THE HSBC AMANAH EUROPE EQUITY

u hsbcamanah.comFor professional advisers only

2

HSBC Amanah is the Islamic financial services division of the HSBC Group and is well-placed to understand, structure, and deliver financial solutions that are compatible with the requirements of Shariah. HSBC Amanah is one of the leading global players in the Islamic Finance industry.

u Sinopia Asset Management is the Investment Adviser for the HSBC Amanah Europe Equity, which is a sub-fund of the HSBC Amanah Funds SICAV

u Sinopia Asset Management is the specialist for quantitative asset management of the HSBC Group, aiming to provide robust quantitative investment solutions in a controlled risk environment for all types of investors

u Four sources of alpha: active stock selection, dynamic country and sector allocation and continuous market exposure management

u Total assets of Islamic financial institutions have grown by an average of 15-20% per annum* over the past five years

u Europe is the birthplace of many of the world’s largest leading multinational companies

u Investing in Europe gives access to a large single market of around 300 million** customers, with modern infrastructure, highly educated and skilled workforce, allowing businesses to deliver to their partners on time with legal certainty and transparency of regulatory reform.

*Source: HSBC Amanah, October 2008 and www.zawya.com

**Source: The Economist, September 2008

HSBC Amanah Europe Equity

HSBC Amanah

HSBC Amanah is the Islamic financial services division of the HSBC Group. With experienced personnel working from regional offices, its mission is to ensure that HSBC is one of the leading providers of value-added Shariah compliant financial products and services to its clients.

The HSBC Amanah Funds SICAV is an investment company (Société d’Investissement à Capital Variable) constituted in the Grand Duchy of Luxembourg and qualifies as an Undertaking for Collective Investment in Transferable Securities (a ‘UCITS’) and is recognised for sale in the UK by the Financial Services Authority. The Company is organised as an umbrella structure with the ability to issue shares of different classes corresponding to different sub-funds. HSBC Amanah SICAV is specifically designed for investors who wish to invest in equity markets in compliance with Shariah (Islamic law).

HSBC Amanah is guided and supervised by the HSBC Amanah Central Shariah Committee, an independent committee of Islamic scholars. The Committee oversees

the development and operations of all HSBC Amanah products and transactions to ensure that they meet the requirements of Shariah.

Central Shariah Committee

Three scholars of international repute, well versed in both Islamic law and modern finance, serve on the HSBC Amanah Shariah Committee. The Central Committee not only provides initial approvals on investment objectives and investment strategies of all funds, but also reviews the investments periodically to ensure the continuous compliance to Islamic principles. Moreover, the committee conducts annual audits of all funds to ensure adherence to their rulings during the year.

Sheikh Nizam Yaquby

Sheikh Nizam is a graduate in Economics and Comparative Religion from McGill University and is an internationally acclaimed scholar in the Islamic banking industry. He has been a teacher of Tafsir since 1976. He advises a number of banks and financial institutions including Abu Dhabi Islamic

Bank, BNP Paribas, Dow Jones†† Lloyds TSB and Standard Chartered on Islamic banking and finance.

Sheikh Dr Mohamed Elgari

Sheikh Elgari holds a PhD in Economics from the University of California. He is a Professor of Islamic Economics and the director of the Centre for Research in Islamic Economics at King Abdulaziz University in Saudi Arabia. He is an expert at the Islamic Jurisprudence Academy (OIC), Jeddah. Dr Elgari is the editor of the Review of Islamic Economics. He is also an adviser to several Islamic financial institutions worldwide and the author of many books on Islamic banking.

Dr Mohamed Imran Ashraf Usmani

Dr Usmani holds a PhD in Islamic Finance. He also obtained degrees of Alimiyyah and Takhassus (specialisation in Islamic Jurisprudence) from Jamia Darul Uloom, Karachi. His area of expertise is Islamic Finance in which he has

carried out extensive research. Dr. Usmani is a faculty member/teacher of Jamia Darul Uloom, Karachi and Institute of Business Administration (IBA), Karachi. He is the author of various books on Shariah (Islamic law).

