Market/Price Risk – This is the possibility for the Fund to experience losses due to changes in market prices of equities or bonds. It is the exposure to the uncertain market value of these investments due to price fluctuations. It is the risk of the Fund to lose value due to a decline in securities prices, which may sometimes happen rapidly. The value of investments fluctuates over a given time period because of general market conditions, economic changes, or other events that impact large portions of the market such as political events, natural calamities, etc. As a result, the NAVPU may increase to make a profit or decrease to incur a loss.

Liquidity Risk – This is the possibility for the Fund to experience losses due to the inability to sell or convert the investments into cash immediately or in instances where conversion to cash is possible but at a loss. This may be caused by different reasons such as trading in securities with small or few outstanding issues, absence of buyers, limited buy/sell activity or an underdeveloped capital market. Liquidity risk occurs when certain investments in the Fund’s portfolio may be difficult or impossible to sell at a particular time which may prevent allowing withdrawal from the account with until its assets can be converted to cash. Even government securities which are the most liquid fixed income securities may be subjected to liquidity risk particularly when a sizeable volume is involved.

Counterparty Risk – This is the possibility for the Fund to be exposed to risks relating to the credit standing of its counterparties and to their ability to fulfill the conditions of the contracts it enters into with them. In the event of a bankruptcy or insolvency of a counterparty, the Fund could experience delays in liquidating the position and incur losses, including declines in the value of its investment during the period in which the fund seeks to enforce its rights, inability to realize gains on its investment during such period and fees and expenses incurred in enforcing its rights under the contracts. There is also a possibility that the above contracts are terminated due, for instance, to bankruptcy, supervening illegality or change in the tax or accounting laws relative to those at the time the contracts were originated.

Foreign Exchange Risk – This is the possibility for the Fund to experience losses due to fluctuations in foreign exchange rates. The exchange rates depend upon a variety of global and local factors such as interest rates, economic performance, and political developments. It is the risk of the Fund to currency fluctuations when the value of such investments denominated in currencies other than the base currency (Peso) depreciates. Conversely, it is the risk of the Fund to lose value when the base currency (Peso) appreciates. The NAVPU of a peso denominated Fund invested in foreign currency denominated securities may decrease to incur losses when the peso appreciates.

Country Risk – This is the possibility for the Fund to experience losses arising from investments in securities issued by/in foreign countries due to changes in the political, economic and social structures of such countries. There are risks in foreign investments due to the possible internal and external conflicts, currency devaluations, foreign ownership limitations and fiscal/monetary policies of the foreign country involved which are difficult to predict but must be taken into account in making such investments. Likewise, brokerage commissions and other fees may be higher in foreign securities. Government supervision and regulations of foreign stock exchanges, currency markets, trading systems and brokers may be less than those in the Philippines. The procedures and rules governing foreign transactions and custody of securities may also involve delays in payment, delivery or recovery of investments.

Equity Risk – The value of the Fund that invest in equity and equity related securities will be affected by economic, political, market, sectoral, and issuer specific changes. Such changes may adversely affect securities, regardless of the Fund’s specific performance. Additionally, different industries, financial markets, and securities can react differently to these changes. Such fluctuations of the Fund’s value are often exacerbated in the short-term as well. The risk that one or more companies in the Fund’s portfolio will fall, or fail, or rise, can adversely affect the overall portfolio performance in any given period.

Stock Market Cyclical and Concentration Risk – Stock markets tend to move in cycles, with periods of rising prices and periods of falling prices that will affect the Fund’s performance. In addition, the Fund’s targeted actual index may, at times, become focused in stocks of a particular market sector, which would subject the Fund to proportionately higher exposure to the risks of that sector.

Index Sampling Risk – The possibility that the securities selected for the Fund, in the aggregate, will not provide investment performance matching that of the Fund’s targeted actual index and its respective composition given the margin of variance allowed for the Fund.

• Except when specifically required by law, the Trustee shall have no responsibility to withhold income or other taxes on revenues from the Fund.
• Each participant should consult its own tax advisor as to the specific tax consequences of his/her investment in and redemption of units of participation in the Fund, including the applicability and effect of local and national laws of the Philippines, as well as consequences arising under the laws of any other taxing jurisdiction.

DISCLOSURES

•THE UNIT INVESTMENT TRUST FUND (UITF) IS A TRUST PRODUCT AND NOT A DEPOSIT ACCOUNT AND IS NOT INSURED OR GOVERNED BY THE PHILIPPINE DEPOSIT INSURANCE CORPORATION (PDIC).

•THE UITF IS NOT AN OBLIGATION OF, NOR GUARANTEED, NOR INSURED BY THE TRUST ENTITY OR ITS AFFILIATES OR SUBSIDIARIES.

•DUE TO THE NATURE OF THE INVESTMENTS OF A UITF, THE RETURNS/YIELDS CANNOT BE GUARANTEED. HISTORICAL PERFORMANCE, WHEN PRESENTED, IS PURELY FOR REFERENCE PURPOSES AND IS NOT A GUARANTEE OF SIMILAR FUTURE PERFORMANCE.

•ANY LOSSES AND INCOME ARISING FROM MARKET FLUCTUATIONS AND PRICE VOLATILITY OF THE SECURITIES HELD BY THE UITF, EVEN IF INVESTED IN GOVERNMENT SECURITIES ARE FOR THE ACCOUNT OF THE CLIENT. AS SUCH, THE UNITS OF PARTICIPATION OF THE CLIENT INTHE UITF, WHEN REDEEMED, MAY BE WORTH MORE OR LESS THAN HIS/HER INITIAL INVESTMENT/CONTRIBUTION.

•THE TRUSTEE IS NOT LIABLE FOR LOSSES UNLESS UPON WILLFUL DEFAULT, BAD FAITH OR GROSS NEGLIGENCE.

•THE INVESTOR MUST READ THE COMPLETE DETAILS OF THE FUND IN THE UITF’S PLAN, MAKE HIS/HER OWN RISK ASSESSMENT, AND WHEN NECESSARY, SEEK AN INDEPENDENT/PROFESSIONAL OPINION BEFORE MAKING AN INVESTMENT.