Investing your savings can help them grow.

The investment route you choose will depend on how involved you want to be and how much risk you’re willing to take. High risk funds offer a greater chance of growing your savings over the long term, but carry the risk of suddenly falling in value. Low risk funds are generally more stable, but don’t offer much chance for growth.

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.

Freestyle Fund Range Risk Ratings

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

Risk Definitions

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 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.

Which investment route will you take?

The DHL Plan offers you two different ways to invest your pension account: Lifestyle and Freestyle.

Lifestyle is automatic: it manages your investments for you, according to your age, investing your savings in higher growth investments with the aim of growing their value when you are younger and automatically moving them into more stable funds in the lead up to your retirement with the aim of protecting their value. There are three DHL Lifestyle routes to choose from.

The three DHL Lifestyle routes align with different retirement options, and these routes appropriately invest your pension account in the lead up to retirement – they don’t restrict your options at retirement for how you wish to take your benefits when you stop work. However, it’s best to align your investment route with your retirement plans if you can.

Freestyle is manual: if you prefer to be in control, it lets you choose your own investment funds which you manage and change when you want over time. There are eleven Freestyle funds to choose from.

It’s up to you to decide how you invest your pension account. If you do not make a choice, your pension account will be invested in the default DHL Lifestyle Drawdown, which assumes you will want to transfer your account to a drawdown arrangement, keeping your pension account invested while drawing an income.

Your target retirement age

It’s useful to set a target retirement age for yourself however you choose to invest your pension savings, but if you invest your savings in a Lifestyle strategy you should also tell the Plan your target retirement age, as your investments will start to be moved into lower-risk funds based on this age. If you don’t make a choice, your retirement age will be the Plan’s normal retirement age (65 or your State Pension Age if you were auto-enrolled).

Lifestyle

The three Lifestyle routes

When you're 20 years from retirement age, your pension account will automatically start to move into the DHL Diversified Cautious fund which invests in less risky assets to protect its value. Then 10 years from retirement, your savings will gradually move again into funds that align with how you might want to use your savings in retirement. You have three routes to choose from: taking drawdown, buying an annuity or taking your savings in one go as cash. The default route option is to target taking drawdown at retirement but this may not be the right retirement option for you. As you get closer to retirement, you should consider taking financial advice for help choosing the right option.

DHL Lifestyle Drawdown

This is the default for all members. This Lifestyle route assumes you will transfer your account to a drawdown arrangement, keeping your pension account invested while drawing an income. You will still have the option of taking 25% of your savings as tax-free cash after transfer.

DHL Lifestyle Annuity

This Lifestyle route may be for you if you want to take 25% of your savings as tax-free cash, while offering some protection to the size of the annuity income that you will be able to buy with the rest.

DHL Lifestyle Cash

This Lifestyle route assumes that you will take the entire value of your account as cash (of which 25% will be tax-free), while protecting its value as you approach retirement.

Freestyle

There are 11 Freestyle funds to choose from. Each offers a different level of risk for potential growth. Your choice will depend on the level of risk you are prepared to take and may be determined by your age, attitude to risk and other factors such as your religious beliefs or desire to invest in companies based on their approach to Environmental, Social and Governance (ESG) issues.

DHL Emerging Markets Equities fund

Invests in shares listed in developing countries. As part of the fund’s investment process, it takes into account the approach that companies take to ESG issues.

It may be suitable when you are some way from retirement, looking to maximise long-term growth potential but are willing and able to accept the higher risk of the value of your savings falling sharply or would like to invest in emerging market equities.

View fund factsheet

DHL Global Equities fund

Invests in globally listed shares in developed and developing countries. As part of the fund’s investment process, it takes into account the approach that companies take to ESG issues.

It may be suitable when you are some way from retirement, are looking for high long-term growth potential but are willing and able to risk the value of your savings falling or would like to invest in a more globally diverse equity fund.

View fund factsheet

DHL UK Equities fund

Invests in shares listed in the UK. As part of the fund’s investment process, it takes into account the approach that companies take to ESG issues.

It may be suitable when you are some way from retirement looking for high long term investment growth, and exposure to UK-based equities with an emphasis on companies with a particular approach to ESG issues, but are willing and able to risk the value of your savings falling.

View fund factsheet

DHL Shariah Global Equities fund

Invests in globally listed shares in a Shariah compliant manner. Each underlying investment asset has been verified by Islamic scholars and excludes shares in companies which profit from products such as arms, alcohol, tobacco and pork.

It may be suitable if you are some way from retirement looking for high long-term investment growth and you wish to invest in a fund that is compliant with Shariah law, but are willing and able to risk the value of your savings falling. This fund is likely to be riskier than some of the other ways of saving in the Plan. This is because it doesn’t spread the risk in the same way that most of the other funds do, as it can only invest in shares that are Shariah compliant.

