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Goldman Sachs Australian Equity Funds Fundamental Analysis

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									Goldman Sachs Australian Equity Funds




                 Available to Australian and New Zealand
                                   resident investors only.
Goldman Sachs Australian Equity Funds


We believe a style neutral, balanced approach to stock selection
across stock styles and investment horizons, allows for strong
performance results in both up and down markets.


                      We offer a range of Australian equity funds managed by our
                      well established, stable and highly motivated Australian equities
                      investment team. We are a style balanced manager using an
                      active, bottom-up investment process. The team undertake
                      independent fundamental analysis focused on identifying quality
                      companies with attractive valuations. As a balanced manager, the
                      funds do not have any inherent style bias, with stock selection
                      being the primary driver of relative performance.

                      Within our range of Australian equity funds, we have both ‘core’
                      and ‘satellite’ investment options available.


                      Core fund
                      „„Goldman    Sachs Australian Equities Wholesale Fund – a diversified
                        portfolio of medium-to-large capitalisation Australian equities that have
                        strong capital growth potential over the medium-to-long term.


                      Satellite funds
                      „„Goldman   Sachs Emerging Leaders Wholesale Fund – a portfolio
                        investing in both small and medium sized emerging companies that have
                        strong capital growth potential.
                      „„Goldman   Sachs Premier Australian Equities Fund – a concentrated
                        version of our core Australian equities capability, selecting the best ideas
                        and strongest insights to achieve medium-to-long term capital growth.
                      (Together the ‘Funds’)
Investment philosophy   The team invest based on the rationale that share prices do not always accurately
                        reflect the underlying fundamental valuation of companies, leading to companies
and style               being mispriced by the market. Our Australian equities team believes the key to
                        exploiting these inefficiencies is by applying a fundamental research approach and a
                        consistent valuation framework. The team strives to form a ‘differentiated’ view with
                        their investments, based upon industry specific knowledge and insight.
                        Our investment style is a fundamental style neutral approach with performance
                        driven by stock specific insights, capable of performing through market cycles.


Investment approach     Guided by this philosophy, the investment process aims to generate a diversified and
                        balanced portfolio, with the potential for outperformance over the long-term. Our
and process             conviction driven investment process involves the following stages:



                        Idea                               Stock                              Portfolio
                        generation                         analysis                           construction

                        1. Idea generation
                        We utilise multiple sources of information to generate ideas and identify and
                        exploit inefficient markets. Our insights are developed by using company analysis,
                        value chain analysis and industry analysis as key inputs into the first stage of our
                        investment process. Ideas can also arise out of the team’s interaction with the
                        broader investment platform.
                        2. Stock analysis
                        Our fundamental analysis centres on exploiting market inefficiencies and mispricing.
                        Our focus on bottom-up research allows for more differentiated ideas that facilitate
                        high conviction positions with low turnover. Our stock analysis is in-depth and
                        ongoing. It involves seeking and validating information from a variety of sources
                        including management meetings and discussions with industry contacts. The peer
                        review stage is central to the team’s valuation and execution process. This stage
                        allows for the rigorous assessment of each stock prior to its inclusion in the portfolio
                        to ensure we maintain stock discipline.
                        3. Portfolio construction
                        The portfolio construction part of the process brings together the team’s best ideas
                        in a risk-controlled manner. The process generates high conviction and balanced
                        portfolios through the cycle.
Australian equities   Our Australian equities team is comprised of nine investors based in Melbourne.
                      The team is complemented by the broader investment team – including macro, fixed
investment team       interest, credit and quantitative equity specialists. Led by Head of Australian Equities,
                      Dion Hershan, each team member actively contributes to the stock selection and
                      decision-making process. The Funds are managed using a team-based investment
                      model that leverages their complementary range of skills and experiences.
                      Our Australian equities investment team
                                       Dion Hershan                                 Marcus Ryan
                                       Head of Australian                           Portfolio Analyst
                                       Equities




                                       Katie Hudson                                 Michael Steele
                                       Senior Investment                            Portfolio Analyst
                                       Manager




                                       Geoff Frankish                               Edward Waller
                                       Senior Investment                            Dealer/Portfolio Analyst
                                       Manager




