Franklin Templeton Insights: What’s driving Oil Market Volatility?

Fred Fromm, vice president, portfolio manager and research analyst with Franklin Equity Group, explains why recent oil market demand and supply shocks are essentially unprecedented and are leading to oil prices that are uneconomical for almost all market participants.

At Friday’s OPEC+ ¹ meeting, Russia balked at supply cuts to offset the reduced demand we see from the spread of COVID-19. In response, over the weekend, Saudi Arabia dropped its export prices across the board, essentially starting a price war in the global oil markets. The idea seems to be to force Russia to come back to the bargaining table and agree to supply cuts.

We believe the combination of both a demand shock (from the coronavirus outbreak) and a supply shock (from the price reductions) is essentially unprecedented, with no equivalent in the last 30 years that we can point to.

Outlook

The oil prices we are seeing currently are uneconomical for almost all market participants, in our opinion. While higher-cost producers like US shale clearly cannot generate profits at these levels, we believe even cheaper producers like Russia are likely to see challenges in this price environment. Saudi Arabia, while having very low production costs, also has domestic spending needs that likely require oil prices to be higher in the long term as well.

Despite this, we believe there is continued room for prices to remain depressed in the short term, or even for the rest of 2020. Oil prices quite often under- or over-shoot price levels indicated by market fundamentals and may take time to settle back to normalised levels.

Longer term, energy markets tend to be self-correcting with low prices leading to supply reductions that balance the market, and we believe we are likely to see significant supply destruction at current prices as drilling activity is either deferred or halted, particularly among smaller producers and those with poor balance sheets. While this could be healthy for oil markets longer term, it will be painful in the short term, and will impact multiple industries both within and outside of the energy sector.

We continue to have confidence in higher-quality producers and integrated oil firms. These are likely not just to endure through a period of lower prices, similar to what we saw in late 2015 and early 2016, but are also likely to be able to position their businesses well for the inevitable recovery in the markets. We do believe this process will take some time, however, as the market digests the impacts of the multiple factors driving prices down.

¹ OPEC+ is an alliance of oil producers, including members and non-members of the Organization of the Petroleum Exporting Countries.


 

Franklin Templeton Key risks & Disclaimers:

Important Legal Information

This material is intended to be of general interest only and should not be construed as individual investment advice or a recommendation or solicitation to buy, sell or hold any security or to adopt any investment strategy. It does not constitute legal or tax advice.

The views expressed are those of the investment manager and the comments, opinions and analyses are rendered as of publication date and may change without notice. The information provided in this material is not intended as a complete analysis of every material fact regarding any country, region or market.

Data from third party sources may have been used in the preparation of this material and Franklin Templeton (“FT”) has not independently verified, validated or audited such data. FT accepts no liability whatsoever for any loss arising from use of this information and reliance upon the comments, opinions and analyses in the material is at the sole discretion of the user.

Products, services and information may not be available in all jurisdictions and are offered outside the U.S. by other FT affiliates and/or their distributors as local laws and regulation permits. Please consult your own professional adviser or Franklin Templeton institutional contact for further information on availability of products and services in your jurisdiction.

Issued in the U.S. by Franklin Templeton Distributors, Inc., One Franklin Parkway, San Mateo, California 94403-1906, (800) DIAL BEN/342-5236, franklintempleton.com—Franklin Templeton Distributors, Inc. is the principal distributor of Franklin Templeton’s U.S. registered products, which are not FDIC insured; may lose value; and are not bank guaranteed and are available only in jurisdictions where an offer or solicitation of such products is permitted under applicable laws and regulation.

CFA® and Chartered Financial Analyst® are trademarks owned by CFA Institute.

What are the risks?

All investments involve risks, including possible loss of principal. The value of investments can go down as well as up, and investors may not get back the full amount invested. Stock prices fluctuate, sometimes rapidly and dramatically, due to factors affecting individual companies, particular industries or sectors or general market conditions. Investing in the natural resources sector involves special risks, including increased susceptibility to adverse economic and regulatory developments affecting the sector. Growth stock prices may fall dramatically if the company fails to meet projections of earnings or revenue; their prices may be more volatile than other securities, particularly over the short term. Smaller companies can be particularly sensitive to changes in economic conditions and have less certain growth prospects than larger, more established companies and can be volatile, especially over the short term. Investing in foreign companies involves special risks, including currency fluctuations and political uncertainty.



