WAY Fund Managers Limited Elite Income Plan Cash Trust

Transcription

1 Fund Managers WAY Fund Managers Limited Elite Income Plan Cash Trust Interim Short Report for the period to 31 July 2013

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3 Contents Page Report of the Investment Adviser 3 Portfolio Statement 4 Performance Record 5 General Information 7 Risk Profile 9 Management and Professional Service Providers' Details 10 2

4 REPORT OF THE INVESTMENT ADVISER for the period to 31 July 2013 Investment Objective and Policy The investment objective of the Trust is the generation of income through active management of a diversified portfolio of UK deposits, short-dated money market and other instruments. Performance Over the review period and since launch, the relative performance of Elite Income Plan Cash Trust has been as follows: Cumulative Performance to 31 6 months 1 year 2 years 3 years *Launch July 2013 Elite Income Plan Cash Trust -0.13% 0.04% 0.31% 0.61% 27.69% IMA Money Market Sector Average 0.10% 0.26% 0.66% 0.99% 33.98% Discrete Annual Performance to 31 July Elite Income Plan Cash Trust 1.26% 0.07% 0.29% 0.27% 0.04% *Since launch on 18 October 1999 Investment Review Throughout the review period the Trust s return has been achieved by placing weekly to six-monthly money market deposits with various banks and building societies. As a result of the Trust s investment policy, performance is dependent on the level of short-term interest rates set by the Monetary Policy Committee of the Bank of England in respect to the prevailing conditions of the UK economy. Interest rates over the period continued to remain at 0.5%, with little sign of this changing in the near term. In the period Mervyn King decided to step down as the Governor of the Bank, to be replaced by Mark Carney. There was much interest to see if Mr Carney would follow the path set out by his predecessor. In July he announced that the Bank of England would give us more details about future interest rate decisions, in particular the notion of forward guidance as a policy tool. The Monetary Policy committee also took the decision not to increase quantitative easing in the period keeping it at 375 Billion. Inflation over the six month period remained fairly steady, only falling in April to 2.4% before rising back to 2.7% in May. The Housing market has shown signs of recovery mainly lead by the South West and the Governments Help to buy scheme, but with unemployment still high there seems little pressure on the Bank of England to increase rates. Outlook We believe that the Bank of England will not want to increase interest rates too soon to stifle the recovery seen in the economy, so we expect to continue in a low interest rate environment for a year or two. Vestra Wealth LLP Investment Adviser to the Trust 12 August

5 PORTFOLIO STATEMENT as at 31 July 2013 Percentage Market of total Value net assets Holding % Money Market Short Term Deposits 98.99% (100.49%) 250,000 Anglo Irish 0.86% 14/08/ , % 270,000 Barclays 0.44% 28/11/13 270, % 250,000 Bristol & West 0.62% 14/08/ , % 250,000 Britannia 0.49% 08/08/ , % 230,000 Santander Bank 0.5% 24/10/ , % Market value of investments: 98.99%% (99.40%) 1,250, % Net other assets 1.01% (0.60% ) 12, % Total Net Assets 1,262, % Note: Comparative figures shown in brackets relate to 31 January

6 PERFORMANCE RECORD Price and Income History Income Units Calendar Highest Lowest Distribution Year Price Price per Unit p p p * Accumulation Units Calendar Highest Lowest Distribution Year Price Price per Unit p p p * * To 31 July 2013 Net Asset Value Income Units Calendar Net Asset Units Net Asset Value Year Value in per unit issue p 31/01/ , , /01/ ,295 66, /01/ , , /01/ , , /07/ , , Accumulation Units Calendar Net Asset Units Net Asset Value Year Value in per unit issue p 31/01/2010 3,855,907 3,203, /01/2011 2,706,607 2,243, /01/2012 2,382,249 1,969, /01/2013 1,238,817 1,022, /07/2013 1,071, ,

