Collective Investment Schemes M3 Flashcards

What is a Singapore Variable Capital Company (VCC)?

Answer: A corporate structure specifically designed for investment funds

A VCC is a corporate structure introduced in Singapore specifically for investment funds, offering operational flexibility and tax benefits.

What is switching in unit trusts?

Answer: Moving your investment from one fund to another within the same fund house

Switching allows unitholders to move their investment from one fund to another managed by the same fund manager, often at a reduced fee.

What disclosure requirements apply to CIS in Singapore?

Answer: Must provide a prospectus, product highlights sheet, and regular reporting

CIS must provide a registered prospectus, a product highlights sheet summarizing key features and risks, and ongoing periodic reports to investors.

What is a product highlights sheet?

Answer: A concise document summarizing a CIS's key features, risks, and costs

A product highlights sheet is a short, reader-friendly document that highlights key information about a CIS including its objectives, risks, fees, and past performance.

What is the role of the investment committee in a fund?

Answer: To oversee investment decisions and ensure adherence to the fund's mandate

The investment committee provides oversight of the fund manager's investment decisions, ensuring they align with the fund's stated objectives and mandate.

What is a target-date fund?

Answer: A fund that automatically adjusts its asset allocation as it approaches a specific target date

A target-date fund gradually shifts from aggressive investments (equities) to conservative investments (bonds) as the target retirement date approaches.