van Eyk Blueprint Absolute Australian Shares Fund

Transcription

1 van Eyk Blueprint Absolute Australian Shares Fund Product Disclosure Statement ARSN: APIR code: MAQ0632AU Dated: 1 July 2014 Issuer: Macquarie Investment Management Limited ABN: AFS Licence Number:

2 IMPORTANT INFORMATION Product Disclosure Statement and the Significant Underlying Fund Supplement This document is a Product Disclosure Statement (PDS) which has been prepared by Macquarie Investment Management Limited ABN and AFSL (Macquarie, we, us, our) as the responsible entity of the van Eyk Blueprint Absolute Australian Shares Fund (Fund). The date of this PDS is 1 July Although this document is called Product Disclosure Statement, for the purposes of the Corporations Act, the Product Disclosure Statement for the Fund actually consists of two documents. The first document is this Product Disclosure Statement which, among other things, contains information about the structure of the Fund, its investment strategy, the risks of investing and how to apply and redeem from the Fund. The second document is called a Significant Underlying Fund Supplement, and it sets out certain information relating to any Significant Underlying Funds in which the Fund may be invested from time to time. Significant Underlying Fund is defined in ASIC Regulatory Guide 240 dated October 2013 (as may be amended, supplemented or replaced from time to time), a copy of which is available from The information provided in this PDS and any Significant Underlying Fund Supplement is general information only and does not take account of your personal financial situation or needs. You should therefore not make any decision about whether to invest in the Fund unless you obtain individual financial advice tailored to your personal circumstances. You can access a copy of the latest version of this PDS, the Significant Underlying Fund Supplement and any updated information (as referred to below) free of charge at blueprint.vaneyk.com.au or by contacting Macquarie Investment Management Client Service. Use of the words PDS and Product Disclosure Statement in this document and any Significant Underlying Fund Supplement Any reference in: > > this document (other than the section above), and > > any Significant Underlying Fund Supplement, to the words PDS or Product Disclosure Statement is a reference to this document dated 1 July 2014 (and any updates to this document as discussed below). Changes and updates to this PDS and any Significant Underlying Fund Supplement The information in this PDS and any Significant Underlying Fund Supplement may change from time to time. Where this happens, and such change is not materially adverse to you, we may update the information by posting a notice on van Eyk s website. Investments in the Fund are subject to investment risk Investments in the Fund are not deposits with, or other liabilities of, Macquarie Bank Limited ABN (Macquarie Bank) or any member of the Macquarie Group and are subject to investment risk, including possible delays in repayment and loss of income and principal invested. Neither Macquarie Bank nor any other member of the Macquarie Group guarantees the performance of the Fund, the repayment of capital from the Fund or any particular rate of return. Investor directed portfolio service (IDPS) We authorise the use of this PDS and the Significant Underlying Fund Supplement as disclosure for investors who wish to access the Fund through an investor directed portfolio service or IDPS-like scheme (commonly a master trust or wrap account) or a nominee or custody service approved by us. Further advice recommended An investment in the Fund involves financial and other risks and is only suitable for investors for whom an investment in the Fund does not represent a complete investment portfolio or programme and who fully understand the risks of investing in the Fund. Before making an investment in the Fund, you should: > > carefully read all of this PDS and the Significant Underlying Fund Supplement > > seek professional legal, taxation and financial advice to determine whether an investment in the Fund is appropriate for you, and > > carefully consider the potential benefits of, and the risks involved in, investing in the Fund, in light of your particular investment needs, objectives and financial and taxation circumstances. Please refer to Section 3 of this PDS for a description of some of the significant risks of Fund. Business Days and currency references Unless otherwise stated to the contrary, a reference in this PDS and any Significant Underlying Fund Supplement to: > > Business Day means a day (other than a Saturday, Sunday, public holiday or bank holiday) on which banks are open for general banking business in Sydney, and > > dollars or $ are to Australian dollars. The offer This offer is only open to persons receiving this PDS and the Significant Underlying Fund Supplement within Australia or any other jurisdiction approved by us. Warning statement for New Zealand investors (a) This offer to New Zealand investors is a regulated offer made under Australian and New Zealand law. In Australia, this is Chapter 8 of the Corporations Act 2001 and Regulations. In New Zealand, this is Part 5 of the Securities Act 1978 and the Securities (Mutual Recognition of Securities Offerings-Australia) Regulations (b) This offer and the content of the PDS and Significant Underlying Fund Supplement are principally governed by Australian rather than New Zealand law. In the main, the Corporations Act 2001 and Regulations (Australia) set out how the offer must be made. (c) There are differences in how securities are regulated under Australian law. For example, the disclosure of fees for collective investment schemes is different under the Australian regime. (d) The rights, remedies, and compensation arrangements available to New Zealand investors in Australian securities may differ from the rights, remedies, and compensation arrangements for New Zealand securities. (e) Both the Australian and New Zealand securities regulators have enforcement responsibilities in relation to this offer. If you need to make a complaint about this offer, please contact the Financial Markets Authority, Wellington, New Zealand. The Australian and New Zealand regulators will work together to settle your complaint. (f) The taxation treatment of Australian securities is not the same as for New Zealand securities. (g) If you are uncertain about whether this investment is appropriate for you, you should seek the advice of an appropriately qualified financial adviser. (h) The offer may involve a currency exchange risk. The currency for the securities is not New Zealand dollars. The value of the securities will go up or down according to changes in the exchange rate between the currency for the securities and New Zealand dollars. These changes may be significant. (i) (j) If you expect the securities to pay any amounts in a currency that is not New Zealand dollars, you may incur significant fees in having the funds credited to a bank account in New Zealand in New Zealand dollars.* The dispute resolution process described in this PDS is only available in Australia and is not available in New Zealand. * Redemptions and distributions of income will only be paid, in Australian dollars, to Australian bank accounts.

