Cyprus UCITS Fund

A UCITS is an undertaking:

• The sole object of which is the collective investment of capital raised from the public in transferable securities and/or other liquid financial instruments, as such are referred to in the UCI Law;
• Which operates on the principle of risk spreading; and
• The units/shares of which are, at the request of the investor, redeemed or repurchased, directly or indirectly, out of this undertaking’s assets

A UCITS may act either as a Mutual Fund or as a Variable Capital Investment Company.

Mutual Funds are one of the most popular types of collective investment vehicles. The investors, instead of acting separately, combine their capital and create a common asset to invest in securities (such as equities, bonds and other market instruments) within the concept of the UCITS. The manager of the fund and the custodian of this type of the UCITS shall satisfy the criteria required by the CySEC.

A Variable Capital Investment Company is typically a public liability company with a variable capital depending on subscriptions and redemptions performed in conjunction with the valuation of the assets. Custody of the assets is normally assigned to an approved custodian. The management of the assets is carried out by the fund manager assigned by the CySEC.
UCITS are in summary permitted to invest in:

• Transferable securities (“TS”) and money market instruments (“MMI”) which are either admitted to official listing on a stock exchange in an EU or non-EU Member State or which are dealt in on another regulated market which operates regularly and is recognised and open to the public;
• recently issued TS which will be admitted to official listing on a stock exchange or on another regulated market (as described above) within one year of issue;
• MMI, other than those dealt in on a regulated market provided that the issue or the issuer is itself regulated for the purpose of protecting investors and savings;
• Units/shares of other UCITS or undertakings for collective investment (“UCI”) which are subject to prudential regulation and supervision (subject to certain conditions);
• Deposits with eligible credit institutions which are repayable on demand or have the right to be withdrawn, and maturing in no more than 12 months; and
• Financial derivative instruments (“FDIs”) dealt in on a regulated market or over the counter (“OTC”) which meet certain criteria, among which that the underlying of the derivative consists of financial indices, interest rates, foreign exchange rates, or currencies.