ANNEX VIII
CONTENT AND PRESENTATION OF PAST PERFORMANCE INFORMATION
Definitions
1. For the purpose of presenting information on past performance the following definitions shall apply:
‘UCITS’ means a UCITS authorised in accordance with Article 5 of Directive 2009/65/EC which:
is a Category 2 PRIIP as set out in point 5 of Annex II; and
does not provide retail investors, at certain predetermined dates, with algorithm-based payoffs that are linked to the performance, or to the realisation of price changes or other conditions, of financial assets, indices or reference portfolios or have similar features;
‘AIF’ means an AIF as defined in Article 4(1), point (a) of Directive 2011/61/EU which:
is a Category 2 PRIIP as set out in point 5 of Annex II;
is an open-ended AIF as referred to in Article 1(2) of Commission Delegated Regulation (EU) No 694/2014 ( 14 ); and
does not provide retail investors, at certain predetermined dates, with algorithm-based payoffs that are linked to the performance, or to the realisation of price changes or other conditions, of financial assets, indices or reference portfolios or have similar features;
‘unit-linked insurance-based investment product’ means a unit-linked insurance- based investment product which:
is a Category 2 PRIIP as set out in point 5 of Annex II;
has potential early exit or redemption possibilities prior to the recommended holding period, which are not subject to significant limiting conditions;
provides benefits that are directly linked to the value of assets which are divided into units; and
does not provide retail investors, at certain predetermined dates, with algorithm-based payoffs that are linked to the performance, or to the realisation of price changes or other conditions, of financial assets, indices or reference portfolios or have similar features.
Past performance calculation for UCITS or AIFs
2. The calculation of past performance figures shall be based on the net asset value of the UCITS or AIFs, and they shall be calculated on the basis that any distributable income of the fund has been reinvested.
Use of ‘simulated’ data for past performance for UCITS or AIFs
3. A simulated performance record for the period before data was available shall only be permitted in the following cases, provided that its use is fair, clear and not misleading:
a new share class of an existing UCITS or AIF or investment compartment may simulate its performance by taking the performance of another class, provided the two classes do not differ materially in the extent of their participation in the assets of the UCITS or the AIF;
a feeder UCITS or AIF may simulate its performance by taking the performance of its master UCITS or AIF, provided that one of the following conditions is met;
the feeder UCITS or AIF’s strategy and objectives do not allow it to hold assets other than units of the master UCITS or AIF and ancillary liquid assets;
the feeder UCITS or AIF’s characteristics do not differ materially from those of the master UCITS or AIF.
Past performance calculation for unit-linked insurance-based investment products
4. The calculation of past performance as described in point 2 of this Annex shall apply mutatis mutandis to unit-linked insurance-based investment products. The calculation shall be consistent either with the explanation of the impact of the biometric risk premium or the cost part of the biometric risk premium on the investment return as referred to in Article 2(4).
Presentation of past performance for UCITS or AIFs
5. The information about the past performance of the UCITS or the AIF shall be presented in a bar chart covering the performance of the UCITS or the AIF for the last 10 years. The size of the bar chart shall allow for legibility.
6. UCITS or AIFs with performance of less than five complete calendar years shall use a presentation covering the last five years only.
7. Any year for which data is not available shall be shown as blank with no annotation other than the date.
8. For UCITS or AIFs which do not yet have performance data for one complete calendar year, a statement shall be included explaining that there is insufficient data to provide a useful indication of past performance to retail investors.
9. The bar chart layout shall be supplemented by the following statements, which shall appear prominently:
a warning about the limited value of past performance as a guide to future performance, using the following statement in bold letters:
‘ Past performance is not a reliable indicator of future performance. Markets could develop very differently in the future.
It can help you to assess how the fund has been managed in the past ’;
a narrative explaining what is shown which shall be included above the bar chart and shall state in bold letters:
‘ This chart shows the fund’s performance as the percentage loss or gain per year over the last [x] years. ’;
if applicable, a product specific warning about the lack of representativeness of the past in accordance with point 15 of this Annex or if relevant other reasons with a maximum of 150 characters in plain language;
a brief explanation of which charges and fees have been included or excluded from the calculation of past performance where relevant. This shall not apply to UCITS or AIFs which do not have entry or exit charges. [An example narrative:
‘ Performance is shown after deduction of ongoing charges. Any entry and exit charges are excluded from the calculation. ’];
an indication of the year in which the fund, compartment or share class came into existence;
if relevant an indication of the currency in which past performance has been calculated.
10. The information shall not contain any record of past performance for any part of the current calendar year.
Use of a benchmark alongside the past performance
11. Where the section entitled ‘What is this product?’ of the key information document makes reference to a benchmark, a bar showing the performance of that benchmark shall be included in the chart alongside each bar showing past performance of the UCITS or the AIFs. This applies for UCITS or AIFs tracking a benchmark as well as for those managed in reference to a benchmark. A UCITS or AIF is deemed to be managed in reference to a benchmark, where the benchmark index plays a role in the management of the UCITS or AIF, such as for portfolio composition and/or performance measures.
12. For UCITS or AIFs which do not have past performance data over the required five or 10 years, the benchmark shall not be shown for years in which the UCITS or AIF did not exist.
13. If the UCITS or AIF is managed in reference to a benchmark as referred to in point 11 of this Annex, the narratives in point 9 of this Annex shall be supplemented as follows in bold letters:
‘ This chart shows the fund’s performance as the percentage loss or gain per year over the last [] years against its benchmark. ’
‘ It can help you to assess how the fund has been managed in the past and compare it to its benchmark. ’
Presentation of the bar chart
14. The bar chart presenting past performance shall comply with the following criteria:
the scale of the Y-axis of the bar chart shall be linear, not logarithmic;
the scale shall be adapted to the span of the bars shown and shall not compress the bars so as to make fluctuations in returns harder to distinguish;
the X-axis shall be set at the level of 0 % performance;
a label shall be added to each bar indicating the return in percentage that was achieved;
past performance figures shall be rounded to one decimal place.
Impact and treatment of material changes
15. Where a material change occurs in the UCITS’ or AIF’s objectives and investment policy during the period displayed in the bar chart referred to in points 5 to 10 of this Annex, the UCITS’ or AIF’s past performance prior to that material change shall continue to be shown.
16. The period prior to the material change referred to in point 15 of this Annex shall be indicated on the bar chart and labelled with a clear warning that the performance was achieved under circumstances that no longer apply.
Use of ‘simulated’ data for past performance
17. In all cases where performance has been simulated in accordance with point 3 of this Annex, there shall be prominent disclosure on the bar chart that the performance has been simulated.
18. A UCITS or AIF changing its legal status but remaining established in the same Member State shall retain its performance record only where the competent authority of that Member State reasonably assesses that the change of status would not impact the UCITS’ or AIF’s performance.
19. In the case of mergers referred to in Article 2(1), points (p)(i) and (iii),) of Directive 2009/65/EC, only the past performance of the receiving UCITS shall be maintained.
20. Point 19 of this Annex shall apply mutatis mutandis in the case of mergers of AIFs.
Presentation of past performance of feeder UCITS or AIFs
21. The past performance presentation of feeder UCITS or AIF shall be specific to the feeder UCITS or AIF, and shall not reproduce the performance record of the master UCITS or AIF.
22. Point 21 of this Annex shall not apply where:
the feeder UCITS or AIF shows the past performance of its master UCITS or AIF as a benchmark; or
the feeder was launched as a feeder UCITS or AIF at a later date than the master UCITS or AIF, and where the conditions of point 3 of this Annex are satisfied, and where a simulated performance is shown for the years before the feeder existed, based on the past performance of the master UCITS or AIF; or
the feeder UCITS has a past performance record from before the date on which it began to operate as a feeder, its own record being retained in the bar chart for the relevant years, with the material change labelled as required by point 16 of this Annex.
Presentation of past performance of unit-linked insurance-based investment products
23. Points 5 to 16 of this Annex shall apply mutatis mutandis to unit-linked insurance-based investment products. The presentation shall be consistent either with the description of the impact of the biometric risk premium or the cost part of the biometric risk premium on the investment return referred to in Article 2(4).
( 14 ) Commission Delegated Regulation (EU) No 694/2014 of 17 December 2013 supplementing Directive 2011/61/EU of the European Parliament and of the Council with regard to regulatory technical standards determining types of alternative investment fund managers (OJ L 183, 24.6.2014, p. 18).