Risk Disclosure

Background

We are Raison Securities Limited, a private company incorporated in the Astana International Financial Centre (business identification number 230140900126) with its registered address at Office 148, 55/22 Mangilik El Avenue, Block C4.3., floor 1, Astana, Z05T3F5, the Republic of Kazakhstan ("we", "us", “our” or "Raison").

Raison is regulated by the Astana Financial Supervisory Authority (AIFC) and authorised to conduct the following Regulated Activities: Dealing in Investment as Principal on a matched principal basis, Dealing in Investments as Agent, Advising on Investments and Arranging Deals in Investments with a scope of authorisation restricted to the specified Financial Products such as Shares, Debentures, Structured products, Units in a Collective Investment Scheme.

Unless specified otherwise, all definitions are adopted from the Raison Terms of Brokerage (Agency) Service, which are available in Raison App and our website.

Raison provides investment services to its clients (the "Client(s)", "you" or "your") by executing Orders or transmitting Orders to a Broker for execution (or onward transmission for execution).

Additionally, Raison provides investment advice to its Clients as an additional service which is governed by Raison Terms of Investment Advisory Service. You can subscribe to Raison Investment Advisory Service via Raison App by signing the Terms of Investment Advisory Service and providing additional information about you in order for Raison to provide you with an opinion as to whether a specific instrument is suitable for you.

Purpose

It is important that you understand the risks associated with investing in financial instruments before placing any Orders through the Raison App. This risk disclosure is intended to provide you with a general understanding of the nature and risks of financial instruments. It is not exhaustive and does not disclose all risks or considerations that may be relevant to your investment decisions.

Before placing any Orders, you should fully understand all such risks and have independently determined that an investment is appropriate for you. You may wish to seek advice from independent professional advisors such as accounting, financial, investment, legal, regulatory, tax and other advisors before making any investment decisions.

This Risk Disclosure does not intend to disclose all risks or other considerations relevant to your investment decisions. Rather, it contains a general description of the nature and typical risks of financial instruments that you may encounter when placing an Order through the Raison App.

More detailed risk disclosure in respect of each specific Instrument may be found in any associated product documentation, such as prospectuses, term sheets, offering circulars, memoranda, brochures, instrument documentation and terms, and key information documents and guides.

It is important that you fully understand the risks associated with investing in financial instruments before proceeding with any investment decisions. We strongly recommend that you read all relevant documentation provided by Raison, so that you understand how the financial instrument works and the full risk profile of the transaction.

Please be aware that all trading in financial instruments carries an element of risk. The value of your investments can go down as well as up, and you may lose some or all of your investment. Past performance is not an indicator of future performance for an Instrument.

Before buying or selling any Instruments, you should ensure that you have adequate financial resources and the ability to bear any potential losses that may arise. You should not rely on being able to generate profits for any purpose (such as the repayment of debts) and should not enter into any borrowing arrangements to fund your purchases of any Instruments through Raison.

By using the Raison App and placing an Order, you confirm that you have read and understood this Risk Disclosure, and that you have independently determined that an investment is appropriate for you.

No Advice

We provide a non-advised (execution only) execution and Order transmission service for shares and other Instruments. This means that we will execute your Orders without investigating or advising on the suitability of the investment or your Orders, unless you separately subscribe for our Investment Advisory Services via the Raison App and provide us with additional information about yourself.

Please be aware that if you do not subscribe to our Investment Advisory Services, we do not provide or offer any investment or other advice, including advice on the suitability of any particular investment or investment strategy, and you do not benefit from the protection of relevant rules on assessing suitability.

We may occasionally publish general or specific information or commentary on the Raison App, our website, in the general press, through communications with you, or otherwise. However, it is important to note that this information is not, and should not be interpreted as, advice, and any decision to submit Orders is made solely by you.

When you provide an Order to us through the Raison App, we will assume that you have considered the risks associated with the Instrument and deemed it suitable or appropriate for your individual circumstances or needs. We also assume you have taken independent professional advice where necessary.