MeDirect Disclaimers:

This information has been accurately reproduced, as received from Franklin Templeton Investment Management Limited (FTIML). No information has been omitted which would render the reproduced information inaccurate or misleading. This information is being distributed by MeDirect Bank (Malta) plc to its customers. The information contained in this document is for general information purposes only and is not intended to provide legal or other professional advice nor does it commit MeDirect Bank (Malta) plc to any obligation whatsoever. The information available in this document is not intended to be a suggestion, recommendation or solicitation to buy, hold or sell, any securities and is not guaranteed as to accuracy or completeness.

The financial instruments discussed in the document may not be suitable for all investors and investors must make their own informed decisions and seek their own advice regarding the appropriateness of investing in financial instruments or implementing strategies discussed herein.

If you invest in this product you may lose some or all of the money you invest. The value of your investment may go down as well as up. A commission or sales fee may be charged at the time of the initial purchase for an investment and may be deducted from the invested amount therefore lowering the size of your investment. Any income you get from this investment may go down as well as up. This product may be affected by changes in currency exchange rate movements thereby affecting your investment return therefrom. The performance figures quoted refer to the past and past performance is not a guarantee of future performance or a reliable guide to future performance. Any decision to invest in a mutual fund should always be based upon the details contained in the Prospectus and Key Investor Information Document (KIID), which may be obtained from MeDirect Bank (Malta) plc.

BlackRock Commentary: Policy response to virus takes shape

Jean Boivin, Head of BlackRock Investment Institute together with Elga Bartsch, Head of Macro Research and Mike Pyle, Global Chief Investment Strategist within the BlackRock Investment Institute share their insights on global economy, markets and geopolitics. Their views are theirs alone and are not intended to be construed as investment advice.

The coronavirus outbreak has continued to roil markets, even as significant monetary policy steps have been taken. Uncertainties related to the outbreak give public health officials a strong incentive to act aggressively to mitigate its human toll. These measures, though temporary in nature, slow economic activity, sometimes precipitously. We believe this will eventually set the scene for a strong rebound, but a decisive policy response is needed to safeguard fundamentals.

Central bank policy rates and market pricing of future rates, 2018-2020

Central bank policy rates and market pricing for future rates 2018 - 2020

Sources: BlackRock Investment Institute, with data from Refinitiv Datastream, March 2020. Notes: Data are as of March 5, 2020. The solid lines show the market pricing of policy rates in overnight index swaps on a one-year horizon starting in one year’s time. Dotted lines show policy rates for each region; we use the midpoint of the fed funds target range for the U.S.

Policy can target three things in the face of this shock:

  • Prevent a sustained tightening of financial conditions;
  • Help stave off cash flow shocks that would threaten to shutter otherwise sound businesses;
  • Support individuals whose incomes are eroded by the disruptions.

We see a need for a decisive and pre-emptive policy response across these dimensions. The remaining space for traditional monetary policy tools such as rate cuts is limited, with interest rates near all-time lows. Simply using up that space – especially without coordination with fiscal policy – could quickly draw attention to the empty toolbox and backfire. The Federal Reserve cut interest rates last week, outside a policy meeting for the first time since the 2008 financial crisis. That rate cut failed to stabilize markets, which are now pricing in an even steeper drop in the Fed’s policy rates – as the chart shows.

The only way to address the diminished monetary policy toolkit is to add more lines of defense, such as bringing in fiscal policy explicitly as part of the emergency response. This echoes our view that monetary-fiscal coordination is critical in dealing with the next downturn. We are seeing early signs of a response to the current shock. Fiscal policy is the space to watch. Europe’s finance ministers appear prepared to launch fiscal measures. U.S. officials are likely to take up greater fiscal action if events warrant it – beyond the $8.3 billion in emergency spending approved last week – even in an election year with a divided government.

We expect policy responses across economies to be loosely coordinated – yet differentiated – due to the varied characteristics of economies as well as political and policy constraints. One example is the key funding sources of economies – and their implications on policy actions. The U.S. economy is relatively dependent on funding from capital markets. In economies that rely more on bank lending, policymakers have additional policy options to keep credit flowing, such as targeted liquidity operations in combination with regulatory relief. The Bank of Japan and European Central Bank (ECB) may have less room to cut rates, but can support the private sector by buying equities and corporate debt – a tool that the Fed doesn’t have. The Fed may cut its policy rate again later in the month, but at this stage we do not expect a renewed expansion of its balance sheet. We see the ECB announcing policy actions this week, likely putting more emphasis on targeted credit easing measures than the Fed.

