About Henderson Global Investors

Henderson Global Investors – Reasons Why

Date: May 2004

Contents

About Henderson Global Investors........................................................................................................................................1

OEICs......................................................................................................................................................................................... 1

Corporate Bond Fund................................................................................................................................................................ 1

European Capital Growth Fund.................................................................................................................................................1

European Fund......................................................................................................................................................................... 1

Strategic High Yield Bond Fund................................................................................................................................................1

European Smaller Companies Fund.........................................................................................................................................2

Index Linked Bond Fund........................................................................................................................................................... 2

Long Dated Gilt Fund................................................................................................................................................................ 2

Long Dated Corporate Bond Fund............................................................................................................................................2

Preference & Bond Fund........................................................................................................................................................... 2

UK Capital Growth Fund........................................................................................................................................................... 2

UK Equity Fund......................................................................................................................................................................... 3

UK Equity Income Fund............................................................................................................................................................ 3

UK Gilt Fund.............................................................................................................................................................................. 3

UK Smaller Companies Fund.................................................................................................................................................... 3

Emerging Markets Fund............................................................................................................................................................ 3

Industries of the Future Fund.................................................................................................................................................... 3

Global Technology Fund........................................................................................................................................................... 4

International Fund..................................................................................................................................................................... 4

Japan Capital Growth Fund...................................................................................................................................................... 4

Japan Fund............................................................................................................................................................................... 4

North American Fund................................................................................................................................................................ 4

Overseas Bond Fund (not available as an ISA, ISA or PEP Transfer).....................................................................................4

Pacific Capital Growth Fund...................................................................................................................................................... 5

Pacific Fund.............................................................................................................................................................................. 5

Investment Trusts..................................................................................................................................................................... 5

Henderson High Income Trust PLC..........................................................................................................................................5

Henderson Far East Income Trust PLC....................................................................................................................................6

The Bankers Investment Trust PLC..........................................................................................................................................6

The City of London Trust PLC................................................................................................................................................... 6

Lowland Investment Company PLC..........................................................................................................................................7

Witan Investment Company PLC..............................................................................................................................................7

Henderson Electric and General Investment Company PLC....................................................................................................7

The Henderson Smaller Companies Investment Trust PLC.....................................................................................................7

Henderson Strata Investments..................................................................................................................................................8

TR Property Investment Trust PLC...........................................................................................................................................8

Henderson EuroTrust PLC........................................................................................................................................................ 8

TR European Growth Trust PLC...............................................................................................................................................8

Henderson European Micro Trust PLC.....................................................................................................................................9

Henderson TR Pacific Investment Trust PLC...........................................................................................................................9

Unit Trusts – Cash Fund........................................................................................................................................................... 9

Managed Income..................................................................................................................................................................... 10

Fixed income option................................................................................................................................................................ 10

Variable income...................................................................................................................................................................... 10

Income reinvestment............................................................................................................................................................... 10

Independent Portfolios........................................................................................................................................................... 10

Distribution Portfolio................................................................................................................................................................ 10

Growth Portfolio...................................................................................................................................................................... 11

Income Portfolio...................................................................................................................................................................... 11

Portfolio Management Service..............................................................................................................................................11

Distribution Portfolio................................................................................................................................................................ 11

Income & Growth Portfolio......................................................................................................................................................12

Growth Portfolio...................................................................................................................................................................... 12

Overseas Portfolio................................................................................................................................................................... 12

International Portfolio.............................................................................................................................................................. 12

About Henderson Global Investors

Henderson Global Investors is a dynamic participant in investment markets across the globe, providing a wide range of

investment products and services to institutions and individuals in the UK, Europe, North America and Asia Pacific. It manages

over £69.4 billion (as at 30 June 2003) in assets and employs more than 800 people around the world. Henderson has a clear

focus on investment management. Our purpose is to build people's wealth and security through skilful investment. Our goal is to

be a world class investment management company, operating globally.

In Europe, Henderson has offices in France, Germany, Holland, Italy, Switzerland and the UK, where our headquarters are

based. Henderson has had a presence in North America since 1999 when it acquired US real estate investment manager

Phoenix Realty Advisers, which was subsequently renamed Henderson Global Investors (North America) Inc. Henderson has

offices in Chicago and Hartford. Additionally North Americans will know the Henderson brand through its distribution

partnerships with Mackenzie Financial Corporation, one of Canada's leading mutual fund providers. In Asia Pacific, investors

can access Henderson’s asset management expertise through its offices in Tokyo and Singapore.