7 PERFORMANCE RECORD (continued) Income Units Price per Date Units p Launch Date 10 December Accounts Date 31 July Latest Date 19 September Accumulation Units Price per Date Units p Launch Date 18 October Accounts Date 31 July Latest Date 19 September On-going Charges Figure ("OCF") The OCF is the ratio of the relevant annualised total disclosable costs of each unit class from the most recent reporting period to the average Net Asset Value for each unit class over the same period. This is calculated in accordance with CESR/ The OCFs for the Trust for both income and accumulation unit classes as at 31 July 2013 were 0.55% (January 2013: 0.43%). Currently the annual management charge of 0.50%, the registrar fees and the TA fees are not being levied to the Synthetic Risk The SRRI table demonstrates where the Trust ranks in terms of its potential risk and reward. The higher the rank the greater the potential reward but the greater the risk of losing money. It is based on past data, may change over time and may not be a reliable indication of the future risk profile of the Trust. The shaded area in the table below shows the Trust s ranking on the Risk and Reward Indicator. Typically lower rewards, lower risk Typically higher rewards, higher risk

8 GENERAL INFORMATION Trust deed The Trust was established by a Trust Deed made between the Manager and the Trustee dated 30 September Prospectus Copies of the Trust s Prospectus are available free of charge from the Manager upon request. Unit type The Trust issues Income and Accumulation units. Pricing and dealing Dealing in all unit trusts operated by WAY Fund Managers Limited may be carried out between 09:00 and 17:00 hours on any business day. Investors and advisors may normally buy and sell units over the telephone and advisers may normally buy and sell units over the telephone. Units can only be bought in writing enclosing settlement in full. Prices are quoted on a forward basis. This means that all deals are based on a price that is calculated at the next valuation point (which is 12:00 hours on each business day) following receipt of instructions. Instructions received before 12:00 hours will be priced at 12:00 hours that day, whilst those deals taken later in the day will receive the next dealing price which is fixed at 12:00 hours on the following business day. In certain circumstances the Manager may charge a dilution levy, in accordance with FCA regulations, on subscriptions and redemptions of units, which is paid into the Trust and included in the Statement of Change in Net Assets Attributable to Unitholders. The levy is intended to cover certain dealing charges not included in the market value of the trust used in calculating the share price, which could have a diluting effect on the performance of the Trust The minimum initial lump sum investment in the Trust is 5,000 and the minimum amount you may sell back to the Manager at any one time is 1,000, providing you maintain a balance of 5,000. At its absolute discretion, the Manager may accept a lower minimum amount for the purchase and sale of units. A contract note in respect of any purchase will be issued immediately and full settlement, in cleared funds, is due within four business days of the purchase date. Unit certificates will not be issued. Instructions to sell your units may be required to be given in writing to WAY Fund Managers Limited, Cedar House, 3 Cedar Park, Cobham Road, Wimbone, Dorset BH21 7SB. A contract note confirming the instruction to sell will be issued immediately. Following receipt of a correctly completed Form of Renunciation, a cheque in settlement will be sent direct to you or your bank/building society within four business days. Management charges, spreads and yields The initial charge on the Trust is 5.25% and the annual management fee was 0.5% until 16 October 2009.Owing to the historically low interest rate environment WAY Fund Managers Limited elected to temporarily waive the annual management charge with effect from 17 October This action was taken in order to seek to protect investors from the effect of capital depreciation. The Collective Investment Schemes Sourcebook permits these to be increased subject to sixty days notice in writing to unitholders. As at 1 February 2010 the Trust moved from dual pricing to become a single priced Trust. As at 31 July 2013 the gross estimated yield for income share class was 0.51% and accumulation shares class 0.53%. This yield is calculated and published daily. Certain other expenses are met by the Trust, all of which are detailed in the Prospectus. 7

