RISK DISCLOSURES

Amongst the general risk factors of a typical fund, for instance, unguaranteed returns and non-redemption risk due to the lack of liquidity and absence of secondary market for the share of the company. VAI Fund is prone to several specific risks illustrated below:-

(a) Management risk

VAI Fund invests a minimum of 95% of Net Assets in the shares of the company, WCEI International Ltd is essentially involved in the supervision of risk and returns of investment portfolios. Unit holders may suffer reduced returns or lose of invested capital due to the fund manager’s negligence. However, due to the exceptional track record and experience of our fund managers, such risks are significantly lowered.

(b) Currency risk

VAI Fund will make investments in the targeted businesses that may be dominated in currencies other than USD. The unpredictability and fluctuation in foreign exchange rates, mainly between USD and various currencies give rise to currency risks as the shares of the company is denominated in USD, the value of fund investments might be positively or adversely affected. Although currency hedging may not alleviate fully the currency risks, we will utilize such technique to minimize and mitigate currency exposures.

(c)  Country risk

The structure of the company is susceptible to the effect of political instability, exchange controls, alteration in taxation, foreign investment policies, restrictions on repatriation of investments and etc which may be potentially imposed by the relevant authorities in the Federal Territory of Labuan, Malaysia where the company is domiciled. The Board and fund managers of the company will enforce relevant risk measures to combat such uncertainties.

(d) Other risks

Other risks comprise of inflation, counterparty risk, insolvency, competition as well as default risks. The Board and management will conduct the highest level of scrutiny and due diligence to ensure the accountability and uprightness of our brokers, counterparties as well as the business and financial stability of brokerage firms prior to any engagement in objective to mitigate the abovementioned risks.

Prior investing to VAI Fund, investors are expected to apprehend the degree of risks involved and be of opinion that the consideration investment is in accordance to their investment objectives and horizons. It is mandatory for investors to accept fully the investment strategy stipulated by the company and are able to harbour substantial or the entire loss of capital invested in the fund.