Sun Life Malaysia Islamic World Equity Fund Report - November 2021

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1. Sun Life Malaysia Islamic World Equity Fund November 2021 FUND OBJECTIVE Seeks to achieve capital appreciation in the long term through investments in Shariah-compliant equities and equityrelated securities . FUND DETAILS Launch Date 13 February 2015 Domicile Malaysia Currency Ringgit Malaysia Launch Price RM1.0000 Units in Circulation 53.81 million units (30 November 2021) Fund Size RM92.44 million (30 November 2021) Unit NAV RM1.7180 (30 November 2021) Dealing Daily (as per Bursa Malaysia trading day) Fund Manager abrdn Islamic Malaysia Sdn Bhd Target Fund Aberdeen Standard Islamic World Equity Fund Benchmark MSCI ACWI Islamic (Shariah) Index Taxation 8% of annual investment income Fees ▪ Sun Life Malaysia does not impose any fund management charge on Sun Life Malaysia Islamic World Equity Income Fund ▪ 1.75% p.a. fund management charge is applied on the target fund’s NAV by Aberdeen Standard Islamic Investments (Malaysia) Sdn. Bhd. Suitable for investors: ▪ Have a long term investment horizon ▪ Target capital appreciation ▪ Willing to take higher risk for potential higher gains Risk Profile ASSET ALLOCATION OF THE TARGET FUND Equities Cash 90% - 100% 0% -10% SECTOR ALLOCATION OF THE TARGET FUND TOP HOLDINGS OF THE TARGET FUND Healthcare 24.3% TSMC 3.5% Information Technology 20.4% Procter & Gamble Co 3.4% Industrials 17.1% ASML Holding 3.3% Consumer Discretionary 9.5% L'Oreal 3.2% Consumer Staples 8.2% Nike Inc 3.0% Materials 6.6% Dechra Pharmaceuticals 2.8% Real Estate 4.0% Atlas Copco 2.5% Utilities 1.4% LULULEMON Athletica 2.5% Cash 8.5% Trane Technologies 2.5% Total 100.0% Aveva Group 2.5% Total 29.2% Sun Life Malaysia Takaful Berhad 200501012215 (689263-M) Level 11, 338 Jalan Tuanku Abdul Rahman, 50100 Kuala Lumpur Telephone (603) 2612 3600 Client Careline 1300-88-5055 wecare@sunlifemalaysia.com sunlifemalaysia.com
2. Sun Life Malaysia Islamic World Equity Fund November 2021 PERFORMANCE RECORD This fund feeds into Aberdeen Standard Islamic World Equity Fund ("target fund") with the objective to achieve capital appreciation in the long term through investments in Shariah-compliant equities and equity-related securities. Table below shows the investment returns of Sun Life Malaysia Islamic World Equity Fund versus its benchmark as at 30 November 2021: % YTD 1M 6M 1-Year 3-Years 5-Years Fund* 20.76 -0.21 10.21 23.91 57.00 66.98 Since Inception 71.80 Benchmark 18.35 -0.62 3.97 22.80 46.26 65.84 108.05 * Calculation of past performance is based on NAV-to-NAV Notice: Past performance of the fund is not an indication of its future performance which may differ. The fund performance is not guaranteed. FUND MANAGER’S COMMENTS • Global equities endured a challenging period, posting a negative return for the month (in local-currency terms). Markets initially weakened due to a spike in US inflation, but then sold off sharply in late November after the discovery of a new, more virulent Covid-19 variant, Omicron. • Our holding in Taiwan Semiconductor Manufacturing Co gained, as November saw large scale capital expenditure announcements from the major semiconductor players. Costco Wholesale’s resilient, annual-subscription business model helped its shares to do relatively well during a month of higher market volatility. China Resources Land’s shares rallied as investors now appear to be viewing the mainland developer as a beneficiary of industry consolidation. • Conversely, Paylocity shares came under pressure. Although the company reported better-than-expected earnings and raised guidance, some felt it was not enough to justify its current share price. Elsewhere, other holdings to underperform included software developer, Aveva. The company reported a widening loss in the six-month period to the end of September. Lastly, AstraZeneca underperformed. While the company delivered strong quarterly revenue growth, it posted a quarterly earnings loss, although much of this was expected. Despite this, the pharmaceutical company has a number of promising oncology drugs gaining sales momentum and drugs in development that are showing promising results. • We initiated a new position in integrated circuit designer Analog Devices. Sales included Inditex and Nestle, as both are no longer Sariah compliant. We reinvested the proceeds in Procter & Gamble and Target Group. We also exited Salesforce. Lastly, other activity involved topping up Adobe, AstraZeneca, Aveva, Linde, Lonza Group, Manhattan Associates, TSMC, Medtronic, Atlas Copco. Koninklijke DSM, Roche, Orsted and Schneider Electric. Sun Life Malaysia Takaful Berhad 200501012215 (689263-M) Level 11, 338 Jalan Tuanku Abdul Rahman, 50100 Kuala Lumpur Telephone (603) 2612 3600 Client Careline 1300-88-5055 wecare@sunlifemalaysia.com sunlifemalaysia.com
