INVESTMENT PROPOSITION

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1 INVESTMENT PROPOSITION

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3 OUR PRINCIPLES AND HOW WE INVEST We understand the trust placed in us when choosing to invest with Charlotte Square. That is why we always look for the correct balance between the range of asset classes and individual investment selections - as the key to providing the greatest risk-adjusted returns and meeting our clients objectives.

4 Investment Philosophy Client and Introducer Communications Active Investment Management Broad and Diversified Approach Vested Interest Performance At Charlotte Square, our primary objective is to build consistent portfolio performance based on the fundamental principles of capital preservation and absolute returns. Our investment philosophy is based on four key values. CLIENT AND INTRODUCER COMMUNICATIONS We believe that adopting a direct and personal approach at every stage in the relationship is the best way to understand and deliver what our clients expect from us as their investment manager. ACTIVE INVESTMENT MANAGEMENT We believe in an active investment approach, based on fundamental analysis where we make tactical deviations in investment allocations based on market conditions, high or low performing asset classes, and other opportunities or risks. A BROAD AND DIVERSIFIED APPROACH We adopt a diversified investment approach to create portfolios across a broad range of asset classes, geographies, sectors, fund managers and individual securities. We believe that this is the best way to reduce risk and deliver returns. VESTED INTEREST PERFORMANCE (VIP) Our entire investment process is underpinned by our VIP philosophy. We actively seek company and fund managers with a significant personal investment in their own fund or business. We believe they have a greater incentive to perform better than those who don t a Vested Interest in their own Performance. We are, however, not constrained by this and hunt for opportunities outside the owner-managed space as well.

5 Investment Philosophy We purposefully adopt both a strategic and a tactical asset allocation approach to provide a long term investment strategy that offers the best returns in different market conditions. INSTITUTIONAL QUALITY INVESTMENT MANAGEMENT Talent our investment team has expertise in investment research and portfolio management across multiple asset classes for private and corporate clients, trusts and pension accounts. Rigour the investment process combines a top-down approach that assesses the macro-economic environment, with a bottom-up investment methodology that seeks to uncover specific opportunities with real potential. Customisation portfolios are carefully constructed according to each client s individual needs. These take into account income requirements, capital appreciation, tax status, risk preferences, time horizons and any other special requirements that our clients may have. Oversight we actively monitor the suitability of individual portfolios across a range of criteria including asset allocation, performance, volatility, concentration, drawdown, turnover and income objectives. We will then position the portfolios accordingly to either changing market or personal conditions over the long term.

6 The Charlotte Square Investment Process 1. ESTABLISH CLIENT NEEDS Investment Management Risk Profiling System 2. ASSET ALLOCATION STRATEGY Investment Universe Macro Economic Environment 3. INVESTMENT RESEARCH Charlotte Square Buy List Internal Investment Meetings 4. PORTFOLIO CONSTRUCTION & MONITORING Rigorous research and review process Our investment process is based on rigorous research for both asset allocation and investment selection. Our experience and expertise allows us to explore a wide investment universe across multiple asset classes to find the best investment solutions according to our clients needs. ESTABLISHING CLIENT NEEDS The starting point is always to obtain a clear understanding of the individual client s circumstances, goals and risk preferences in order to construct suitable investment strategies. The adopted strategy takes account of such factors as time horizon, income requirements, capacity to absorb losses and level of comfort investing in financial markets. ASSET ALLOCATION STRATEGY The house view on financial markets developed by our Asset Allocation Committee will be used to position our clients portfolio strategies accordingly. INVESTMENT STRATEGY AND SELECTION Individual investments will be selected based on the rigorous quantitative and qualitative research conducted by our investment team to provide the best investment opportunities, always aiming for the optimum risk-reward for our clients portfolios. PORTFOLIO MONITORING The final step is to create a portfolio based on the client s risk-return profile and individual investment objectives. Portfolios are then actively monitored and positioned accordingly, to navigate through changing market and personal conditions over a long-term time horizon.

7 The Charlotte Square Investment Process We recognise the importance clients and their professional advisors place on being able to directly access the investment manager who has personal knowledge of the client and their portfolios. ESTABLISHING CLIENT NEEDS AND OBJECTIVES Once the client risk profile has been established, we work with the client to assess their personal requirements (e.g. ethical investments only ). As part of this we also discuss and consider the following to help them achieve their investment goals: Tax Status Attitude to risk Time Horizons Income / Capital Growth Client Aims & Objectives Special Requirements e.g. ethical investment only We believe direct access to the manager making the decisions on the portfolio offers the best client outcome. For many clients, it is at this point in the process that we may advise them to seek specialist advice from their professional adviser regarding any tax or other financial implications. Direct Access to the Investment Managers Clients and their advisors will have direct access to the investment managers and the wider Charlotte Square team for a quick response to queries and individual requirements regarding changes in the market or their personal circumstances. Working in Partnership We are happy to work directly with clients and their professional advisers to ensure that we develop investment goals and risk levels, which are then reviewed periodically. It is through this communication that we develop investment strategies that continue to align with the different needs of each of our clients.