All Shariah compliant investments must be certified by experts in Shariah, generally through a panel or board comprised of respected Shariah scholars who are qualified to issue ‘Fatwas’ (religious rulings) on financial transactions. This panel of Shariah experts ensure full compliance of all Shariah compliant investment funds. For illustration, the Central Shariah Committee of HSBC Amanah has determined that investment funds investing in equities as an asset class will not invest in companies whose primary business activity is as shown in Figure 1 (sectoral screens), or in companies which exhibit characteristics as shown in Figure 2 (financial screens)*.

3

The HSBC Amanah Europe Equity

The fund meets Shariah principles as interpreted and laid down by the Shariah Committee and provided to the Board of Directors. The investment process ensures adherence to Shariah principles which HSBC Amanah’s Central Shariah Committee closely monitor. Sectoral screens, financial ratio and transaction screening takes place before any trade is entered into.

The HSBC Amanah Europe Equity sub-fund seeks long-term capital growth through the implementation of an

active management strategy. The investments will consist of a diversified portfolio of European equity securities that comply with Islamic investment principles. The investment universe includes also the European emerging countries. This sub-fund is designed for investors who want exposure to European equities consistent with the principles of Shariah law and who are seeking portfolio diversification with potentially strong returns over a 5 to 10 year period and a fairly high level of volatility. The sub-fund is managed by Sinopia, the specialist quantitative management arm of the HSBC Group.

Figure 1: Sectors Figure 2: Financial

Alcohol Weapons All the following should be less than 33%

Tobacco Pork Total Debt/12 month trailing market capitalisation

Financial services Gambling Cash & Interest bearing securities/12 month trailing market capitalisation

Pornography Leisure/media Accounts Receivable/12 month trailing market capitalisation

*The above screens apply only to funds managed using the Dow Jones†† Islamic Market indices. For funds using the MSCI†, different financial screenings will

be used.

Why an Islamic Europe Equity fund?

4

Total assets of Islamic financial institutions have grown by an average of 15-20% per annum over the past five years1, suggesting strong demand for Islamic investing. It is expected Islamic finance will continue to grow at this rate for the next few years and that total assets in Islamic finance will reach $1 trillion by 2012. The growth in Islamic finance has also been mirrored in the growth of Shariah compliant investment funds. It is estimated that currently, there are more than US$30 billion under management in Shariah compliant investment funds2.

While Islamic finance was developed for the Muslim community, there is a genuine socio-economic component that renders it equally attractive to investors of all faiths. Ethical investment and Islamic investment products share common ground and the recent surge in demand for ethical products could provide a lift for Shariah investments.

Europe’s economy is the world’s second largest (as measured by GDP); Investing in Euroland gives access to a large single market of over 300 million customers, with modern infrastructure and a highly educated and skilled workforce. Europe is the birthplace of many of the world’s largest leading multinational companies, and home to its global headquarters like Allianz, Air France-KLM, Nestle, Vodafone, Novartis, GlaxoSmithkline, BHP Billington, L’Oréal Group, LVMH, Nokia Corporation, Royal Dutch Shell, just to name a few. A considerable number of European-based companies are ranked among the worlds’ top-ten within their sector of activity, within a strong legal and regulatory system. Investors are benefiting from enhanced market visibility and liquidity. Increased competitive pressures have forced European companies to improve productivity.

1 Source: HSBC Amanah, October 2008 and www.zawya.com, 2 Source: www.zawya.com, 3Source : The Economist September 2008

Why HSBC Amanah Europe Equity fund ?

HSBC Amanah is well-placed to understand, structure, and deliver financial solutions that are compatible with the requirements of Shariah. It is headquartered in Dubai, and with regional representatives in New York, Riyadh, Dubai, London, Jakarta and Kuala Lumpur, HSBC Amanah is one of the leading global players in the Islamic Finance industry.

