Principal Global Investors, LLC (Principal) has been added as at 16 June 2016 the SGMF Pacific Basin (Ex-Japan) Equity Fund.

Addition of Principal

What They Do

Principal maintains that the majority of investors are averse to risk and to change, creating persistent biases, anomalies and inefficiencies upon which it can capitalise. Its investment management team seeks to generate alpha through early identification of fundamental changes (relative to market expectations) while avoiding overpaying for such changes.

How They Do It

Principal believes that three attributes distinguish alpha-creating investment opportunities:

• Sustainable fundamental change with respect to operating performance, industry trends and capital allocation;
• Rising investor expectations in the form of earnings revisions, price momentum and volume trends; and
• Attractive valuations, measured by a matrix of approaches

The identification of stocks that fit this framework is facilitated by a well-integrated quantitative and fundamental process using Principal’s proprietary research model, which the team believes provides both depth in due diligence and breadth in coverage.

Principal’s analysts tend to scrutinize the model’s top 20% of ranked companies for portfolio inclusion. While the absolute ranking of the stocks is the foremost driver for analysts to dig deeper, ranking changes are also taken into consideration for the prioritization of research.

The resulting portfolio will hold between 50 and 100 stocks. Principal manages style exposure by tracking valuation dispersions among key style factors, enabling the team to rebalance when dispersions widen.

About Principal

Principal Global Investors is a wholly owned global asset management subsidiary of Principal Financial Group (PFG), which is headquartered in Des Moines, Iowa and has assets under management totaling $380 billion as at 31 December 2015. Principal Global Investors has invested in developed and emerging markets since 1987, and has $81.4 billion in assets under management as at 31 December 2015.

Why We Chose Them

• Well-integrated investment approach: Principal’s three well-defined alpha sources are ingrained throughout the quantitative and qualitative processes, ensuring integrity between the investment philosophy and process.
• Tailored, resilient quantitative model: The strategy employs 20 distinct, multi-factor, region- and sector-specific models that are based on a cluster analysis of value, fundamentals and price. These models capture both the quantitative cause-and-effect relationship and fundamental perspectives provided by Principal’s resourceful and experienced analyst team.
• Dedicated fundamental research: Solid fundamental oversight supplements the analyst team’s quantitative screening and provides a rigorous “sanity check” in addition to the quantitative model.

Glossary of Financial Terms:

• Alpha: Alpha refers to returns in excess of the benchmark.
• Fundamental: Fundamental analysis is based on analyst research and judgement.
• Fundamentals: Fundamentals refers to data that can be used to assess a country or company's financial health such as amount of debt, level of profitability, cash-flow, inventory size, etc.
• Qualitative: Qualitative refers to security analysis based on analyst research and subjective views.
• Quantitative: Quantitative analysis is based on computer-driven models.

IMPORTANT NOTE: The opinions and views contained in this document are solely those of SEI and are subject to change; descriptions relating to organisational structure, teams, and investment processes herein may differ significantly from those prescribed by underlying managers regarding their own investment houses and investments.

Important Information:
Past performance is not a guarantee of future performance.
Investments in SEI Funds are generally medium to long term investments. The value of an investment and any income from it can go down as well as up. Investors may not get back the original amount invested. Additionally, this investment may not be suitable for everyone. If you should have any doubt whether it is suitable for you, you should obtain expert advice.
No offer of any security is made hereby. Recipients of this information who intend to apply for shares in any SEI Fund are reminded that any such application may be made solely on the basis of the information contained in the Prospectus. This material represents an assessment of the market environment at a specific point in time and is not intended to be a forecast of future events, or a guarantee of future results. This information should not be relied upon by the reader as research or investment advice regarding the funds or any stock in particular, nor should it be construed as a recommendation to purchase or sell a security, including futures contracts.
In addition to the normal risks associated with equity investing, international investments may involve risk of capital loss from unfavourable fluctuation in currency values, from differences in generally accepted accounting principles or from economic or political instability in other nations. Bonds and bond funds are subject to interest rate risk and will decline in value as interest rates rise. High yield bonds involve greater risks of default or downgrade and are more volatile than investment grade securities, due to the speculative nature of their investments. Narrowly focused investments and smaller companies typically exhibit higher volatility. SEI Funds may use derivative instruments such as futures, forwards, options, swaps, contracts for differences, credit derivatives, caps, floors and currency forward contracts. These instruments may be used for hedging purposes and/or investment purposes.
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This information is issued by SEI Investments (Europe) Limited, 1st Floor, Alphabeta, 14-18 Finsbury Square, London EC2A 1BR which is authorised and regulated by the Financial Conduct Authority. Please refer to our latest Full Prospectus (which includes information in relation to the use of derivatives and the risks associated with the use of derivative instruments), Key Investor Information Documents and latest Annual or Semi-Annual Reports for more information on our funds. This information can be obtained by contacting your Financial Advisor or using the contact details shown above.