As a member of the Defined Contribution (DC) Section of the DHL Group Retirement Plan (the “Plan”), you have a
range of investment fund options available to you. You can select from the DHL Lifestyle (with 3 routes to
retirement) or 11 Freestyle funds. The Plan Trustee has named the different funds to reflect the underlying
investments of each fund closely.
Each fund invests in different asset types, each with different objectives, risks and charges. Risks can be
defined and quantified in a number of different ways. Below is a table of the fund range for the Plan – these
are the 11 Freestyle funds, including the funds which are also used within the 3 DHL Lifestyle strategies. Also
shown for each of the funds are three risk measures based on a Low/Medium/High scale. These risk measures are
defined and graded by the Plan Trustee to help you understand the potential risks associated with each of the
fund options.
DHL fund name |
Capital Risk |
Inflation Risk |
Pension Conversion Risk |
DHL Diversified Growth fund |
Medium/High |
Medium |
High |
DHL Diversified Cautious fund |
Medium |
Medium |
Medium |
DHL Fixed-Interest Bonds fund |
Medium |
Medium |
Low (non-increasing and fixed annuities) |
DHL Inflation-Linked Gilts fund |
Medium |
Low |
Low (increasing annuities) |
DHL Liquidity fund |
VeryLow |
High |
Medium/High |
DHL Shariah Global Equities fund |
High |
Medium |
High |
DHL Global Property fund |
High |
Medium |
High |
DHL UK Corporate Bonds fund |
Medium |
Medium |
Low/Medium (non-increasing and fixed annuities) |
DHL Emerging Markets Equities fund |
Very High |
Medium |
High |
DHL Global Equities fund |
High |
Medium |
High |
DHL UK Equities fund |
High |
Low/Medium |
High |
Capital Risk: the risk of a fall in the value of a member’s pension account.
Inflation Risk: the risk that if investment returns are lower than inflation then the purchasing power of
a member’s pension account will go down.
Pension Conversion Risk: the risk that a member’s pension account will buy less pension at retirement as
a result of changes in annuity prices. This is relevant to those members who wish to purchase an annuity from an
insurance company.
These risk definitions take a long-term view of the potential future risks relative to the other funds available
to you. The Trustee uses these three risk measures as it believes these reflect the key risks faced by our DC
members. DC members are generally long-term investors that have different routes to access their DC account at
retirement (drawdown, annuity or cash). The nature and timing of how savings are accessed under each of
these retirement routes gives rise to different risks. For example, Capital Risk may be the biggest risk for a
member close to retirement and wishing to access their DC account as cash.
Whilst the Plan Trustee has decided the names of each of the funds available to you, each of the DHL funds
invests in an underlying fund (or a number of underlying funds) managed by a professional investment manager
appointed by the Trustee. Each of the investment managers releases fact sheets for these underlying funds (for
example, on their firm’s website). These fact sheets will have their own risk ratings – these are defined by the
Financial Conduct Authority (FCA) on a scale of 1 to 7 where 1 is the lowest risk and 7 is the highest risk.
These risk ratings are calculated using a prescribed method in line with FCA requirements that considers the
price fluctuations of the underlying fund over recent years.
For example, the DHL Global Equities fund invests in the Legal & General Future World Global Equity Index Fund,
the underlying fund. You can access the factsheets for the all underlying Legal & General funds by looking in
Legal & General’s Fund Centre at:
https://fundcentres.lgim.com/uk/en/fund-centre/pmc
The underlying fund for the DHL Shariah Global Equities fund is the HSBC Islamic Global Equity Index Fund. You
can access the factsheet for this underlying fund by looking in HSBC’s Fund Centre at:
https://www.assetmanagement.hsbc.com/uk/institutions/gfc?fundid=HAIF004&SH=YCGBP
The Plan Trustee acknowledges that in some instances there could be differences between the risk ratings set by
the Trustee and those shown on the underlying fund manager fact sheets. In this situation the Trustee would like
to remind you that the risk ratings for the DHL Plan are intended to be long-term and forward-looking, whilst
the fund managers calculate risk ratings using a prescribed approach that only reflects historical price
volatility.
Whilst each of the 11 Freestyle funds has its own unique risk characteristics, risks are automatically managed
over time for members within the DHL Lifestyle strategy.