MANAGED PORTFOLIO SERVICEIDX GROWTHJANUARY 2018

OBJECTIVE

The investment objective is to grow the capital value of the portfolio as well as togenerate some degree of income. The Quilter Cheviot IDX Growth Strategy isdesigned for an investor with a time horizon of more than 5 years, and a medium tohigher tolerance for risk that can accept significant variation or disruption to capitalvalue or current income in order to achieve their longer-term objective.

The Quilter Cheviot IDX Growth Strategy is a diversified portfolio comprisingpredominantly domestic and international equity index-tracking funds with a smallexposure to fixed interest index-tracking funds. There may also be exposure toexchange-traded products (ETPs) and funds investing into ‘‘alternatives’’ such ascommercial property, private equity, commodities and absolute return strategies.

STRATEGY PERFORMANCE(30 APRIL 2013 TO 29 DECEMBER 2017)

Dec 2

013

Dec 2

014

Dec 2

015

Dec 2

016

-20

0

20

40

60

IDX Growth

% G

RO

WT

H

Source: Quilter Cheviot, Financial Express (FE). Model performance is shown in GBP, gross ofmanagement fees with all income reinvested, actual returns may vary. Past performance is not aguarantee of future results.

ASSET CLASS / GEOGRAPHICAL LOCATION

As at 29 December 2017

Far East 2.5%Property 3.0%Emerging 3.8%Cash 4.0%Fixed Interest 4.0%Japan 5.2%Hedge Funds 6.5%Cont'l Europe 6.8%North America 25.1%UK 39.1%

PORTFOLIO HOLDINGS

International Equity: 43.4%iShares North American Equity IndexVanguard US Equity IndexL&G European IndexiShares Japan Equity IndexL&G Global Emerging MarketsL&G Pacific Index

UK Equity: 39.1%Vanguard FTSE UK All Share IndexHSBC FTSE All Share IndexHSBC FTSE 250 IndexVanguard FTSE UK Equity Income Index

Alternatives: 9.5%Aberdeen UK Property Feeder Unit TrustAspect Diversified TrendsLFIS Vision UCITS - Premia M GBPInvesco Perpetual Global Targeted ReturnsGAM Star Absolute Return BondOld Mutual Global Equity Absolute ReturniShares Global Property Securities Eq Index

Fixed Interest & Cash: 8.0%Cash (£)iShares UK Gilts All Stocks IndexL&G Short Dated Sterling Corporate Bond IndexVanguard UK Investment Grade Bond Index

Name YTD 1 Year 3 Year 5 Year Since Inception

IDX Growth 11.2% 11.2% 35.3% N/A 51.7%

FTSE UK Private Investor Growth TR 11.4% 11.4% 36.7% 70.3% 53.7%

IA Flexible Investment TR 11.2% 11.2% 29.1% 55.1% 41.6%

Cash 0.3% 0.3% 1.2% 2.2% 2.0%

Risk Statistics Estimated Realised (3 Year) Realised (Since Inception)

Annualised Volatility 11.1% 7.3% 7.7%

Drawdown -35.1% -9.0% -9.0%

Key Facts

Strategy Benchmark: FTSE UK Private Investor Growth TR Strategy Launch Date: 30 April 2013

Historic Yield: 2.4%

Source: Quilter Cheviot, Financial Express (FE) 08 January. All figures to 29 December 2017

IMPORTANT INFORMATIONPast performance is not a reliable indicator of future returns. The value of investments and the income from them can go down as well as up. You may not recoverwhat you invest.

The historic yield data is calculated using the previous year's dividend information and the bid or mid price from the last dividend. Data provided by Financial Express (FE),Quilter Cheviot (29 December 2017). The level of yield actually achieved on your portfolio will be dependent on the tax treatment of the product you have invested in and yourpersonal tax circumstances.

Volatility is a measure of risk and measures the variability of price fluctuations of an investment, or a portfolio of investments. Realised (i.e. experienced) model volatility isexpressed as the annualised standard deviation of returns over the stated time period(s), calculated using monthly data. The realised drawdown is the peak to trough declineexperienced by the model over the stated time period(s), calculated using monthly data. Estimated annualised volatility and drawdown figures have been calculated basedupon an historic analysis of the model’s current strategic asset allocation, calculated using monthly data. IA Sector returns are net of the underlying manager fund chargeswhilst benchmarks will not include any charges.

The asset allocations shown are dynamic, based upon the price movements of the underlying investments. Clients investing in the strategy for the first time, either via newbusiness or a switch, will have their portfolio determined by the fund and asset allocations set at the last rebalance date.

MANAGED PORTFOLIO SERVICE - IDX GROWTH

MARKET COMMENTARY

For the first time since the financial crisis in 2008, the global economyenjoyed a period of synchronised growth in 2017. Leading indicatorssuggest that this momentum should continue in 2018. Theimprovement in economic conditions has driven company profitshigher, which, in turn, has supported strong gains in equity marketsduring 2017, with many equity indices closing the year at, or veryclose to, their all-time high.