3. Sun Life Malaysia Islamic World Equity Fund November 2021 RISKS All investment carries some form of risks . The potential key risks include but are not limited to the following: External Investment Manager Risk Market risk Stock specific risk Concentration risk Shariah-compliant warrants risk Currency risk The fund management function of the target fund is delegated to Aberdeen Asset Managers Limited (“AAML”). AAML (“External Investment Manager”) is an entity within the Aberdeen Standard Investments group (“ASI Group”). Although the External Investment Manager is an entity within the ASI Group and they will have regular meetings with Aberdeen Standard to deliberate on the investment themes and portfolio decisions, there is still the risk that the External Investment Manager may not adhere to the investment mandate of the target fund due to an oversight. In the event of an oversight by the External Investment Manager, the NAV of the target fund will be adversely affected and the investment of the unit holders may be jeopardised through the loss of their capital invested in the target fund. Market risk refers to potential losses that may arise from changes in the market prices of the Shariah-compliant equities that the target fund invests in. Prices of the Shariah-compliant equities will fluctuate in response to various factors, for example, events or news that relates to the Shariahcompliant equities as well as general market or economic conditions. In mitigating this risk, Aberdeen Standard will invest in various sectors, thus the collapse of any particular sector would not have a major adverse impact on the value of the target fund. Any drop in the price of a particular Shariah-compliant stock held by the target fund may affect the unit price of the target fund adversely. This risk can be mitigated by investing in a wide range of Shariah-compliant equities in different sectors, thus spreading the element of risk. This risk refers to the risk that the target fund invests a substantial portion of its assets in a particular sector or geographical area which may cause the target fund to be more susceptible to adverse economic events affecting that particular industry or region. This risk is mitigated through the diversification process that Aberdeen Standard will employ in the management of the target fund whereby the target fund will hold a diversified portfolio of Shariah-compliant equities across various sectors and countries. The price, performance and liquidity of Shariah-compliant warrants are typically linked to the underlying Shariah-compliant equities and therefore subject to those risks. However, the price, performance and liquidity of such Shariah-compliant warrants will generally fluctuate more than the underlying Shariah-compliant equities because of the greater volatility of the warrants market. The erosion of value of the Shariah-compliant warrants may accelerate as the Shariah-compliant warrants approach its expiry date and the potential gains from a favourable price movement of the underlying Shariah-compliant equities may be offset by time decay. As the investments of the target fund may be denominated in currencies other than the base currency, any fluctuation in the exchange rate between the base currency and the currencies in which the investments are denominated may have an impact on the value of these investments. Investors should be aware that if the currencies in which the investments are denominated depreciate against the base currency, this will have an adverse effect on the NAV of the target fund in the base currency and vice versa. Investors should note that any gains or losses arising from the fluctuation in the exchange rate may further increase or decrease the returns of the investment. The impact of the exchange rate movement between the base currency of the target fund and the currency of the underlying investments may result in a depreciation of the value of the investments as expressed in the base currency of the target fund. Sun Life Malaysia Takaful Berhad 200501012215 (689263-M) Level 11, 338 Jalan Tuanku Abdul Rahman, 50100 Kuala Lumpur Telephone (603) 2612 3600 Client Careline 1300-88-5055 wecare@sunlifemalaysia.com sunlifemalaysia.com
