Threadneedle Specialist Investment Funds ICVC

Annual Report and Accounts Threadneedle Specialist Investment Funds ICVC April 2012 Threadneedle Specialist Investment Funds ICVC threadneedle.com Threadneedle Specialist Investment Funds ICVC Annual Report and Accounts April 2012 Contents Company Information 2 Director’s Report 3 Threadneedle Specialist Investment Funds ICVC Threadneedle Specialist Investment Funds ICVC market a variety of share classes, offering a selection of net income, gross income, net accumulation or gross accumulation of distributable income. Different classes or combinations of classes are available on different funds. The range of share classes that exists are as follows; Class 1, Class 1 Hedged, Class 2, Class 2 Hedged, Class X and Limited Issue Class. Statement of Authorised Corporate Director’s (ACD) Responsibilities 70 Statement and Report of the Depositary 70 Independent Auditors’ Report 71 Portfolio Statements: UK Mid 250 Fund 72 – 73 UK Extended Alpha Fund 74 – 75 All share types and classes are covered in this Annual Report. UK Equity Alpha Income Fund 76 – 77 Aggregated Financial Statements for Threadneedle Specialist Investment Funds ICVC 4 Notes to the Aggregated Financial Statements for Threadneedle Specialist Investment Funds ICVC 5 – 8 UK Absolute Alpha Fund 78 – 79 Absolute Return Bond Fund 80 – 84 Target Return Fund 85 – 88 UK Mid 250 Fund UK Extended Alpha Fund UK Equity Alpha Income Fund UK Absolute Alpha Fund Absolute Return Bond Fund Target Return Fund Pan European Accelerando Fund Pan European Equity Dividend Fund American Extended Alpha Fund China Opportunities Fund Global Emerging Markets Equity Fund Emerging Market Local Fund Global Extended Alpha Fund Global Equity Income Fund 9 – 11 Pan European Accelerando Fund 12 – 16 Pan European Equity Dividend Fund 17 – 19 American Extended Alpha Fund 20 – 22 China Opportunities Fund 23 – 28 Global Emerging Markets Equity Fund 29 – 34 Emerging Market Local Fund 35 – 38 Global Extended Alpha Fund 39 – 43 Global Equity Income Fund 44 – 47 Comparative Tables 48 – 51 Performance Summaries 52 – 55 Ongoing Charges Figure Summary 56 – 60 Risk and Reward Profiles 61 – 64 Shares Issued and Redeemed Summary 65 – 69 Further Information 89 – 90 91 – 93 94 – 95 96 – 98 99 – 103 104 – 106 107 – 109 110 – 113 114 – 119 120 – 121 122 123 124 125 – 126 Directory Important Information 127 – 128 129 – 132 1 Threadneedle Specialist Investment Funds ICVC Annual Report and Accounts April 2012 Company Information Company Threadneedle Specialist Investment Funds ICVC Registered Number IC000232 Registered Office 60 St Mary Axe, London EC3A 8JQ Director There is a sole director, the Authorised Corporate Director (the “ACD”), which is Threadneedle Investment Services Limited. Board of Directors of the ACD Chairman and Chief Executive C J Henderson Other Directors C D Fleming T N Gillbanks P J W Reed N J Ring 2 Threadneedle Specialist Investment Funds ICVC Annual Report and Accounts April 2012 Director’s Report This is the Annual Report and Accounts for Threadneedle Specialist Investment Funds ICVC, which reviews the performance of the funds and financial markets over the 12 months to 30th April 2012. During the period under review, financial markets experienced phases of ‘risk on’ or ‘risk off’ as they were buffeted by a number of important economic and geopolitical events. Markets had to contend with the ‘Arab Spring’, the after-effects of the earthquake and tsunami in Japan, the marked slowdown in global growth and the spiralling sovereign debt problems in the eurozone. The summer saw sharp falls in equity markets across the globe amid heightened worries over the eurozone debt crisis. However, markets rallied during the late autumn and winter as further measures were put in place to tackle the debt problems in the eurozone periphery, and notably Greece. In particular, markets were buoyed by the European Central Bank’s Long-Term Refinancing Operation (LTRO), which was announced in December. This alleviated immediate liquidity pressures and allowed European banks to secure three-year funding on particularly favourable terms. During this period, equity markets also responded positively to some stronger economic data from the US. Towards the end of the reporting period, the positive effects of the LTRO began to fade and concerns over the debt crisis and poor growth prospects for Europe returned to the fore. European populations are increasingly voicing their objections to the austerity measures designed to repair government finances and are making their feelings known at the ballot box. Following the fall of the incumbent Greek, Italian and Spanish governments late last year, more recent elections have seen the collapse of the Dutch government, while the anti-austerity socialist François Hollande was elected French president shortly after the end of the period. More worryingly, the recent Greek elections proved inconclusive, with strong gains by political factions calling for the renegotiation of the EU’s bailout terms. While much of the developed world is facing a difficult year, there continue to be exciting opportunities amongst emerging markets, which together account for around 50% of global GDP. These countries are enjoying continued growth in consumer spending and, in contrast to developed economies, their governments have plenty of scope to support economic expansion. In the challenging conditions facing the developed world, companies with strong business models and robust balance sheets should fare significantly better than their weaker counterparts. Moreover, it is particularly encouraging to see that many of the stronger companies are returning cash to investors in the form of higher dividends and share buybacks. Equity valuations continue to look attractive by historical comparison and also relative to other asset classes. Elsewhere, bond yields in the core government markets remain at historically low levels and we prefer the prospects for corporate and emerging market bonds. We hope that you find the individual fund reports informative. If you would like further information regarding any aspect of your investment, or about other Threadneedle products, please either contact us directly or speak to your financial adviser. Alternatively, you may find it helpful to visit threadneedle.com for further information about Threadneedle. Thank you for your continued support. Crispin Henderson Director ... - tailieumienphi.vn