The underlying economic conditions are the best in a decade. Thebreadth of growth is almost unprecedented and less debt dependentthan most previous cycles, the exception perhaps being China. Themain engines are the US, eurozone and China all of which look set foranother strong performance in 2018. In the closing days of 2017,President Trump succeeded in delivering on one of his electionpledges – namely the biggest overhaul of US taxation in thirty years.Under the new system, the headline rate of corporation tax will fallfrom 35% to 21%. US companies that have kept cash overseas will beable to remit this to the US and see it taxed at a beneficial rate of15.5%. It is anticipated that the changes to the tax rates could add6-8% to company profits in 2018.

Politics and Brexit uncertainty have begun to impact on the UKeconomy. Although surveys suggest that consumers remain confidentabout their current conditions, they are less so about the future. Incontrast to mainland Europe, growth forecasts for the UK havesteadily reduced in recent months. From enjoying the fastesteconomic growth of the major G7 economies prior to the EUreferendum in June 2016, the UK is at now at the bottom of the pack.Much depends on the Brexit negotiations and the fate of the pound. A“breakthrough” by Theresa May and her negotiating team means thatthe next phase of the talks can commence, but many of the key issues

remain unresolved.

Nine years after the financial crisis, the economic cycle is maturing.Financial conditions will likely tighten over the coming year as centralbanks phase out quantitative easing and move to normalise interestrates. However we believe the business cycle has further to run andsee few signs of traditional excess associated with an over-extendedbull market. The newly announced cuts in US tax rates should help theworld’s largest economy deliver another year of decent growth. Anincrease in corporate leverage is one of the few warning signs, butother indicators are typical of this reflationary stage of the cycleincluding a pickup in global capital expenditure which usuallyaccompanies improved corporate confidence and cash flow. Otherindicators are nowhere near historic extremes, and with little sign of apickup in inflation, very low credit spreads and equity valuations onlyslightly above long-term averages, equities can make further progressin 2018. Financials may find conditions a little more challenging asshort rates rise and the business models of certain consumer sectorsremain structurally challenged, but cyclical and resource companiesare enjoying a revival. Global equities trade on a 16x forward P/Emultiple on forecast 10% earnings growth and a dividend yield of2.4%. The European and Japanese equity markets look better valuethan average but we wouldn’t rule out another strong year for the US.

ABOUT QUILTER CHEVIOT'S MANAGED PORTFOLIO SERVICE

Quilter Cheviot has a heritage that can be traced back to 1771. We are one of the UK’s largest discretionary investment management firms,focusing on providing and managing bespoke investment portfolios for private clients, trusts, charities and pension funds.

Our Managed Portfolio Service (MPS) provides a range of discretionary investment portfolios which offer clients diversified exposure to globalfinancial markets. MPS was launched in 2001 and provides clients with a high level of diversification through investment in collective funds. With astrong track record, we offer a range of investment Strategies and the flexibility to switch seamlessly between them without charge should aninvestor’s circumstances or risk appetite change.

RECENT AWARDS QUILTER

INVESTMENT MANAGERS

Simon Doherty - Chartered FCSISimon joined Quilter Cheviot in 2007 and is leadportfolio manager of the Quilter Cheviot ManagedPortfolio Service (MPS) and chair of the firm’sInvestment Funds Committee. A graduate of TrinityCollege Dublin with a first class honours degree,Simon has completed the Investment ManagementCertificate (IMC), the CISI Masters in WealthManagement and has passed Level I of the CFAProgram.

Benjamin Mountain - CFABenjamin is Co-Director of Investments for theMulti-Asset Team. Benjamin joined Quilter & Co in1999 and is responsible for the Investment Division’sManaged Portfolio Services and the Fund Researchteam. Benjamin is a member of Quilter Cheviot’sInvestment Funds Committee and AlternativesCommittee. He is a Chartered Financial Analyst (CFA)Charterholder and a Member of the CharteredInstitute for Securities & Investment.

CONTACT DETAILS

Quilter Cheviot

MPS Team, One Kingsway,London WC2B 6ANt: +44 (0)20 7220 7103e: mpsteam@quiltercheviot.comw: www.quiltercheviot.com

Quilter Cheviot Limited is registered in England with number 01923571, registered office at OneKingsway, London WC2B 6AN. Quilter Cheviot Limited is a member of the London Stock Exchange andauthorised and regulated by the UK Financial Conduct Authority. This document is not a solicitation oran offer to buy or sell any security. The information on which the document is based is deemed to bereliable, but we have not independently verified such information and we do not guarantee its accuracyor completeness. Changes in exchange rates may have an adverse effect on the value, price or incomeof foreign currency denominated securities. Estimated gross yield is not a reliable indicator of futurereturns. The securities and investment services discussed in this factsheet may not be suitable for allrecipients. Quilter Cheviot Limited recommends that investors independently evaluate particularinvestments and strategies, and encourages investors to seek the advice of a financial advisor. Theappropriateness of a particular strategy will depend on an investor’s individual circumstances andobjectives.