#### TYPES OF DERIVATIVES THE SUB-FUNDS MAY USE
A derivative is a financial contract whose value depends on the performance of one of more reference assets (such as a security or basket of securities, an index or an interest rate). Although the sub-funds specific investment policy does not rule out the use of any type of derivative, the following types currently make up the most common derivatives used by the sub-funds:
Core Derivatives — may be used by any sub-fund, consistent with its investment policy
financial futures
options, such as options on equities, interest rates, indices, bonds, currencies,
commodity indices warrants,
forwards, such as foreign exchange contracts
swaps (contracts where two parties exchange the returns from two different assets, indices, or baskets of the same), such as foreign exchange, interest rate, but NOT including total return swaps, credit default swaps, commodity index swaps, volatility or variance swaps.
Additional Derivatives — any intent to use will be disclosed in "Sub- Fund Descriptions""
Total return swaps (contracts where one party transfers to another party the total performance of a reference assets, including all interest, fee income, market gains or losses, and credit losses). Total return swaps entered into by the sub-funds are in the form of unfunded swaps. An unfunded swap is a swap where no upfront payment is made by the total return receiver at inception. A funded swap is a swap where the total return receiver pays an upfront amount in return for the total return of the reference asset. Funded swaps tend to be costlier due to the upfront payment requirement.
credit derivatives, such as credit default swaps (contracts where a bankruptcy, default, or other "credit event" triggers a payment from one party to the other).
TBA derivatives (forward contracts on a generic pool of mortgages. Overall characteristics of this pool is specified) but the exact securities to be delivered to the buyer are determined 2 days before delivery, rather than at the time of the original trade)
structured financial derivatives, such as credit-linked and equity- linked securities.
Currency hedging A sub-fund may engage in direct hedging (taking a position in a given currency that is in the opposite direction from the position created by other portfolio investments) and in cross-hedging (reducing the effective exposure to one currency while increasing the effective exposure to another).
Currency hedging can be done at the sub-fund level and at the share class level (for share classes that are hedged to a different currency than the sub-fund's base currency).
When a sub-fund holds assets that are denominated in multiple currencies, there is a greater risk that currency fluctuations will in practice not be fully hedged.
Interest rate hedging For interest rate hedging, the sub-funds typically use interest rate futures, interest rate swaps, writing call options on interest rates or buying put options on interest rates.
Credit risk hedging A sub-fund can use credit default swaps to hedge the credit risk of its assets. This includes hedges against the risks of specific assets or issuers as well as hedges against securities or issuers to which the sub-fund is not directly exposed.
Duration hedging seeks to reduce the exposure to interest rates parallel shifts along the curves. Such hedging can be done at the sub-fund level.
Efficient portfolio management The sub-funds can use any allowable derivative for efficient portfolio management. Efficient portfolio management includes cost reduction, cash management, the orderly maintenance of liquidity and related practices (for instance, maintaining 100% investment exposure while also keeping a portion of assets liquid to handle redemptions of shares and the buying and selling of investments). Efficient portfolio management does not include any activities that create leverage at the overall portfolio level.
Gaining exposure The sub-funds can use any allowable derivative as a substitute for direct investment, that is, to gain investment exposure to any security, market, index, rate, or instrument that is consistent with the sub-fund's investment objective and policy. This exposure may exceed the one than would be obtained through direct investment in that position (leverage effect).
A sub-fund can also sell a credit default swap as a way of gaining a specific credit exposure. Selling a credit default swap could generate large losses if the issuer or security on which the swap is based experiences a bankruptcy, default or other "credit event".
contracts for difference (contracts whose value is based on the difference between two reference measurements) such as a basket of securities.
Futures are generally exchange-traded. All other types of derivatives are generally OTC. For any index-linked derivatives, the index provider determines the rebalancing frequency.

Translation (ENES, 2018-08-01):
##### TIPOS DE DERIVADOS QUE PUEDEN USAR LOS SUBFONDOS
Un derivado es un contrato financiero cuyo valor depende de la rentabilidad de uno o más activos de referencia (como un valor o una cesta de valores, un índice o un tipo de interés). Aunque la política de inversión específica de los subfondos no excluye el uso de ningún tipo de derivado, los siguientes tipos constituyen los derivados más comunes utilizados por los subfondos:
Derivados principales: los puede usar cualquier subfondo, de una manera coherente con su política de inversión
opciones,
futuras financieras, tales como opciones en valores de renta variable, tipos de interés, Índices, bonos, divisas,
certificados para comprar Índices de productos básicos,
contratos a plazo, como los contratos de intercambio de divisas,
permutas financieras (contratos en los que dos partes intercambian los beneficios de dos activos, Índices o cestas de los mismos, que son diferentes), tales como cambio de divisa, tipo de interés, pero SIN incluir las permutas de rentabilidad total, las permutas de incumplimiento crediticio, las permutas del Índice de productos básicos, la volatilidad o las permutas de variación.
Derivados adicionales: cualquier intento de uso se especificará en “Descripciones de los subfondos”
Permutas de rentabilidad total (contratos donde una parte transfiere a otra la rentabilidad total de unos activos de referencia, incluyendo todos los intereses, ingresos en concepto de comisiones, ganancias o pérdidas de mercado y de crédito). Las permutas de rentabilidad total adquiridas por los subfondos son permutas sin financiación. Una permuta sin financiación es una permuta en la que el receptor de la rentabilidad total no realiza un pago por adelantado al principio. Una permuta con financiación es una permuta en la que el receptor de la rentabilidad total paga una cantidad por adelantado a cambio de la rentabilidad total del activo de referencia. Las permutas con financiación tienden a ser más costosas debido al requisito de pagar por adelantado.
Derivados de crédito, tales como las permutas de incumplimiento crediticio (contratos en los que la bancarrota, el impago u otro “evento crediticio” desencadena un pago que una parte realiza a otra parte).
Derivados TBA (contratos a plazo sobre un conjunto general de créditos hipotecarios. Se especifican las características generales de este conjunto), pero los valores exactos que han de ser entregados al comprador se determinan dos días antes de la entrega y no en el momento de la primera negociación).
Derivados financieros estructurados, tales como valores vinculados al crédito y valores vinculados a la renta variable.
Contratos por diferencias (contratos cuyo valor se basa en la disparidad entre dos medidas de referencia) como una cesta de valores.
Generalmente los futuros se negocian en la bolsa. El resto de derivados es de tipo OTC generalmente. En el caso de los derivados vinculados al Índice, la frecuencia de reajuste la determina el proveedor del Índice.