II. Investment Declaration

23. The objective of investment policy of the Managing Company shall include the short-term investment of funds into securities in order to attain the gain of assets included in the Fund.

24. The assets included in the Fund may be invested in:

• state securities of the Russian Federation;
• state securities of the constituent territories of the Russian Federation;
• securities of the Russian municipal formations;
• shares of Russian open joint stock companies, except for the shares of Russian joint stock  investment funds included in the categories of real estate funds ore funds of funds;
• bonds of Russian business companies if the state registration of it’s issue was accompanied with the registration of its prospectus of issue;
• investment units of open or interval mutual investment funds;
• investment units of closed mutual investment funds included in the quotation list of trade institutors;
• securities of foreign states;
• securities of international financial organizations;
• shares of foreign joint stock companies;
• bonds of foreign commercial entities;

The Fund assets will be invested in ordinary and preferred shares and bonds of issuers engaged, mainly, in the following branches of industry: power industry, fuel industry, communication and telecommunications, chemical industry, mechanical engineering and metalworking, metallurgy, trade, transport, food industry, financial sector and insurance, forest, woodworking, pulp & paper industry, mineral resource industry, construction, science and scientific service, industry of construction materials, light industry, housing maintenance and utilities, petrochemical industry, medical industry, printing industry, agriculture, glass and porcelain & faience industry, perfumery & cosmetic industry.

The assets included in the Fund may be invested in bonds issued by:

- the Russian Federation;

- federal executive bodies of the Russian Federation;

- constituent territories of the Russian Federation;

- executive bodies of the constituent territories of the Russian Federation;

- bodies of local self-government;

- foreign states.

- Russian and foreign legal entities.

The Fund assets may include monetary funds including foreign currency particularly but not exclusively  on bank accounts and in deposits.

For the Fund assets there may be acquired only securities in relation to which the acceptable quotations are available as of the date of purchase agreement or of the previous date.

The securities the assets included in the Fund invested in shall be included in the quotation lists of trade institutors at the securities market or admitted for trading by the trade institutor without including in the quotation list.

The Fund assets may not include:

- shares of Russian joint stock investment funds and investment units of mutual investment funds if the investment reserves of such joint stock investment funds or mutual investment funds are being managed by the same managing company which is engaged in the trust management of the fund;

- securities issued by the Managing Company, the Specialized depository or the Auditor of such fund, as well as their affiliated persons, except for the securities included in the quotations list of trade institutor;

- shares of foreign joint stock companies and bonds of foreign commercial entities  which have not been listed at the stock exchanges the list of which is defined by the Federal Commission for the Securities Market.

- securities of foreign states and securities of international financial organizations not included in the list approved by the Federal Commission for the Securities Market.

Within the term of the Fund formation the assets thereof may include only the assets brought in by the holders of investment units.

25. Structure of the Fund’s assets shall meet at the same time the following requirements:

- monetary funds allocated in the accounts and on deposits of one and the same credit institution may not exceed 25 per cent of the value of the assets

 - estimated value of securities of foreign states, securities of international financial organizations, shares of foreign joint stock companies and bonds of foreign commercial entities may not exceed 20 per cent of the asset value;

- not less than two-thirds of the days not being days off and holidays within one month the estimated value of state securities of the Russian Federation, state securities of constituent territories of the Russian Federation, securities of Russian municipal formations, shares of Russian open joint stock companies, bonds of Russian business companies, shares of foreign joint stock companies, bonds of foreign commercial entities, securities of international financial organizations and securities of foreign states shall constitute not less  than 70 per cent of the asset value;

- the estimated value of state securities of the Russian Federation or  state securities of constituent territories of the Russian Federation of a single issue may not exceed 35 per cent of the asset value;

- the estimated value of securities of a single issuer (except for the state securities of the Russian Federation and  state securities of constituent territories of the Russian Federation) may not exceed 15 per cent of the asset value;

- the estimated value of securities which lack the acceptable quotations may not exceed 10 per cent of the asset value;

- the estimated value of shares of Russian joint stock companies and bonds of Russian economic companies not included in the quotation lists of trade institutors may not exceed 50 per cent of the asset value;

- the number of ordinary shares of an open joint stock company may not exceed 10 per cent of the total number of placed ordinary shares of that joint stock company in relation to which the reports of issue results are registered;

- the estimated value of shares of Russian joint stock investment funds and investment units of mutual investment funds may not exceed 10 per cent of the asset value;

- the number of investment units of a mutual investment fund may not exceed 30 per cent of the number of issued investment units of that mutual investment fund.

This clause shall be valid upon completion of the Fund formation.

26. Description of Risks Connected with Investment

Investments in securities is connected with the high degree of risk and does not implicate any guarantees on the issuer’s part both as regards of the repayment of basic sum and interest thereon. Beside that, the  risks of investment in securities include the following:

Higher political risk of expropriation, taxation of confiscation kind, state’s failure to perform the obligations in relation to the securities, devaluation and fluctuation of currency exchange rates, policy aimed at reducing the profit of investments including, along with other things, limitation of investments in the economy sectors being the sphere of specific state interests.

The Managing Company shall undertake all necessary actions in order to ensure full authencity and veracity of information on the basis of which the securities acquisition will be carried out. Nevertheless, an investor shall run the risk of losses connected with the reduction of value of investment units of the Fund. The investment profitability is not ensured in the future and the state does not guarantee the profitability of investments in the Fund.  The results of activity of the Managing Company in the past is not the guarantee of the Fund income in the future and the decision on purchase of Fund units shall be taken by the investor by himself upon familiarization of these Rules of the Fund, its investment declaration and evaluation of relevant risks.