Sinopia Asset Management is the specialist for quantitative asset management of the HSBC Group, aiming to provide robust quantitative investment solutions in a controlled risk environment for all types of investors. The highly innovative product offering, the disciplined investment strategies and the specialized staff have made Sinopia a key player in the quantitative asset management community.

HSBC Amanah Europe Equity features four key sources to drive fund performance with active risk management: active stock selection, dynamic country and sector allocation and continuous market exposure management.

As you can see below, the Dow Jones†† Islamic Europe Market Index outperformed the Dow Jones†† Euro Stoxx Index between the end of December 2003 and the end of December 2008.

Using quantitative valuation methods, Sinopia selects the most promising stocks within the investment universe and builds a portfolio that takes into consideration stock/sector/country and market interaction. In addition to dynamic country and sector allocation, the fund also achieves its performance by constantly monitoring and adjusting its overall equity exposure (between 90% and 100%). The strategy complies with Islamic investment principles.

The fund aims to outperform the Dow Jones†† Islamic

2.36%

-8.43%-20%

0%

20%

40%

60%

80%

100%

Dec-03 Jun-04 Dec-04 Jun-05 Dec-05 Jun-06 Dec-06 Jun-07 Dec-07 Jun-08 Dec-08

Dow Jones†† Islamic Europe Market Index Dow Jones†† Euro Stoxx Index

Source : Bloomberg Data as at end of December 2003. Both indices are on a US $ price return basis and rebased to 100. Past performance is not a guide

to future performance.

55

Europe Market index over the long-term, with a tracking error between 4% and 6%.

Key features

u Active quantitative management style

u Four sources of alpha: active stock selection, dynamic country and sector allocation and continuous market exposure management

u Daily risk control

u Shariah compliant investment solution

u UCITS qualified fund

u Daily liquidity for subscriptions and redemptions

Four combined sources of performance with active risk management

HSBC Amanah Europe Equity features four key sources to drive fund performance:

u Continuous exposure management: overall equity exposure is constantly monitored with adjustments made based on Sinopia’s expected returns for the European equity market

u Dynamic country allocation: according to its valuation signals, the fund manager takes lower or higher exposure relative to the index on the different countries of the investment universe

u Dynamic sector allocation: the fund manager adjusts the sector weights compared to the index based on identified market opportunities

u Active stock selection: using quantitative valuation, the fund manager selects the stocks which offer the best performance potential within each country

The weight of these sources of performance is broken down as follows: equity market exposure 10%, country allocation 40%, sector allocation 20% and stock selection 30%.

Risk is also actively managed. The risk budget of the strategy is optimised in building an efficient portfolio, using Sinopia’s forecasts on returns and risks.

Investment process

In order to manage this strategy, Sinopia developed a structured investment process, which uses three steps to generate performance: quantitative valuation for the market as a whole, countries and sectors as well as stock level, portfolio optimisation and disciplined implementation.

Quantitative stock valuation

In order to value a stock, Sinopia uses its own forecast for future company earnings and long-term interest rates. To determine future earnings, Sinopia reviews and analyses economic forecasts using proprietary quantitative tools and processes the information to take into consideration optimism bias, inertia of the consensus, and dispersion effects. Momentum criteria and valuation criteria are used to select the best stock within each country/sector.

Portfolio construction

This step allows Sinopia to convert the expected returns into target portfolios while taking into account the risk levels associated within the portfolio’s assets. For HSBC Amanah Europe Equity, the average relative risk level is between 4% and 6%. During portfolio construction, Sinopia’s unique approach takes into consideration stock/sector interaction and concentration in order to optimise performance and minimise risk. In practice, a stock’s weighting will be determined based on its expected returns, its country and sector, its risk and transaction costs linked to the investment.

Sinopia uses a proprietary and robust risk/return optimisation model in order to help determine the optimal sector allocation. The fund will under/overweight countries and sectors +/-5% compared to the index, depending on earnings forecasts and respective volatilities.

Finally, the fund’s exposure level will be adjusted between 90% and 100% depending on forecasts.