3 CONTENTS van Eyk Blueprint Absolute Australian Shares Fund at a glance How the Fund works How we invest your money Risks you should consider Fees and other costs Taxation considerations How to invest and access your money Other information 28 Contact details

4 van Eyk Blueprint Absolute Australian Shares Fund at a glance The Fund is a fund of hedge funds for the purposes of ASIC Regulatory Guide 240. The following table sets out a summary of the disclosure ASIC requires for fund of hedge funds and a guide to where more detailed information can be found in the PDS. A copy of ASIC Regulatory Guide 240 dated October 2013 (as may be amended, supplemented or replaced from time to time) is available from You should also refer to the Significant Underlying Fund Supplement, available at blueprint.vaneyk.com.au, for more information on any Significant Underlying Funds in which the Fund is invested. ASIC Regulatory Guide 240 Benchmarks 2 Valuation of non-exchange traded assets Periodic reporting This benchmark addresses whether valuations of the Fund s non-exchange traded assets are provided by an independent administrator or an independent valuation service provider. This benchmark is not met. Macquarie usually values the Fund s assets at their most recent market value, using independent pricing sources where available for the particular asset type. Interests in unlisted funds are normally valued at their most recent unit price, as supplied by the fund administrator. Where independent pricing sources are not available (for example, for some non-exchange traded assets), Macquarie may perform the valuation calculations itself. Macquarie has expertise and experience in financial risk modelling and valuing financial products and other assets types. The methods and policies adopted by Macquarie are consistent with industry standards and result in unit price calculations that, although not independently performed, are independently verifiable. Refer to Section 1.5 of this PDS for more information in relation to the valuation of the Fund s assets. This benchmark addresses whether periodic disclosure of certain key information relating to the Fund is provided on an annual and/or monthly basis. This benchmark is met. For the purposes of ASIC Regulatory Guide 240: > > The following information will be available to investors on an annual basis: actual allocation to each underlying investment the liquidity profile of each underlying investment the Fund s leverage ratio, and the derivatives counterparties engaged by the Fund. > > The following information will be available to investors on a monthly basis: the Fund s current total net asset value the redemption value of a unit in the Fund the net return on the Fund s assets after fees, costs and taxes the monthly or annual investment returns over at least a five-year period any material change in the Fund s risk profile and strategy any changes (including changes in related party status) to any of the Fund s key service providers, and any change in the individuals playing a key role in the making of the Fund s investment decisions. The table in Section 7.2 of this PDS sets out the information that will be provided, how often it is available and where it can be accessed.

5 ASIC Regulatory Guide 240 Disclosure Principles Investment strategy Fund objective The Fund aims to provide capital growth over the long term. The investment manager Fund structure Valuation, location and custody of assets Investment strategy The Fund provides exposure to a diversified portfolio of strategies, including: > > absolute return strategies, which includes directional trading strategies, which aim to generate returns from actual movements in the value of Australian shares and the Australian share market generally, non-directional trading strategies, which aim to generate returns irrespective of how the Australian share market performs, and > > volatility trading strategies, which aim to generate returns from changes in share market volatility. The Fund will predominantly invest in other unlisted managed funds, although it may also hold derivatives, listed managed investments, cash and short-term money market securities. The Fund s allocation to its underlying investments is determined by van Eyk in accordance with its investment research and certain investment guidelines. Refer to Section 2.2 of this PDS for more information. Refer to Section 2.1 of this PDS for more information on the underlying investments. van Eyk Research Pty Ltd (ABN ) (van Eyk) is the investment manager of the Fund. van Eyk is a corporate authorised representative of van Eyk Financial Group Pty Ltd ABN and AFSL (authorised representative number ). In its role as investment manager, van Eyk will provide direction on the proportion of the Fund allocated to each strategy, and each underlying investment in accordance with its investment research and the investment guidelines (as described in more detail in Section 2 of this PDS). Refer to Section 4 of this PDS for fees payable to van Eyk. The Fund is an Australian unit trust registered under the Corporations Act as a managed investment scheme. The responsible entity of the Fund is Macquarie Investment Management Limited. Macquarie may appoint service providers to assist in the ongoing operation, management and administration of the Fund. The key service providers to the Fund are: van Eyk Research Pty Ltd, the investment manager Bond Street Custodians Limited, who may act as custodian for all or some of the Fund s assets from time to time, and Ernst & Young Australia, the auditor of the Fund. Refer to Section 1.1 of this PDS for more information. Valuation of the Fund s assets The Fund s assets are normally valued at their most recent market value, using independent pricing sources where available for the particular asset type. Where independent pricing sources are not available, for example, for some non-exchange traded assets, Macquarie may perform the valuation calculations itself. Refer to Section 1.5 of this PDS for more information. 3

