Risk Disclosure
UTGL Risk Disclosure Statement
PLEASE READ THIS RISK DISCLOSURE STATEMENT CAREFULLY. BY EXECUTING THE ACCOUNT MANDATE, ACKNOWLEDGEMENT AND CONFIRMATION, YOU ACKNOWLEDGE THAT YOU HAVE READ THIS RISK DISCLOSURE STATEMENT AND UNDERSTAND THE RISKS.
MARKET RISK
The investment can be a volatile instrument and may be subject to considerable fluctuations in value and other risks inherent in investing in the investment derivatives. The value of the investment may fall as rapidly as it may rise.
RISK OF UNDERLYING ASSETS
The investments could offer investors a return based on the returns of the underlying assets into which the investment proceeds shall be invested, while subject to the credit risk of the relevant counterparty and/or the reference entity, and of any other issuer or counterparty of the underlying assets and/or any reference entity or reference obligations relevant to any investment of investment proceeds. Returns on the investments are dependent on the returns to be received.
LOSS OF PRINCIPAL RISK
The Investments are NOT principal protected. In the worst case scenario, an investor may lose its entire investment in the investments. An investor should not purchase the investments unless it accepts the risk of losing all or a substantial part of its investment.
NOT A DEPOSIT
The investments are not time deposits and are therefore not protected by the Deposit Protection Scheme in Hong Kong.
UNDER PERFORMANCE RISK
Potential return on the investments may be less than returns on a bank deposit, a non-structured fixed coupon Investment or any other investments.
CREDIT RISK
The investments constitute direct and unsubordinated contractual obligations. The investments are collateralised and secured on the underlying assets into which the Investment proceeds shall be invested. The Trustee has minimal assets and share capital.
POSSIBLE CONFLICTS OF INTEREST RISK
There could be conflicts of interest arising out of the activities of the Trustee and/or its affiliates. The Trustee and/or its affiliates may act in a number of capacities in respect of the investments or the underlying asset(s) of the investments. Potential conflicts of interest may arise in relation to the Trustee and its affiliates and their respective roles as they may retain various powers of discretion which may have a material impact on the value and performance of the investments. These discretions may be exercised (or not be exercised) in a way that could adversely affect the investors.
POSSIBLE CONFLICTS OF INTEREST RISK
There could be conflicts of interest arising out of the activities of the Trustee and/or its affiliates. The Trustee and/or its affiliates may act in a number of capacities in respect of the investments or the underlying asset(s) of the investments. Potential conflicts of interest may arise in relation to the Trustee and its affiliates and their respective roles as they may retain various powers of discretion which may have a material impact on the value and performance of the investments. These discretions may be exercised (or not be exercised) in a way that could adversely affect the investors.
The Trustee and/or its affiliates may, at the date hereof or at any time hereafter, be in possession of information in relation to the underlying assets of the investments that are or may be material in the context of the investments and may or may not be publicly available to investors. There is no obligation on the Trustee and/or its affiliates to disclose to investors any such information, even where such information may be material to the decision by an investor as to whether or not to purchase the Investments.
The Trustee and its affiliates owe no duty to the investment holders to avoid the above conflicts or disclose them. If any of the above activities adversely affect the Investments, the Trustee and its affiliates are not responsible for any losses.
FOREIGN EXCHANGE RISK
Investors in the investment will bear a foreign exchange risk should the exchange rates change during the life of the investment. Any depreciation of currencies between subscription for the investments and repatriation of proceeds for the investments would mean that the return on the investments would be adversely affected. Investors should note that such fluctuation in the exchange rate may affect any positive price performance of the Investments such that the redemption amount payable maybe substantially increased or reduced.
GENERAL INVESTMENT RISK
There is no guarantee that in any time period, particularly in the short term, the Portfolio into which the Investment proceeds shall be invested will achieve appreciation in terms of capital growth. The Portfolio may be subject to market fluctuations and to all the risks inherent in all investments and markets. As a result, the net asset value of the Portfolio and therefore the redemption amount payable to the Investment Holder may go down as well as up. Investment in the Portfolio involves risks. It is possible that an investor may lose a substantial proportion or all of its investment in the Portfolio.
CONCENTRATION RISK
The investment of the Portfolio may be concentrated in a particular investment, market or country. A concentrated investment strategy may be subject to a greater degree of volatility and risk than a diversified investment strategy. To the extent the Portfolio concentrates its investment in a particular investment, market or country, its investments will become more susceptible to fluctuations in value resulting from adverse economic or business conditions with respect thereto. As a consequence, the return on investments of the investment proceeds into the Portfolio that adopts a concentrated investment strategy may be adversely affected by the unfavourable developments in the particular investment, markets or countries in which the Portfolio invests.
LIQUIDITY RISK
The market for some securities in which the Portfolio may invest may be relatively illiquid and the liquidity of certain of the markets generally has fluctuated substantially over time. Liquidity relates to the ability of the Portfolio to sell an investment in a timely manner. The market for relatively illiquid securities tends to be more volatile than the market for more liquid securities. Investment of the Portfolio's assets in relatively illiquid securities may restrict the ability of the Portfolio to dispose of its investments at a price and time that it wishes to do so.
RISKS RELATING TO THE LACK OF MANAGEMENT CONTROL BY INVESTMENT HOLDER
The investment holders have no right or power to take part in the management or control of the Portfolio. The Portfolio is managed solely by the Investment Manager. Investment holders must rely solely on the judgment of the Investment Manager in managing the investments and should not invest in the Investment unless willing to entrust all aspects of the management of the Portfolio and its investments to the Investment Manager.
TAXATION RISK
Each investor is advised to consult the investor's own tax advisers. Tax rules and their interpretation in relation to interests in the Portfolio may change during the life of the Portfolio which may have an adverse effect on the Portfolio, the investors and the Portfolio's investments and investment opportunities. There can be no assurance that any tax authority or court will agree with any particular interpretation of the relevant laws. Any relevant tax authority may conduct tax reviews on the transactions conducted by the Portfolio and impose additional taxes in respect of previous periods. If the Portfolio makes investments in a jurisdiction, the Portfolio or the investors may be subject to income or other tax in that jurisdiction. In addition, withholding taxes may be imposed on income of the Portfolio from investments in certain jurisdictions.
