Non-Diversification Risk Clause Samples

Non-Diversification Risk. A non-diversified Underlying Fund may invest a greater percentage of its assets in the obligations of a single issuer than a diversified Underlying Fund, and consequently is more susceptible than a diversified Underlying Fund to any economic, political or regulatory occurrence that affects an individual issuer.

Non-Diversification Risk. The Emerging Bond Fund may invest a large percentage of its assets in securities issued by or representing a small number of issuers. As a result, the Emerging Bond Fund’s performance may depend on the performance of a small number of issuers. ● Non-U.S. Issuers Risk. Securities issued by non-U.S. issuers carry different risks from securities issued by U.S. issuers. These risks include differences in accounting, auditing and financial reporting standards, the possibility of expropriation or confiscatory taxation, adverse changes in investment or exchange control regulations, political instability, regulatory and economic differences, and potential restrictions on the flow of international capital. The Emerging Bond Fund is specifically exposed to Central and South American Economic Risk. ● Operational Risk. The Emerging Bond Fund is exposed to operational risk arising from a number of factors, including, but not limited to, human error, processing and communication errors, errors of the Emerging Bond Fund’s service providers, counterparties or other third-parties, failed or inadequate processes and technology or systems failures. The Emerging Bond Fund and Blackrock seek to reduce these operational risks through controls and procedures. However, these measures do not address every possible risk and may be inadequate for those risks that they are intended to address.

Non-Diversification Risk. The Fund is classified as “non- diversified.” This means that, compared with funds that are classified as “diversified,” the Fund may invest a greater percentage of its assets in securities or other instruments representing a small number of issuers or counterparties and thus may be more susceptible to the risks associated with these particular issuers or counterparties. As a result, the Fund’s performance may depend to a greater extent on the performance of a small number of issuers or counterparties, which may lead to more volatility in the Fund’s NAV.

Non-Diversification Risk. This risk arises when the Portfolio is not sufficiently diversified by investing in a wide variety of instruments. As mentioned above, the Portfolio Manager will attempt to maintain a diversified Portfolio in order to minimize this risk. xvii. Mutual Fund Risk: This risk arises from investing in units of Mutual funds. Risk factors inherent to equities and debt securities are also applicable to investments in mutual fund units. Further, scheme specific risk factors of each such underlying scheme, including a performance of their underlying stocks, derivatives instruments, stock lending, off- shore investments, etc., will be applicable in the case of investments in mutual fund units. In addition, events like a change in fund manager of the scheme, take over, mergers and other changes in status and constitution of mutual funds, foreclosure of schemes or plans, change in government policies could affect the performance of the investment in mutual fund units. xviii. Prospective clients should review / study the Disclosure Document carefully and in its entirety and shall not construe the contents hereof or regard the summaries contained herein as advice relating to legal, taxation, or financial / investment matters and are advised to consult their own professional advisor(s) as to the legal, tax, financial or any other requirements or restrictions relating to the subscription, gifting, acquisition, holding, disposal (sale or conversion into money) of Portfolio and to the treatment of income (if any), capitalisation, capital gains, any distribution, and other tax consequences relevant to their Portfolio, acquisition, holding, capitalisation, disposal (sale, transfer or conversion into money) of Portfolio within their jurisdiction of nationality, residence, incorporation, domicile etc. or under the laws of any jurisdiction to which they or any managed funds to be used to purchase/gift portfolio of securities are subject, and also to determine possible legal, tax, financial or other consequences of subscribing / gifting, purchasing or holding portfolio of securities before making an investment. xix. The Portfolio Manager is neither responsible nor liable for any losses resulting from the Services. xx. Clients are not being offered any guaranteed/assured returns. xxi. The investments under the Portfolio may be concentrated towards equity/equity related instruments of companies primarily belonging to a single or few sectors and hence shall be affected by risks associ...

Non-Diversification Risk. To the extent the Underlying Fund becomes “non-diversified”, an Underlying Fund may hold a smaller number of portfolio securities than many other funds. To the extent an Underlying Fund invests in a relatively small number of issuers, a decline in the market value of a particular security held by an Underlying Fund may affect its value more than if it invested in a larger number of issuers. The value of Underlying Fund Shares may be more volatile than the values of shares of more diversified funds. An Underlying Fund may become diversified for periods of time solely as a result of changes in the composition of the index (e.g., changes in weightings of one or more component securities). non-U.S. entity than about a U.S. entity, and many non-U.S. entities are not subject to accounting, auditing, legal and financial report standards comparable to those in the United States. Further, such entities and/or their securities may be subject to risks associated with currency controls; expropriation; changes in tax policy; greater market volatility; differing securities market structures; higher transaction costs; and various administrative difficulties, such as delays in clearing and settling portfolio transactions or in receiving payment of dividends. To the extent underlying securities held by the Fund trade on foreign exchanges that are closed when the exchange on which the Fund’s shares trade is open, there may be deviations between the current price of an underlying security and the last quoted price for the underlying security on the closed foreign market. These deviations could result in the Fund experiencing premiums or discounts greater than those of ETFs that invest in domestic securities. Securities traded on foreign markets may be less liquid (harder to sell) than securities traded domestically. Foreign governments may impose restrictions on the repatriation of capital to the U.S. In addition, to the extent that the Fund buys securities denominated in a foreign currency, there are special risks such as changes in currency exchange rates and the risk that a foreign government could regulate foreign exchange transactions. In addition, to the extent investments are made in a limited number of countries, events in those countries will have a more significant impact on the Fund. Investments in depositary receipts may be less liquid and more volatile than the underlying shares in their primary trading market.

Non-Diversification Risk. The Fund is non-diversified, which means that it may invest a larger portion of its assets in a smaller number of issuers. This could make the Fund more susceptible to economic or credit risks than a diversified fund.

Non-Diversification Risk. As a “non-diversified” investment company, the Fund may invest more than 5% of its total assets in the securities of one or more Portfolio Companies. Therefore, the Fund may be more susceptible than a diversified fund to being adversely affected by events impacting a single Portfolio Company, geographic location, security or investment type. Though the Fund will not be actively managed each day, the price at which at the terms that the Fund can purchase the Portfolio Company Securities will be based on the skills of the Originator’s team. Further, the Manager, will typically not actively be seeking for opportunities to sell Portfolio Company Securities, it is the current intention of the Manager that such exits will typically only occur on certain events, such as an IPO or a change of control. Prior to the launch of the Fund, the Originator had limited to no experience in purchasing securities in the secondary market. This limited experience may hinder the Fund’s ability to secure attractive investment opportunities and/or anticipate when the Fund should liquidate the investments. The investor is responsible for performing its own due diligence to determine whether to invest in the Fund. Further neither the Fund, the Manager, the Organizer of any of their affiliates make any determination regarding the suitability of an investment in the Fund. Investors should seek advice from their own financial, legal and tax advisors. The Portfolio Company Securities are passive investments. Even if the Fund has voting securities, it will not own enough shares to have a say in the management of a Portfolio Company. You will ultimately be dependent on the skills of the management of the Portfolio Companies, market and industry conditions related to the Portfolio Companies for the success of the Portfolio Company Securities. The Fund will generally not have a distribution until it sells Portfolio Company Securities, meaning that investors will only generally receive distributions upon a Liquidity Event. Upon such an event, investors will only receive payments after payment of fees to our Manager. At which point, investors will receive a return of their capital contribution (if there is sufficient funds) and, to the extent there are any remaining amounts, those will generally be split between our Manager and the investors, with the Manager receiving 20% of those amounts. These fees lower the value of your investment (compared to if you owned the Portfolio Company Securitie...