Sequoia Launch Units – Series 37A
The objective of the Units in Sequoia Launch Series 37A is to deliver positive returns to investors, regardless of market conditions over a period of 3 years and 139 days (being the remaining time to maturity on the existing Series 37 Units). The Units aim to achieve this by offering leveraged exposure to a diversified basket of global investment funds with various investment styles and exposure including:
- Global Equity Absolute Return;
- UK Equity Absolute Return;
- Global Currencies and Bonds (Long / Short)
- Multi-Strategy Growth
A summary of the key features are as follows
- Reference Basket: Equally weighted exposure to the Euro denominated share classes of the following 4 global funds (the funds are not rebalanced at any time following the Commencement Date)
- Currency of Reference Basket
- Unit Currency Exposure
- The Potential for 4 Uncapped Performance Coupons
- Performance Fees
- Limited recourse Loan
- Annual Interest Rate on Loan
- Application Fee
- Volatility Mechanism
- Target Volatility
- Maximum Participation Rate
- Margin Calls
- SMSF Eligibility
- Weighting on Commencement Date to the following 4 funds:
20%: Merian Global Equity Absolute Return Fund
20%: Janus Henderson - United Kingdom Absolute Return
40%: H2O Adagio (Global Currencies and Bonds)
20%: Pioneer Funds – Multi Strategy Growth
- AUD Hedged
- Reference Basket with 2.0% Target Volatility
- Four (4) potential Uncapped Performance Coupons, payable annually, based on the performance of the Strategy Value.
- Yes. Investors borrow 100% of the Investment Amount.
- 3 years and 139 days
- 1.99% p.a.
To find out more, and to download a copy of the Flyer, Term sheet PDS and Master PDS, please click on the links below
- Explanatory Statement
- Termsheet PDS – Sequoia Launch Series 37A
- Termsheet PDS – Sequoia Lauch Series 37
- Master PDS (DPA with no Loan)
- Financial Services Guide for clients of Sequoia Asset Management Pty Ltd
- General Advice Declaration for clients of Sequoia Asset Management Pty Ltd
- Notice of Adjustment Event Sequoia Launch Series 37A
Unwind of Series 37 and Application for Series 37A Units
Investors who elect to acquire Series 37A Units will not be required to pay any Application Fee or Adviser Fee (or any other fees). The Issuer will buy back the Investor’s Series 37 Units at a price of $1 per Series 37 Unit and refund the balance of the Investor’s non-amortised Prepaid Interest. The balance of these proceeds will then be applied in full repayment of the Loan attributable to the Series 37Units and full payment of the Prepaid Interest of the Series 37A Units, meaning that there is no additional payment required from Investor’s who elect to acquire the Series 37A Units. An Investor making this election will be required to have made the election in respect of all of their Series 37 Units.
You should ensure you have understood and read in full the Series 37A Units’ PDS before making a decision to acquire the Series 37A Units.
This Election Form constitutes both an Application Form for Sequoia Launch Units – Series 37A (“Series 37A Units”), and an Issuer Buy-Back Form for Sequoia Launch Units – Series 37 ( issued under a Term Sheet PDS dated 15 February 2017 and Master PDS dated 14 August 2017) (“Series 37 Units”), both issued by Sequoia Specialist Investments Pty Ltd (ACN 145 459 936) and arranged by Sequoia Asset Management Pty Ltd (ACN 135 907 550, AFSL 341506). This Election Form accompanies the Term Sheet PDS for the Series 37A Units dated 31 October 2018 , Master PDS dated 14 August 2017 and any supplementary PDS issued for the Units (“PDS”). It is important that you read the Term Sheet PDS and PDS in full and the acknowledgements contained in this Election Form before applying for the Issuer Buy-Back of the Series 37 Units and an investment in the Series 37A Units.
A person who gives another person access to this Election Form must at the same time and by the same means give the other person access to the PDS including any supplemental PDS. The Issuer will provide you with a paper copy of the PDS including the Master PDS, any supplemental PDS and this Election Form, on request without charge.
This form is to be used if you are an investor in the Series 37 Units and wish to request an Issuer Buy-Back of your Series 37 Units and to use the proceeds of the Issuer Buy-Back to acquire Series 37A Units. Please see the instructions on how to complete this Form in the PDS. This Election Form must be received by the Registrar by 12:00 pm on 16 November 2018 in order to be accepted by the Issuer. Election Forms received after this time will not be accepted by the Issuer. Election Forms received by persons who are not a registered holder ofSeries 37 Units will also not be accepted by the Issuer.
Series 37A Units are only issued on receipt of:
- an executed copy of this Election Form,
- approval of the Application by the Issuer and Lender, and
- verification of the applicant’s identity (verification of the applicant’s identity will be performed on the basis of past information provided by the applicant to the Issuer).