6

Implementation

In order to optimise performance, Sinopia controls costs during implementation. The implementation of the allocations derived from the above steps is under the supervision and responsibility of the fund manager with the assistance of specialised traders. The instrument selection is made according to the liquidity and the relative costs of the instruments available to build the allocation. There is no use of derivatives, according to the Islamic investment principles.

Throughout Sinopia’s investment process, risk management plays a vital role. Risk management is a core component of

Sinopia’s investment philosophy and process. Therefore, all teams contribute to risk assessment: from asset allocation analysis and decision (Research and Asset Management) to implementation (Asset Management and Trading) and controls (Asset Management, Middle Office and Risk Controls). Portfolios are explicitly built taking into account the trade-off between expected return and risk levels. On an ongoing basis, Sinopia’s investment process incorporates the systematic monitoring of portfolio exposures, absolute or relative risk levels, as well as a strict control of operational risk.

((YY/YY): Number of years at Sinopia / Number of years experience - as at 31/10/08)

Jean Francois Schmitt (8/15), Global Head of Equity - Sinopia Asset Management

10 portfolio managers

Paris Francois Dossou, Deputy Head (10/10) Jeanne Follet (1/9)

Patrick Gautier (7/9) Nadia Ben Djemiaa (4/4)

Laurence Jobert (1/9) Malika Oueznadji (7/7)

London Nils Jungbacke (7/11) Sunny Wu (4/6)

Harvey Sidhu (8/10)

Hong Kong Benedicte Mougeot, Deputy Head (13/13)

3 assistant managers

Paris Abderrahman Belcad (3/3)

Sylvain Treilles (1/1)

Jeremy Pierre (1/1)

Celine Boe-Deschamps (9/9), Head of UK Trading

6 equity traders

Paris Jerome Allouch, Deputy Head (1/8)

Julien Tourchon (1/6)

Ekaterina Diatchenko (2/4)

Elena Ripca (1/1)

Gabriel Taboul (1/1)

Hong Kong Elie El Khoueiri (3/3)

The investment team

Fund characteristics

Fund name: HSBC Amanah Europe Equity

Portfolio manager: Laurence Jobert

Management company: HSBC Investment Funds (Luxembourg) SA

Legal form: Sub-fund of the Luxembourg-based HSBC Amanah Funds SICAV

Investment adviser: Sinopia Asset Management

Management style: Active quantitative

Index: Dow Jones†† Islamic Europe Market Index

Restrictions: Shariah principles

Universe: Eurozone, United Kingdom, Norway, Sweden, Denmark and Switzerland equities which meet Islamic principles

Fund tracking error: Expected to be between 4% and 6%

Number of stocks: Normally between 80 and 120

Management fees: 1.50%

Subscription fees: Up to 5.54% of the net asset value per shares

Redemption fees: None

Dealing: Daily

Valuation: Daily

Settlement: T+4

This document is intended for investment professionals only and should not be distributed to retail clients. HSBC Amanah Funds SICAV is a Luxembourg

domiciled SICAV and is regulated by the CSSF. HSBC Amanah Funds SICAV cannot be sold by anyone in any jurisdiction in which such offer or solicitation is not

lawful or in which the person making such an offer or solicitation is not qualified to do so or to anyone to whom it is unlawful to make such offer or solicitation.

All applications are made on the basis of the current HSBC Amanah Funds SICAV Prospectus, simplified prospectus and most recent annual and semi-annual

reports. These can be obtained on request and free of charge from HSBC Global Asset Management (UK) Limited or the local distributors. The securities

representing interests in HSBC Amanah Funds SICAV have not been and will not be registered under the US Securities Act of 1933 and will not be offered for

sale or sold in the United States of America, its territories or possessions and all areas subject to its jurisdiction, or United States person, except in a transaction

which does not violate the Securities Law of the United States of America. The value of investments may go down as well as up and you may not get back the

full amount you invested. Where overseas investments are held the rate of exchange may cause the value of investments to go down as well as up. Markets

