MARK SCHRODER   28 July to 14 August 2016

> application form [proxy]


The Proxy cache is comprised of funds managed by Proxy Mutual Management Limited. The custodian of the cache is Mutual Investment Holdings Pty Ltd (MIH), a wholly owned subsidiary of Proxy Fund Management Limited. The Proxy cache is an investment structure whereby the custodian appointed by the trustee of the scheme, Standard Asset Trusts Ltd, holds the assets of the cache, including tangible, intangible and assorted derivative assets, for the benefit of members holding units in the separate underlying funds. Investment management decisions are made by Proxy and delegated sub mangers. Assets of the funds are held separately. Members receive units in the cache, in whichever fund or funds are chosen.

Each fund is an investment entity for tax purposes. All returns of a fund will be attributed to investors in proportion to the units held in that fund. Any income attributed to investors is taxed within the fund at the tax rate selected. Each fund within the cache is actively managed. Funds are primarily invested directly (or indirectly through associated pooled funds) in unlisted equity securities and exchange traded derivatives. Each fund may also hold material levels of cash, real property, and fixed interest securities when deemed necessary.

The Proxy cache offers three investment funds – Emerging, Stable, and Socially Responsible. The funds are invested in the Mutual Management Fund (No 2) LLC. Sub managers, selected for their expertise in particular asset classes, are appointed by Proxy Mutual Management Limited to manage the assets of the cache. Members may invest in one or more of the funds in any proportion agreed, subject to meeting minimum investment and account balance requirements. Each investment fund has a benchmark asset mix dependent on its expected return and risk. The actual investment mix will vary from benchmark targets according to market valuations. An overvalued asset or assets within a portfolio will affect the actual ratio of assets held in a specified pool at any particular time.

As at the date of disclosure, there has been no material change in circumstances for either the authorised body, Proxy Mutual Management Limited, or its related bodies corporate. However, the asset mix benchmarks have been revised. These amendments alter the mix of defensive and growth assets in the Stable and Emerging funds. The percentage of growth assets in the Stable fund has increased by 12%. The percentage of defensive assets in the Emerging fund has reduced by 17%. These changes have been made to simplify the management structure of the cache and improve diversity and liquidity within the underlying funds. Further, note that the Proxy cache as a whole is increasing its exposure to derivatives. The value of these derivatives is dependent on the future value of underlying assets. Such underlying assets include assets directly held by, or otherwise available to, MIH.

The three funds, and assets within those funds, can be hedged and counter-hedged at the discretion of the cache manager. Net positions hedged by Proxy Mutual Management Limited, within expressed limits at minimal market exposure, can be executed via agreements entered into with external counterparties. Liquid intangible assets held within one fund may be realised in order to complete oversubscribed redemption requests in another fund where that fund’s tangible assets are illiquid, or otherwise held offline.