By using the Raison App, you agree that you are responsible for your own investment decisions, have sufficient knowledge and experience to make those decisions, understand the risks associated with making investments, and have taken professional advice where appropriate to make those decisions.

You also agree that neither Raison nor its staff will have any liability for any loss arising from your investment that you make through the Raison App.

General Risks of Investing

Risk of Investing in Shares:

Share Instruments represent ownership in a company. You may benefit from rights associated with being a shareholder of a company, such as appreciation in value or receiving dividends, but these are not guaranteed. Additionally, shares in a company can decrease in value or become valueless in the event of an insolvency, and shareholders are usually the last ones to receive payments. It is important to understand that investing in a company's shares exposes you to concentrated risk related to that specific company.

Risks of Investing in Fractional Shares:

Fractional shares represent a fraction of a single share in a company. They are subject to the same risks as shares, including the risk of a decrease in value or becoming valueless, but also have the added risk of rounding.

Risks of Investing in Exchange-Traded Funds (ETFs):

ETFs typically hold a basket of securities and can provide diversification to mitigate risk. However, they are still subject to the same risks as the underlying securities and can be subject to market risk and other risks. For example, if an ETF consists of shares in companies that all operate in the same industry, the ETF will have similar risks as that industry and may be impacted by a downturn in that industry.

Risk of Investing in Depositary Receipts:

Depositary receipt Instruments allow you to hold shares in a foreign public company. By holding a depositary receipt, you do not hold a share in a company directly, but rather a receipt issued by a local financial institution that holds the shares through a foreign custodian.

These depositary receipts are subject to the same risks as shares, but may also have an increased amount of political and legal/regulatory risks associated with them, depending on the legal and political environment of the foreign company. It's important to understand that investing in depositary receipt Instruments carries the risk of fluctuations in the foreign currency exchange rate and political risks.

As such, you should be aware of the risks associated with investing in foreign securities and should consult with a financial advisor before making an investment decision.

Risk factors

The following risk factors should be taken into account before placing an Order:

Insolvency Risk:

When you invest in an Instrument issued or related to a certain entity, the insolvency of that entity can result in financial loss. Instruments such as ordinary shares typically have the lowest priority in the event of an issuer's insolvency, which means you could lose your entire initial investment.

In the event that the Broker and/or Custodian begins insolvency proceedings, this could result in your Positions being liquidated without your consent or transferred to another broker or custodian. This could cause a loss of value in your investments.

Political Risk:

The political or economic stability of the country of registration or establishment of an Instrument issuer can affect the Instrument, including its value, associated legal rights, or other properties.

Sudden and/or radical changes in the legislative or economic environment, social or political crisis are considered to be political risks. The materialization of political risks can cause you to lose partially or entirely investments made in Instruments that are affected by such risks.

Market Risk:

The value of an Instrument can fluctuate due to changes in the market it's situated in. Market events, investor perception, and the ability to trade the Instrument can have a positive or negative impact on the investment's price.

For example, securities listed in the US may be subject to market trends located in the US, which may be unfamiliar or unforeseen by you. During times of market volatility, the price of an Instrument may change significantly and unexpectedly and it may become more difficult to purchase or sell, and the price of an Instrument may increase or decrease when executed compared to the price quoted at the time an Order was submitted.

Liquidity Risk:

The liquidity of an Instrument is affected by the supply and demand for that Instrument and also indirectly by other factors, including market disruptions or infrastructure issues. It may be difficult or impossible to liquidate or acquire a Position under certain trading conditions.

This may occur, for example, at times of rapid price movement if the price rises or falls to such an extent that under the rules of the relevant exchange trading is suspended or restricted. If you decide to close your Account, all Positions will be sold, which may result in certain fees being charged, and you cannot transfer Positions to any other broker except where the Broker and/or Custodian has become insolvent and such transfer is being allowed in the insolvency proceedings.

You are responsible for monitoring the value of your Positions and should check the Raison App regularly to monitor your Positions.

The Risk of Inflation:

As an investor, it's important to be aware of the potential impact of inflation on your investments. Inflation, or the rising cost of goods and services in an economy, can cause the real value of your investments to decrease over time.

