HOW DOES IT WORK?
For all Canadian funds (including those with a USD
Purchase Option), Manulife calculates the daily Net
Asset Value (NAV) per unit in Canadian dollars based on the NAV of the fund allocated to a series and the number of units outstanding for such series 1 . In addition, for the funds with a USD Purchase Option, the NAV per unit in USD (“Adjusted NAV per unit”) is calculated by converting the Canadian dollar NAV to the U.S. dollar NAV using the noon rate of exchange as quoted by the Bank of Canada. Cash dividends and distributions under the USD purchase option are also paid in U.S. dollars. The Adjusted NAV per unit is used for the purposes of purchasing and redeeming of units under the USD Purchase Option.
The following example demonstrates how the option works*.
An investor wants to purchase Fund A (which has a USD Purchase Option) with $100 USD:
Purchase with
$100 USD
Investor
Receive 20 units per Adjusted NAV per unit of $5.00 USD/unit
MMF
Fund A
(CAD)
Assuming:
1. Fund A’s NAV per unit = $5.00 CAD/unit
2. Exchange rate is $1.00 USD/$1.00 CAD
As a result:
1. The Adjusted NAV per unit = $5.00 USD/unit
2. Investor will receive = 20 units of Fund A

One year later, the investor wants to redeem his 20 units of Fund A:
Redeem
20 units
Investor
Receive $200 USD per
Adjusted NAV per unit of $10 USD/Unit
MMF
Fund A
(CAD)
Assuming:
1. Fund A’s NAV per unit has increased to $10.00 CAD/unit
2. Exchange rate remains at $1.00 USD/$1.00 CAD
As a result,
1. The Adjusted NAV per unit = $10.00 USD/unit
2. Investor will receive = $200 USD for his 20 units of Fund A
Note that the investor’s capital gain of $100 U.S. dollars ($200 U.S. dollars – $100 U.S. dollars) is solely based on the fund’s performance (as the exchange rate has not changed).
On the other hand, if we assume the following upon redemption:
Redeem
20 units
Investor
Receive $400 USD per
Adjusted NAV per unit of $20USD/unit
MMF
Fund A
(CAD)
1. Fund A’s NAV per unit has increased to $10.00 CAD/unit
2. CAD has strengthened to $2.00 USD/$1.00 CAD
As a result,
1. The Adjusted NAV per unit = $20.00 USD/unit
2. Investor will receive = $400 USD for his 20 units of Fund A
In this example, the investor’s gain is $300 U.S. dollars ($400 U.S. dollars – $100 U.S. dollars) due to a combination of the gain from fund performance and the favorable exchange rate.
* For illustration purpose only. Base case example, excluding distributions, performance, transaction costs and fees. 1 Units of a fund refer to units of a Manulife fund and/or shares of a Manulife
Corporate Class.

WHy INVEST IN THE USD
PURCHASE OPTION?
Consider the USD Purchase Option for your clients who have U.S. dollars to invest in funds.
This purchase option may also be suitable for investors who believe that Canadian dollars will be stronger than U.S. dollars over their investment horizon
(e.g. they expect to receive more U.S. dollars per
Canadian dollars upon redemption).
WHAT ARE THE RISKS?
I. Investor’s currency risk (currency risk associated with the USD Purchase Option)
Because our funds are priced in Canadian dollars, investors who purchase the funds using a USD Purchase
Option are subject to the fluctuation of USD/CAD exchange rate (as demonstrated in the first section), regardless of the fund’s performance. In general, if the Canadian dollar appreciates against the U.S. dollar
(e.g. from $1USD/$1CAD to $2USD/$1CAD) over their investment horizon, investors may incur currency gains. Conversely, if the Canadian dollar depreciates against the U.S. dollar (e.g. from $1USD/$1CAD to
$0.5USD/$1CAD) over the investment horizon, investors may incur currency losses.
II. Fund’s currency risk (currency risk associated with the funds’ investments in foreign denominated securities)
The funds, whether they are purchased in Canadian dollars or U.S. dollars, are denominated in Canadian dollars and are subject to currency risk associated with their overseas investments. For instance, a fund that invests in U.S. securities must first exchange its
Canadian dollars for U.S. dollars prior to purchasing.
When the fund sells those securities, it exchanges
U.S. dollars back to Canadian dollars. The fluctuation of
USD/CAD exchange rate will result in currency gains or losses which impact the fund’s performance.
WHAT ARE THE CONSEQUENCES
OF INVESTING IN A USD PURCHASE
OPTION IN FUNDS THAT EMPLOy A
HEDGING STRATEGy?
Consider a scenario where an investor purchases a fund with U.S. dollars and the fund invests primarily in U.S. securities. For a non-hedged fund, the investor’s currency risk and the fund’s currency risk will likely cancel out (natural hedge). This is because the weakening of U.S. dollars will hurt the fund (as it will receive less Canadian dollars upon selling of U.S. securities) but will benefit the investor (as he receives more U.S. dollars per one Canadian dollar upon redemption). However, if it was a currency hedged fund, the fund itself would be protected from currency movement, while the investor would realize a currency gain.
Regardless of the portfolio manager’s hedging strategy, the USD Purchase Option provides investors with flexibility to increase or limit their currency exposure.
HOW IS THE MANULIFE USD PURCHASE
OPTION DIFFERENT FROM CURRENCy
NEUTRAL FUNDS?
Essentially a currency neutral fund hedges all of its foreign currency exposure back to Canadian dollars, using derivative instruments such as currency forwards, swaps and options. Movements in the USD/CAD exchange rate will not impact the fund’s performance 2 .
The Manulife Mutual Funds USD Purchase Option allows investors to purchase a fund in U.S. dollars regardless of the fund’s hedging strategy.
2 Note that hedging does incur transaction costs and fees, which will impact the fund’s performance