6 4 ASIC Regulatory Guide 240 Disclosure Principles Valuation, location and custody of assets (continued) Liquidity of assets Leverage Derivatives Short-selling Redemptions Location and custody of the Fund s material assets All of the material assets of the Fund are, as at the date of this PDS, located in Australia and are held by either Macquarie or Bond Street Custodians Limited as custodian. The location of the material assets of the Fund may change from time to time. As at the date of this PDS, van Eyk reasonably expects to be able to realise at least 80% of the Fund s assets under normal market conditions, at the value ascribed to those assets in calculating the Fund s net asset value, within ten days (subject to any relevant transaction costs). Refer to Section 3 of this PDS for the risks associated with liquidity. The Fund will not borrow, or use derivatives, for the purposes of leveraging or magnifying the Fund s exposure to any particular asset or market. Any derivatives entered into by the Fund will be fully backed by cash and/or relevant assets. Some of the underlying funds in which the Fund invests may use leverage, whether through borrowing to invest or derivatives. Refer to Section 2 of this PDS for more information. Investors should note that there are risks associated with the use of leverage by the underlying funds. Refer to Section 3 of this PDS for more information. The Fund may use both exchange-traded and over-the-counter derivatives such as forwards, futures, options and index-linked products, however, not for the purposes of leveraging or magnifying the Fund s exposure to any particular asset or market. All of the Fund s over-the-counter derivatives counterparties must be of investment grade at the time of trading and have, in van Eyk s reasonable opinion, sufficient expertise and experience in trading the relevant derivatives. Investors should note that there are risks associated with the use of derivatives and that underlying funds in which the Fund invests may use derivatives for the purposes of leveraging that underlying fund s exposure to a particular asset or market. Refer to Section 3 of this PDS for more information. The Fund does not itself engage in short-selling. It may however invest in other underlying funds that engage in short-selling. Generally speaking, an underlying fund may engage in short-selling so as to benefit from falling asset prices. That is, short-selling may allow the underlying fund to produce positive returns in circumstances where the market generally has fallen in value. Investors should note that there are specific risks associated with shortselling. Refer to Section 3 of this PDS for more information. You can generally redeem part or all of your investment in the Fund on each Business Day. Redemption requests will generally need to be received by us prior to 12.00pm Sydney time on a Business Day in order to be redeemed at the redemption price calculated for that Business Day. In some circumstances, investors may not be able to redeem their investment in the usual period or at all. Refer to Section 6.2 of this PDS for more information.

7 Section 1: How the Fund works 1.1 Fund structure The Fund is an Australian unit trust registered under the Corporations Act 2001 (Cth) (Corporations Act) as a managed investment scheme. Each unit gives an investor in the Fund a beneficial interest in the Fund s assets as a whole, but not an entitlement to, or interest in, any particular asset of the Fund. Macquarie Investment Management Limited (Macquarie, we, us, our) is the responsible entity of the Fund and is responsible for operating the Fund in accordance with the Fund s constitution, and the Corporations Act. Macquarie is an Australian registered company, having its principal place of business at No.1 Martin Place, Sydney NSW. Other key entities involved in the Fund s investment structure are: 1. Investment manager Macquarie has appointed van Eyk Research Pty Ltd (van Eyk) as the investment manager of the Fund (see Section 1.2 of this PDS for more information about van Eyk). 2. Custodian Macquarie has appointed Bond Street Custodians Limited (ABN ) (Bond Street), a related body corporate of ours, to hold certain domestic and unlisted international assets of the Fund. Bond Street is: > > an Australian registered company, having its principal place of business at No.1 Martin Place, Sydney NSW, and > > the holder of Australian Financial Services Licence No , which authorises it to provide custodial services in Australia. Bond Street may also, from time to time, appoint a subcustodian to hold the Fund s assets where Bond Street is unable to hold those assets directly, or it is otherwise more efficient to appoint a sub-custodian. Bond Street remains liable however for all assets held by a sub-custodian appointed by it. Any conflict of interest or potential conflict of interest between us and Bond Street is managed in accordance with our Conflicts of Interest Policy. In addition to the investment manager and custodian referred to above, the other key service provider to the Fund is Ernst & Young Australia. Ernst & Young Australia provides the following services to the Fund: (a) audits Macquarie s compliance with the Fund s compliance plan (b) if required by the Corporations Act, reviews the Fund s half-yearly financial report and provides an auditor s report, and (c) audits the Fund s financial report each financial year and provides an auditor s report. Macquarie enters into arm s length contractual agreements with each service provider and will periodically monitor and review their performance to ensure that services are being provided in accordance with the terms of such agreements. The diagram below shows the flow of investment money through the structure of the Fund. 5 Investors Investment amount ($) > > Redemption proceeds (if any) > > Distributions of income and capital gains (if any) Macquarie Investment Management Limited as responsible entity for the van Eyk Blueprint Absolute Australian Shares Fund Amounts invested are held by the Custodian Amounts needed to pay redemption proceeds and/or distributions to investors are paid out of the Fund s assets Bond Street Custodians Limited (holds the assets of the Fund) 1 van Eyk manages the Fund s assets Assets of the Fund 1 Macquarie Investment Management Limited as responsible entity may also hold certain assets of the Fund from time to time. Material arrangements Any material arrangements in connection with the Fund will be entered into on arm s length terms or better.

