NTUC Income AR 2017

NOTES TO THE FINANCIAL STATEMENTS FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2017 12. INVESTMENT IN FUNDS The funds invested in by the Group may utilise a variety of financial instruments in their trading strategies, including equity and debt securities, as well as, an array of derivative instruments. Several of these financial instruments contain the risk whereby changes in market values of the securities underlying the financial instruments may be in excess of the amounts recorded on each portfolio fund’s statement of financial position. However, as the Group has limited interests in these funds, the Group’s risk with respect to such transactions is limited to its capital balance in, and where applicable, capital commitments to, each fund. The Group’s holding in a unitized fund, as a percentage of the fund’s total net asset value, will vary from time to time dependent on the volume of subscriptions and redemptions at the fund level. It is possible but unlikely that the Group may, at any point in time, hold a majority of a fund’s total units in issue. The Group’s maximum exposure to loss from its interests in funds is equal to the total fair value of its investments in and capital commitments contracted to the funds. Once the Group has disposed of its shares / units in a portfolio fund or withdrawn from its partnership contracts, the Group ceases to be exposed to any risk from that fund. The Group’s outstanding investment capital commitments are disclosed in Note 30. The tables below summarises the fair value of the Group’s holdings in funds by risk of concentration with respect to geographic region and industry focus of the funds. 2017 % of the Investment in Funds Fair value $’000 Industry focus Diversified Financials 63% 2,648,181 Energy 1% 51,148 Real Estate 36% 1,526,715 Telecommunication Services * 0% 1,534 Industrials * 0% 13,545 Utilities * 0% 770 100% 4,241,893 Geographic region Asia Pacific 35% 1,496,400 Australia 2% 66,812 Europe 14% 598,155 North America 36% 1,527,192 Others 13% 553,334 100% 4,241,893 * less than 1% ANNUAL REPORT 2017 EVERY DAY MADE DIFFERENT 101