Hastings High Yield Fund (HHY)

Aurora Funds Management Limited (“Aurora”), as responsible entity of the HHY Fund (“HHY”), has undertaken a strategic review of HHY’s investment strategy, and is pleased to advise current and potential unit holders of our intention to enhance the investment strategy of HHY, effective 19 August 2015.

Aurora has determined that enhancing the current investment strategy in the manner outlined below, will provide unit holders with improved returns and a more regular source of income given the current size of the fund.

The existing investment strategy provides investors with exposure to high yield securities in the form of loans and hybrid securities issued by Australian entities and international entities from OECD countries; and unlisted and unrated securities that are not otherwise readily accessible to ASX investors.  This will not change.

The additional investment strategies will include the ability to invest in listed Australian and international equities, unlisted Australian and international securities, options, convertible securities, and other derivative securities.   Each investment will be actively managed and selected at the discretion of the Investment Manager with a focus on value investing.  All of the capital may be invested in a single investment opportunity or a number of different opportunities.

The Investment Manager may also reduce part of the equity market exposure by short selling securities, or using appropriate levels of interest rate or currency hedging to limit exposures to fluctuations in these markets without sacrificing long-term investment performance. The Fund may also use borrowings to increase its levels of investment into the enhanced investment strategy.

The gross allocation range for HHY Fund will be as follows (net of hedging):