Henderson’s main focus is on active management across a variety of asset classes, including equities and fixed interest asset

management, property services, private capital, listed investment trusts, retail OEICs and an offshore Horizon range of funds

distributed through a combination of both retail and wholesale channels.

With strong investment expertise across every asset class, Henderson’s skilful investment managers invest in every major

market around the globe. They are supported by a global team of researchers and economists who have a keen understanding

of the economic forces driving the security markets and who undertake rigorous sector and theme analysis. Underpinning this

process is a comprehensive risk-control framework to ensure that investment views are translated into portfolios managed in

line with investors’ risk and return requirements.

Please note that this is only suggested text. You may wish to tailor this text to suit your house style, and give more or

less information to your clients. It is by no means comprehensive, and Henderson Global Investors can take no

responsibility for your compliance. You should be aware that when you make recommendations there may be other

regulatory requirements that apply. This is meant to only be an example for IFAs and should not be construed as a

recommendation to invest.

Henderson Global Investors – Reasons Why 1

OEICs

Henderson Global Investors is among the leaders in the investment funds industry, with 25 OEIC funds covering a broad range of markets and investment objectives. Like unit trusts, OEICs are a cost effective method of investing in the stock market. By pooling your money together with other like minded investors, you can benefit from a professionally managed portfolio of company shares without the time-consuming and sometimes costly administration associated with managing your own portfolio.

The Overseas Bond is only available as an OEIC, the other 24 OEICS are also available in ISAs, ISA Transfers and PEP Transfers.

Corporate Bond Fund

I recommend a lump sum investment of £x,xxx into the Henderson Corporate Bond Fund.

This fund aims to provide an income by investing in sterling denominated corporate bonds, eurobonds and other investment grade bonds.

The current net yield is x.x%. This should equate to an initial income of around £x,xxx per annum after tax / Whilst this is an income producing fund, I recommend for the time being that income is accumulated in order to enhance your total investment return.

European Capital Growth Fund

I recommend a lump sum / monthly investment of £x,xxx into the Henderson European Capital Growth Fund.

This Fund aims to achieve long term capital growth by investing in companies throughout Europe, with the exception of the UK. Holdings will generally be in larger companies, although some smaller and medium sized company stocks may also be selected. Smaller company stocks are usually considered to be more open to market fluctuations than larger companies, but this may be offset by their superior potential for growth over the long term. The fund has an excellent track record, with consistent long term performance, yet its volatility is in line with the sector average. It is a well balanced fund with a wide geographical and sector spread across the continent.

European Fund

I recommend a lump sum / monthly investment of £x,xxx into the Henderson European Fund.

This Fund aims to achieve long term capital growth by investing primarily in larger companies throughout Europe, with the exception of the UK. It is a well balanced Fund with a wide geographical and sector spread across the continent.

Strategic High Yield Bond Fund

I recommend a lump sum investment of £x,xxx into the European High Yield Bond Fund.

This Fund aims to provide a high income with some potential for capital growth by investing in European bonds. These will be primarily high yielding bonds issued by companies registered or incorporated in Europe or deriving significant revenues from their European operations or with significant assets in Europe.



European Smaller Companies Fund

I recommend a lump sum / monthly investment of £x,xxx into the Henderson European Smaller Companies Fund.

This Fund aims to achieve long term capital growth by investing in companies throughout Europe, with the exception of the UK. Holdings will be in smaller companies which, although usually considered to be more open to market fluctuations than larger companies, may offset this prospect by their superior potential for growth over the long term. The fund focuses on opportunities which demonstrate solid track records and high quality management.

Index Linked Bond Fund

I recommend a lump sum investment of £x,xxx into the Henderson Index Linked Bond Fund.

This Fund aims to provide an income by investing mainly in UK Government index linked securities.


Long Dated Gilt Fund

I recommend a lump sum investment of £x,xxx into the Henderson Long Dated Gilt Fund.

This Fund aims to provide an income by investing in long dated UK Government securities and floating rate notes. The securities will have an excess of 15 years to maturity. This Fund is particularly suited to risk averse investors.


Long Dated Corporate Bond Fund

I recommend a lump sum investment of £x,xxx into the Henderson Long Dated Corporate Bond Fund.

