How Canada's 1st Guaranteed Mutual Funds Work
IA Clarington Target Click Funds - Canada's
1st guaranteed mutual funds - provide balanced exposure
to global equity markets with a guarantee. At maturity, each fund
guarantees to payout the highest month-end price it ever
A portion of the portfolio is always invested in strip bonds, which
supports payment upon maturity of the Funds's guaranteed amount.
The amount invested in strip bonds depends on the number of years
to maturity in each Fund. The closer to maturity, the greater the
allocation to bonds. See disclosure for additional information
about the Funds's guaranteed amount at maturity.
The remaining portfolio is allocated to cash and a global equity
mutual fund ("GEEF"). The GEEF obtains exposure to six global stock
market indices through an actively managed derivatives portfolio.
Through the use of derivatives the Portfolio Manager seeks to
enhance the monthly returns of each index. Therefore, if a Target
Click Fund's stated allocation to equities is 30%, the return
characteristics of the equity component is expected to behave as if
the Fund had an effective exposure to equities greater than that.
See disclosure for additional information about the historical
effects of enhancement.
Rebalancing occurs annually on the last business day in
February. The Fund rebalances its cash and equity positions to
equal amounts, selling equities in rising markets and buying them
in falling markets.
IA Clarington Target Click 2025
Each of the IA Clarington Target Click Funds (the "Funds") holds
fixed income securities issued by the Canadian federal or
provincial governments that support payment on the Fund's maturity
date of the highest month-end net asset value per unit achieved
during the life of the Fund. In normal circumstances, it is
expected that this fixed income component would ensure payment of
the guaranteed value. In addition to the fixed income component,
Industrial Alliance Insurance and Financial Services Inc.
("Industrial Alliance"), the parent company of the Portfolio
Advisor to the Funds, has provided a guarantee to each of the Funds
that it will pay any shortfall to the Fund if the net asset value
of any Fund is less than its guaranteed value at maturity. If such
a payment were required to be made, it would be subject to the
creditworthiness of Industrial Alliance.
Each Fund's maturity date will occur on June 30 of the year
specified in the Fund's name. The guaranteed amount will benefit
the investors who hold units of the Fund on that maturity date. In
some circumstances, the maturity date for a Fund may be
accelerated, in which case the Fund will pay the greater of the net
asset value on that accelerated maturity date and the net present
value of the guaranteed amount, less any applicable redemption
Commissions, trailing commissions, management fees and expenses
all may be associated with mutual fund investments. Please read the
prospectus before investing. Any indicated rates of return are the
historical annual compounded total returns including changes in
security value and reinvestment of all distributions/dividends and
does not take into account sales, redemption, distribution or
optional charges or income taxes payable by any security holder
that would have reduced returns. Mutual funds are not generally
guaranteed, their values change frequently and past performance may
not be repeated. However, each IA Clarington Target Click Fund has
the benefit of the guarantee described above.
The information contained above may include estimates, projections
and other "forward-looking statements." Actual events may differ
substantially from those presented herein. IA Clarington
Investments Inc. assumes no duty to update any such forward-looking
statements or any other information or opinions in this document.
IA Clarington makes no representation that future investment
performance will conform to past performance and it should never be
assumed that past performance foretells future performance.