Terms of the Issuer Buy-Back
- Buy-Back Price of $1 per Series 37 Unit;
- Investor must elect for the Issuer to Buy-Back all of the Series 37 Units registered in the name of the Investor and make an investment application for the same number of Series 37A Units in the name of the Investor;
- Issuer will apply the total amount of the Buy-Back Price in full satisfaction of the Investor’s Series 37 Units Loan;
- Issuer will refund to the Investor in full all non-amortised Prepaid Interest in respect of the Investor’s Series 37 Units Loan if the Investor elects to take part in the Issuer Buy-Back;
- Investor must direct the Issuer to apply 100% of the Prepaid Interest refund to an investment in Series 37A Units in the name of the Investor.
Potential investors should obtain independent financial and taxation advice as to the suitability of this investment to them having regard to their investment objectives, financial situation and particular needs. Nothing in this PDS is a recommendation by the Issuer, the Security Trustee, the Custodian or their related bodies corporate concerning investment in the Units or any specific taxation consequences arising from an investment in the Units.
Initial Strategy Value
21st November 2018
The Strategy Value for Sequoia Launch Series 37A on 21st November 2018 = [96.815]
This is the date of the Issuer Buy-Back for investors who unwound their investment in Sequoia Launch Series 37 and invested into Sequoia Launch Series 37A.
16 November 2018 is the Commencement Date for Sequoia Launch Series 37A.
Strategy Value Strike on the Commencement Date
16 November 2018
1st Coupon: 4 April 2019
2nd Coupon: 3 April 2020
3rd Coupon: 4 April 2021
4th Coupon: 4 April 2022
Performance Coupon (%)
Launch Series 37A (Global Funds) Performance
|Date||Strategy Value||Reference Basket||Indicative Unit Value*||Gross Performance|
|04-Apr -2019||97.074||n/a||No Coupon||No Coupon|
|03-Apr-2020||94.87||n/a||No Coupon||No Coupon|
*Gross performance is measured by the reference to the strategy value strike of 100, since this is what is used as a reference for calculating future potential performance coupons.
* Unit Value: Investors please note this is a theoretical investment maturity value. This investment is designed to be held to maturity. Any investors seeking to redeem prior to maturity may receive an amount significantly different to the Indicative Unit Value stated
Launch series 37A (Global Funds) Performance Key risks
- Your return (including any Coupons) is affected by the performance of the Underlyings comprising the Reference Basket. There is no guarantee that the Reference Basket will perform well.
- In the Event that an appropriate hedge cannot be achieved in relation to all or some of the Underlying’s comprising the Reference Basket, the Issuer may choose to remove the Underlying or replace the Underlying with a similar fund in its absolute discretion. Any changes will be notified on the Issuers website and in correspondence to Investors.
- The Units have varying levels of exposure to the Reference Basket depending on volatility due to the variable Participation Rate. It operates by varying the exposure that the Units will have to the Reference Basket depending on the Realised Volatility of the Reference Basket and the Target Volatility. There is the risk that the Participation Rate could drop below 100% during the Investment Term in which case Investors will not gain the full benefits of an increase of the value of the Reference Basket.
- Investors should note that there is a lag in measuring the Realised Volatility of the Reference Basket. This means that where there has been a period of high Realised Volatility, the Investor’s exposure to the Reference Basket will be low, regardless of whether the Reference Basket is performing positively or negatively.
- There will be no Performance Coupons payable if the performance of the Strategy Value does not exceed the Strategy Value Strike on a Coupon Determination Date.
- The potential Performance Coupons are determined by reference to the Strategy Value Strike and Strategy Value on the relevant Coupon Determination Date and any past Performance Coupons paid.
- There is no guarantee that the Units will generate returns in excess of the Prepaid Interest and Fees, during the Investment Term. Additionally, in the event of an Investor requested Issuer Buy-Back, Early Maturity Event, you will not receive a refund of your Prepaid Interest or Fees.
- Gains (and losses) may be magnified by the use of a 100% Loan. However, note that the Loan is a limited recourse Loan, so you can never lose more than your Prepaid Interest Amount and Fees paid at Commencement.
- Investors are subject to counterparty credit risk with respect to the Issuer and the Hedge Counterparty; and
- the Units may mature early following an Early Maturity Event, including an Adjustment Event, Market Disruption Event or if the Issuer accepts your request for an Issuer Buy-Back.
Please refer to Section 2 “Risks” of the Master PDS for more information.
Please refer to Section 4 “Key Risks” of the Term Sheet PDS and Section 2 “Risks” of the Master PDS for more information.
Units in Sequoia Launch Units – Series 37A are issued by Sequoia Specialist Investments Pty Ltd (ACN 145 459 936) (the “Issuer”) and arranged by Sequoia Asset Management Pty Ltd (ABN 70 135 907 550, AFSL 341506) (the “Arranger”). Investments in the SequoiaLaunch Units – Series 37A can only be made by completing an Election Form above (also attached to the Sequoia Launch Series 37A Term Sheet Product Disclosure Statement (“TSPDS”) dated 31 October 2018), after reading the Master PDS dated 14 August 2017 and submitting it to Sequoia.