8 The Charlotte Square Investment Process At Charlotte Square, our Asset Allocation Committee meets regularly to discuss the various factors that are currently influencing financial markets to determine the appropriate allocation strategies across multiple asset classes ASSET ALLOCATION STRATEGY Our research starts with an assessment of the overall macro-economic environment to evaluate investment opportunities and movements across the globe, taking into account economic developments, emerging trends and political and social changes across several geographies. ASSET ALLOCATION STRUCTURE Investment Universe Asset Allocation Committee Analyse Macro- Economic Environment Long-term Strategic Allocation Tactical Asset Allocation Diversified view across Multiple Asset Classes The macro-economic analysis is then used in conjunction with additional asset-class specific research to help develop an assessment across the asset class spectrum. Our strategic asset allocation provides the foundation on which to safeguard long term investment objectives. FLEXIBLE ALLOCATION FRAMEWORK Strategic Asset Allocation Investment Selection Tactical Asset Allocation Investment Portfolio Within our flexible asset allocation framework, we will construct the strategic asset allocation strategy based on the long-term risk-return expectations of of asset classes, in combination with tactical asset allocation. This positions the portfolio according to market opportunities and risks.

9 The Charlotte Square Investment Process Charlotte Square has strong in-house investment and research capabilities across several asset classes. INVESTMENT & RESEARCH CAPABILITIES The structured research practice at Charlotte Square includes: Quantitative screening Bottom-up fundamental analysis In-person interviews with company management (we hold over 200 interviews a year). Charlotte Square has strong in-house investment and research capabilities across several asset classes. Investment selection is a bottom-up research driven process and analyses the key quantitative and qualitative factors across individual investments within the different asset classes. This information is used to develop an informed decision on whether a particular investment should be bought or sold. Areas of Investment Expertise Collectives Equities Fixed Income Alternatives Investment Trusts Unit Trusts ETFs Main Market AIM IPOs and Secondary Equity Offerings Gilts Corporate Bonds (including index-linked) Zero Dividend Preference Shares Property Infrastructure Hedge Funds Structured Products Commodities VIP Framework considered across asset classes The investment selection process is research driven and analyses the key quantitative and qualitative factors across individual investments within the different asset classes.

10 The Charlotte Square Investment Process A client focused approach to preserving capital and reducing risk through well diversified portfolios. PORTFOLIO CONSTRUCTION & MONITORING Asset Allocation Investment Decisions Portfolio Construction and Monitoring Client Reviews Investment Objectives We like to keep in touch with our clients on a regular basis and will provide the reporting package that best suits the clients needs. Specialist Investment Knowledge Once our investment managers are confident they understand the individual clients needs, they will assess and monitor the suitability of investments when constructing the investment portfolio. Monitoring The macro-economic conditions and broad asset classes will be continually analysed and individual holdings screened using quantitative and qualitative analysis. Reviewing and Rebalancing Portfolios Portfolios are continually reviewed to assess whether they remain in line with their stated objectives and are rebalanced if they start to deviate from the asset allocation decision. We also regularly review clients individual needs and objectives, so that we can continue to provide the most appropriate service to suit their requirements.

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12 40 Charlotte Square, Edinburgh EH2 4HQ T Important Information: The information in this document is not intended as an offer or solicitation to buy or sell securities or any other investment or product, nor does it constitute a personal recommendation. The value of investments, and the income from them, can go down as well as up, and you may not recover the amount of your initial investment. Past performance is not a reliable indicator of future results. Neither Charlotte Square, Raymond James nor any connected company accepts responsibility for any direct or indirect or consequential loss suffered by you or any other person as a result of your acting, or deciding not to act, in reliance upon any information contained in this document. Before contemplating any transaction, you should consider whether you require advice from your financial adviser. Charlotte Square is a trade name of Raymond James Investment Services Limited (Raymond James) utilised under exclusive licence. Raymond James is a member of the London Stock Exchange and is authorised and regulated by the Financial Conduct Authority. Registered in England and Wales No Registered Office Broadwalk House, 5 Appold Street, London EC2A 2AG. Pershing Securities Limited is a member of the London Stock Exchange and is authorised and regulated by the Financial Conduct Authority. CS23 09/15