05 Jun 2017 11:49

SEB Fund 5 – SEB Danish Mortgage Bond Fund changes July 2017

We plan to make changes in SEB Fund 5 – SEB Danish Mortgage Bond Fund, as detailed below. Kindly note that the changes described here will take effect as of 11 July 2017. 

Investors are not required to take action due to the changes described herein. If you do not wish to continue investing in the fund, you may redeem your units without being charged a redemption fee. However, you must do this before the cut-off time on 10 July 2017.

Summary of the main fund changes:

  • Financial instruments: investments in warrants and credit default swaps will no longer be allowed. Note that the fund currently does not invest in any such instruments.
  • Credit ratings for bonds: the fund will only be allowed to invest in bonds whose issuers have credit ratings ranging from AAA to a minimum of BBB- (investment grade) on Standard & Poor's scale or the equivalent.
  • Risk management process: the method we use to measure the fund's level of risk will change from the value at risk method to the commitment method. We decided to make this change because we regard the commitment method to be better suited to calculating the fund's global exposure.
  • Unit classes to be hedged: we will introduce a currency hedge in the below listed unit classes. As a result, the unit classes will also be renamed to reflect such change. The ISIN codes will, however, remain the same. The new names of the affected unit classes will be as follows:
Current denomination C (DKK) ID (DKK) ID (SEK)
New denomination C (H-DKK)  ID (H-DKK) ID (H-SEK)
ISIN codes LU0784737032  LU0784738279 LU0337316128 
  • Removal of the performance fee for the ID (SEK) unit class: we decided to remove the performance fee for the ID (SEK) unit class. The last payment of the performance fee for this unit class will be made in July 2017, if applicable.

In addition to the changes described above, we would like to inform you that the index used for the calculation of performance fee when applicable, the Effas Danish Government > 1 year index, has ceased to be published. We have replaced it with a comparable alternative, the Bloomberg Denmark Sovereign Bond Index. Consequently, the fund’s return will be compared to a composite index consisting of Nykredit Danish Mortgage Bond (75%) and Bloomberg Denmark Sovereign Bond Index (25%) when calculating excess performance.

Updated product documentation, including the prospectus for SEB Fund 5 dated July 2017, will be available on www.sebgroup.lu and on request at the registered office of the management company.

The Management Company, Luxembourg branch