in some countries can be described as ‘emerging markets’. Some of these may involve a higher risk than where an investment is within a more established

market. Where a sub-fund invests predominately in one geographical area, any decline in economic conditions may affect prices and the value of underlying

investments. HSBC Global Asset Management (UK) Limited provides information to professional advisers and their clients on the investment products and

services of members of the HSBC Group. The material contained in this document is for information only and does not constitute investment advice or a

recommendation to any reader of this material to buy or sell investments. The funds mentioned in this document may not be registered for sale or available in

all jurisdictions. For available funds please contact your local HSBC office. It is possible that the restrictions placed on investment such as the prohibition on the

use of interest bearing investments, the donations to approved Charities and the limited universe of stocks available to the Investment Adviser may result in the

funds performing less well than funds with similar investment objectives which are not subject to Shariah restrictions.

This document is issued by HSBC Global Asset Management (UK) Limited, 8 Canada Square, Canary Wharf, London, E14 5HQ, UK. Authorised and regulated by

the Financial Services Authority and registered as number 122335. © Copyright. HSBC Global Asset Management 2009. All Rights Reserved.

This product is marketed in a sub-distributing capacity on a principal – to – principal basis by the HSBC Global Asset Management MENA, a unit that is part of

HSBC Bank Middle East Limited, PO Box 66, Dubai, UAE, which is incorporated and regulated by the Jersey Financial Services Commission. Services are subject

to the Bank’s terms and conditions. HSBC Bank Middle East Limited is a member of the HSBC Group.

The information provided has not been prepared taking into account the particular investment objectives, financial situation and needs of any particular investor.

As a result, investors using this information should assess whether it is appropriate in the light of their own individual circumstances before acting on it. The

information in this document is derived from sources believed to be reliable, but which have not been independently verified. However, HSBC Bank Middle East

Limited makes no guarantee of its accuracy and completeness and is not responsible for errors of transmission of factual or analytical data, nor shall HSBC Bank

Middle East Limited be liable for damages arising out of any person’s reliance upon this information. All charts and graphs are from publicly available sources or

proprietary data. The opinions in this document constitute the present judgment of the issuer, which is subject to change without notice.

This document is neither an offer to sell, purchase or subscribe for any investment nor a solicitation of such an offer. This document is intended for the use of

institutional and professional customers and is not intended for the use of private customers. This document is intended to be distributed in its entirety. No

consideration has been given to the particular investment objectives, financial situation or particular needs of any recipient. Any transaction will be subject to

HSBC Bank’s Terms of Business. 16546/ME/0409 FP09-0363.

† Source: MSCI. The MSCI information may only be used for your internal use, may not be reproduced or redisseminated in any form and may not be used to create

any financial instruments or products or any indices. The MSCI information is provided on an ‘as is’ basis and the user of this information assumes the entire risk of

any use it may make or permit to be made of this information. Neither MSCI, any of its affiliates or any other person involved in or related to compiling, computing

or creating the MSCI information (collectively, the ‘MSCI Parties’) makes any express or implied warranties or representations with respect to such information or

the results to be obtained by the use thereof, and the MSCI Parties hereby expressly disclaim all warranties (including, without limitation, all warranties of originality,

accuracy, completeness, timeliness, non-infringement, merchantability and fitness for a particular purpose) with respect to this information. Without limiting any of

the foregoing, in no event shall any MSCI Party have any liability for any direct, indirect, special, incidental, punitive, consequential or any other damages (including,

without limitation, lost profits) even if notified of, or if it might otherwise have anticipated, the possibility of such damages.

† † Source: Dow Jones and Dow Jones Islamic Market Titans Index SM are service marks of Dow Jones & Company, Inc. and will be licensed for use by HSBC

Investment Funds (Luxembourg) S.A. The HSBC Amanah Global Equity Index Fund is not sponsored, endorsed, sold or promoted by Dow Jones and Dow

Jones makes no representation regarding the advisability of investing in the Fund.