Bottom line, we see monetary policy responses as helpful, but they will be wasted without complementary fiscal and targeted liquidity measures. The coronavirus shock is similar to shocks caused by natural disasters in the sense that their impact on economic activity tends to be temporary. We see a sharp economic rebound once potential disruptions dissipate, and expect the global economic expansion to remain intact – albeit on a lower trajectory. Yet the unknown depth and duration of the shock add material risks, and markets will need greater clarity on the outbreak itself as well as the overall policy response before stabilizing. We believe investors should stay invested, but keep risk near benchmark weights. We have recently updated our views on equity factors – highlighting resilient exposure like quality and minimum volatility – and are still reviewing our regional equity and fixed income views.

Week Ahead

 

  • Tuesday to Sunday: China total social financing, new loans
  • Wednesday: U.S. Consumer price index (CPI)
  • Thursday: ECB monetary policy meeting
  • Friday: University of Michigan surveys of consumers

China’s total social financing data will be a focus, with markets expecting weaker new loan growth as the outbreak has stalled lending to consumers. The lending figures come on the heels of data pointing to plunges in activities in both manufacturing and services sectors. The University of Michigan survey could shed some light on the resilience of U.S. consumers that has underpinned the economy in recent years, as the outbreak spreads in the world’s largest economy.


 

BlackRock’s Key risks & Disclaimers:

This material is not intended to be relied upon as a forecast, research or investment advice, and is not a recommendation, offer or solicitation to buy or sell any securities or to adopt any investment strategy. The opinions expressed are as of March 9, 2020 and may change. The information and opinions are derived from proprietary and non-proprietary sources deemed by BlackRock to be reliable, are not necessarily all-inclusive and are not guaranteed as to accuracy. As such, no warranty of accuracy or reliability is given and no responsibility arising in any other way for errors and omissions (including responsibility to any person by reason of negligence) is accepted by BlackRock, its officers, employees or agents. This material may contain ’forward looking’ information that is not purely historical in nature. Such information may include, among other things, projections and forecasts. There is no guarantee that any forecasts made will come to pass. Reliance upon information in this material is at the sole discretion of the reader.

The information provided here is neither tax nor legal advice. Investors should speak to their tax professional for specific information regarding their tax situation. Investment involves risk including possible loss of principal. International investing involves risks, including risks related to foreign currency, limited liquidity, less government regulation, and the possibility of substantial volatility due to adverse political, economic or other developments. These risks are often heightened for investments in emerging/developing markets or smaller capital markets. 

Issued by BlackRock Investment Management (UK) Limited, authorized and regulated by the Financial Conduct Authority. Registered office: 12 Throgmorton Avenue, London, EC2N 2DL



MeDirect Disclaimers:

This information has been accurately reproduced, as received from  BlackRock Investment Management (UK) Limited. No information has been omitted which would render the reproduced information inaccurate or misleading. This information is being distributed by MeDirect Bank (Malta) plc to its customers. The information contained in this document is for general information purposes only and is not intended to provide legal or other professional advice nor does it commit MeDirect Bank (Malta) plc to any obligation whatsoever. The information available in this document is not intended to be a suggestion, recommendation or solicitation to buy, hold or sell, any securities and is not guaranteed as to accuracy or completeness.

The financial instruments discussed in the document may not be suitable for all investors and investors must make their own informed decisions and seek their own advice regarding the appropriateness of investing in financial instruments or implementing strategies discussed herein.

If you invest in this product you may lose some or all of the money you invest. The value of your investment may go down as well as up. A commission or sales fee may be charged at the time of the initial purchase for an investment and may be deducted from the invested amount therefore lowering the size of your investment. Any income you get from this investment may go down as well as up. This product may be affected by changes in currency exchange rate movements thereby affecting your investment return therefrom. The performance figures quoted refer to the past and past performance is not a guarantee of future performance or a reliable guide to future performance. Any decision to invest in a mutual fund should always be based upon the details contained in the Prospectus and Key Investor Information Document (KIID), which may be obtained from MeDirect Bank (Malta) plc.

