World Government Bond ex-U.S. Index Strategy


Investment Objective

Investment Objective

The Strategy seeks an investment return that approximates as closely as practicable, before expenses, the performance of its benchmark index (the "Index") over the long term.

BENCHMARK: FTSE World Government Bond Ex-U.S. Index


Investment Strategy

Investment Strategy

The Strategy is managed using an "indexing" investment approach, by which SSGA attempts to approximate, before expenses, the performance of the Index over the long term. The Strategy will not necessarily own all of the securities included in the Index.  The Strategy may attempt to invest in the securities comprising the Index, in the same proportions as they are represented in the Index. However, due to the large number of securities in the Index and the fact that many of the securities comprising the Index may be unavailable for purchase, it may not be possible for the Strategy to purchase some, or any, of the securities actually comprising the Index. In such a case, SSGA will select securities for the Strategy comprising a portfolio that SSGA expects will provide a return comparable to that of the Index.  The Strategy may at times purchase or sell futures contracts on the Index, or options on those futures, or engage in other transactions involving the use of derivatives, in lieu of investment directly in the securities making up the Index. The Strategy might do so, for example, in order to increase its investment exposure pending investment of cash in the bonds comprising the Index or as part of an index replication strategy. Alternatively, the Strategy might use such instruments to reduce its investment exposure in situations where it intends to sell a portion of the securities in its portfolio but the sale has not yet been completed. The Strategy does not hedge currency exposures back to its base currency.  The Strategy may use currency forwards in order to hedge non-U.S. dollar currency exposure. The Strategy seeks to follow the Index's methodology; however it may not always be possible to mirror the Index exactly; as such, any discrepancies may lead to possible tracking error. Currency hedging may also lead to increased portfolio turnover, due to the realization of profit and loss on the hedges. This increased turnover may lead to increased transaction costs.  The Strategy's return may not match the return of the Index. This Strategy may at times use deliverable and undeliverable currency forwards, to take or hedge exposures, in lieu of investment directly in the securities making up the Index or to enhance the Strategy's replication of the Index return. 

SSGA may implement the Strategy's asset allocations through investments in indexed investment vehicles, which typically attempt to replicate the returns of a specific index or group of indices. These will typically include investment pools (which may, but will not necessarily, be registered under the U.S. Investment Company Act of 1940, as amended) managed or sponsored by SSGA or an affiliate. Because of the unit issuance processes employed by the various underlying investment pools, allocations by the Strategy to certain pools on a given trading day may be invested in such pools at the next trading day's net asset value per unit. This will result in the portion of the Strategy's assets being invested in such investment pools being held in cash for the trading day and may result in increased tracking error. This could adversely impact the return to any investor.

Note:

All rights in the FTSE World Government Ex-U.S. Bond Index (the "Index") vest in the LSE Group company which owns the Index.  "FTSE®" is a trademark of the LSE Group company.

There are risks involved with investing, including possible loss of principal. You should refer to the Strategy's Disclosure Document (SDD) for a complete description of the risks of investing in the Strategy. Please contact SSGA's relationship management team for a copy of the SDD.