This Fund aims to provide an income by investing in long dated sterling denominated corporate bonds, eurobonds and other investment grade bonds.


Preference & Bond Fund

I recommend a lump sum investment of £x,xxx into the Henderson Preference & Bond Fund.

This Fund aims to provide an income by investing in fixed interest, mainly corporate bonds and preference shares issued by UK and European companies. The Fund is popular with risk averse investors seeking regular attractive income whilst maintaining a lower than average level of volatility.

The current net yield is x.x%. This should equate to an initial income of around £x,xxx per annum after tax.

UK Capital Growth Fund

I recommend a lump sum / monthly investment of £x,xxx into the Henderson UK Capital Growth Fund.


This Fund aims to achieve long term capital growth by investing in companies in the UK. Holdings will generally be in larger companies, with a strong bias towards the top 100. It has a well balanced spread of investments in different economic sectors.

UK Equity Fund

I recommend a lump sum / monthly investment of £x,xxx into the Henderson UK Equity Fund.

This Fund aims to achieve long term capital growth and some income by investing in larger companies in the UK, along with some fixed interest and convertible shares. The Fund has a well balanced spread of investments across different economic sectors.

UK Equity Income Fund

I recommend a lump sum / monthly investment of £x,xxx into the UK Equity Income Fund.

This Fund invests in larger companies in the UK, along with some fixed interest and convertible shares. It aims to generate an income in excess of the yield of the FTSE All Share Index, and to offer a degree of long term capital growth.

UK Gilt Fund

I recommend a lump sum investment of £x,xxx into the Henderson UK Gilt Fund.

This Fund aims to provide an income by investing in UK Government Securities and floating rate notes. This fund is particularly suited to risk averse investors.

The current net yield is x.x%. This should equate to an initial income of around £x,xxx per annum after tax. Whilst this is an income producing fund, I recommend for the time being that income is accumulated in order to enhance your total investment return.

UK Smaller Companies Fund

I recommend a lump sum / monthly investment of £x,xxx into the Henderson UK Smaller Companies Fund.

This Fund aims to achieve capital growth by investing in smaller UK companies. The fund manager focuses on growth opportunities and will not sell holdings in companies just because they become large. Smaller companies, although usually considered more open to market fluctuations than larger ones, may offset this prospect by their superior potential for growth over the long term.

Emerging Markets Fund

I recommend a lump sum / monthly investment of £x,xxx into the Hendersons Emerging Markets Fund.

This Fund aims to achieve capital growth by investing in companies based in, or deriving revenues from, emerging markets. Although emerging markets tend to be more volatile than other more established markets, this may be offset by their potential for growth over the long term.


Industries of the Future Fund

I recommend a lump sum / monthly investment of £x,xxx into the Henderson Industries of the Future Fund.

Objectives

The Henderson Industries of the Future Fund invests globally in companies that we believe will benefit from the shift towards sustainable economics and business practices. These include companies providing clean energy, medical technology, social housing and organic foods.

The Investment Opportunity

Social, technological and demographic trends, together with government policies, are fundamentally shaping future economic activity. For example, by 2015, annual global investment in renewable energy projects will grow from today’s level of around USD 20 billion USD 100 billion.i The global water industry is now a USD 300-400 billion a year market, and is expected to grow at an average rate of 7% per annum to 2010. ii Similar growth opportunities can also be found in medical technology, health and safety, and social housing.

The central conclusion of Henderson Global Investors’ research into these and other investment areas is that sustainability should be considered as a strategic investment theme that is reshaping the economic landscape.

Global Technology Fund

I recommend a lump sum / monthly investment of £x,xxx into the Henderson Global Technology Fund.

This Fund has a good long term record of growth, and in the relatively volatile technology sector, concentrates on larger companies with a proven track record, rather than the riskier start up stocks. The technology sector offers the prospect of superior long term growth, although it can also be more exposed to short term market fluctuations than companies in more established industries.

International Fund

I recommend a lump sum / monthly investment of £x,xxx into the Henderson International Fund.

Aiming for long term capital growth, this Fund invests in listed stocks throughout the world and is unrestricted in its choice of economic sector. A selection of fund managers contribute to the stock selection, with a lead fund manager to co-ordinate the investment allocations.

Japan Capital Growth Fund

I recommend a lump sum / monthly investment of £x,xxx into the Henderson Japan Capital Growth Fund.