BlackRock Commentary: Policy response to virus takes shape

Jean Boivin, Head of BlackRock Investment Institute together with Elga Bartsch, Head of Macro Research and Mike Pyle, Global Chief Investment Strategist within the BlackRock Investment Institute share their insights on global economy, markets and geopolitics. Their views are theirs alone and are not intended to be construed as investment advice.

The coronavirus outbreak has continued to roil markets, even as significant monetary policy steps have been taken. Uncertainties related to the outbreak give public health officials a strong incentive to act aggressively to mitigate its human toll. These measures, though temporary in nature, slow economic activity, sometimes precipitously. We believe this will eventually set the scene for a strong rebound, but a decisive policy response is needed to safeguard fundamentals.

Central bank policy rates and market pricing of future rates, 2018-2020

Central bank policy rates and market pricing for future rates 2018 - 2020

Sources: BlackRock Investment Institute, with data from Refinitiv Datastream, March 2020. Notes: Data are as of March 5, 2020. The solid lines show the market pricing of policy rates in overnight index swaps on a one-year horizon starting in one year’s time. Dotted lines show policy rates for each region; we use the midpoint of the fed funds target range for the U.S.

Policy can target three things in the face of this shock:

  • Prevent a sustained tightening of financial conditions;
  • Help stave off cash flow shocks that would threaten to shutter otherwise sound businesses;
  • Support individuals whose incomes are eroded by the disruptions.

We see a need for a decisive and pre-emptive policy response across these dimensions. The remaining space for traditional monetary policy tools such as rate cuts is limited, with interest rates near all-time lows. Simply using up that space – especially without coordination with fiscal policy – could quickly draw attention to the empty toolbox and backfire. The Federal Reserve cut interest rates last week, outside a policy meeting for the first time since the 2008 financial crisis. That rate cut failed to stabilize markets, which are now pricing in an even steeper drop in the Fed’s policy rates – as the chart shows.

The only way to address the diminished monetary policy toolkit is to add more lines of defense, such as bringing in fiscal policy explicitly as part of the emergency response. This echoes our view that monetary-fiscal coordination is critical in dealing with the next downturn. We are seeing early signs of a response to the current shock. Fiscal policy is the space to watch. Europe’s finance ministers appear prepared to launch fiscal measures. U.S. officials are likely to take up greater fiscal action if events warrant it – beyond the $8.3 billion in emergency spending approved last week – even in an election year with a divided government.

We expect policy responses across economies to be loosely coordinated – yet differentiated – due to the varied characteristics of economies as well as political and policy constraints. One example is the key funding sources of economies – and their implications on policy actions. The U.S. economy is relatively dependent on funding from capital markets. In economies that rely more on bank lending, policymakers have additional policy options to keep credit flowing, such as targeted liquidity operations in combination with regulatory relief. The Bank of Japan and European Central Bank (ECB) may have less room to cut rates, but can support the private sector by buying equities and corporate debt – a tool that the Fed doesn’t have. The Fed may cut its policy rate again later in the month, but at this stage we do not expect a renewed expansion of its balance sheet. We see the ECB announcing policy actions this week, likely putting more emphasis on targeted credit easing measures than the Fed.

Bottom line, we see monetary policy responses as helpful, but they will be wasted without complementary fiscal and targeted liquidity measures. The coronavirus shock is similar to shocks caused by natural disasters in the sense that their impact on economic activity tends to be temporary. We see a sharp economic rebound once potential disruptions dissipate, and expect the global economic expansion to remain intact – albeit on a lower trajectory. Yet the unknown depth and duration of the shock add material risks, and markets will need greater clarity on the outbreak itself as well as the overall policy response before stabilizing. We believe investors should stay invested, but keep risk near benchmark weights. We have recently updated our views on equity factors – highlighting resilient exposure like quality and minimum volatility – and are still reviewing our regional equity and fixed income views.

Week Ahead

 

  • Tuesday to Sunday: China total social financing, new loans
  • Wednesday: U.S. Consumer price index (CPI)
  • Thursday: ECB monetary policy meeting
  • Friday: University of Michigan surveys of consumers

China’s total social financing data will be a focus, with markets expecting weaker new loan growth as the outbreak has stalled lending to consumers. The lending figures come on the heels of data pointing to plunges in activities in both manufacturing and services sectors. The University of Michigan survey could shed some light on the resilience of U.S. consumers that has underpinned the economy in recent years, as the outbreak spreads in the world’s largest economy.


