Currency Share Class definition
Examples of Currency Share Class in a sentence
Any profit and loss resulting from foreign exchange hedging will be allocated only to the Non Base Currency Share Class to which the specific hedge relates.
In the case of an Unhedged Currency Share Class a currency conversion will take place on subscriptions, redemptions, switches and distributions at prevailing exchange rates.
However, the gains/losses on and the costs of the relevant financial instruments will accrue solely to the relevant hedged Currency Share Class.
To the extent that hedging is successful for a particular Hedged Currency Share Class the performance of the Hedged Currency Share Class is likely to move in line with the performance of the underlying assets with the result that Shareholders in that Hedged Currency Share Class will not gain if the Hedged Currency Share Class currency falls against the Base Currency and/or the currency in which the assets of the particular Fund are denominated.
Derivative Specific Share Classes may be created in a Fund, for the purposes of (i) effecting currency hedging at the Share Class level in order to hedge the currency exposure of the assets of a Fund attributable to a particular Share Class; (ii) hedging against exchange rate fluctuation risks between the denominated currency of the Currency Share Class and the Base Currency of the Fund in which that Class of Shares is issued.
In such circumstances Shareholders of the relevant hedged Currency Share Class may be exposed to fluctuations in the Net Asset Value per Share reflecting the gains/losses on and the costs of the relevant financial instruments.
In the case of an Unhedged Currency Share Class, a currency conversion will take place on subscriptions, redemptions, and exchanges at prevailing exchange rates.
The Investment Manager may try but is not obliged to mitigate this risk by using financial instruments such as those described under the heading Portfolio Currency Risk, for hedged Currency Share Classes provided that such instruments shall in no case exceed 105% of the Net Asset Value attributable to the relevant hedged Currency Share Class.
Investors should be aware that this strategy may substantially limit Shareholders of the relevant hedged Currency Share Class from benefiting if the denominated currency falls against the Base Currency and/or the currency/currencies in which the assets of the Fund are denominated.
Changes in the exchange rate between the Base Currency and such denominated currency of a Currency Share Class may lead to a depreciation of the value of such Shares as expressed in the denominated currency.