HOW TO PURCHASE A MANULIFE MUTUAL FUND WITH A USD PURCHASE OPTION
Purchasing Manulife funds with U.S. dollars is as simple as purchasing with Canadian dollars. Each series of
Manulife funds with a USD Purchase Option has a separate fund code, which can be found in the Fund Name and Number Guide.
WHICH MANULIFE FUNDS HAVE A USD PURCHASE OPTION?
Manulife Mutual Funds offers a USD Purchase Option for many of its funds as listed below:
✓ Indicates funds or classes which actively hedge U.S. Dollars
Manulife Asia Equity Class
Manulife Asia Total Return Bond Fund
✓ Manulife Canadian Focused Class
Manulife Corporate Bond Class
✓ Manulife Corporate Bond Fund
Manulife Diversified Investment Fund
Manulife Diversified Strategies Fund
Manulife Emerging Markets Balanced Fund
✓ Manulife Emerging Markets Debt Fund
Manulife Emerging Markets Equity Class
✓ Manulife Floating Rate Income Class
✓ Manulife Floating Rate Income Fund
Manulife Global Dividend Income Fund
Manulife Global Dividend Income Fund - Series T(6)
Manulife Global Focused Balanced Fund
✓ Manulife Global Focused Class
✓ Manulife Global Focused Fund
Manulife Global Infrastructure Class
Manulife Global Infrastructure Fund
Manulife Global Opportunities Balanced Class
Manulife Global Opportunities Balanced Fund
Manulife Global Opportunities Class
Manulife Global Real Estate Class
Manulife Global Real Estate Fund
Manulife Global Small Cap Balanced Fund
✓ Manulife High Yield Bond Fund
Manulife International Focused Fund
Manulife International Focused Fund – Series T(6)
Manulife International Value Equity Fund
Manulife International Value Equity Class
Manulife Leaders Opportunities Portfolio
Manulife Monthly High Income Class
Manulife Special Opportunities Class
Manulife Strategic Balanced Yield Class
Manulife Strategic Balanced Yield Fund
✓ Manulife Strategic Income Class
✓ Manulife Strategic Income Fund
Manulife U.S. All Cap Equity Class
Manulife U.S. All Cap Equity Fund
Manulife U.S. Large Cap Equity Class
Manulife U.S. Large Cap Equity Fund
✓ Manulife U.S. Opportunities Class
Manulife U.S. Opportunities Fund
✓ Manulife Value Fund
Manulife World Investment Class
✓ Manulife Yield Opportunities Class
✓ Manulife Yield Opportunities Fund
Source: Manulife Mutual Funds

FOR MORE INFORMATION, PLEASE CONTACT yOUR MANULIFE INVESTMENTS SALES TEAM OR
VISIT MANULIFEMUTUALFUNDS.CA
FOR ADVISOR USE ONLY
Manulife Funds, Manulife Corporate Classes and Manulife Leaders Portfolios are managed by Manulife Mutual Funds. Commissions, trailing commissions, management fees and expenses all may be associated with mutual fund investments. Please read the prospectus before investing. Mutual funds are not guaranteed, their values change frequently and past performance may not be repeated. Manulife, Manulife Mutual Funds, the Manulife Mutual Funds For Your Future logo, the Four Cubes Design, the Block Design, Strong Reliable
Trustworthy Forward-thinking and Manulife Leaders Portfolios are trademarks of The Manufacturers Life Insurance Company and are used by it, and by its affiliates under license.
TMK1244E 11/12