 

BlackRock’s Key risks & Disclaimers:

This material is not intended to be relied upon as a forecast, research or investment advice, and is not a recommendation, offer or solicitation to buy or sell any securities or to adopt any investment strategy. The opinions expressed are as of March 9, 2020 and may change. The information and opinions are derived from proprietary and non-proprietary sources deemed by BlackRock to be reliable, are not necessarily all-inclusive and are not guaranteed as to accuracy. As such, no warranty of accuracy or reliability is given and no responsibility arising in any other way for errors and omissions (including responsibility to any person by reason of negligence) is accepted by BlackRock, its officers, employees or agents. This material may contain ’forward looking’ information that is not purely historical in nature. Such information may include, among other things, projections and forecasts. There is no guarantee that any forecasts made will come to pass. Reliance upon information in this material is at the sole discretion of the reader.

The information provided here is neither tax nor legal advice. Investors should speak to their tax professional for specific information regarding their tax situation. Investment involves risk including possible loss of principal. International investing involves risks, including risks related to foreign currency, limited liquidity, less government regulation, and the possibility of substantial volatility due to adverse political, economic or other developments. These risks are often heightened for investments in emerging/developing markets or smaller capital markets. 

Issued by BlackRock Investment Management (UK) Limited, authorized and regulated by the Financial Conduct Authority. Registered office: 12 Throgmorton Avenue, London, EC2N 2DL



MeDirect Disclaimers:

This information has been accurately reproduced, as received from  BlackRock Investment Management (UK) Limited. No information has been omitted which would render the reproduced information inaccurate or misleading. This information is being distributed by MeDirect Bank (Malta) plc to its customers. The information contained in this document is for general information purposes only and is not intended to provide legal or other professional advice nor does it commit MeDirect Bank (Malta) plc to any obligation whatsoever. The information available in this document is not intended to be a suggestion, recommendation or solicitation to buy, hold or sell, any securities and is not guaranteed as to accuracy or completeness.

The financial instruments discussed in the document may not be suitable for all investors and investors must make their own informed decisions and seek their own advice regarding the appropriateness of investing in financial instruments or implementing strategies discussed herein.

If you invest in this product you may lose some or all of the money you invest. The value of your investment may go down as well as up. A commission or sales fee may be charged at the time of the initial purchase for an investment and may be deducted from the invested amount therefore lowering the size of your investment. Any income you get from this investment may go down as well as up. This product may be affected by changes in currency exchange rate movements thereby affecting your investment return therefrom. The performance figures quoted refer to the past and past performance is not a guarantee of future performance or a reliable guide to future performance. Any decision to invest in a mutual fund should always be based upon the details contained in the Prospectus and Key Investor Information Document (KIID), which may be obtained from MeDirect Bank (Malta) plc.

Franklin Templeton Insights: What’s driving Oil Market Volatility?

Fred Fromm, vice president, portfolio manager and research analyst with Franklin Equity Group, explains why recent oil market demand and supply shocks are essentially unprecedented and are leading to oil prices that are uneconomical for almost all market participants.

At Friday’s OPEC+ ¹ meeting, Russia balked at supply cuts to offset the reduced demand we see from the spread of COVID-19. In response, over the weekend, Saudi Arabia dropped its export prices across the board, essentially starting a price war in the global oil markets. The idea seems to be to force Russia to come back to the bargaining table and agree to supply cuts.

We believe the combination of both a demand shock (from the coronavirus outbreak) and a supply shock (from the price reductions) is essentially unprecedented, with no equivalent in the last 30 years that we can point to.

Outlook

The oil prices we are seeing currently are uneconomical for almost all market participants, in our opinion. While higher-cost producers like US shale clearly cannot generate profits at these levels, we believe even cheaper producers like Russia are likely to see challenges in this price environment. Saudi Arabia, while having very low production costs, also has domestic spending needs that likely require oil prices to be higher in the long term as well.

Despite this, we believe there is continued room for prices to remain depressed in the short term, or even for the rest of 2020. Oil prices quite often under- or over-shoot price levels indicated by market fundamentals and may take time to settle back to normalised levels.