View fund factsheet

DHL Global Property fund

Invests in globally listed real estate companies.

It may be suitable when you are some way from retirement, are looking for long-term growth potential but are willing and able to risk the value of your savings falling or would like to diversify your investments with real estate.

View fund factsheet

DHL Diversified Growth fund

Invests in a broad range of asset classes including global equities and corporate bonds. Both of these take into account the approach that companies take to ESG issues. It also invests in emerging market government debt and a range of alternative assets (e.g. infrastructure and property).

It may be suitable when you are some way from retirement, are looking for the potential for growth but are willing and able to risk the value of your savings falling, or are looking to spread the risks that your investments are exposed to.

View fund factsheet

DHL Corporate Bonds fund

Invests in high credit quality sterling corporate bonds. As part of the fund’s investment process, it takes into account the approach that companies take to ESG issues.

This fund may be suitable for you when you are some way from retirement and looking to diversify your investments in order to achieve good returns whilst spreading your investments to limit risk exposure.

View fund factsheet

DHL Diversified Cautious fund

This fund may be suitable for all or part of your account up until retirement, if you are looking for growth potential but have a lower risk tolerance. You are willing and able to risk the value of your savings falling but would prefer less risk than you might get with the DHL Diversified Growth fund. It may also be suitable if you are looking to spread the risks that your investments are exposed to. However, there is a risk that your investments won’t keep pace with inflation over the longer term.

View fund factsheet

DHL Fixed-Interest Bonds fund

Invests in UK government and sterling corporate bonds to broadly match the changes in non-increasing and fixed increase annuity prices. Both of these take into account the approach that companies take to ESG issues. A bond is like a loan to an organisation which in return pays interest on that loan and then repays the amount borrowed. Bonds are usually issued either by companies or governments. While the rate of return expected on this fund is lower than the equity and diversified funds, it is also expected to rise and fall in value less sharply.

As well as being appropriate for investors who are less willing and able to accept risk. It is also suitable for members approaching retirement, if you want to buy an annuity, as the value of bond investments typically rise and fall in a similar way to the changing cost of buying a pension. Therefore, this fund can help to minimise changes in the value of your pension as you approach retirement.

View fund factsheet

DHL Inflation-Linked Gilts fund

Invests in inflation-linked bonds issued by the UK Government. This return makes gilts generally less volatile than shares (equities) but as such gives lower returns over longer periods. Although less volatile, their capital value is linked to interest rates and will fall when interest rates are rising and rise when interest rates fall.

It may be suitable for someone nearing retirement who wants greater protection from the value of their savings from large falls in value.

View fund factsheet

DHL Liquidity fund

Invests in high credit quality deposits and other short-term money market instruments in sterling. This fund offers greater security compared to many other types of investment.

It may be suitable for someone close to retirement who wants greater protection from the value of their pension savings against negative returns. However, there is a risk that your investments won’t keep pace with inflation over the longer term.

View fund factsheet

Charges you pay from 1 January 2024

Legal and General Investment Management (LGIM) has been appointed by the Trustees to manage the investment of your Pension account and charge for this service.

For example, the charge for the Cautious Growth fund is 0.125% of fund value per year, which means that for each £1,000 invested in the Cautious Growth Fund, the investment management charge is £1.25 per annum.

Members of the Plan also pay an Annual Administration Management Charge (AMC) of 0.17% of their pension account, which means that for each £1,000 invested, the AMC is £1.70 per annum.

The charges are accrued on a daily basis throughout each quarter and reflected within the unit price for each fund. These charges are recovered through an adjustment to the unit price (so in other words this is automatically reflected in the value of your fund holdings).

	Investment charge	AMC
Description	As a % of fund value	As a % of fund value	Equivalent per £1,000 in your account
DHL Inflation-Linked Gilts fund	0.0725%*	0.17%	£2.425
DHL Liquidity fund	0.100%*	0.17%	£2.70
DHL Diversified Cautious fund	0.125%*	0.17%	£2.95
DHL Diversified Growth Fund	0.125%*	0.17%	£2.95
DHL UK Equities fund	0.110%*	0.17%	£2.80
DHL Emerging Markets Equities fund	0.26%*	0.17%	£3.30
DHL Global Property fund	0.287%*	0.17%	£4.57
DHL UK Corporate Bonds fund	0.100%*	0.17%	£2.70
DHL Fixed-Interest Bonds fund	0.100%*	0.17%	£2.70
DHL Global Equities fund	0.125%*	0.17%	£2.95
DHL Shariah Global Equities fund	0.350%	0.17%	£5.20

*Of this charge, 0.04% is returned to the DHL Group Retirement Plan and used towards the cost of governance and investment advice to the Trustees.