OOO

Fund Objective

OOO aims to track the performance of an index (before fees and expenses) that provides exposure to crude oil futures, hedged for currency movements in the AUD/USD exchange rate.

Fund Strategy

The index which OOO aims to track provides exposure to the price of West Texas Intermediate (WTI) crude oil futures, hedged for currency exposure.

The price of oil futures contracts is not the same as the “spot price” of oil. As such, OOO does not aim to, and should not be expected to, provide the same return as the performance of this spot price. The performance of an ETF that is linked to oil futures may be materially different to the performance of the spot price of oil itself. This is because the process of “rolling” from one futures contract to the next to maintain investment exposure can result in either a cost or benefit to the Fund, affecting returns. Please refer to the PDS for further information and you can view a more detailed Insights post related to this issue here.

The prices of futures contracts for subsequent periods is known as the ‘futures curve’. See the Resources section below for a link to the WTI Crude Oil futures curve, which indicates whether rolling into subsequent futures contracts will be at higher prices, which would tend to reduce Fund returns, or at lower prices, which would tend to increase Fund returns, assuming no change in the spot price for oil.

Announcements regarding temporary change to OOO’s underlying futures exposure from one-month to three-month WTI Crude Oil futures contracts – see here and here. Given this change, and as noted in the announcements, it should be expected that there will be a larger than usual divergence or ‘tracking error’ in the Fund’s performance compared to the Index which the Fund aims to track.

Investors should exercise caution in light of the unprecedented volatility and heightened risk in the global oil market. Please refer to the Supplementary PDS which supplements the risk disclosures in the PDS in light of recent market developments, including the potential for negative futures contract prices, and the consequent risk that the value of the Fund’s units could permanently reduce to zero in the event of such extreme market volatility, with no ability for unitholders to participate in any future recovery in the values of the futures contracts.

Benefits of OOO

Simple access to price of oil futures

Gain access to the performance of crude oil futures as simply as buying a share, without the complications and cost of investing in the futures market yourself or buying and storing physical commodities.

Portfolio diversification

As oil historically has shown a low correlation to other major asset classes, investing in OOO can help to diversify your portfolio.

Currency-hedged

Oil futures are priced in USD. Hedging against fluctuations in the USD/AUD means you have more ‘pure’ exposure to the price of oil futures.

How to Invest

• You can buy or sell units just like you’d buy or sell any share on the ASX.
• Fund requires no minimum investment.