Non-diversification risk is the risk that the Fund may invest a larger percentage of its assets in securities of a few companies than that of a diversified fund. As a result, the Fund’s performance may be disproportionally impacted by the performance of relatively few securities. For the Fund, the non-diversification risk of the underlying index is mitigated by adopting the MSCI’s 10/40 Index Methodology as described in section 2.2 where maximum holding weights are applied to individual and group of individual securities. Please refer to http://www.msci.com/ for further details on how this methodology works.
Concentration risk is the risk that assets of the Fund are highly concentrated in a sector or group of sectors. To the extent that it concentrates its assets in a single sector or group of sectors, the Fund will be subject to the risk that economic, political or specific conditions that have a negative impact on that sector or group of sectors will negatively impact the Fund to a greater extent than if the Fund’s assets were invested in a wider variety of sectors.
While the Index is constructed to have an expected dividend yield that is greater than the parent index, no assurances can be made that this will be achieved in all conditions, and in particularly over shorter periods.