SKANDIA GLOBAL FUNDS PLC - Fidelity Investments

Skandia Global Funds plc
Annual Report and Audited Financial Statements for the year ended 31 December 2011
NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 December 2011 (continued)
17. Derivatives and other Financial Instruments (continued)
(a) Market Risk (continued)
Skandia Japanese Equity Fund
The Skandia Japanese Equity Fund‟s strategy on the management of investment risk is driven by the Fund‟s investment
objective which is to seek to achieve asset growth through investment in a well-diversified portfolio of securities of Japanese
issuers or of issuers established outside Japan which have a predominant proportion of their assets or business operations in
Japan. The Fund may invest in ordinary shares or common stock, ADRs, GDRs, preference shares and warrants (not
exceeding 5 per cent of the Net Asset Value of the Fund). At least 85 per cent of the securities of the Fund will comprise
securities of companies which are constituents of the Tokyo Stock Exchange First Section Index.
The manager reviews the levels of investment risk on a no less than monthly basis, with particular emphasis on VaR and
leverage, where the latter exists.
The VaR for the Skandia Japanese Equity Fund is comparatively similar at the end of 2011 to the end of 2010, and has been
stable throughout the year. At the end of 2011, the VaR of the Fund was 14.24%. The minimum, average, and maximum
VaR were 13.06, 13.98 and 15.13 respectively.
The Fund does not actively employ leverage, and leverage has not exceeded the minimal level as disclosed in the Fund‟s
prospectus.
2011 VaR 2010 VaR
Total VaR 14.24% 16.31%
Total VaR Market Value (JPY) 1,295,598,431 1,383,446,666
VaR with Currency hedged 13.30% 16.33%
Skandia Pacific Equity Fund
The Skandia Pacific Equity Fund‟s strategy on the management of investment risk is driven by the Fund‟s investment
objective which is to seek to achieve asset growth through investment in a well-diversified portfolio of securities of Pacific
region issuers or of issuers established outside the Pacific region which have a predominant proportion of their assets or
business operations in the Pacific region. The Fund may invest in ordinary shares or common stock, ADRs, GDRs,
preference shares and warrants (not exceeding 5 per cent of the Net Asset Value of the Fund). At least 75 per cent of the
Fund‟s investments will comprise securities of companies which are constituents of the MSCI AC Pacific Free Ex Japan
Index. The Fund may invest up to 75 per cent of its Net Asset Value in the securities of issuers in emerging market countries.
The Fund may also invest up to 5 per cent of its Net Asset Value in real estate investment trusts listed, traded or dealt in on
Regulated markets that are not considered Emerging Markets.
The manager reviews the levels of investment risk on a no less than monthly basis, with particular emphasis on VaR and
leverage, where the latter exists.
The VaR for the Skandia Pacific Equity Fund is comparatively similar at the end of 2011 to the end of 2010, and has been
stable throughout the year. At the end of 2011, the VaR of the Fund was 13.81%. The minimum, average, and maximum
VaR were 13.18, 13.62 and 14.37 respectively.
The Fund does not actively employ leverage, and leverage has not exceeded the minimal level as disclosed in the Fund‟s
prospectus.
2011 VaR 2010 VaR
Total VaR 13.18% 14.32%
Total VaR Market Value (JPY) 102,268,565 160,612,277
VaR with Currency hedged 9.87% 10.61%
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