PKO Treasury and Municipal Bonds II is actively managed and invests participants' funds in money market instruments and debt instruments, primarily in bonds issued by Local Government Units (LGUs), which are relatively difficult for individual investors to access. Additionally, the subfund invests in short-term government bonds.
The interest rates on these bonds are higher than those of standard government securities, and their valuation remains relatively stable due to their low sensitivity to interest rate changes in Poland. This, combined with the use of instruments and solutions designed to further reduce valuation volatility within the subfund's portfolio, offers the potential for attractive returns with limited fluctuation in the value of participation units.
Furthermore, the subfund has entered into an agreement with PKO Bank Polski, under which the bank has provided a guarantee covering amounts owed to the subfund from its holdings of LGU bonds in case of non-payment by the issuer. The bank has also committed to repurchasing part or all of the LGU bond portfolio upon the subfund’s request.
However, if a counterparty fails to meet its obligations to the subfund or if the aforementioned agreement is terminated, there is a liquidity risk arising from the potential inability to sell assets. As a result, this could ultimately lead to the suspension of participation unit redemptions by the subfund.
Investing involves risk. Please read KID and the Fund's Prospectus before making an investment. The historical performance presented is not a guarantee for similar investment results in the future. The full content of the legal note.