8 6 1.2 The investment manager van Eyk is the investment manager of the Fund. van Eyk is a corporate authorised representative of van Eyk Financial Group Pty Ltd ABN and AFSL (authorised representative number van Eyk is an Australian registered company, and has its principal place of business at 9 Castlereagh Street Sydney, NSW. The rights and obligations of each of Macquarie and van Eyk are set out in the terms of an investment management agreement which has been negotiated on an arm s length basis. There are no unusual or materially onerous terms (from an investor s perspective) in the investment management agreement between Macquarie and van Eyk. In its role as investment manager, van Eyk will provide direction on the proportion of the Fund allocated to each underlying investment in accordance with its investment research (as described in more detail in Section 2.3 of this PDS) and the investment guidelines (as described in more detail in Section 2.1). As at the date of this PDS, Macquarie, as responsible entity of the Fund, is not aware of any relevant significant adverse regulatory findings against van Eyk. 1.3 Key people of the investment manager The following provides details of the identities, relevant qualifications and commercial experience of the key individuals of van Eyk. Chief Investment Officer, Mark Thomas Industry experience Qualifications 23 years Bachelor of Business (Finance and Economics) (UTS) Mark is the Chief Executive Officer and the Chief Investment Officer of van Eyk. Mark joined van Eyk in He has held various roles within the organisation including the responsibility for setting house views on investment markets and asset allocation as the editor of van Eyk s flagship publication, the Investment Outlook Report. Mark is experienced in manager research, having led various reviews to assess the capability of investment managers across numerous markets and strategies. Mark is the chairman of the investment committee and is ultimately responsible for the performance and setting the investment strategy of the Fund. Mark has been responsible for investment decisions through his appointment to the investment committee in February 2003 for the Blueprint Series. The Blueprint Series comprises a number of managed investment schemes across all major asset classes. Deputy Chief Investment Officer, Robert da Silva Industry experience Qualifications 29 years Bachelor of Business (Finance & Economics), Master of Finance, Graduate Diploma in Applied Finance, Fellow Financial Services Institute of Australasia Robert joined van Eyk in 2013 as Head of Manager Research and Deputy Chief Investment Officer. His role encompasses leading the investment research team in fund manager reviews across many asset classes including Australian and global equities, fixed income, alternative assets and absolute return strategies. He is a member of the investment committee which has overall investment management responsibility for the performance of the Fund. This includes setting portfolio objectives, investment strategies (including asset allocation) fund manager selection and ongoing monitoring and reporting. Prior to his appointment at van Eyk, Robert was Managing Director of Asia-Pacific Fixed Income at Principal Global Investors, where he spent almost ten years. During that time, he was responsible for portfolio management of managed investment schemes, researching fixed income markets and research into macroeconomic and microeconomic issues as they impact on interest rates. He was also responsible for managing asset allocation, duration, sector and credit decisions for Asia-Pacific fixed income markets within global and domestic portfolios. Prior to that, he spent more than a decade at BT Funds Management where he was Executive Vice President, Fixed Income Portfolio Manager and was involved in strategic and tactical asset allocation for the BT suite of balanced funds. As at the date of this PDS, Macquarie, as responsible entity of the Fund, is not aware of any relevant significant adverse regulatory findings against these key people of van Eyk. The monitoring of the Fund s portfolio is undertaken on a continuing basis by van Eyk s investment research team. The proportion of time each key person devotes to executing the Fund s investment strategy is determined by the Head of Research in accordance with the Fund objective. This includes the provision of research, quantitative screening, analysis, and portfolio and risk management services. Although the key people of van Eyk may be involved in managing or advising a number of other investment strategies employed by van Eyk from time to time, the amount of time spent by each key person on the Fund s investment strategy is set to ensure the full and timely implementation of the investment strategy.