This is because the rate of return on a particular Instrument may become lower than the rate of inflation, resulting in losses that you would otherwise not have incurred if you had invested in another Instrument whose value kept pace with the rate of inflation.

Risk of Instrument Rights:

Certain financial instruments may grant the holder certain rights, such as the ability to vote at an annual general meeting or receive a dividend payment from the issuer.

However, it's important to note that these rights are subject to change and may not always be exercised. Additionally, the payment of dividends is subject to certain conditions, such as the availability of distributable profits by the issuer, and therefore cannot be guaranteed.

Custodian and Safekeeping Risk:

While Raison takes care in selecting custodians to provide Instrument custody, registration and settlement services, it is possible that in the event of a custodian's bankruptcy, legal regulations and court practices may not fully protect Clients' Instruments held in omnibus or nominee accounts. This could result in clients suffering losses due to a loss or withholding of the Instruments.

Operational Risk:

Breakdowns or malfunctions of essential systems and controls, including IT systems, can have an impact on all financial products. Additionally, business risk, such as incompetence or poor management, can also affect investors in the business.

Changes in personnel and organization can greatly exacerbate these risks and operational risk may not always be apparent from outside the organization. These risks can arise for both Raison and its business partners.

Currency Risk:

When investing in securities that are denominated in a foreign currency, changes in exchange rates can have a positive or negative impact on the gain or loss of your investment.

Fraud Risk:

Although many markets and jurisdictions have strict anti-fraud regulations in place, financial crime still exists in various forms. Fraudulent actors may impersonate financial counterparts or their products, promoting investment in those products and potentially resulting in complete loss of investment. In some cases, fraud risk may also lead to loss of personal or other data. Recovery of losses caused by fraudulent activity is not always guaranteed.

Third Party Risk:

Certain Instruments may require actions, performance, or consent from a third party in order for the investment to settle or for the legal ownership to change. For example, trustees, custodians, agents, clearing houses, and exchanges may need to take specific actions. This can expose you to the risk of a third party failing to act as required or in a timely manner.

Legal and Regulatory Risk:

Investing in financial instruments may be subject to changes in laws and regulations. These changes may result in additional costs or, in some cases, the loss of the investment. Legal changes could also cause a previously legal and acceptable Instrument to become illegal.

Developments in the legal and regulatory environment in which investors and issuers operate may lead to changes in the rights, obligations, and remedies available to investors. This can create uncertainty and ambiguity in relation to an investor's legal position and their ability to enforce their rights under the jurisdiction's legal system.

Tax Risk:

Changes in tax laws, such as the imposition of new taxes or changes to existing taxes, can have a significant impact on the profitability of an investment and may result in additional costs when selling the Instrument.

The tax treatment of certain financial instruments, issuers, and investors can be complex and subject to change. As a result, there may be a high degree of uncertainty and unpredictability in relation to the tax position of a particular Instrument or the ability to reclaim taxes on an Instrument.

It is the responsibility of the individual to determine the tax impact of their investments and to seek the advice of a tax professional if unsure or with any questions. Raison does not provide any tax advice.

Rounding Risk:

In connection to a Corporate Action, including but not limited to dividend, interest payments, splits and reverse splits of Instruments, etc., the amount of Instruments or money provided to you may be rounded down and therefore reduced due to rounding principles.

Details on Instrument or money rounding depend on the number of Instruments currently held by you, conditions laid out in Corporate Actions, international practices and other details.

Exchange Risk:

In respect of securities that are listed or traded on a public exchange, the ability to deal in those securities will be subject to the terms, conditions, rules, and procedures applicable to that exchange or clearing house.

In certain circumstances, it may be more difficult to acquire or sell an Instrument as a result of changes or decisions at the exchange level. For example, at times of rapid volatility and price movements, the relevant exchange may take the decision to temporarily block, restrict, or suspend dealings in that product.

This may result in you being unable to liquidate your Position at a particular time and for a particular price, or alternatively make it difficult or impossible to acquire an Instrument.