This material has been prepared by PP Capital Asset Management to inform investors who want to know more about the products. The publication is not an offer or invitation to buy or sell shares, securities, currencies or other financial instruments. Investors are encouraged to exercise their own judgment on how to invest, and the publication's information, calculations, assessments and estimates should not replace the customer's own assessment.

This material has been prepared by PP Capital Asset Management to inform investors who want to know more about the products. The publication is not an offer or invitation to buy or sell shares, securities, currencies or other financial instruments. Investors are encouraged to exercise their own judgment on how to invest, and the publication's information, calculations, assessments and estimates should not replace the customer's own assessment.

PPC Mortgage Bonds is PP Capital's mortgage bond product and is managed by Palle Lund Hansen and Sverrir Sverrisson, who have successfully managed the portfolio following the same strategy since its inception in 2013. The strategy is a good option to those who want limited risk in their portfolio with a stable positive return that compliments well with negative returns in a bank deposit account.

The investment strategy for PPC Mortgage Bonds takes into account the legislation on Danish mortgage institutions and bank investment frameworks. These segments have been successful in Denmark for many, many years.. The low-risk strategy fits well into a balanced mandate with risky asset classes.

PPC Mortgage bonds with AAA-rating aim to provide customers with a stable annual return of between 1.5% - 2% in the current interest rate environment. The strategy's objective is to achieve limited risk returns, with the current average modified duration being between 0 and 2.3.

The strategy focuses on delivering a high risk-adjusted return by investing exclusively in Danish government, municipal, and mortgage bonds, with the opportunity to remain in cash for shorter periods. The strategy is actively managed, but the focus is on preserving the customer's capital by positioning the portfolio so that there is minimal risk of greater fluctuations in the portfolio's value. The strategy is based on good and solid craftsmanship, where all bonds are evaluated on the basis of a thorough and efficient selection process, which over time has proved its worth.

In order to provide a stable return, the portfolio is actively allocated between government, municipal and convertible mortgage bonds, as well as ordinary and capped floaters. There is no duration limitation on the individual bonds, but the weighted modified duration of the strategy must be between 0 and 5. Portfolio liquidity is prioritized at the highest level and reviewed on an ongoing basis. This liquidity must be adequate enough for us to be able to actively allocate between different instruments to maximize our return on investment.

This material has been prepared by PP Capital Asset Management to inform investors who want to know more about the products. The publication is not an offer or invitation to buy or sell shares, securities, currencies or other financial instruments. Investors are encouraged to exercise their own judgment on how to invest, and the publication's information, calculations, assessments and estimates should not replace the customer's own assessment.

This material has been prepared by PP Capital Asset Management to inform investors who want to know more about the products. The publication is not an offer or invitation to buy or sell shares, securities, currencies or other financial instruments. Investors are encouraged to exercise their own judgment on how to invest, and the publication's information, calculations, assessments and estimates should not replace the customer's own assessment.

PPC TAKTIK is a quantitative asset allocation strategy with dynamic allocation between asset classes. The strategy is data-driven and is based on the well-known intermarket analysis hypothesis on market conditions in the financial markets. By using this approach, the strategy seeks to exploit the economic conditions that exist between commodities, inflation, interest rates, stock prices, and the economy as a whole. The overall goal is to measure market risk and allocate to the asset class that will generate the highest return on a monthly basis. The strategy is rule-based, and the investment process is therefore objective, implying that manual investment decision making would compromise final allocation. TAKTIK is a strategy where the goal is to increase wealth via high returns and low costs.

By investing in TAKTIK, the investors can expect us to:
- Build a concentrated index portfolio
- Invest in US index-based ETFs
- Invest long term
- Modify the portfolio two to four times per year. However, market turmoil may cause higher frequency of portfolio adjustment due to volatile markets
- Always remain fully invested
- Follow the general business cycle and
- Achieve positive absolute returns without an annual loss

Economic conditions are input through indicators. These indicators are quantified information that helps explain trends that can be complicated and difficult to see. Indicators typically have three functions; simplification, quantification and communication. The indicators in TACKTIK are designed with the first features in mind, and quantify market effects by simplifying the natural complexity that exists in each market relationship. In this way, we are able to gather a large amount of market information, simplify this data, and use it in our analysis of market risk.

The strategy operates with four signals:
1. IN,
2. Strong IN,
3. OUT and
4. Strong OUT
respectively. The strategy allocates funds to liquid ETFs where neither repo nor derivative contracts are used. We analyze data after the last trading day of the month, and the allocation strategy provides us with a signal for the coming month. We then allocate the funds in the portfolio based on the signal.

In the selection of ETFs, our investment criteria are consistent with our investment philosophy which cover assets under management, market spreads, daily turn-over volume, and whether the ETFs make use of derivatives or loans.

What is an ETF?

ETF is an acronym for Exchange-Traded Fund- a diversified collection of assets traded on stock exchanges around the world, which can be bought and sold at any time during exchange opening hours. They are therefore hybrid investment products that carry aspects of both mutual funds and equities. The similarity to mutual funds is that both investment products are run by a fund manager, who manages the underlying assets for a set fee. ETFs, unlike mutual funds, are traded intraday on global stock exchanges and can therefore be bought and sold by retail, institutional investors and professional counterparties. ETFs are priced continuously which provide them as a rule with a relatively greater level of liquidity than the underlying component instruments.

ETFs can therefore both be traded on margin, repo, or used in an investment strategy by sophisticated investors. Although the so-called closed-end mutual funds are also traded on stock exchanges, ETFs differ by publishing the underlying stock value daily, allowing buyers and sellers to examine the traded ETF versus the prices of the underlying assets. Like investment funds, net asset value (NAV) is also calculated on ETFs, so prices give a fair value to the underlying stocks.

ETFs provide an opportunity to obtain the desired exposure and investment strategy of an investment fund. It's both an easy and inexpensive way to invest money, and offers investors numerous opportunities to put together their portfolio in the best and most diversified way possible.

ETFs are among the most interesting financial products on the market at present, and their popularity has meant that the number of listed ETFs has risen from 276 in 2003 to over 4,700 in 2016, while assets under management have gone from $204.3 billion in 2003 to $3,422.2 billion in the span of 13 years. In other words, the innovative development of the ETF market over the past 20 years has changed the way financial markets work and the way investor place their money. The introduction of ETFs has enabled private investors to gain exposure to asset classes and investment strategies that were previously inaccessible or unattainable due to high costs.

This material has been prepared by PP Capital Asset Management to inform investors who want to know more about the products. The publication is not an offer or invitation to buy or sell shares, securities, currencies or other financial instruments. Investors are encouraged to exercise their own judgment on how to invest, and the publication's information, calculations, assessments and estimates should not replace the customer's own assessment.