Cap Equity Fund Institutional S Accumulation

OBJECTIVES AND INVESTMENT POLICY Investment Objective To generate growth over the long term (5 years or more) by investing in US and Canadian small and mid-capitalisation equities (company shares). Performance Target: To achieve the return of the Russell 2500 Index plus 3% per annum over rolling five years periods (before charges). The Performance Target is the level of performance that the management team hopes to achieve for the fund. There is however no certainty or promise that they will achieve the Performance Target. Performance comparator: Investment Association North America Equity Sector Average. The ACD believes this is an appropriate target for the fund based on the investment policy of the fund and the constituents of the index. Investment Policy Portfolio Securities - The fund will invest at least 70% in equities and equity related securities of small and mid-capitalisation companies listed, incorporated or domiciled in the United States of America (US) and Canada or companies that derive a significant proportion of their revenues or profits from US or Canadian operations or have a significant proportion of their assets there. - For all investments, small and mid-capitalisation companies are defined as any stock having a market capitalisation less than the 20th percentile stock of the Russell 3000 Index (which is used as a representation of the overall US market). - The fund may also invest in larger capitalisation companies listed, incorporated, or domiciled in the US and Canada. - Investment in companies listed, incorporated or domiciled in or having a significant proportion of their assets in Canada or deriving a signification proportion of their revenue or profits from Canadian operations is not expected to exceed 20% of the fund's assets. - The fund may also invest in other funds (including those managed by abrdn) and money-market instruments, and cash. Management Process - The management team use their discretion (active management) to maintain a diverse asset mix at sector and stock level. - Their primary focus is on stock selection using research techniques to select individual holdings. The research process is focused on finding high quality companies at attractive valuations that can be held for the long term. - In seeking to achieve the Performance Target, the Russell 2500 Index is used as a reference point for portfolio construction and as a basis for setting risk constraints. The expected variation (''tracking error'') between the returns of the fund and the index is not ordinarily expected to exceed 10%. Due to the active nature of the management process, the Fund's performance profile may deviate significantly from that of the Index. - Please note: The fund's ability to buy and sell small and midcapitalisation shares and the associated costs can be affected during periods of market stress. In certain circumstances investors in the fund may not be able to sell their investment when they want to. Derivatives and Techniques - The fund may use derivatives to reduce risk, reduce cost and/or generate additional income or growth consistent with the risk profile of the fund (often referred to as 'Efficient Portfolio Management'). - Derivative usage in the fund is expected to be very limited. Where derivatives are used, this would mainly be in response to significant inflows into the fund so that in these instances, cash can be invested while maintaining the fund's existing allocations to company shares. Investors in the fund may buy and sell shares on any dealing day (as defined in the Prospectus). If you invest in income shares, income from investments in the fund will be paid out to you. If you invest in accumulation shares, income will be added to the value of your shares. Recommendation: the fund may not be appropriate for investors who plan to withdraw their money within five years. Investors should satisfy themselves that their attitude to risk aligns with the risk profile of this fund before investing.