This Fund aims to achieve long term capital growth by investing in Japanese companies. The fund is not restricted in the size of companies in which it may invest, and may therefore contain holdings in smaller companies. Smaller company stocks are usually considered to be more open to market fluctuations than larger companies, but this may be offset by their superior potential for growth over the long term.

i http://www.dti.gov.uk/sectors_environment.htmlii Canaccord, Water – The Future is Clear, October 10, 2002


Japan Fund

I recommend a lump sum / monthly investment of £x,xxx into the Henderson Japan Fund.

This Fund aims to achieve long term capital growth by investing primarily in larger Japanese companies. It is suitable for investors who would like some exposure to the Japanese market, but with a relatively cautious approach.

North American Fund

I recommend a lump sum / monthly investment of £x,xxx into the Henderson North American Fund.

This Fund aims to achieve long term capital growth by investing in North American companies, with some holdings in Canada. Investments are made in a wide spread of companies, carefully chosen across different market sectors. There is a bias towards larger and better known companies.

Overseas Bond Fund (not available as an ISA, ISA or PEP Transfer)

I recommend a lump sum / monthly investment of £x,xxx into the Henderson Overseas Bond Fund.

This Fund aims to provide an income by investing in fixed and floating rate securities in any area of the world excluding the UK. The Fund manager typically seeks a small number of holdings offering the best potential returns, not only from income and capital growth, but also through movements in currency exchange rates.


Pacific Capital Growth Fund

I recommend a lump sum / monthly investment of £x,xxx into the Henderson Pacific Capital Growth Fund.

This Fund aims to achieve long term capital growth by investing in companies throughout the Pacific region, with the exception of Japan. The portfolio is conservatively managed, with emphasis on companies with quality management and growth potential.

Pacific Fund

I recommend a lump sum / monthly investment of £x,xxx into the Henderson Pacific Fund.

This Fund aims to achieve long term capital growth by investing in companies throughout the Pacific region, with the exception of Japan. The portfolio is managed along institutional lines, with stocks generally being selected from among larger companies.

Investment Trusts

All Henderson Investment Trusts are available in an ISA and ISA and PEP Transfers.

Henderson High Income Trust PLC


Henderson High Income aims to give shareholders a high income stream with the real prospect of growth in capital value. It invests in a prudently diversified selection of both well-known and smaller companies and fixed interest stocks. Accordingly the growth of the trust will be primarily related to equities but with some exposure to fixed interest markets.

We aim to invest in companies with strong balance sheets and paying dividends which they can consistently afford to grow. This is to minimise the risk of dividend cuts and to give the prospect of dividend increases in the longer term. There is a focus on well-managed companies whose qualities have been temporarily overlooked and which offer potential for capital appreciation over the medium term.The new Ordinary Shares are entitled to all the net revenue from the Company's portfolio that is distributed and will be entitled to all of the net assets of the trust following repayment of the Zero Dividend Preference shares (‘ZDPs’). The yield is currently x.x% so you could expect to receive an initial income of £x,xxx per annum based on my recommended investment.

The ZDPs had an initial capital entitlement of 50p per share which will increase at a compound annual rate of 8.2 % so as to reach a final capital entitlement of 74.87p per share on 30 September 2005. Based on my recommended investment and assuming the current price of shares, I would expect you to

receive a sum of £x,xxx at wind up date. But should the need arise you may sell your shares in the

market at any time prior to wind up, at the prevailing market price which is subject to fluctuation.

The ZDPs are well covered by the assets of the trust and are therefore a relatively safe form of investment offering below average risk.

The units consist of one new Ordinary Share and one ZDP and are similar to an ordinary share in a conventionally structured trust. By stapling them together the ZDPs substantially reduce the ‘gearing’ of the new Ordinary Shares.

Henderson High Income units are similar to an ordinary share in a conventionally structured trust. The ordinary shares offer a geared, higher yielding investment whilst the zero dividend preference shares offer pre-determined growth with relatively low risk.

Ordinary shares will particularly appeal to investors seeking a very high income from an equity investment, with prospects for capital growth. ZDPs will appeal to investors who seek capital growth with below average risk. With predictable quarterly dividends and long-term growth in value, Henderson High Income will form an important part of many investors' portfolios.

Henderson Far East Income Trust PLC

Henderson Far East Income Trust is the only UK investment trust to combine specialisation in the Far East with a high yield. It pays dividends quarterly.

