Goldman Sachs N-11 Equity Portfolio A sub-fund of Goldman Sachs Funds SICAV People. Potential. Possibilities.

Transcription

1 Goldman Sachs N- Equity Portfolio A sub-fund of Goldman Sachs Funds SICAV People. Potential. Possibilities.

2 Contents The Next defined: People. Potential. Possibilities. 03 People: Young and expanding populations 06 Potential: Strong market growth and performance 07 Possibilities: Portfolio diversification 08 A look inside: What is the GS N- Equity Portfolio? 09 Active management in Growth and Emerging Markets 0 Why Goldman Sachs Asset Management? A closer look at our key characteristics

3 Goldman Sachs N- Equity Portfolio 03 The Next defined Goldman Sachs invests a large amount of time researching economic data in order to identify future investment opportunities. In 200, Jim O Neill defined the BRICs concept which has become synonymous with the emergence of Brazil, Russia, India and China as potential economic growth opportunities of the future. Four years later, the Next (N-) concept was introduced. The N- are a diverse group of countries that we believe could potentially rival the G7 2 in terms of economic growth over time: Bangladesh, Egypt, Indonesia, Iran 3, South Korea, Mexico, Nigeria, Pakistan, the Philippines, Turkey and Vietnam. Today, it is exciting to see that most of the positive momentum behind the world economy is being driven by the majority of the BRIC and N- countries. In 200, Jim O Neill was Head of Goldman Sachs Global Economics, Commodities & Strategy. From 200 to 203 he was Chairman of Goldman Sachs Asset Management (GSAM). 2 The G7 are Canada, France, Germany, Italy, Japan, the United Kingdom and the United States. 3 Please note that the GS N- Equity Portfolio is subject to legal and regulatory prohibitions with regard to investments in Iran. As a result of this the fund will not invest in Iran.

4 04 Goldman Sachs N- Equity Portfolio The Next : People. Potential. Possibilities. Turkey Pakistan Vietnam South Korea Today, monumental shifts in the global economy are taking place. We believe that the N- collectively could add over US$ 4 trillion to global GDP in the current decade, which is higher than the projected US contribution. 2 Egypt Philippines Mexico Nigeria Iran Bangladesh Indonesia The N- concept was invented by Goldman Sachs & Co. Research in 2005 and includes Iran. Please note that the GS N- Equity Portfolio is subject to legal and regulatory prohibitions with regard to investments in Iran. As a result of this the fund will not invest in Iran. 2 Goldman Sachs Asset Management, An Update on the N- s Progress and Future Trends, February 203.

5 Unlocking the Next The N- are a very broad and diverse group of countries in terms of geography and stages of economic development, with some countries still truly emerging from more nascent levels of development. They are, however, unified by the strength of their demographics they have some of the largest and youngest populations globally and collectively already account for 9% of the world s population. After the BRICs, the N- are the next countries that we believe could have a meaningful impact on the global economy. As at August 20. Source: United Nations Data, United Nations Population Division, World Population Prospects: The 200 Revision.

6 06 Goldman Sachs N- Equity Portfolio People: Young and expanding populations All the N- countries have comparatively large populations with young people that are in a position to earn and spend. While these large and young populations drive their respective economies forward, income levels will increase. When people rise up through different income bands, demand for various goods and services increases as they become affordable. The N- could have more new entrants to the high income class than the US by Average incremental consumption from the N- could be larger than that of the US for the next 25 years. The Rise of the BRICs and N- Consumer, Goldman Sachs Asset Management Strategy Series, 3 December 200.

7 Goldman Sachs N- Equity Portfolio 07 Potential: Strong market growth and performance With a collective annual return of 9.4%, the N- countries as a group outperform the developed markets, as well as the broad emerging and frontier markets. Impressively, over the next decades, the N- are estimated to grow by over 700%. By 2050 they could account for 7% of global GDP. 2 Percentage change in GDP from 20 to % vs. N- G7 Source: Bloomberg. Annualised 0-yr price return through 3 December Source: Goldman Sachs Global ECS Research. As at December Source: Goldman Sachs Global ECS Research. As at December %

