GOLDMAN SACHS STERLING LIQUID RESERVES I (XFMQ)

Investment Process

The investment process for this fund has five stages. The first accounts for the core of the process and incorporates credit risk analysis conducted by the Goldman Sachs Credit Department, interest rate risk analysis and liquidity analysis. The next step in the process involves a weekly management team discussion on the strategy and portfolio composition of the fund as well as consideration of macroeconomic themes. At the third stage the optimum yield curve exposure is sought, incorporating liquidity issues and the strategic view. The Credit department then compiles an approved list of money market instruments that is continually monitored. Finally, the portfolio is constructed subject to credit and market liquidity constraints - it will have a weighted average maturity of no more than 60 days although this will usually range between 30 to 50 days. The fund may invest in first tier government securities, commercial paper and floating and variable rate obligations, all of which will be denominated in sterling. This will include debt issued by UK companies, gilts and sterling-denominated debt of non-UK companies. The management team will consider Environmental Social Governance (ESG) factors and as such will not invest in debt securities issued by companies that are directly engaged and/or generating significant revenues from production of, and/or involvement in controversial weapons (including nuclear weapons); production or sale of tobacco; extraction, production or generation of certain fossil fuels (including thermal coal, shale gas and oil, oil sands, and arctic oil and gas); production or sale of civilian firearms; and operation of private prisons.