Henderson Far East Income Trust invests in companies based in the Far East, including Australia, New Zealand, Hong Kong and Japan. It invests in both shares and convertible bonds so as to generate a high income and also to benefit from the economic growth prospects in the Far East.

Henderson Far East is ideally suited to investors who wish to benefit from growth in Far Eastern markets but who also wish to continue to receive a substantial income from their investment. The current net income yield of the trust is x.x%, which should equate to an initial income of around £x,xxx per annum after tax. / Whilst this trust has an income bias, I recommend for the time being that income is accumulated in order to enhance your total investment returns.

The Bankers Investment Trust PLC

Bankers invests in a combination of UK and international companies, both large and small.

Its objectives are to achieve long term asset growth in excess of the FTSE All Share Index and to achieve regular dividend growth in excess of the increase in the Retail Prices Index.

The trust generally follows a ‘value’ investment style. This means that it seeks out companies whose share price appears undervalued. This may be because the stock market has yet to react to their potential or because they


operate in sectors which have been out of favour. Whatever the reason for a share offering value, Bankers focuses on strong companies where the stock market has yet to react to that strength.

Bankers is one of the best known investment trusts and is an ideal starter investment for those who value the potential available from the bargains which the stock market offers.

The City of London Trust PLC

City of London invests in quality British companies, many of which are household names or international leaders in their industry, such as Glaxo, Shell or Lloyds TSB. It invests predominantly in large companies.

City of London takes a long-term view in its investment approach, with the aim of increasing the value of its assets and its dividends in the long term at a rate faster than that of the FTSE All Share Index.

City of London has grown to be one of the largest investment trusts investing solely in the UK. Its investment style has produced consistently good performance and it has increased its dividend every year since 1966. With a higher than average yield and quarterly dividends, City of London is ideal for investors looking for a top quality UK investment.

City of London will particularly appeal as a starter equity investment for regular savers or as a cornerstone of a UK equity portfolio, for example backing a mortgage. The current net income yield of the trust is x.x%, which should equate to an initial income of around £x,xxx per annum after tax. / Whilst this trust has an income element, I recommend for the time being that income is accumulated in order to enhance your total investment return.

Lowland Investment Company PLC

Lowland invests in companies which pay high and growing dividends, and where we believe that there are strong prospects of capital growth.

Lowland invests over half its portfolio in small and medium sized UK companies and selects them on the basis of the value they offer. We are always looking out for good companies which have been undervalued by the stock market, as we are confident that short term fashion and trends provide good investment opportunities.

Lowland should appeal to investors who want a higher than average income from their investment and who want that income, and their capital, to grow over the long term. The current net income yield of the trust is x.x%, which should equate to an initial income of around £x,xxx per annum after tax. / Whilst this trust has an income element, I recommend for the time being that income is accumulated in order to enhance your total investment return.

Witan Investment Company PLC

Witan invests in a prudently diversified range of well managed large companies, with some smaller companies selected for their excellent long term growth prospects. It invests in companies around the world but aims always to have over half its portfolio in the United Kingdom.Witan is particularly suited to sterling based investors looking for a combination of UK and international investments. Witan aims to grow the capital value of investors’ assets steadily and without taking undue risk. It does this by identifying and investing in those businesses around the world with the best prospects for growth of capital and dividends. One of the UK’s largest investment trusts, Witan features a globally diversified portfolio of around 200 top companies from around the world, each carefully selected for the quality of their business and their prospects.

Witan is an ideal investment for those who want a ‘one hit’ representative stake in some of the soundest companies in both the UK and global economies, managed by some of the UK’s top investment managers. It is conservative in its outlook and has consistently produced good returns for investors over its 90 year history.


Henderson Electric and General Investment Company PLC

Henderson Electric and General is an international portfolio of companies selected for their prospects of above average capital growth. The consistent, long-term performance stems from a sharply focused approach to stock selection.

Stock selection – stocks are selected from the universe of small, medium and large companies solely according to merit. The principal criteria are: the strength of the management and their clarity of vision; the growth potential of the markets in which they operate and their competitive advantage; and the level of cash generation.

Henderson Electric and General will appeal to investors looking to benefit from the growth of some of the most dynamic and exciting international companies.

The Henderson Smaller Companies Investment Trust PLC

The investment objective of The Henderson Smaller Companies Investment Trust is to maximise long term returns by investing in a UK portfolio of smaller companies with growth potential.

