DISC 7 Performance information

1. (1) The performance information comprises:
   1. (a) information about the performance of a consumer composite investment covering the relevant period so as to illustrate variations in value of the investment over that period;
   2. (b) any additional information necessary to produce the line graph as required by DISC 7.1.4R; and
   3. (c) the information required by DISC 7.1.5R.
2. (2) The relevant period for the purposes of the performance information is the shorter of:
   1. (a) ten consecutive years ending on a date no earlier than 60 days before the date the manufacturer prepares a product summary for a consumer composite investment as required under DISC 2A.2.1R or updates a product summary for a consumer composite investment as required by DISC 3.2.2R; or
   2. (b) the entire period from the day a consumer composite investment was manufactured until a date no earlier than 60 days before the date the manufacturer prepares a product summary for that consumer composite investment as required by DISC 2A.2.1R(1) or updates a product summary for that consumer composite investment as required by DISC 3.2.2R.
3. (3) The requirement in (1) does not apply in respect of consumer composite investments for which no past performance information is available.
4. (4) The manufacturer must ensure the pricing basis adopted for the performance data covering the relevant period is consistent throughout and provides a fair representation and full disclosure of the performance of the consumer composite investment.

5. (5) Where the consumer composite investment is an investment in a closed-ended investment fund or any other share in a fund which is admitted to official listing on an exchange and for which there is a difference between share price and net asset value per share, the performance information must include the historical share price as well as the historical net asset value per share for the relevant period.

    

The product summary must also contain the following information:

1. (1) the year in which the consumer composite investment was manufactured;
2. (2) where the underlying asset is in a different currency to pounds sterling, an explanation of this and a warning that performance may be affected by currency fluctuations;
3. (3) the relevant period; and
4. (4) the source of the performance information.

The line graph must be accompanied by: 

1. (1) a prominent warning to the retail investor explaining that past performance is not a guide to future performance;
2. (2) where the relevant period is 1 year or less, a warning that the performance shown is for a short period of time and that it will not necessarily be representative of the performance of the consumer composite investment in the longer term; and
3. (3) the information in DISC 7.1.5R.

Where the relevant period for a consumer composite investment comprises less than 3 months, the manufacturer preparing the product summary may:

1. (1) opt not to prepare a line graph; and
2. (2) if so, state in the product summary that there is insufficient performance information to usefully illustrate the performance of the consumer composite investment.

1. (1) The line graph must show the performance of a hypothetical investment amount in the consumer composite investment invested at the start of the relevant period for the duration of that period with at least 1 datapoint for the last day of each month during the relevant period.
2. (2) The investment amount referred to in (1) must:
   1. (a) where the consumer composite investment is priced or denominated in pounds sterling, be £10,000; or
   2. (b) where the consumer composite investment is priced or denominated in a currency other than pounds sterling, be an amount of the other currency of a similar magnitude to £10,000 which is cleanly divisible by 1000.
3. (3) The past performance shown in (1) must be net of any costs and charges for that consumer composite investment.
4. (4) Where the consumer composite investment is a with-profits insurance contract, the performance shown in (1) must include the effect of any bonus amount or market value reduction during the relevant period.
5. (5) For the purposes of (4), a bonus amount or market value reduction is an adjustment to a retail investor's investment return under a mechanism in the with-profits insurance contract for the purpose of evening out the effect of volatility on investment returns.
6. (6) Where DISC 7.1.1R(5) applies, the manufacturer preparing the product summary may add a separate line graph comparing historical share prices against historical net asset value per share over the relevant period. 

The line graph must meet the following requirements:

1. (1) it must be legible;
2. (2) the units:
   1. (a) on the Y-axis must be the currency in which the consumer composite investment is priced; and
   2. (b) on the X-axis must be calendar years (or parts thereof); and
3. (3) the scale of the Y-axis must:
   1. (a) be linear; and
   2. (b) not be logarithmic; and
4. (4) values showing amounts of currency must be rounded to whole numbers.

In the case of a UCITS scheme or a non-UCITS retail scheme: 

1. (1) where one or both of a target benchmark or a constraining benchmark has been referred to in the prospectus for that fund, the line graph must include lines tracking the performance of the benchmarks referred to over the same period and on the same basis as illustrated for the past performance of the consumer composite investment; and
2. (2) the line graph may include a comparator benchmark, provided that where the prospectus for that fund included a comparator benchmark the same comparator benchmark is used in the line graph over the same time period and on the same basis as illustrated for the past performance of the consumer composite investment.

Where a manufacturer preparing the product summary does not include a line in the line graph for a benchmark, it must provide in the product summary: 

1. (1) a statement to that effect; and
2. (2) a short explanation as to how retail investors can assess the performance of the consumer composite investment.

For the purposes of DISC 7.3.2R and DISC 7.3.3R:

1. (1) a target benchmark is where a target for a fund's performance has been set, or a payment out of the assets of the fund is permitted, by reference to a comparison of one or more aspects of the fund's assets or price with fluctuations in the value or price of an index or indices or any other similar factor;
2. (2) a constraining benchmark is where, without being a target benchmark, arrangements are in place in relation to the fund according to which the composition of the portfolio of the fund is, or is implied to be, constrained by reference to the value, the price or the components of an index or indices or any other similar factor; and
3. (3) a comparator benchmark is where, without being a target benchmark or a constraining benchmark, the fund's performance is compared against the value or price of an index or indices or any other similar factor.

Where the manufacturer preparing the product summary opts not to include a benchmark for a consumer composite investment under DISC 7.4.2(R), it must:

1. (1) omit the line referred to in DISC 7.4.2(R); and
2. (2) provide in the product summary:
   1. (a) a short explanation of why the manufacturer has opted not to include a relevant benchmark (for example, because it considers there is no relevant benchmark for the fund); and
   2. (b) a short explanation as to how retail investors can assess the performance of the consumer composite investment.

1. (1) This rule applies where a material change occurs to the objectives and strategy of a consumer composite investment (as identified under DISC 3.2.4R(1)) during the relevant period shown by the line graph and the consumer composite investment is:
   1. (a) an investment in a fund; or
   2. (b) an insurance-based investment product.
2. (2) The time of the change must be indicated in the line graph for the consumer composite investment with a warning that the prior performance was achieved under circumstances that no longer apply.

1. (1) This guidance applies in the following circumstances:
   1. (a) a consumer composite investment is an investment in a fund or an insurance-based investment product;
   2. (b) a material change occurs to the objectives and strategy of that consumer composite investment during the relevant period shown by the line graph; and
   3. (c) a benchmark is shown in the line graph.
2. (2) In the circumstances set out in (1), the FCA expects the benchmark shown in the line graph before and after the change in objectives and strategy to be consistent with the objectives and strategy for the period to which the benchmark relates.