Financial instruments and investment-related risks overview

Version 1.0, valid from 15. september 2022

Before starting using our services and investing, please read this document and carefully assess your individual situation in terms of financial status, investment goals, risk tolerance, etc. Please consider consulting a professional advisor if needed to better understand the risks related to investment.

All investment decisions you make regarding transactions in financial instruments while using our services are at your own discretion and risk. Fundvest does not make any investment recommendations nor provides any investment advice. All information that is available on our website, social media channels and app is for information purpose and may not be considered as any advice or recommendation.

Fundvest does not provide tax, accounting, or legal advice to its clients, and all investors are advised to consult with professional advisors regarding any potential obligations.

This document was prepared by Fundvest UAB . It contains information about the nature and risk of financial instruments that you may invest in while using our services. It may not explain all the risks or how the specific risks may affect you personally. If you have any doubts if our services and the specific financial instruments are appropriate for you, please seek professional advice.

Investing is always related to risk which may result in financial losses. This may happen because the value of the financial instruments you purchase may drop and because of this the return may be negative meaning that the transaction may be unprofitable or even become of no value at all. The risk of loss is different and depends on each specific financial instrument. We strongly encourage you to evaluate the characteristics of financial instruments and the related risks, taking into account your financial status, previous investment experience, your personal investment goals and time period, also other important factors. You should not engage in investing unless you understand the nature of the particular financial instrument and the extent of your exposure to the risk of financial loss.

When using our investment platform you may invest in the following financial instruments:

• Stocks (shares) which are units of ownership in companies. Shares that are traded in the stock exchanges (e.g. New York Stock Exchange) can be purchased when using our platform. If the company that issued the shares (issuer) earns profit, part of the profit can be distributed to the owners of the shares (shareholders) in the form of dividends.

• ETFs (exchange-traded funds) which are collective investment funds that are traded in the stock exchanges. They may consist of various asset classes, such as shares, bonds, etc., thus ensuring greater diversification and potentially lower investment risk. ETFs are managed by professional investment management companies.

By investing in any of the above you risk not getting back the same as you originally invested. Additionally, please take into account other risks that are listed below.

Counterparty credit risk – the risk that Client might incur losses if a counterparty against whom Client has a credit exposure, does not fulfil his financial obligations.

Country risk – risk that financial instrument value might changed because of events or development in precise country or region. Information risk – the risk that Client might make a decision not having the complete information about the financial instrument or information being not available to Client.

Interest rate risk – the risk that market value of financial instrument will change a lot because of changes in interest rates (especially applicable towards bonds and bond-based ETFs).

Legal risk – risk of financial instruments losing value or incure addidional expences because of legal restrictions or duties as a result of changes including, but not limited to legislation, mandatory changes by regulators or national competent authorities.

Liquidity risk – the risk that financial instrument cannot be purchased or sold without significant additional expence due to lack of liquidity in the market. One of the ways how liquidity risk can be measured (suitable not for all cases) is the difference between best bid and best ask price (in absolute terms or as percentage of the last traded price).

Market risk – often called „systematic risk“ is the risk of price changes because of overall performance of relevant financial markets.

Price risk – the risk on relevant financial instrument price changes.

Stocks (shares) Stocks are open to all general risks mentioned above and some stock-specific risks such as:

Rating risk – risk that value of listed stock might change because of change in credit rating issues by one of the rating agencies.

Risk of (hostile) merger and acquisition – risk that company might be acquired or merged leading to the fact that Client ownership in listed company will be bought following the accounced terms and conditions.

ETFs are managed by asset management companies. ETFs are open to general risks mentioned above and some specific risks such as:

Closure risk – risk that fund management company will decised to liquidate ETFs or merge it with another listed or unlisted product.

Management fee risk – risk that fund management company will change the management fee that is taken while managing the fund.