                                       Matthew Rey                                  Mark Jones
                                       Senior Investment                            Portfolio Analyst
                                       Manager




                                       Chris Driessen
                                       Investment Manager
Features of the Funds
                                           Goldman Sachs Australian                          Goldman Sachs Emerging                            Goldman Sachs Premier
                                           Equities Wholesale Fund                           Leaders Wholesale Fund                            Australian Equities Fund
    Investment objective                   To achieve medium-to-long term                    To achieve medium-to-long term                    To achieve medium-to-long term
                                           capital growth by investing in                    capital growth by investing in                    capital growth by investing in
                                           companies listed on the Australian                small and medium sized Australian                 companies listed on the Australian
                                           Securities Exchange. In doing so,                 companies that are considered                     Securities Exchange. In doing so,
                                           we aim to outperform the                          to possess strong capital growth                  we aim to outperform the
                                           S&P/ASX 200 Accumulation Index                    potential. In doing so, we aim to                 S&P/ASX 300 Accumulation Index
                                           over rolling three-year periods.                  outperform the benchmark^ over                    over rolling three-year periods.
                                                                                             rolling three-year periods.
    Benchmark                              S&P/ASX 200 Accumulation Index                    ^Benchmark comprises 50%                          S&P/ASX 300 Accumulation Index
                                                                                             S&P/ASX Midcap 50 Accumulation
                                                                                             Index and 50% S&P/ASX Small
                                                                                             Ordinaries Accumulation Index
    How will the Funds                        In
                                           „„ securities which are listed                      In
                                                                                             „„ securities which are listed                      In
                                                                                                                                               „„ securities which are listed
    be invested?                                on the Australian Securities                     on the Australian Securities                      on the Australian Securities
                                                Exchange, but excluding                          Exchange, but not included in                     Exchange with a bias towards
                                                converting preference shares.                    the S&P/ASX 50 Leaders Index.                     companies within the S&P/ASX
                                           „„Minimum of 80% invested                            Securities in companies that                      300 Accumulation Index.
                                                in securities.                                   are elevated to the S&P/ASX                   „„Minimum of 80% invested
                                                                                                 50 Leaders Index will be sold                     in securities.
                                           „„Maximum of 20% invested
                                                                                                 within 18 months‡.
                                                in cash.                                                                                       „„Maximum of 20% invested
                                                                                             „„Primarily invested in companies                    in cash.
                                                                                                 with a market capitalisation
                                                                                                 greater than $300 million.
                                                                                             „„Minimum of 80% invested
                                                                                                 in securities.
                                                                                             „„Maximum of 20% invested
                                                                                                 in cash.
    Number of securities held              Generally 30 – 55 securities held in              Generally 30 – 55 securities held in              Generally, 15 – 25 securities held in
                                           the portfolio.                                    the portfolio.                                    the portfolio.
    Recommended investment                 Long term 5-7+ years                              Long term 5-7+ years                              Long term 5-7+ years
    timeframe
    Variability of returns                 High                                              High                                              High
    Unit pricing                           Daily                                             Daily                                             Daily
    Withdrawals                            Daily                                             Daily                                             Daily
    Distributions                          Half-yearly                                       Half-yearly                                       Half-yearly
    Contributions                          Daily                                             Daily                                             Daily
‡
  Securities may be purchased in companies that move into the S&P/ASX 50 Leaders Index where the purchase is the take-up of an allotment under a rights issue, and the Manager
reasonably believes it is in the best interests of Unitholders to do so. Securities purchased in this manner may only be held for a period of 18 months from the time the relevant company was
last elevated into the S&P/ASX 50 Leaders Index.
Investment requirements and fees
                                         Goldman Sachs Australian            Goldman Sachs Emerging        Goldman Sachs Premier
                                         Equities Wholesale Fund             Leaders Wholesale Fund        Australian Equities Fund
 APIR                                    JBW0009AU                           JBW0010AU
 Inception date                          July 1996                           September 1997                August 2010
 Minimum initial                         $50,000                             $50,000                       $50,000
 investment *
 Minimum investment                      1,000 Units or $1,000              1,000 Units or $1,000          1,000 Units or $1,000
 balance (which ever is less)
 Estimated management                    0.95% p.a.                         1.25% p.a.                     1.30% p.a.
 cost
 Withdrawal fee                          Not applicable                     Not applicable                 Not applicable

* Or such lesser amount as the Manager may agree from time to time.



