HSBC American Index Fund

1 hsbc American Index fund hsbc Index Tracker Investment Funds OEIC. Why invest in an American Index Tracking fund ? The fund at a glance It is simple. An American Index fund aims to deliver consistent benchmark EXPERIENCE. We launched our first returns while minimising costs. The fund provides access to a representative equity Index fund in 1990 and have a long Index of the 500 largest companies in the US. track record in managing Index funds. Investing in the S&P Composite Index provides good diversification. DIVERSIFICATION. An American The largest industries within the S&P 500 Composite Index are healthcare, Index fund has the potential to provide technology, consumer services, consumer goods, discretionary, energy and diversification as a strategic investment financials. Index tracking avoids the risk of a fund manager having a heavy within a balanced portfolio with carefully bias towards individual stocks.

2 Many investors believe that a traditional selected companies that are representative manager cannot outperform the Index for very long, and if that is so, it of various industries. makes more sense to literally track the Index . Index Tracking Funds are DISCIPLINED. As risk management far more effective in efficient' markets, such as the US where financial is key to hsbc Global Asset systems ensure that everything investors need to know is in the public Management's investment and allocation domain and well-reported process, we follow a three-step process It provides access to the performance of the market. An Index Tracking when implementing and managing Index fund is designed to literally track' the performance of a specific stock funds and mandates: preliminary Index market Index .

3 The fund will hold the vast majority of the shares that make up analysis, portfolio construction and trading the Index constituents providing investors with a performance very close to analysis and implementation. that of the specific market LOW COSTS. Our indexation process and Source of portfolio diversification, simple to access. The S&P 500 strategies are designed to consistently Composite Index is a representative Index of the largest 500 companies in deliver Index returns, whilst minimising the US trading associated costs and tracking error risk through a distinct quantitative process. Good value. Index Tracking Funds require fewer resources to manage compared with active funds as the manager is not seeking to outperform the About hsbc Global Asset Management benchmark Index hsbc Global Asset Management acts Why buy the hsbc American Index fund ?

4 As the global representative of the specialist investment businesses. We It is run by a specialist. hsbc Global Asset Management's Index Tracking are on the ground everywhere you Funds are managed in-house by our team of specialists who have over 15. want to be, giving us a unique global years experience in managing funds advantage. We aim to provide insights, It is transparent. Our indexation process is disciplined and transparent. investment opportunities and access The strategy tracks the S&P 500 composite Index observant of to service excellence worldwide. S&P's following constraints: maximum expected tracking error level, For further information please visit neutralisation of the key risk sources, portfolio weight deviations (versus Index ), sector and country bias Disciplined strategy and constant monitoring.

5 The team efficiently monitors the changes to the Index and buys and sells the underlying shares in the relevant proportions while minimising unnecessary transaction costs and focusing on liquidity For professional clients only Introducing the team and the investment strategy fund details: Efficient and focused team. Index tracking requires fewer resources than active fund management which in turn reduces costs fund manager: Bijan Seghatchian Launch date: 31 October 1988. The manager works with a specialist quantitative approach. We utilise a well-defined quantitative approach, with constant monitoring of fund exposures Initial charge: Nil and absolute or relative risk levels Annual charge: Predicted TER: Strict management controls. We use precise implementation and strict operational risk controls Daily at (UK.)

6 Dealing & valuation: time). The system provides a full replication strategy. The fund replicates the S&P 500. Domicile: United Kingdom Composite Index by containing stocks which are in the same proportions to that of the Index Minimum initial 1,000. investment ( ): What are the risks when investing in the S&P 500? Minimum additional 500. investment ( ): Market risk. Investments in stock markets fluctuate and past performance is Standard & Poor's 500. not an indicator of future performance. The value of the market can fall as well Benchmark: Composite Index as rise Dividends: Annual (July). Volatility. Unexpected changes in US economic growth and other Regular savings macroeconomic and monetary data can have a large impact on share prices From 50 per month scheme: Index concentration risk.

7 Because many indices are weighted by the market Launch price (in ): capitalisation of the companies that make them up, the fortunes of large firms ISIN code and industries will have a significant impact on the performance of the Index as a GB0000470418. (accumulation units): whole. Although there are diversification rules that put some limits on the extent ISIN code of any biases towards individual stocks within a fund , an Index tracker will (to GB0000469741. (income units): the best of the manager's ability) seek to directly replicate the market, and any Total number of biases within it, irrespective of its fortunes 503. holdings: Portfolio composition About the manager Technology Bijan Seghatchian joined hsbc Global Asset Financials Management in 2007 as Operations / Business Oil and Gas Development Manager.

8 He is presently fund Manager of Passive Equity Funds, having Industrials managed equity Index funds since January 2009. Consumer Services Prior to hsbc Global Asset Management, he has Consumer Goods been within the hsbc Global Asset Management Health Care Group IT since February 1995. Bijan holds a BSc in Psychology /Philosophy from Bristol University, Cash and Other an MSc in Systems & Technology from City Utilities University and a Post Graduate Certificate in Basic Materials Economics from London University. Telecomms Source: hsbc Global Asset Management. Data as at 31 Jan 2011. For professional clients only and not for distribution to retail clients. The material contained in this document is for information only and does not constitute investment advice or a recommendation to any reader of this material to buy or sell investments.

9 Stockmarket investments should be viewed as a medium to long term investment and should be held for at least five years. The hsbc American Index fund is a sub- fund of the hsbc Index Tracker Investment Funds range. The Authorised Corporate Director and Investment Manager is hsbc Global Asset Management (UK) Limited, who provides information to professional advisers and their clients on the investment products and services of members of the hsbc Group. All applications are made on the basis of the current hsbc Investment Tracker fund prospectus, simplified prospectus and most recent annual and semi annual report, which can be obtained upon request free of charge from hsbc Global Asset Management (UK) Limited, 8, Canada Square, Canary Wharf, London, E14 5HQ, UK, or the local distributors.

10 Investors and potential investors should read and note the risk warnings in the prospectus. Standard & Poor's 500' is a trademark of the McGraw-Hill Companies, Inc and has been licenced for use by this fund . The fund is not sponsored, endorsed, sold or promoted by S&P and S&P makes no representation regarding the advisability of investing in this fund . It is important to remember that the value of investments, and the income from them, can go down as well as up and investors may not get back the amount originally invested. Where overseas investments are held the rate of currency exchange may cause the value of such investments to go down as well as up. Past performance is not an indication of future performance. Approved for issue in the United Kingdom by hsbc Global Asset Management (UK) Limited Authorised and regulated by the Financial Services Authority 2011 hsbc Global Asset Management (UK) Limited.