4. Sun Life Malaysia Islamic World Equity Fund November 2021 RISKS (CONTINUED) Reclassification of Shariah status risk Emerging and developing market risk This risk refers to the risk that the currently held Shariah-compliant equities in the target fund may be reclassified as Shariah non-compliant in the periodic review of the equities by the Shariah Advisory Council of the Securities Commission Malaysia (SACSC), the Shariah Adviser or the Shariah boards of the relevant Islamic indices. If this occurs, Aberdeen Standard and the External Investment Manager will take the necessary steps to dispose of such equities. There may be opportunity loss to the target fund due to the target fund not being allowed to retain the excess capital gains derived from the disposal of the Shariah non-compliant equities. Aberdeen Standard and the External Investment Manager will be required to dispose of these equities immediately if the market price is above the investment cost. Should the market price be below the investment cost, Aberdeen Standard and the External Investment Manager may choose to hold on to these holdings until the market price meets the investment cost. Nevertheless, should Aberdeen Standard and the External Investment Manager decide to dispose of these equities below the investment cost, the target fund will be faced with the risk of realising its losses, thus negatively impacting the NAV of the target fund. In emerging and developing markets, the legal, judicial and regulatory infrastructure is still developing and there are much legal uncertainties both for the local market participants and their overseas counterparts. As the emerging and developing markets carry significant risks, investors of the target fund should therefore ensure that, before investing in the target fund, they understand the relevant risks and are satisfied that an investment in the target fund is suitable. Investors should note in particular that the proceeds from the sale of Shariah-compliant securities in some markets or the receipt of any dividends or other income by the target fund may be or may become subject to tax, levies, duties or other fees or charges imposed by the authorities in that market, including taxation levied by withholding at the source. Tax law and practices in certain countries into which the target fund invests or may invest in the future (in particular, emerging and developing markets) is not clearly established. It is possible that the current interpretation of the law or understanding of practice might change, or that the law might be changed with retrospective effect. It is also possible that the target fund could become subject to additional taxation in such countries that is not anticipated either at the date of this prospectus or when investments are made, valued or disposed of. Taxation Execution and Counterparty Risk In some markets there may be no secure method of delivery against payment which would avoid exposure to counterparty risk. It may be necessary to make payment on a purchase or delivery on a sale before receipt of the Shariah-compliant securities or, as the case may be, sale proceeds. Source : abrdn Islamic Malaysia Sdn Bhd Date : 30 November 2021 Disclaimer: The benchmark performance is not a guide to future performances which may differ. The performance of the fund is not guaranteed. The value of the fund will fluctuate and may fall below the amount of premiums paid and the fund value depends on the actual performance of the underlying investment. This material is for information purposes only and is subject to change at any time without notice. Sun Life Malaysia does not guarantee its accuracy, completeness, correctness or timeliness for any purpose or reason. This information should not be considered as advice or recommendation in relation to your account or particular investment objectives, financial situation or needs. You may not revise, transform, or build upon this material without prior written consent of Sun Life Malaysia. Before acting on any information you should seek independent financial advice. Sun Life Malaysia may suspend the unit pricing and defer the payment of benefits, other than death and total and permanent disability benefits, subscription or redemption of units, switching of funds, under this contract for a reasonable period in exceptional circumstances, such as and including intervening events resulting in temporary closure of any stock exchange. Sun Life Malaysia Takaful Berhad 200501012215 (689263-M) Level 11, 338 Jalan Tuanku Abdul Rahman, 50100 Kuala Lumpur Telephone (603) 2612 3600 Client Careline 1300-88-5055 wecare@sunlifemalaysia.com sunlifemalaysia.com