Although classified in the smaller companies sector, the trust takes the approach of running its winners. This means that new investments are selected in the small cap sector but when an investment is successful and grows, the trust will not necessarily sell simply because the company has outgrown the smaller companies category.

The trust focuses on growth and consistency in its investments. It seeks out investments in companies which provide a unique or differentiated product or service, focusing largely on intellectual, rather than physical, capital. A large investment trust such as this provides an ideal means of gaining exposure to smaller companies.

The Henderson Smaller Companies will appeal to investors who are looking to invest in quality UK smaller companies through one of the largest and longest established investment trusts.

Henderson Strata Investments

Henderson Strata searches out exceptional and exciting growth companies in the UK and from around the world.

Henderson Strata is highly focused on achieving above average capital growth and income is not a priority. It does this by finding little known but exceptional companies with the potential to grow fast. We believe that by adopting a consistent style combined with a rigorous process we shall achieve long-term returns ahead of our benchmark.

The search for investments is on a stock by stock basis. Many of the companies chosen for investment will not be well known and are often little researched, so it is considered vital to develop and maintain close contact. Applying strict criteria quickly separates the true long term growth stocks from those which may prove to be just an average investment. If circumstances change and the prospects look less encouraging, an investment is sold promptly. This ensures a dynamic portfolio.

Henderson Strata should appeal to investors who recognise the long term growth potential of a globally diversified smaller companies investment trust, particularly as a complement to a well balanced, core investment portfolio.

TR Property Investment Trust PLC

TR Property invests by means of a combination of the shares of property companies and direct property. The closed end investment trust structure is ideally suited to direct property investment and it provides diversified exposure to a large range of commercial property interests and shares.

TR Property also offers the advantage for investors of being able to buy and sell, quickly and cheaply, at any time, thus avoiding the delays and expense normally incurred with property investment. With Henderson Global Investors you benefit from the property skills of one of the largest specialist property investment teams.


Because of its balanced investment approach, the trust is able to switch its investment emphasis between direct property and the shares of property companies where this is believed to be advantageous. In property shares, the emphasis is on the ability of companies to grow both their dividends and capital value, which implies a tendency to seek out smaller companies with potential.

TR Property provides an ideal way of investing in commercial property and benefits from the specialist expertise of one of the UK’s largest specialist property management teams, while maintaining full accessibility for the investor.

Henderson EuroTrust PLC

Henderson EuroTrust's approach can be summarised as trying to find the 50 most interesting investments in Europe at any one time, in the light of widespread changes in European economies and companies. It concentrates on medium to larger sized companies, is driven totally by stock selection rather than either sector or geography, and tends to prefer growth companies.

TR European Growth Trust PLC

TR European Growth invests in smaller and medium sized continental European companies which appear to be undervalued when compared with larger companies.

When choosing which investments to buy, the managers look at each stock individually, keeping an eye on countries and sectors to ensure that there is some spread within the portfolio. They always look for clear upside when they buy a share and are not afraid of having significant sums in any one country or sector. Likewise, from time to time, they use borrowings to increase returns when there is particular value in the market available.

As a consequence, over the long term, TR European Growth has delivered returns substantially in excess of its peer group and of its benchmark. This clear focus on the best opportunities means that the manager remains confident that TR European Growth should continue to provide substantial returns for its investors over the long term.

TR European Growth should appeal to investors who recognise the growth potential of smaller and medium sized companies in Europe and who are looking to complement a balanced, core portfolio.

Henderson European Micro Trust PLC

The Company’s investment objective is to achieve long-term capital growth through investment in European smaller companies with market capitalisations of up to £250 million. The Company will aim for a net asset value total return greater than that of its benchmark index, the HSBC Smaller Europe (ex-UK) Index.

The increasing number of listed companies in Europe not only provides the opportunity to invest in companies involved in new growth areas, but we believe that the substantial increase in choice is also likely to result in market inefficiencies as it becomes easier for specific companies to be overlooked. We believe that the key is in identifying specific investment opportunities in good companies at attractive valuations rather than having exposure to the asset class as a whole. Smaller companies tend to be less researched and suffer from less investor interest than their larger counterparts.

It is important to identify whether the potential investee company has a robust business model which includes a good competitive position, long term potential, strong management and a means of realising value for investors.

We believe that an investment trust is well suited to investment in very small companies. The liquidity of smaller companies, by their nature, tends to be relatively low and so the certainty of the closed-end structure, with the flexibility of gearing, is advantageous.

