infrastructure Power/Energy Infrastructure funds that primarily invest directly into assets located in Australia and/or New Zealand Strategies providing capital, largely structured as loans, to borrowers involved in Infrastructure projects Infrastructure funds that primarily invest directly into assets located in Asia, Central and Eastern Europe, MENA and/or Latin America Infrastructure funds that primarily invest directly into assets located in Europe (including those focused solely on the UK) Infrastructure funds that primarily invest in other, third-party infrastructure funds (either listed or unlisted) Infrastructure funds that invest directly into assets on a global basis, primarily in developed regions (Europe, North America, Australasia) Infrastructure funds that primarily invest in listed equities, either on a global or regional basis and either on an active or passive basis Infrastructure funds that primarily invest directly into assets located in the US and/or Canada Infrastructure funds that primarily invest directly into assets in the traditional or renewable energy sectors Insurance Linked Strategies Product Group Catastrophe Insurance Linked Strategies where the predominant insurance risks are linked to natural and man-made catastrophes MERCER 18

22 Life Insurance Linked Strategies where the predominant insurance risks are linked to life risks such mortality or longevity Insurance Linked Strategies International Equity Product Group Flexible Equity Global Equity Core Global Equity Growth Global Equity Small Cap Global Equity SRI Global Equity Sustainability themes Global Equity Sustainability themes Clean Energy Global Equity Sustainability themes Water Global Equity Targeted Volatility Global Equity Value Long only equity strategies that aim to outperform cash-based, inflationbased or absolute return-based benchmarks as opposed to equity market indices Long only or 130/30-type global equity strategies, other than those that tend to have either a growth bias or a value bias, that aim to outperform a global equity index Long only or 130/30-type global equity strategies that tend to have a growth bias, and aim to outperform a global equity broad market or growth style index Long only or 130/30-type global small cap equity strategies that aim to outperform a global small cap equity index Long only or 130/30-type global equity strategies that are tilted towards socially responsible stocks in some way and aim to outperform a global equity index Long only or 130/30-type global equity strategies that focus on broad sustainability themes (such as climate change, demographics, environment) and aim to outperform a global equity index Long only or 130/30-type global equity strategies that focus on sustainability themes in Clean energy and aim to outperform a global equity index Long only or 130/30-type global equity strategies that focus on sustainability themes in Water and aim to outperform a global equity index Global equity strategies explicitly focusing on delivering returns with an absolute volatility significantly lower than the appropriate equity benchmark Long only or 130/30-type global equity strategies that tend to have a value bias, and aim to outperform a global equity broad market or value style index All other global or international equity strategies other than those that fit the definitions for Hedge Funds/Absolute Return, Private Equity, Real Estate or Alternatives // /NZD (see note (b)) // /NZD (see note (b)) // /NZD (see note (b)) // /NZD (see note (b)) // /NZD (see note (b)) // /NZD (see note (b)) // /NZD (see note (b)) // /NZD (see note (b)) // /NZD (see note (b)) MERCER 19

23 World ex Japan Equity Core World ex Japan Equity Growth World ex Japan Equity Targeted Volatility World ex Japan Equity Value World ex US/EAFE Equity Core World ex US/EAFE Equity Growth World ex US/EAFE Equity SRI World ex US/EAFE Equity Value World ex US/EAFE Equity Small Cap World ex US/EAFE Equity Targeted Volatility Long only or 130/30-type world ex Japan equity strategies, other than those that tend to have either a growth bias or a value bias, that aim to outperform a world ex Japan equity index Long only or 130/30-type world ex Japan equity strategies that tend to have a growth bias and aim to outperform a world ex Japan broad market or growth style index Global ex-japan equity strategies explicitly focusing on delivering returns with an absolute volatility significantly lower than the appropriate equity benchmark Long only or 130/30-type world ex Japan equity strategies that tend to have a value bias and aim to outperform a world ex Japan broad market or value style index Long only or 130/30-type world ex US or EAFE equity strategies, other than those that tend to have either a growth bias or a value bias, that aim to outperform a world ex US or EAFE equity index Long only or 130/30-type world ex US or EAFE equity strategies that tend to have a growth bias, and aim to outperform a world ex US or EAFE equity broad market or growth style index Long only or 130/30-type world ex US or EAFE equity strategies that are tilted towards socially responsible stocks in some way and aim to outperform a world ex US or EAFE equity index Long only or 130/30-type world ex US or EAFE equity strategies that tend to have a value bias, and aim to outperform a world ex US or EAFE equity broad market or value style index Long only or 130/30-type world ex US small cap equity strategies that aim to outperform a world ex US small cap equity index Global equity strategies explicitly focusing on delivering returns with an absolute volatility significantly lower than the appropriate equity benchmark JPY JPY JPY/ JPY / / / / / / International Fixed Product Group Absolute Return Global or regionally based products designed to add value in all market environments. These funds main goal is capital preservation and will attempt to add value through a diversified array of fixed income alpha sources / MERCER 20

24 Global Bank Loans Global Buy and Maintain Credit Global Convertibles Global Credit Global Fixed Income Broad Market/ Aggregate Global Fixed Income Sovereign Global Fixed Income SRI Long only global fixed income strategies that invest predominantly in floating rate senior secured/leveraged loans and aim to outperform a global leveraged loan index Long only global fixed income strategies that seek to capture the credit premium and illiquidity premium of the global credit markets, focusing on fundamentals predominantly within investment grade credit with minimal turnover, with a non-traditional benchmark approach Global convertibles strategies with no permanent country or regional biases Global investment grade credit strategies that aim to outperform a global investment grade credit benchmark index Global fixed income strategies that aim to outperform a broad market/aggregate global fixed income index Global fixed income strategies that aim to outperform a sovereign only or broad market/aggregate global fixed income index Global fixed income strategies that are tilted towards socially responsible investments in some way and aim to outperform a broad market/aggregate global fixed income index / See note (c) See note (c) See note (c) See note (c) Global High Yield Long only global high yield (sub-investment grade) credit strategies Global Inflation-Linked Bonds Multi-Asset Credit Secure Financing Multi-Asset Global inflation-linked bond strategies Multi-Asset Credit funds are mandates which will add value by rotating capital across various different fixed income asset classes and through issue selection. Asset allocation will generally focus on the higher yielding areas of the fixed income market, but some may also look to invest in investment grade credit and sovereign debt. Asset classes normally associated with these funds, but not exclusively will be: high yield, leveraged loans, non-agency RMBS, ABS, convertibles and EMD. They may also have a small allocation to stressed/distressed debt. We do not expect managers to focus on a benchmark but will look to deliver a return of cash + 4% to 6% over a full market cycle. However, these funds will have a high correlation to credit spreads and will underperform cash in a negative spread environment All other global or international fixed income strategies other than those that fit one of the definitions for Hedge Funds/Absolute Return Strategies that allocate capital across a range of debt securities that have a form of collateral backing or secured cashflow. These will include asset classes such as Asset Backed Securities including Mortgage Backed Securities, Collateralized Loan Obligations, Real Estate and Infrastructure Debt, Bank Loans, Direct Lending, Private Credit, Supply Chain Finance, Regulatory Capital, etc See note (c) MERCER 21