9 1.4 Termination of van Eyk s appointment as investment manager Under the investment management agreement, Macquarie may terminate the appointment of van Eyk as the investment manager of the Fund by giving written notice to van Eyk in certain circumstances, including where: > > a receiver, receiver and manager, administrative receiver or similar person is appointed with respect to the assets and undertakings of van Eyk > > van Eyk: goes into liquidation (other than for the purposes of a reconstruction or amalgamation on terms previously approved in writing by us) ceases to carry on business in relation to its activities as an investment manager breaches any material provision of the agreement, or fails to observe or perform any representation, warranty or undertaking given by van Eyk under the agreement ceases to be authorised, either as a corporate authorised representative of van Eyk Financial Group Pty Ltd or as the holder of an Australian financial services licence (AFSL), to provide any financial services that are to be provided under the agreement, or otherwise cannot lawfully provide such services for any reason (including but not limited to suspension of van Eyk Financial Group Pty Ltd s AFSL), or sells or transfers or makes any agreement for the sale or transfer of the main business and undertaking of van Eyk or of a beneficial interest therein, other than to a related body corporate for purposes of corporate reconstruction on terms previously approved in writing by us at any time and in any circumstances, relevant law requires the agreement to terminate. Other than any accrued fees and expenses payable, there are no other payment obligations on termination of the agreement. See Section 4 of this PDS for information on the fees and other costs that may be charged in relation to the Fund. 1.5 Valuation and unit pricing The value of a unit will generally be calculated each Business Day, and will be based on the value of the Fund s assets, less liabilities, divided by the number of units on issue. The price of units will vary as the value of the Fund s assets and liabilities rises or falls. Application and redemption prices take into account our estimate of transaction costs (the buy/sell spread). The application price and redemption price will differ to the value of a unit as a result of the buy/sell spread. See Section 4.2 of this PDS for more details on the buy/sell spread. Valuation of Fund s assets The Fund s assets are normally valued at their most recent market value, using independent pricing sources where available for the particular asset type. Interests in unlisted funds are normally valued at their most recent unit price, as supplied by the fund administrator. Why independent valuations may not be used in certain circumstances? Where independent pricing sources are not available, for example, for some non-exchange traded assets, Macquarie may perform the valuation calculations itself. Macquarie has expertise and experience in financial risk modelling and valuing financial products and other assets types, including non-exchange traded assets. Macquarie has in place valuation methods and policies which describe how non-exchange traded assets and liabilities are to be classified and the methodology to be used to value those assets and liabilities. These methods and policies are consistent with industry standards and result in unit price calculations that, although not independently performed, are independently verifiable. The use of internal valuations may also result in cost efficiencies for the Fund. 7

10 How is the risk of any related party conflicts and any lack of independence in valuations addressed? Macquarie has in place a number of controls which operate to limit the risk of any lack of independence and any related party conflicts in the valuation of non-exchange traded assets. These include, but are not limited to: > > best interests duty: Macquarie, as responsibility entity of the Fund, is obliged under the Corporations Act to: act in the best interests of unitholders, and in circumstances where this is a conflict between Macquarie s interests as responsible entity and the interests of members of the Fund, give priority to the unitholders interests > > separation of function/reporting line controls: Macquarie employees performing the valuation function are separate from, and do not report to van Eyk or other staff engaged in the management of the Fund s portfolio, and > > documented policy regarding the exercise of valuation discretions: Macquarie has documented its policy regarding the exercise of any discretions it may have under the Fund s constitution that relate to the determination of application and redemption prices. A copy of this policy is available free of charge from Macquarie Investment Management Client Service. 1.6 Distributions The Fund may receive distributions, interest and gains from the underlying investments. We will generally seek to distribute any net income on a six-monthly basis and any net realised capital gains at least once a year. Distributions will be calculated based on the net income and net realised capital gains of the Fund. Unit prices may fall after the end of each distribution period as a result of the allocation of the distribution which reduces the Fund s assets. You may elect, in the Application Form, to have your distributions paid directly into a nominated Australian financial institution account or to have your distributions reinvested as additional units. If you do not make an election on the Application Form, your distributions will be automatically reinvested. If you elect to have your distributions paid to you, we may pay distributions into a non-interest bearing trust account in order to facilitate payment of these amounts to your nominated account. If we are unable to credit your account for any reason these amounts may continue to be held in a non-interest bearing trust account until you provide alternative payment instructions or we are required by law to pay these amounts to any regulatory body or other person or account. 8 Does this give rise to any additional risks for investors? For the reasons given above, we do not believe that Macquarie performing the valuation of any non-exchange traded assets results in any material increase in risk to investors.