Longer term, energy markets tend to be self-correcting with low prices leading to supply reductions that balance the market, and we believe we are likely to see significant supply destruction at current prices as drilling activity is either deferred or halted, particularly among smaller producers and those with poor balance sheets. While this could be healthy for oil markets longer term, it will be painful in the short term, and will impact multiple industries both within and outside of the energy sector.

We continue to have confidence in higher-quality producers and integrated oil firms. These are likely not just to endure through a period of lower prices, similar to what we saw in late 2015 and early 2016, but are also likely to be able to position their businesses well for the inevitable recovery in the markets. We do believe this process will take some time, however, as the market digests the impacts of the multiple factors driving prices down.

¹ OPEC+ is an alliance of oil producers, including members and non-members of the Organization of the Petroleum Exporting Countries.


 

Franklin Templeton Key risks & Disclaimers:

Important Legal Information

This material is intended to be of general interest only and should not be construed as individual investment advice or a recommendation or solicitation to buy, sell or hold any security or to adopt any investment strategy. It does not constitute legal or tax advice.

The views expressed are those of the investment manager and the comments, opinions and analyses are rendered as of publication date and may change without notice. The information provided in this material is not intended as a complete analysis of every material fact regarding any country, region or market.

Data from third party sources may have been used in the preparation of this material and Franklin Templeton (“FT”) has not independently verified, validated or audited such data. FT accepts no liability whatsoever for any loss arising from use of this information and reliance upon the comments, opinions and analyses in the material is at the sole discretion of the user.

Products, services and information may not be available in all jurisdictions and are offered outside the U.S. by other FT affiliates and/or their distributors as local laws and regulation permits. Please consult your own professional adviser or Franklin Templeton institutional contact for further information on availability of products and services in your jurisdiction.

Issued in the U.S. by Franklin Templeton Distributors, Inc., One Franklin Parkway, San Mateo, California 94403-1906, (800) DIAL BEN/342-5236, franklintempleton.com—Franklin Templeton Distributors, Inc. is the principal distributor of Franklin Templeton’s U.S. registered products, which are not FDIC insured; may lose value; and are not bank guaranteed and are available only in jurisdictions where an offer or solicitation of such products is permitted under applicable laws and regulation.

CFA® and Chartered Financial Analyst® are trademarks owned by CFA Institute.

What are the risks?

All investments involve risks, including possible loss of principal. The value of investments can go down as well as up, and investors may not get back the full amount invested. Stock prices fluctuate, sometimes rapidly and dramatically, due to factors affecting individual companies, particular industries or sectors or general market conditions. Investing in the natural resources sector involves special risks, including increased susceptibility to adverse economic and regulatory developments affecting the sector. Growth stock prices may fall dramatically if the company fails to meet projections of earnings or revenue; their prices may be more volatile than other securities, particularly over the short term. Smaller companies can be particularly sensitive to changes in economic conditions and have less certain growth prospects than larger, more established companies and can be volatile, especially over the short term. Investing in foreign companies involves special risks, including currency fluctuations and political uncertainty.



MeDirect Disclaimers:

This information has been accurately reproduced, as received from Franklin Templeton Investment Management Limited (FTIML). No information has been omitted which would render the reproduced information inaccurate or misleading. This information is being distributed by MeDirect Bank (Malta) plc to its customers. The information contained in this document is for general information purposes only and is not intended to provide legal or other professional advice nor does it commit MeDirect Bank (Malta) plc to any obligation whatsoever. The information available in this document is not intended to be a suggestion, recommendation or solicitation to buy, hold or sell, any securities and is not guaranteed as to accuracy or completeness.

The financial instruments discussed in the document may not be suitable for all investors and investors must make their own informed decisions and seek their own advice regarding the appropriateness of investing in financial instruments or implementing strategies discussed herein.

If you invest in this product you may lose some or all of the money you invest. The value of your investment may go down as well as up. A commission or sales fee may be charged at the time of the initial purchase for an investment and may be deducted from the invested amount therefore lowering the size of your investment. Any income you get from this investment may go down as well as up. This product may be affected by changes in currency exchange rate movements thereby affecting your investment return therefrom. The performance figures quoted refer to the past and past performance is not a guarantee of future performance or a reliable guide to future performance. Any decision to invest in a mutual fund should always be based upon the details contained in the Prospectus and Key Investor Information Document (KIID), which may be obtained from MeDirect Bank (Malta) plc.

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