The first section reports similar information to the ‘Account Information’ section of the CTI template, as evidenced in Figure 1 below. Similarly, the fourth section of the EMT reports some of the costs and charges found in the CTI, though where the CTI reports ‘parent’ cells and their ‘child’ costs at a far more granular level, the EMT only reports totals of costs and charges.
However, the ‘Target Market Section’ is unique to the EMT. In this section, the manufacturer assesses the following items: Investor Type; Knowledge and/or Experience; Client Ability to Bear Losses; Risk Tolerance; Client Objective & Needs and Distribution Strategy. These are answered through a mixture of mostly ‘yes/no/neutral’ responses, though ‘1-7 or empty’ responses are used in some cases to, for example, show the relative risk tolerance of clients for respective structured securities or funds.
In addition, the ‘Costs & Charges Ex-Ante’ section is unique to the EMT template. To recap, ex-ante refers to reporting estimated costs for the next year whilst ex-post refers to reporting costs incurred in past years.
Due to this, the EMT is not exclusively used to report costs and charges data to current investors, but also provides crucial information that can help future investors decide if a fund is suitable for them to invest in or not.