11 Section 2: How we invest your money You should consider the potential investment returns, the risks involved and your investment timeframe when deciding whether or not to invest in the Fund. 2.1 Investment strategy van Eyk Blueprint Absolute Australian Shares Fund Fund objective Description of the Fund The Fund aims to produce capital growth over the long term that is not dependent on the Australian share market increasing in value over the long term. Investment strategy The Fund provides exposure to a diversified portfolio of strategies, including: > > absolute return strategies: which includes directional trading strategies, which aim to generate returns from actual movements in the value of Australian shares and the Australian share market generally, non-directional trading strategies, which aim to generate returns irrespective of how the Australian share market performs, and > > volatility trading strategies: which aim to generate returns from changes in share market volatility. These trading strategies can be complex and there is no guarantee that investment in such strategies will allow the Fund to achieve its investment objective. See Section 3 for more information about some of the significant risks associated with these strategies. Typical asset classes the Fund will invest in The Fund will generally not invest directly in any particular shares or strategy but will obtain its exposures through investments in other unlisted managed funds (Underlying Funds). The Fund may also hold derivatives, listed managed investments, cash and short-term money market securities. van Eyk will manage the Fund s allocation to each underlying investment according to van Eyk s investment research and monitoring (as discussed in more detail in Sections 2.2 and 2.3 of this PDS) and the asset allocation guidelines (as described below). 9 Currency denomination of the assets The Fund is denominated in Australian dollars. Some of the Fund s underlying investments may be exposed to foreign currencies on a limited basis, including without limitation, US dollars, British pounds and Euros. The manager of an Underlying Fund (Underlying Manager) or van Eyk may or may not hedge such foreign currency exposures. While van Eyk does not have any specific policy relating to currency exposures within an Underlying Fund, van Eyk does however consider an Underlying Fund s potential currency exposures as part of its investment research (see Section 2.2 of this PDS) and in the context of the Fund s overall investment objective. See Section 3 of this PDS for information about some of the risks that may arise from foreign currency exposure. Location and custody of the assets There are no fixed geographic weightings in the allocation of the Fund s assets, with the allocation of the Fund s investment being determined by van Eyk s investment research and monitoring (as discussed in more detail in Sections 2.2 and 2.3 of this PDS). The Fund has appointed Bond Street Limited as custodian to hold some of the Fund s assets (see Section 1.1. of this PDS for more information). Macquarie may also hold some of the Fund s assets directly from time to time. In relation to the Underlying Funds in which the Fund may invest, van Eyk does not have a policy on: > > acceptable geographical weightings with an Underlying Fund, or > > the custodians appointed within an Underlying Fund. van Eyk does however consider an Underlying Fund s potential geographical exposures as part of its investment research (see Section 2.2 of this PDS) and in the context of the Fund s overall investment objective. Macquarie will also ordinarily, as part of its operational due diligence process before an investment is made by the Fund, consider whether the custodian of any Underlying Fund has the operational capacity and expertise to hold the assets of the relevant Underlying Fund.

12 van Eyk Blueprint Absolute Australian Shares Fund Liquidity Description of the Fund (continued) van Eyk generally selects underlying investments that have at least the same liquidity terms that the Fund offers, or better. As a result, as at the date of this PDS, van Eyk reasonably expects to be able to realise at least 80% of the Fund s assets under normal market conditions, at the value ascribed to those assets in calculating the Fund s net asset value, within ten days (subject to any applicable transaction costs). 10 Derivatives The Fund may use both exchange-traded and over-the-counter derivatives, including forwards, futures, options and index-linked products. Derivatives may be used: > > to hedge existing exposures, and > > as an alternative way of obtaining an exposure to a particular asset (for example, as opposed to buying or selling the physical asset). Any derivatives positions entered into by the Fund will be fully offset by cash and/or relevant assets. Derivatives will not be used by the Fund for the purposes of leveraging the Fund s exposure to any particular asset or market. All over-the-counter derivatives counterparties of the Fund must be of investment grade at the time of trading and have, in van Eyk s reasonable opinion, sufficient expertise and experience in trading such financial instruments. Exchange-traded and over-the-counter derivatives may also be used by the Underlying Managers for the purposes of obtaining leveraged exposure to an asset or market (see Leverage below for more information). van Eyk does not currently have any policy in relation to the acceptable use of derivatives by Underlying Managers, but does consider the Underlying Manager s use of derivatives as part of its investment research (see Section 2.2 of this PDS) and in the context of the Fund s overall investment objective. The use of derivatives by the Fund, and any Underlying Fund, gives rise to a number of risks including counterparty risk, risk relating to margin/collateral requirements and documentation risk. Refer to Section 3 of this PDS for more information on some of the risks associated with the use of derivatives. Leverage The Fund will not borrow, or use derivatives, for the purposes of leveraging or magnifying the Fund s exposure to any particular asset or market. Any derivatives entered into by the Fund will be fully backed by cash, and/or relevant assets. Some of the Underlying Funds may use leverage, whether through borrowing to invest or derivatives. van Eyk does not currently have any policy in relation to either: > > the maximum allowed level of leverage permitted within the Fund itself, or > > the acceptable use of leverage by any individual Underlying Manager. van Eyk does however consider an Underlying Manager s use of leverage, and its potential effect on the overall leverage of the Fund, as part of its investment research (see Section 2.2 of this PDS) and in the context of the Fund s overall investment objective. As the Fund itself does not use leverage, there is no gross or net leverage at the Fund level. However, our estimate of the leverage embedded in the Underlying Funds as at 31 December 2013 is 200%. Updated leverage ratios for the Fund as at the period ending 30 June will be available annually on van Eyk s website in the monthly Fund performance (see Section 7.2 of this for more information).