9 GENERAL INFORMATION (continued) Certain other expenses are met by the Trust, the nature of which are detailed in the Trust s Prospectus. Reports, in their short-form, will be sent to all unitholders on an annual and half-yearly basis. The long-form accounts are available free of charge on request from the Manager. Publication of prices The price of units in the Trust is quoted daily on the web pages of Financial Express at Capital Gains Tax An Authorised Unit Trust is exempt from UK Capital Gains Tax. An individual s first 10,900 of net gains on disposals in the 2013/2014 tax year are exempt from tax. Gains in excess of 10,900 for 2013/2014 are subject to a rate of tax dependent on an individual's total annual taxable income. Important information It is important to remember that the price of units, and the income from them, can fall as well as rise and is not guaranteed and that investors may not get back the amount originally invested. Past performance is not a guide to future performance. Changes in the rate of exchange of currencies, particularly where overseas securities are held, may also affect the value of your investment. The issue of units may be subject to an initial charge and this is likely to have an impact on the realisable value of your investment, particularly in the short term. You should always regard unit trust investment as long term. 8

10 RISK PROFILE The Manager uses a risk management process, as reviewed by the Trustee, enabling it to monitor and measure frequently as appropriate the risk of a Trust's positions and their contribution to the overall risk profile of the Trust. Currently derivatives may be used by the Trust for the purposes of efficient portfolio management (including hedging). It is not anticipated that the use of derivatives in this way by the Trust will alter or change the risk profile of the Trust. Before using the risk management process, the Manager will notify the FCA of the details including the methods for estimating risks in derivative and forward transactions and the types of derivatives and forward that will be used within the Trust together with their underlying risks and any relevant quantitative limits. Any material alteration of the above details of the risk management procedures will be notified by the Manager in advance to the FCA. Derivative exposure The Trust may invest in derivatives and forward transactions only where the exposure to which the Trust is committed by that transaction itself is suitably covered from within the Trusts' property. Exposure will include any initial outlay in respect of that transaction. Cover ensures that the Trust is not exposed to the risk of loss of property, including money, to an extent greater than the net value of the Trusts' property. Therefore, the Trust must hold property sufficient in value or amount to match the exposure arising from a derivative obligation to which the Trust is committed. The detailed requirements in accordance with COLL for cover of the Trust is set out below. Cover used in respect of one transaction in derivatives or forward transactions should not be used for cover in respect of another transaction in derivatives or a forward transaction. Cover for transaction in derivatives and forward transactions A transaction in derivatives or forward transaction is to be entered into only if the maximum exposure, in terms of the principal or notional principal created by the transaction to which the Trust is or may be committed by another person, is covered globally and individually. With regard to cover, each transaction must be covered individually by property of the right kind (i.e. appropriate stock or property for exposure in terms of property; cash or near cash for exposure in terms of cash) and also globally (i.e. after providing cover for existing transactions there is adequate cover for another transaction within the property of the Trust so that there can be no gearing). Cash not yet received into a Trust's property but due to be received within one month is available as cover for these purposes. Property which is the subject of a stock lending transaction is only available for cover if the Manager has taken reasonable care to determine that it is obtainable (by return or re-acquisition) in time to meet the obligation for which cover is required. The total exposure relating to derivatives held in a Trust may not exceed the net value of the property. 9

11 Manager and Registrar Investment Adviser WAY Fund Managers Limited* Vestra Wealth LLP Cedar House 14 Cornhill 3 Cedar Park London Cobham Road EC3V 3NR Wimborne Dorset BH21 7SB Fund Accountant Telephone: Apex Fund Services Limited* Veritas House Directors of the Manager 125 Finsbury Pavement P Wilcox (Chairman) London EC2A 1NQ P Legg V Hoare P Hugh-Smith R Coe Trustee State Street Trustees Limited* 20 Churchill Place Canary Wharf London E14 5HJ Independent Auditor Grant Thornton UK LLP 30 Finsbury Square London EC2P 2YU *Authorised and regulated by the Financial Conduct Authority ("FCA") 10

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