8 08 Goldman Sachs N- Equity Portfolio Possibilities: Portfolio diversification Investing in the N- countries can provide broad portfolio diversification benefits, as well as exposure to countries in different stages of economic development. In light of the strong growth drivers, we are excited about the N- story and believe it provides a compelling equity investment opportunity. Geographical diversification Broad sector allocation 3 Different stages of development Goldman Sachs N- Equity Portfolio Country Breakdown Bangladesh.7% Vietnam.8% Pakistan 3.7% Egypt 3.9% Philippines 4.6% Nigeria 5.4% Mexico 23.4% Indonesia 5.0% Turkey 8.9% South Korea 2.7% Source: MSCI Emerging Markets Index, as at 3 December 202. Excludes Iran. Please note that the GS N- Equity Portfolio is subject to legal and regulatory restrictions with regard to investment in Iran. As a result of this the fund will not invest in Iran. For informational purposes only.

9 Goldman Sachs N- Equity Portfolio 09 A look inside: What is the GS N- Equity Portfolio? The Goldman Sachs N- Equity Portfolio is a long-only equity portfolio that seeks to deliver strong growth over the long term by investing in ten of the N- countries and picking stocks that we believe are well-positioned to deliver strong growth over the long term. Who should consider investing? Any investor seeking to: Generate potentially high returns, driven by the potential economic growth of the N- countries over the long term. Complement exposure to BRIC Equity in a well diversified portfolio. Access potential growth markets at attractive valuation levels, while being aware of the higher risk involved investing in these markets. Diversify their exposure to emerging markets and frontier markets by investing in the most dynamic of the emerging market economies. Please note that the GS N- Equity Portfolio is subject to legal and regulatory prohibitions with regard to investments in Iran. As a result of this the fund will not invest in Iran.

10 0 Goldman Sachs N- Equity Portfolio Active management in Growth and Emerging Markets In our view, the N- markets offer significant potential for alpha generation. At GSAM, we believe our presence in the Growth Markets positions our research analysts well to generate compelling investment ideas. Deeper understanding of local customs, languages, companies and market dynamics Local presence with a global perspective By being on the ground, our analysts can gain a deep understanding of local customs and frequent access to company management teams, ensuring a broad coverage of the investment universe. Delivering strong results over the long term with a disciplined process As the N- countries evolve, there are companies that will grow with them and meet the increased demand for goods and services. The local teams work to seek out quality companies which meet our strict investment criteria through rigorous, proprietary, bottom-up research. They look for companies which demonstrate the identified value and growth drivers. Using dedicated resources, including a separate risk management team, we aim to uncover quality attributes which are not yet reflected in the companies share price. This often involves researching the lesser-known, more local companies. Unbridled access to management teams, including those of small and mid cap companies Real-time access to local capital markets and news flow

