To help you in your selection of Investment Units (IU's or funds), this section provides descriptions of the characteristics -- such as investment objective and potential for volatility of your investment -- of various categories of funds. These descriptions are organized by the type of securities purchased by each type of IU's : equities, fixed-income, money market instruments, or some combination of these. Because IU's have specific investment objectives such as growth of capital, safety of principal, current income or tax-exempt income, you can select one fund or any number of different funds to help you meet your specific goals. In general, IU's fall into three general categories:

• Equity IU's invest in shares of common stocks.
• Fixed-Income IU's invest in government or corporate securities such as bonds which offer fixed rates of return.
• Balanced IU's invest in a combination of both stocks and bonds.

Aggressive Growth IU's
These IU's seek to provide maximum growth of capital with secondary emphasis on dividend or interest income. They invest in common stocks with a high potential for rapid growth and capital appreciation. Aggressive Growth Funds are suitable for investors who can afford to assume the risk of potential loss in value of their investment in the hope of achieving substantial and rapid gains. They are not suitable for investors who must conserve their principal or who must maximize current income.

Growth IU's
Like Aggressive Growth Funds, Growth Funds generally invest in stocks for growth rather than current income. They are considered more conservative in their approach because they usually invest in established companies to achieve long-term growth. Although Growth Funds are more conservative than Aggressive Growth Funds, they are still relatively volatile. They are suitable for growth-oriented investors but not investors who are unable to assume risk or who are dependent on maximizing current income from their investments.

International IU's
International Funds seek growth through investments in companies outside Thailand. These funds provide investors with another opportunity to diversify their funds' portfolio, since foreign markets do not always move in the same direction as Thailand. International Funds can invest in common stocks or bonds of foreign firms and governments. These types of funds do carry some additional risks over domestic funds and should be carefully evaluated and selected according to the investor's objectives, timeframe and risk profile.

Growth and Income IU's
Growth and Income Funds seek long-term growth of capital as well as current income. The investment strategies used to reach these goals vary among funds. Growth and Income Funds have low to moderate stability of principal and moderate potential for current income and growth. They are suitable for investors who can assume some risk to achieve growth of capital but who also want to maintain a moderate level of current income.

Fixed-Income IU's
The goal of Fixed-Income Funds is to provide high current income consistent with the preservation of capital. Growth of capital is of secondary importance. Income Funds that invest primarily in bonds and preferred stocks are classified as Fixed-Income Funds. These funds invest in corporate bonds or government-backed mortgage securities that have a fixed rate of return. Fixed-Income Funds are suitable for investors who want to maximize current income and who can assume a degree of capital risk in order to do so. Again, carefully read the prospectus to learn if a fund's investment policy with respect to yield and risk coincides with your own objectives.

Equity Income IU's
Equity Income Funds seek high current yield by investing primarily in equity securities of companies which pay high dividends. Unlike interest payments from bonds, dividends from equity securities can change as companies raise or lower their dividends. Since yield-oriented stocks are more volatile than comparably rated fixed-income securities, Equity Income Funds offer less stability of principal than Fixed-Income Funds. Equity Income Funds are suitable for conservative investors who want high current yield with some growth.

Balanced IU's
The purpose of Balanced Funds is to provide investors with a single fund that combines both growth and income objectives. In order to achieve this goal, Balanced Funds invest in both stocks (for growth) and bonds (for income). Balanced funds typically invest between 35% to 65% of their money in stocks, with the rest allocated to debt instruments. Such diversified holdings ensure that these fund will manage downturns in the stock market without too much of a loss; the other side, of course, is that Balanced Funds will usually enjoy fewer gains than an all-stock fund during a bull market.

Flexible Portfolio IU's
Flexible Portfolio Funds allocate their investments across various asset classes, including domestic common stocks, bonds, and money market instruments, depending on investment situations and fund manger's decision. They can invest in the asset classes similar to Balanced Funds but without limitation of percentage of asset holding. Flexible Portfolio Funds are suitable for medium risk investors.

Money Market IU's
For the cautious investor, these funds provide a very high stability of principal while seeking a moderate to high current income. They invest in highly-liquid, virtually risk-free, short-term debt and Treasury Bills. They have no potential for capital appreciation. Money Market Funds are suitable for conservative investors who want high stability of principal and moderate current income with immediate liquidity.

Funds of Funds
Funds of Funds are funds that invest in other funds. Just as a normal fund invests in a number of different securities, so an Fund of Funds buys shares of many different funds. These funds were designed to achieve even greater diversification than normal mutual funds; however, they suffer from several drawbacks. Expense fees on Funds of Funds are typically higher than those on regular funds because they include part of the expense fees charged by the underlying funds. But even Funds of Funds with low fees may suffer from another disadvantage: duplication. Since Funds of Funds buy many different funds which themselves invest in many different stocks, it is possible for the Funds of Funds to own the same stock through several different funds.

Warrant IU's
The purpose of Warrant Funds is to invest in different warrants. Normally, they invest no less than 65% of their net asset value in stock warrants, bond or preferred stock warrants, fund warrants and preemptive right warrants. Some Warrant Funds may have high risk such as stock warrants, which are not suitable for conservative investors.

Specialty/Sector IU's
Specialty Funds or Sector Funds invest in securities of a specific industry or sector of the economy such as health care, high technology, leisure, utilities or precious metals. Because such funds invest primarily in one sector, they do not offer the element of downside risk protection found in funds that invest in a broad range of industries. However, the funds do enable investors to diversify holdings among many companies within an industry, a more conservative approach than investing directly in one particular company.