The investment style is likely to result in a relatively concentrated portfolio using individual stock selection as the main determinant of portfolio construction.


The Company may utilise short to medium-term borrowings, as opportunities arise, to enhance shareholder returns, but does not intend to use long-term or fixed gearing. Borrowings are not expected to exceed one third of net assets.

Up to 20% of the portfolio may be invested in unlisted securities, with an emphasis on pre-IPO investments.

Henderson European Micro Trust should appeal to investors who recognise the potential of small, growing companies in Europe and who want to complement a balanced core portfolio.

Henderson TR Pacific Investment Trust PLC

Henderson TR Pacific is a specialist investment trust which seeks capital growth from Pacific region stock markets (excluding Japan and Australasia). The objective is to build a core portfolio of quality investments in high growth sectors, with an emphasis on young companies and less mature economies. Henderson TR Pacific is ideally suited for investors who wish to benefit from growth in Far Eastern stock markets.

Unit Trusts – Cash Fund

I recommend a lump sum investment of £x,xxx into the Cash Fund.

This Fund aims to provide security for your capital as well as some income, which is automatically retained within the fund and increases the value of units.

Investments in the Henderson Cash Fund can be switched into any of the Henderson OEIC sub funds or investment trusts.

Managed Income

Some suggestions for your client reports

An ISA [or a PEP] allows an investment to grow without liability to tax on any income or capital growth generated.

Fixed income option

The Henderson Managed Income Plan/ISA/PEP is an investment [Maxi ISA or PEP transfer product] which aims to provide an above average and sustainable level of income from a portfolio of Henderson OEIC (open-ended investment company) funds.

Currently I believe it is appropriate for you to take a fixed monthly/quarterly income of x.x% per annum which equates to £xxx per month [or quarter] based on an investment [or a transfer of your PEP from xxx] of £x,xxx. You should be aware that there is a risk that your capital may be eroded through taking this level of income although Henderson have designed and will manage the product with a view to minimising this risk.

Variable income

The Henderson Managed Income Plan/ISA/PEP is an investment [Maxi ISA or PEP transfer product] which aims to provide an above average level of income from a portfolio of Henderson OEIC (open-ended investment company) funds.

I believe it is appropriate for you to invest £x,xxx in the Plan [ISA or transfer your xxx PEP which is currently valued at around £x,xxx] with quarterly distributions paid to you. Based on a current income yield of x.xx% [6.39% as at 31/1/03] per annum you could expect to receive around £xxx each quarter which could commence on 23rd


[January/April/July/October].

Income reinvestment

The Henderson Managed Income Plan/ ISA/PEP is an investment [Maxi ISA or PEP transfer product] which aims to provide an above average level of income from a portfolio of Henderson OEIC (open-ended investment company) funds. The portfolio consists primarily of fixed interest (bond) funds which tend to be less volatile than equity (share) based funds.

I do not suggest you actually taking the income generated, but to reinvest it within the Plan [ISA or PEP] in order to achieve a total investment return. Should you need to take an income later on this can be easily arranged.

Independent Portfolios

Distribution Portfolio

I am recommending an investment of £x,xxx into the Henderson Independent Distribution Portfolio Trust which aims to achieve an income significantly in excess of the yield of the FTSE All Share Index with the prospect for some capital growth through investment in a spread of authorised companies which may be selected from those available in the whole market. The portfolio offers a level of international diversification whilst maintaining a core holding in the UK. You will also gain exposure to a different range of manager styles and approaches to investment and this diversification should help to reduce risk. You will receive full half yearly reports and valuations to keep you informed of your fund's progress.

The Trust is managed on a discretionary basis. Henderson's multi-manager investment team will use their expertise to select funds from reliable and established investment managers, and to regularly review and update the portfolio to reflect changing market conditions. There are no geographical or sector restrictions but the portfolio will always retain a core holding of UK funds.

Growth Portfolio

I am recommending an investment of £x,xxx into the Henderson Independent Growth Portfolio Trust which aims to achieve long term capital growth through investment in an international portfolio of authorised unit trusts and/or authorised companies, selected from leading fund management groups across the industry. The portfolio offers a level of international diversification whilst maintaining a core holding in the UK. You will also gain exposure to a different range of manager styles and approaches to investment and this diversification should help to reduce risk. You will receive full half yearly reports and valuations to keep you informed of your fund's progress.