13 van Eyk Blueprint Absolute Australian Shares Fund Description of the Fund (continued) Example of impact of estimated leverage on Fund investment returns and losses as at 31 December 2013 As a working example, if the Fund were to utilise $1,000,000 of its cash to purchase $1,000,000 worth of investments, it is not using leverage and its net and gross position are equal. If the Fund borrows $1,000,000 and invests this with the original $1,000,000, it is now using leverage and has a gross invested position of $2,000,000. If the assets increase in value by 20%, the gross value would be $2,400,000. The gain of $400,000 represents a net return of 40% on the $1,000,000 invested in the Fund and results in a net value of $1,400,000 (assuming there is no interest cost on borrowing money). Conversely, if the value of the assets decreases by 20%, the gross value would be $1,600,000. This $400,000 loss represents a 40% net loss on the $1,000,000 invested by the Fund resulting in a net value of $600,000 (again assuming no cost of borrowing). As demonstrated, the use of leverage can increase the size of any potential gains or losses of the Fund. The above calculations are done without including the effect of interest rate cost. Interest rate cost may be material. The level of leverage used is an example only. It is based on the estimated level of the leverage of the Fund for the year ended 31 December It is not a forecast of the level of leverage in the future. It is important to note that van Eyk does not limit the use of leverage that can be used in the Underlying Funds. The level of leverage can be materially higher than that used in this example. The use of leverage within any Underlying Fund does gives rise to a number of risks to which investors in the Fund are indirectly exposed, including losses from adverse market movements and risks relating to margin/collateral requirements. You should refer to Section 3 of this PDS for more information on some of the risks associated with leverage. Short-selling The Fund does not itself engage in short-selling. It may however invest in other Underlying Funds that engage in short-selling. van Eyk does not currently have any policy in relation to the amount of short-selling an Underlying Manager may engage in, but does consider the Underlying Manager s use of short-selling as part of its investment research (see Section 2.2 of this PDS) and in the context of the Fund s overall investment objective. The use of short-selling within any Underlying Fund does gives rise to a number of risks to which investors in the Fund are indirectly exposed, including losses from adverse market movements and risks relating to margin/collateral requirements. See Section 3 of this PDS for more information on some of the risks associated with short-selling. 11 What would be the purpose and rationale for an Underlying Fund to engage in shortselling? Generally speaking, an Underlying Fund may engage in short-selling so as to benefit from falling asset prices. This may allow the Underlying Fund to pursue investment returns that are not dependent on the performance of a market generally. That is, short-selling may allow the Underlying Fund to produce positive returns in circumstances where the market generally has fallen in value.

14 12 van Eyk Blueprint Absolute Australian Shares Fund Description of the Fund (continued) Asset allocation Suggested minimum investment timeframe Below is a hypothetical example showing the potential gains and losses from short-selling. It does not take into account transaction costs or any other expenses associated with stock trading. An investor believes that the price of XYZ stock is due to fall, so decides to sell short 100 shares of the company with the aim of benefiting from the price fall. XYZ s current price is $25. The investor executes the short sell order for 100 shares and borrows the shares from a stock lender to immediately sell them on the market. The investor receives a cash inflow of $2,500 from this transaction. Two weeks later, the price of XYZ has dropped to $20. The investor now buys the shares on the market and returns them to the stock lender. In this transaction, the investor has spent $2,000 to repurchase the shares. The investor has received $2,500 and spent only $2,000, so the profit on the trade is $500. Alternatively, if, after two weeks, the price of XYZ had risen to $30, the investor would have had to buy the shares back on market for a cost of $3000 to be able to return them to the lender. In this situation, the investor would have received $2,500, but spent $3000, leaving the investor with a loss of $500. You should refer to Section 3 of this PDS for more information on some of the risks associated with short-selling. The following investment allocation guidelines and limits apply to what the Fund will actually invest in: Asset type Fund inception date 20 August 2009 Allocation range (%)* Neutral allocation (%) Unlisted managed funds (Underlying Funds) Exchange-traded derivatives Over-the-counter derivatives Listed managed investments Cash and cash equivalent investments The following guidelines apply to the strategies that the Fund will pursue through its investments (as described above): Strategies and exposures Allocation range (%)* Absolute return Australian shares strategies Volatility strategies 0 50 Cash and cash equivalent investments 0 50 * Where actual allocations are outside these ranges, the intention is to re-balance the Fund within a reasonable period after the limits are exceeded. Five to seven years