11 THIS MATERIAL IS PROVIDED AT YOUR REQUEST FOR INFORMATIONAL PURPOSES ONLY. IT IS NOT AN OFFER OR SOLICITATION TO BUY OR SELL ANY SECURITIES. This marketing material has been issued by Goldman Sachs International, which is authorised and regulated by the United Kingdom Financial Conduct Authority (FCA). It only contains selected information on this fund and does not constitute an offer to buy shares in the fund. Prior to an investment, prospective investors should carefully read the latest offering documentation, including but not limited to the fund s prospectus which contains inter alia a comprehensive disclosure of applicable risks. The relevant articles of incorporation, prospectus, simplified prospectus/key investor information document as applicable and latest annual/semi-annual report are available free of charge from the fund s paying and information agent and/or from your financial advisor. Financial advisers generally suggest a diversified portfolio of investments. The fund described herein does not represent a diversified investment by itself. An investor should only invest if he/she has the necessary financial resources to bear a complete loss of this investment. This information must not be misconstrued as investment or tax advice. Prospective investors should consult their financial and tax adviser before investing in order to determine whether an investment would be suitable for them. Furthermore, this information must neither be misconstrued as financial research. It was not prepared in compliance with applicable provisions of law designed to promote the independence of financial analysis and is not subject to a prohibition on trading following the distribution of financial research. The information contained herein is only intended as a product description and is not prepared by the Goldman Sachs Global Investment Research (GIR) Department. The views and opinions expressed herein are valid as of the date of this publication only and may differ from the views and opinions expressed by the GIR Department or other departments or divisions of Goldman Sachs and its affiliates. Goldman Sachs International has no obligation to provide any updates or changes. Past performance does not guarantee future results, which may vary. The value of investments and the income derived from investments will fluctuate and can go down as well as up. A loss of principal may occur. The portfolio risk management process includes an effort to monitor and manage risk, but does not imply low risk. Although certain information has been obtained from sources believed to be reliable, we do not guarantee its accuracy, completeness or fairness. We have relied upon and assumed without independent verification, the accuracy and completeness of all information available from public sources Indices are unmanaged. The figures for the index reflect the reinvestment of dividends but do not reflect the deduction of any fees or expenses which would reduce returns. Investors cannot invest directly in indices. The strategy may include the use of derivatives. Derivatives often involve a high degree of financial risk because a relatively small movement in the price of the underlying security or benchmark may result in a disproportionately large movement in the price of the derivative and are not suitable for all investors. No representation regarding the suitability of these instruments and strategies for a particular investor is made. The securities of emerging markets may be less liquid and more volatile and are subject to a number of additional risks, including but not limited to currency fluctuations and political instability. Investing in the N- countries is subject to risk of loss due to adverse social, political, regulatory or economic events in those countries. Investments into the N- countries may have to be implemented via equity swaps, equity index swaps, futures, participation notes, options and other derivatives which may involve additional financial counterparty risk. Changes in exchange rates may materially impact the value of investments in the N- countries. Financial advisers generally suggest a diversified portfolio of investments. Whilst the N- countries have some diversification in themselves, there may be times when these markets are all impacted in parallel by the same factors, which may make an investment in N- more volatile than a more diversified investment and an investor should only invest if he/she has the necessary financial resources to bear a complete loss of this investment. References to indices, benchmarks or other measures of relative market performance over a specified period of time are provided for your information only and do not imply that the portfolio will achieve similar results. The index composition may not reflect the manner in which a portfolio is constructed. While an adviser seeks to design a portfolio which reflects appropriate risk and return features, portfolio characteristics may deviate from those of the benchmark. The term N- is a registered service mark of Goldman, Sachs & Co. Confidentiality: Opinions expressed are current opinions as of the date appearing in this material only. No part of this material may, without Goldman Sachs Asset Management s prior written consent, be (i) copied, photocopied or duplicated in any form, by any means, or (ii) distributed to any person that is not an employee, officer, director, or authorised agent of the recipient. 203 Goldman Sachs. All rights reserved OSF.OTU

12 Why Goldman Sachs Asset Management? A closer look at our key characteristics Fund Facts: Investment approach: Bottom-up stock picking Investment style: Style agnostic Capitalisation: Small, Medium and Large Range of holdings: holdings Inception date: 26 January 20 Vehicle: SICAV Portfolio, UCITS III Fund Inventor of N- and BRICs. We have a strong history of translating economic concepts into compelling investment ideas. Our investment teams continue to benefit from the unique investment expertise and analysis of the Goldman Sachs Economics Research Group. Conviction-driven, forward-looking investing. Rather than a benchmark orientation, our approach results in portfolios with potential for meaningful long-term excess returns. Locally based analysts. The fund is managed by the N- Equity team. Lead portfolio manager Maria Elena Drew leverages the proven stock-picking ability of 2 investment professionals. The team also draws on the expertise of our emerging markets debt and currency experts to understand how non-investment factors, such as unexpected management changes or changes in the political climate, may affect companies growth. Risks to N- Before investing in this Fund prospective investors are urged to consult with their financial advisor as to the appropriate percentage of investment in this Fund compared to their overall investment portfolio. The Fund invests primarily in the N- countries. Therefore, it is subject to risk of loss due to adverse social, political, regulatory or economic events in those countries. The Fund may invest into the N- countries via equity swaps, equity index swaps, futures, participation notes, options and other derivatives which may involve additional financial counterparty risk. The Fund invests in a portfolio of equity investments that are tied to the N- countries. Whilst the countries are diverse, there may be times when these markets are all impacted in parallel by the same factors, which may make the Fund more volatile than a more diversified equity Fund. This Fund and its share classes are not hedged. Therefore, changes in exchange rates may cause the value of investments to fall as well as rise. For more information on the GS N- Equity Portfolio, please contact your Goldman Sachs Asset Management relationship manager or visit: