Important Notes:

1. Principal MPF Scheme Series 500 ("Scheme") is an MPF Scheme.
2. All constituent funds under this Scheme invest solely or partly in insurance policies issued by Principal Insurance Company (Hong Kong) Limited ("Principal"). Your investment in these funds is therefore subject to the credit risk of Principal.
3. Principal, the Guarantor of the Guaranteed Fund under this Scheme, will only provide a guarantee of capital and a prescribed guarantee rate of return in certain specified circumstances. Please refer to page 31 of this Explanatory Memorandum under the section "Provision of Guarantee" for details of the guarantee conditions.
4. Fees and charges of a MPF conservative fund can be deducted from either (i) the assets of the fund or (ii) members' account by way of unit deduction. The MPF Conservative Fund uses method (i) and, therefore, unit prices/net asset value/fund performance quoted have incorporated charges.
5. You should consider your own risk tolerance level and financial circumstances before making any investment choices. When, in your selection of funds, you are in doubt as to whether a certain fund is suitable for you (including whether it is consistent with your investment objectives), you should seek financial and/or professional advice and choose the fund(s) most suitable for you, taking into account your own circumstances.
6. In the event that you do not make any investment choices, please be reminded that any contributions made and/or benefits transferred into this Scheme will be invested into the Stable Growth Fund, and such fund may not necessarily be a suitable investment for you.
7. You should not invest in reliance on this marketing material alone. You should read the Explanatory Memorandum of the Scheme for further details (including investment policy, risk factors, fee and charges and constituent funds information).

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Objective	To provide a competitive long-term total rate of return, while also providing a minimum guaranteed average annual return over the career of the members.
Investment Portfolio	Invest in an insurance policy Approved Pooled Investment Fund ("Policy APIF") which in turn will invest in two or more Approved Pooled Investment Funds ("APIFs") and/or Approved Index-Tracking Funds (“AITF”). The underlying investments will consist of fixed income and equity securities which may be denominated in HK dollars, US dollars or other currencies. (Investments in the Policy APIF are subject to the credit risk of Principal)
Asset Allocation	Equity Securities 10% - 55% Fixed Income Securities 25% - 90% Cash & Short-term Investments (e.g. bills and deposits) 0% - 20%
Geographic Allocation	United States and Greater China 40 - 100% Other Asia 0 - 50% Europe 0 - 50% Other Countries 0 - 50%
Risk / Return Profile #	(Guaranteed Fund)

* Guaranteed Fund

Principal, the Guarantor of the Guaranteed Fund under this Scheme, will only provide a guarantee of capital and a prescribed guarantee rate of return in certain specified circumstances. Your investments are subject to the credit risk of Principal.

The guarantee of capital and return will only be offered if the contributions in the fund are withdrawn upon the occurrence of a “qualifying event”, which is the receipt by the Trustee of a valid claim of all the accrued benefits of the member upon satisfying any of the following conditions:

(a) Attainment of the normal retirement age or retirement at or after the early retirement age but before the normal retirement age

(b) Total incapacity

(c) Death

(d) Permanent departure from Hong Kong

(e) Claim of “small balance”

The above conditions (a) to (e) apply to employee members, self-employed persons and “preserved account holders”.

(f) Termination of the member's employment (regardless of the reason of termination) and the continuous period for which the member has been investing in the fund up to and including the last date of his employment (“qualifying period”) is at least 36 complete months. The qualifying period in respect of a member will also be re-set to zero if the member (or his personal representative) effects a redemption, switching out or withdrawal of the units of the fund other than upon the occurrence of a qualifying event. For the avoidance of doubt, condition (f) does not apply to self-employed persons or preserved account holders.

If a redemption, switching out or withdrawal of units of the fund is effected by a member other than upon the occurrence of a qualifying event as stated above, the guarantee will be affected and the member’s investments in this fund will be subject to market fluctuation and investment risks. Please refer to page 31 of the Explanatory Memorandum of the Scheme under the section “Provision of Guarantee” for details of the guarantee conditions.

MPF Conservative Fund
Objective	To preserve capital with minimal risk.
Investment Portfolio	Invest in a Policy APIF which will in turn invest in a portfolio of bank deposits, short duration securities and high quality money market instruments denominated in Hong Kong dollars.   (Investments in the Policy APIF are subject to the credit risk of Principal)
Asset Allocation	Certificate of Deposits 0% - 95% Debt Securities 0% - 95% Cash & Short-term Investments (e.g.bills and deposits) 0% - 100%
Geographic Allocation	Hong Kong 100%
Risk / Return Profile #

Note: The MPF Conservative Fund under this Scheme is not a guaranteed fund and does not guarantee the repayment of capital.

Stable Growth Fund
Objective	To achieve stable, long term capital appreciation through investment in a range of money market instruments, cash deposits, fixed income securities and global equities.
Investment Portfolio	Invest in two or more APIFs (in the form of a Policy APIF or a unit trust APIF). Through the underlying investments, the fund  will invest around 70% of its net asset value (“NAV”) in money market instruments, fixed income securities and cash deposits and 30% of its NAV in global equities. (Investments in the Policy APIF are subject to the credit risk of Principal)
Asset Allocation	Global Equities 30% Money Market Instruments, Fixed Income Securities and Cash Deposits 70%
Geographic Allocation	Hong Kong 10% Asia 4% Japan 4% North America 6% Europe 6%
Risk / Return Profile #

Investors should note that (i) the above ranges of asset and geographic allocations are for indication only and long term allocations may vary with changing market conditions; and (ii) the geographic allocation for equity investments is classified by the place of principal business of the issuers and the geographic allocation for fixed income investments is classified by their currency denomination.

#Risk/Return Profile:

Low     Low to Moderate    Moderate    Moderate to High      High

The classifications of Risk/Return Profile are based on past volatility (i.e. annualized standard deviation of returns), worst and best two months returns, and the relative risk levels among the funds in the Scheme. Besides, reference was also made to the investment objectives of the respective funds.

Investment involves risks. The value of the funds may go up or down. Please refer to the Explanatory Memorandum of the Scheme for more details, including fees, charges and the risk factors of the constituent funds and the Scheme.