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Sovereign Diversified Monthly Income Portfolio
Class I and Class F Units
Goal
To provide income and long-term capital growth primarily through exposure to Canadian and foreign equity securities and, to a lesser extent, exposure to fixed-income investments.
Target Asset Allocation
Rusell Sovereign Fixed Income Pool — 20%
Rusell Sovereign Core Plus Fixed Income Pool — 20%
Russell Sovereign Canadian Equity Pool — 20%
Russell Sovereign US Equity Pool — 13%
Russell Sovereign Overseas Equity Pool — 14%
Russell Sovereign Global Equity Pool — 13%
The Portfolio intends to use futures contracts for non-hedging purposes in order to obtain equity exposure on its cash position. The Portfolio will typically hold cash so that it can meet anticipated redemption requests without selling portfolio securities. We expect to use futures to allow the Portfolio to hold cash while receiving a return, which is similar to that of the Portfolio's benchmark.
Who should invest in this fund?
The Sovereign Diversified Monthly Income Portfolio is suitable for those investors who:
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- want to receive monthly distributions and are willing to accept a return of capital
- want to invest in equities and fixed income
- have a moderate tolerance for risk
- are looking for medium to long-term growth
- can tolerate volatility in the short term
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Distribution policy
It is the current intention to distribute between 5% to 9% of the value of the Pool each year, regardless of whether the Pool earned that much in income. Each year, we will fix the annual distribution rate for that year, and this shall be expressed as a fixed amount per share.
The Pool will pay distributions monthly and will distribute any excess income and capital gains annually, in December. The character for Canadian tax purposes of distributions received by you during the year from the Pool will not be determined with certainty until the end of the Pool's taxation year. At such time, the income of the Pool will be allocated to all unitholders who received a distribution from the Pool during the year. This allocation of income, including the particular character of the Pool's income, will be pro rated based on the Pools total distributions for the year.
If the Pool's income was less than the annual distribution rate for that year, then the distribution will include a return of capital. If an investor elects to receive their monthly distribution in cash and not re-invest distributions, it is expected that the value of their investment in this Portfolio will decline over time.
Portfolio distributions will automatically be distributed to you in cash unless you inform Russell in writing that you prefer to have your distributions reinvested in additional securities. Distributions by the Pool are not guaranteed to occur on a specific date and the Pool is not responsible for any fees or charges incurred by you because the Pool did not effect a distribution on a particular day.
Investment Performance*
| 31-Aug-08 |
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3 mths |
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YTD |
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1 yr. |
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3 yrs. |
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5 yrs. |
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10 yrs. |
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Incep.* |
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| Class I-71 |
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-9.56 |
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-12.58 |
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-13.13 |
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-0.57 |
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N/A |
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N/A |
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2.41 |
| Class I-51 |
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-9.56 |
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-12.58 |
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-13.13 |
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N/A |
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N/A |
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N/A |
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0.27 |
* Periods of less than one year are not annualized. Due to regulatory restrictions, we are unable to show the performance of Class F since it has less than 12 months of returns available.
| Total Pool Assets: |
$793.5 million |
| as of September 30, 2008 |
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Summary of Investment Portfolio
| Top 25 Holdings* |
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% of Portfolio |
| as at June 30, 2008 |
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| Percentage of net assets ($884,992,409) of the Portfolio |
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| Russell Core Plus Fixed Income Pool Class O Units |
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20.4 |
| Russell Canadian Equity Pool Class O Units |
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20.4 |
| Russell Fixed Income Pool Class O Units |
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20.0 |
| Russell Global Equity Pool Class O Units |
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13.6 |
| Russell Overseas Equity Pool Class O Units |
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12.9 |
| Russell US Equity Pool Class O Units |
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12.8 |
| * This Portfolio has only 6 holdings as at June 30, 2008 |
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| Note: The statement of investment portfolio may change due to ongoing portfolio transactions of the Portfolio. This list will be updated within 60 days of each quarter end. |
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Note: The statement of investment portfolio may change due to ongoing portfolio transactions of the Portfolio. This list will be updated within 60 days of each quarter end.
Other Information
Eligibility for registered plans: This Pool is intended to be an eligible investment for registered plans.
Foreign property tax status: This Pool is not foreign property under the Income Tax Act (Canada).
Further information about the underlying funds is available at www.sedar.com
1 Class I-7 and Class I-5 were launched on November 15, 2004 and November 1, 2005 respectively. They are currently invested in Class O units of the Sovereign Canadian Equity Pool, Sovereign Canadian Fixed Income Pool, Sovereign US Equity Pool, Sovereign Overseas Equity Pool and Sovereign Global Equity Pool. For the allocations, please see the most recent prospectus.
Date of first publish: October 7, 2008
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Related INFORMATION |
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Products and services described on these websites are intended for Canadian residents only. Information on these sites should not be considered a solicitation to buy or an offer to sell a security to any person. Persons outside Canada may find more information about products and services available within their jurisdictions by going to Russell's worldwide site, http://www.russell.com.
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© Russell Investments Canada Limited 2008. All Rights Reserved.
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