Daiwa SBI Investment Fund - Japan High Dividend Stocks Fund

INVESTMENT INVOLVES RISKS.  THE RISK FACTORS SET OUT BELOW ARE THE MAJOR RISK FACTORS OF INVESTING IN DAIWA SBI INVESTMENT FUND - JAPAN HIGH DIVIDEND STOCKS FUND ("SUB-FUND").  PLEASE REFER TO THE EXPLANATORY MEMORANDUM FOR DETAILS INCLUDING OTHER RISK FACTORS.

1.  Investment risk
The Sub-Fund's investment portfolio may fall in value due to any of the key risk factors below and therefore your investment in the Sub-Fund may suffer losses. There is no guarantee of the repayment of principal.

2.  Currency risk
Underlying investments of the Sub-Fund may be denominated in currencies other than the base currency of the Sub-Fund. Also, a class of units may be designated in a currency other than the base currency of the Sub-Fund. The net asset value of the Sub-Fund may be affected unfavorably by fluctuations in the exchange rates between these currencies and the base currency and by changes in exchange rate controls.

3.  Equity market risk
The Sub-Fund's investment in equity securities is subject to general market risks, whose value may fluctuate due to various factors, such as changes in investment sentiment, political and economic conditions and issuer-specific factors.

4.  High dividend equity risks
There is a risk that the value of the Sub-Fund's equity investments may decline or have a lower than average potential for price appreciation due to their high dividend nature. There is no guarantee that such investments will declare or pay out dividends.
The high dividend policy of the underlying securities may not have a direct relationship with the distribution policy of the Sub-Fund.  There is also no guarantee of dividend or distribution payments by the Sub-Fund during the period an investor holds units in the Sub-Fund.

5.  Risk associated with small-capitalisation / mid-capitalisation companies
The stock of small-capitalisation / mid-capitalisation companies may have lower liquidity and their prices are more volatile to adverse economic developments than those of larger capitalisation companies in general.

6.  Concentration risk
The Sub-Fund's investments are concentrated in Japan equity securities and may be concentrated in a specific industry sector. The value of the Sub-Fund may be more volatile than that of a fund having a more diverse portfolio of investments.
The value of the Sub-Fund may be more susceptible to adverse economic, political, policy, foreign exchange, liquidity, tax, legal or regulatory event affecting the Japanese market.

7.  Risks relating to hedging and the hedged classes of units
There can be no assurance that any currency hedging strategy employed by the Manager will fully and effectively eliminate the currency exposure of the Sub-Fund.
Hedging strategies may preclude investors from benefiting from an increase in the value of the Sub-Fund's base currency.
Any expenses arising from such hedging transactions will be borne by the Sub-Fund or the relevant currency hedged class.

8.  Risks associated with distribution out of/effectively out of the Sub-Fund's capital
In respect of Class A (JPY) Dis, Class A (HKD) Dis, Class A (USD) Dis and Class A (USD) hedged Dis, payment of dividends out of capital and/or effectively out of capital amounts to a return or withdrawal of part of an investor's original investment or from any capital gains attributable to that original investments. Any such distributions may result in an immediate reduction of the net asset value per share/unit.
The distribution amount and net asset value of the currency hedged distribution class may be adversely affected by differences in the interest rates of the reference currency of the currency hedged distribution class and the Sub-Fund's base currency, resulting in an increase in the amount of distribution that is paid out of capital and hence a greater erosion of capital than other non-hedged distribution classes.