  Reasons to invest                              1. Motivated team
  in the Funds                                         Managed by our well established, stable and highly motivated nine person
                                                       Australian equities investment team, completed by the broader investment team.
                                                 2. Independent thinking
                                                       The team undertake proprietary, fundamental analysis to identify mispricing. The
                                                       focus is on forming a differentiated view based upon industry specific knowledge
                                                       and insight.
                                                 3. High conviction with balanced portfolio construction
                                                       We are a style neutral Australian equity manager constructing balanced
                                                       portfolio across investment styles and timeframes, with solid performance
                                                       across the cycle.
About Goldman Sachs Asset Management
Goldman Sachs Asset Management in Australia is a specialist provider of investment management products and
services to Australian and New Zealand investors, and forms part of Goldman Sachs in Australasia. Goldman Sachs
Asset Management offers a comprehensive range of high quality core and satellite investment strategies, including
active equity, fixed income, cash, multi-sector and quantitative products, managed by highly experienced and skilled
investment teams. As at 30 June 2010 total assets under administration were approximately A$13 billion*.
Our clients include some of the industry’s largest institutional investors, wholesale platforms and dealer groups,
as well a large pool of retail clients investing directly or via a financial planner. We place the utmost importance on
client relationships, delivering outstanding investment products and solutions, providing a high level of client service
and communicating timely market and investment insights to our clients. Information on our full range of products is
available on our website www.gs.com.au/funds.
*Combined assets under administration for Goldman Sachs Asset Management & Partners Australia Pty Ltd and Goldman Sachs & Partners Australia Managed Funds Limited.
Applications and contacts
The Funds are available to Australian and New Zealand resident investors only. Applications can be made by completing
the relevant application form attached to the Product Disclosure Statement. To apply, investors must complete the
Application For Investment Form and the Client Identification Form (if required).
The Funds are available on a range of investment platforms. Please contact our Fund Services team for additional
information.



For more information on the Goldman Sachs Australian Equity Funds contact our Fund Services team on 1800 034 494
or via email fst@gs.com.au.


All units in the range of Goldman Sachs registered managed investment schemes in Australia (‘Funds’) are issued by Goldman Sachs & Partners Australia Managed Funds Limited
ABN 63 005 885 567 AFSL 230251 (‘GS&PAMF’). Prior to investing in any of the Funds you should obtain and consider the product disclosure statement (‘PDS’) for the relevant Fund,
available by contacting our Fund Services team on 1800 034 494 or from our website www.gs.com.au/funds. This document contains general financial product advice only. In preparing
this document, GS&PAMF did not take into account the investment objectives, financial situation and particular needs (‘financial circumstances’) of any particular person. Accordingly,
before acting on any advice contained in this document, you should assess whether the advice is appropriate in light of your own financial circumstances or contact your adviser. GS&PAMF
manages each of these funds and will receive fees as set out in the relevant PDS. This document has been prepared by GS&PAMF. It is not a product of the Goldman Sachs & Partners
Australia Investment Research. To the extent that this document discusses general market activity, industry or sector trends, or other broad based economic or political conditions, it
                                                                                                                                                                                             ME625_157862_201007




should not be construed as research or investment advice. To the extent it includes references to specific securities, those references do not constitute a recommendation to buy, sell or
hold such security, and the information may not be current. GS&PAMF believes that the information contained in this document is correct and that any estimates, opinions, conclusions or
recommendations contained in this document are reasonably held or made as at the time of compilation. However, no warranty is made as to the accuracy or reliability of any estimates,
opinions, conclusions, recommendations (which may change without notice) and, to the maximum extent permitted by law, GS&PAMF and its related bodies corporate disclaim all liability
and responsibility for any direct or indirect loss or damage which may be suffered by any recipient through relying on anything contained in or omitted from this document.
Goldman Sachs is a registered trade mark of Goldman, Sachs & Co.

								
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