DISC 7.3 Benchmarks: authorised funds and recognised schemes

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.