Income Portfolio

I am recommending an investment of £x,xxx into the Henderson Independent Income Portfolio Trust which aims to achieve an income in excess of the yield of the FTSE All Share Index through investment in an international portfolio of unit trusts and/or open ended investment companies selected from leading fund management groups across the industry. The portfolio offers a level of international diversification whilst maintaining a core holding in the UK. You will also gain exposure to a different range of manager styles and approaches to investment and this


diversification should help to reduce risk. You will receive full half yearly reports and valuations to keep you informed of your fund's progress.


Portfolio Management Service

The Henderson Portfolio Management Service will give you access to a portfolio of carefully selected unit trusts and fixed interest securities, selected from across the market, and not restricting you to the trusts of just one management group. This is a discretionary service. Henderson's multi-manager investment team will use their expertise to select trusts from reliable and established investment managers, and to regularly review and update the portfolio to reflect changing market conditions and the underlying funds. This avoids the need for you to become involved in the day to day running of your portfolio. The service includes full six monthly reports, portfolio valuations, and other features to keep your paperwork to a minimum.

The service offers the choice of five investment portfolios from which I am recommending an investment of £xx,xxx into the ....

Distribution Portfolio

This is managed to provide you with a high level of dividend income from a portfolio which will initially be split fairly equally between UK equity based unit trusts and fixed interest securities such as gilts (British Government securities). The portfolio has a relatively low exposure to risk, and the potential for a degree of capital growth over the longer term. The current net income yield of the portfolio is x.x% per annum, which should equate to an initial income of around £x,xxx per annum, after tax./ Whilst this is an income portfolio I recommend for the time being that income is reinvested within the portfolio in order to enhance your total investment return.

Income & Growth Portfolio

This is invested in a combination of unit trusts which will offer you good prospects for long term capital growth and a rising level of income. The core of the portfolio is in a mix of UK income trusts, but there is a level of international diversification which is included to enhance the portfolio's potential for capital growth. The current net income yield of the portfolio is x.x% per annum, which should equate to an initial income of around £x,xxx per annum, after tax./ Whilst this portfolio produces a level of income I recommend for the time being that income is reinvested within the portfolio in order to enhance your total investment return.

Growth Portfolio

This is invested in a selection of unit trusts which have the potential to provide you with above average long term capital growth. Investment includes a significant level of international diversification alongside a core portfolio of UK trusts to enhance the prospects for capital growth.

Overseas Portfolio


This is invested in unit trusts which have the potential to provide you with above average long term capital growth. The portfolio is entirely diversified across the overseas markets without any direct exposure to the UK. Developing markets may be included as well as those of more established regions to enhance the prospects for capital growth.

International Portfolio

This is invested in unit trusts which have the potential to achieve above average capital appreciation over the long term. Investment will be predominantly in overseas markets whilst retaining some exposure to the UK market.


Henderson Global Investors4 Broadgate London EC2M 2DATel: 020 7818 1818 Fax: 020 7818 1819

House view

This document has been produced based on Henderson Global Investors’ research and analysis and represents our house view.

Please remember that past performance is not necessarily a guide to future performance. The value of an investment and the income from it can fall as well as rise as a result of market and currency fluctuations and investors may not get back the amount originally invested. Tax free in the context of PEPs and ISAs means free from personal liability to income and capital gains tax. Tax assumptions may change if the law changes, and the value of tax relief will depend upon your individual circumstances.

Disclaimer

The information provided is for the sole use of those in receipt of this document. It may not be reproduced in any form without the express permission of Henderson Global Investors and to the extent that it is passed on care must be taken to ensure that this is in a form which accurately reflects the information presented here.

Reference to individual companies is included solely for the purpose of illustration and should not be construed as a recommendation to buy or sell the same. Henderson Global Investors may provide information on its products and services only and will not give investment advice based on individual circumstances.

Whilst Henderson Global Investors believe that the information is correct at the date of this presentation, no warranty or representation is given to this effect and no responsibility can be accepted by Henderson Global Investors to any intermediaries or end users for any action taken on the basis of the information.

Please refer to the prospectus or Key Features Document for further information.

Regulatory status

Henderson Global Investors is the name under which Henderson Global Investors Limited, Henderson Investment Funds Limited, Henderson Fund Management plc and Henderson Administration Limited provide investment products and services. All companies are authorised and regulated by the Financial Services Authority.


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