In order to qualify for inclusion in the Portfolio, at the time of investment and at the time of each periodic reconstitution and/or rebalancing, each European Dividend Growth Company comprising the Portfolio must (i) be a constituent of the STOXX Europe 600 Index; (ii) have a market capitalization of at least EUR15 billion; and (iii) have a history of dividend growth or, in the Manager’s view, have high potential for future dividend growth. The Manager will select equity securities of European Dividend Growth Companies to construct the Portfolio, giving consideration as applicable to the following, among other factors, of each issuer’s:
Dividend growth potential;
Balance sheet strength; and/or
In addition, up to 25% of the Portfolio may be invested in companies domiciled, incorporated, and/or listed in Europe that are not included in the STOXX Europe 600 Index but that would otherwise be European Dividend Growth Companies.
The Manager expects that between 20 and 25, but no fewer than 20, European Dividend Growth Companies will comprise the Portfolio at any given time.
Investors may elect to automatically reinvest their distributions in additional units of the Fund and realize the benefits of compound growth. Currently, no commissions or brokerage fees are allocated to plan participants. DRIP Plan
Units may be redeemed annually, beginning in 2019, on the second last Business Day of July (“Annual Redemption Date”), subject to certain conditions. In order to effect such redemption, the Units must be surrendered on or before the last Business Day of June prior to the applicable Annual Redemption Date. Unitholders whose Units are redeemed will receive a redemption price in an amount equal to 100% of the Net Asset Value per Unit on the Annual Redemption Date (less any costs and expenses associated with the redemption).
Covered Option Writing
The Manager will write covered call options from time to time on up to, but not more than, 33% of the Portfolio, in order to earn option premiums and lower the overall volatility of returns associated with owning a portfolio of equity securities. Call options will be written only in respect of the Portfolio Securities.