Strategy. Under normal circumstances, at least 80% of the Trusts assets will be invested in municipal obligations that pay interest exempt, in the opinion of bond counsel, from Hawaii State and regular Federal income taxes. In general, almost all of these obligations are issued by the State of Hawaii, its counties and various other local authorities; these obligations may also include certain other governmental issuers. We call these Hawaiian Obligations. These securities may include participation or other interests in municipal securities and variable rate demand notes. Some Hawaiian Obligations, such as general obligation issues, are backed by the issuers taxing authority, while other Hawaiian Obligations, such as revenue bonds, are backed only by revenues from certain facilities or other sources and … Show more… Under normal circumstances, at least 80% of the Trusts assets will be invested in municipal obligations that pay interest exempt, in the opinion of bond counsel, from Hawaii State and regular Federal income taxes. In general, almost all of these obligations are issued by the State of Hawaii, its counties and various other local authorities; these obligations may also include certain other governmental issuers. We call these Hawaiian Obligations. These securities may include participation or other interests in municipal securities and variable rate demand notes. Some Hawaiian Obligations, such as general obligation issues, are backed by the issuers taxing authority, while other Hawaiian Obligations, such as revenue bonds, are backed only by revenues from certain facilities or other sources and not by the issuer itself. These obligations can be of any maturity, but the Trusts weighted average maturity has traditionally been between 5 and 15 years. The Trust is classified as a non-diversified investment company under the Investment Company Act of 1940 (the 1940 Act), which means it may invest a greater percentage of its assets in a smaller number of issuers than a diversified fund. At the time of purchase, the Trusts Hawaiian Obligations must be of investment grade quality. This means that they must either ? be rated within the four highest credit ratings assigned by nationally recognized statistical rating organizations or, ? if unrated, be determined to be of comparable quality by the Trusts investment adviser, Asset Management Group of Bank of Hawaii (the Adviser). The Adviser selects obligations for the Trusts portfolio in order to achieve the Trusts objective by considering various characteristics including quality, maturity and coupon rate. Show less