15 The Fund aims to produce investment returns through: > > exposure to a diversified portfolio of Australian shares, absolute equity strategies and volatility strategies > > blending Underlying Funds that have different investment approaches, as different styles may perform better at different times > > active allocation to Underlying Funds according to van Eyk s investment research and monitoring. van Eyk, established in 1989, is a leading provider of investment research to the Australian financial planning industry. van Eyk specialises in: > > investment research relating to portfolio construction and management > > asset allocation > > direct share research and model portfolios. The Fund will only invest in an underlying investment where the underlying investment satisfies the parameters of van Eyk s investment research (as described in more detail below). 2.2 Portfolio construction and Underlying Manager selection For an Underlying Manager to be selected by van Eyk, it must first be considered as highly regarded under one of the following categories: 1. the Underlying Manager must be rated AA, A or BB 1 by van Eyk with a preference given to the higher AA and A rated managers, though this will depend on available capacity, comparable fees and other aspects van Eyk considers relevant 2. if an Underlying Manager in a portfolio has been downgraded, van Eyk may elect to hold interests with that Underlying Manager if, in van Eyk s opinion, that Underlying Manager may benefit from the investment environment or to manage portfolio turnover 3. where the investment research has been undertaken by one of van Eyk s alliance research partners, the Underlying Manager must be Endorsed 2 by van Eyk 4. a high conviction candidate that falls outside of the review process, referred to as Analyst Expression 3, or 5. index strategies. The Fund may invest in well-known Underlying Managers as well as boutique strategies not normally available to retail investors. In some circumstances, van Eyk may invest directly on behalf of the Fund in order to obtain exposure. Examples of such circumstances include, but are not limited to, those in which van Eyk is unable to source a suitable Underlying Manager through which to obtain the exposure, and/or where van Eyk, in its opinion, considers that direct investment is a more efficient and/or cost-effective means of obtaining the desired exposure. van Eyk s Underlying Manager review process aims to be extensive, with a dedicated experienced investment research team that assesses the merits of the investment skill set of the Underlying Managers. van Eyk focuses its own investment research effort on areas of the market where it believes its research adds most value for its clients. Where applicable, van Eyk reviews an Underlying Manager s people, processes and business management to arrive at a qualitative assessment of the Underlying Manager. van Eyk also makes an assessment of whether an Underlying Manager s style will be, what they consider, suitable to market conditions. This includes a consideration of: a. The investment process An investment process is a means of making decisions in a consistent manner to exploit market inefficiencies in the relevant asset class. Processes govern the style of management and the level of risk people are allowed to take on when making investment decisions. A review of the investment philosophy and resulting processes can highlight whether or not an Underlying Manager has effective and coherent decisionmaking procedures in place. Security selection and portfolio construction are specific areas of interest when comparing Underlying Managers. b. The people who drive it Successful investment management requires above average decision-making ability. People make decisions, and some make them better than others. van Eyk assesses the Underlying Manager s individual capabilities as well as the team s effectiveness. A sound investment process needs to be driven by people who are more effective than the market average. To ensure efficient teamwork, the team must be well-led, wellincentivised, motivated, and likely to remain stable. c. Business management The investment management business is just like any other business. It must be well managed and involves strategic, corporate and product planning, as well as the successful coordination of investment activities, sales, marketing and client service. Profitability is very important since the business must be sustainable in the long term. Parentage or ownership is also important if the business is to be a successful ongoing concern. Parentage must fit with the Underlying Manager s investment philosophy, so that goals for the business are realistic. 13 Footnotes: 1 An Underlying Manager rated A or AA above has identifiable strengths in their people, process and business management and the ability to outperform the applicable benchmark (in comparison to other van Eyk rated managers) over a 3 year horizon. An Underlying Manager rated BB only has some of the identifiable strengths demonstrated by AA and A rated Underlying Managers. 2 An Underlying Manager which is Endorsed has been rated highly enough by one of van Eyk s alliance research partners and van Eyk endorses it as a highly regarded investment vehicle. 3 Where an Underlying Manager is included under the Analyst Expression category, van Eyk may make a tactical allocation to a maximum of 25% within the Fund. This category allows candidates in whom van Eyk s analysts have a high level of conviction, that fall outside the normal review process, to be included in the Fund.

16 14 Within each of these broad categories, van Eyk also looks at a range of factors which are tailored to particular sectors. Formal ratings are assigned at the end of the process and published on van Eyk s subscription-based website, irate, for financial planners. 2.3 Asset allocation van Eyk adopts a unique and structured approach to strategic asset allocation. Strategic asset allocation is determined within a framework of four scenarios, which are defined by different inflation environments. van Eyk assigns a probability to each scenario and this, in turn, defines an expected risk and return profile for each asset class. van Eyk is responsible for active asset allocation within and between asset classes, through active management of the overall investment style of the Fund. Any biases within the Fund reflect van Eyk s investment outlook and current relative market valuations, as published in its subscription-based research for financial planners. Within each investment strategy, van Eyk aims to blend Underlying Managers that have complementary investment styles. The number of Underlying Managers per investment strategy varies depending on, in van Eyk s view, the efficiency of the investment strategy. van Eyk aims to add value to the Fund by using, what they believe to be, an optimal number of active Underlying Managers within inefficient asset classes and passive Underlying Managers in efficient asset classes. As at the date of this PDS, the Fund is currently invested in the following Underlying Funds and the reasons for their allocation are noted in the table below. Fund manager monitoring Underlying Manager monitoring takes various forms, including: > > regular sector reviews including face to face meetings, submission of quantitative and qualitative information (detailed questionnaire) and comment on the draft report > > further meetings on a continuous basis and as required > > ad hoc meetings as considered necessary for ongoing monitoring > > portfolio analysis. Underlying Manager performance is monitored using a variety of metrics such as excess return, tracking error, and consistency on both a monthly and quarterly basis. van Eyk also monitor for material changes to investment personnel, investment process, business strategy or any other matter which affect the ratings process. During the monitoring period (that is between reviews), Underlying Manager ratings may be changed on the basis of the criteria used in van Eyk s investment research process. Underlying Managers that are downgraded are automatically reviewed for replacement. However, if an Underlying Manager in the portfolio has been downgraded, van Eyk may elect to hold interests in the Underlying Fund managed by that Underlying Manager if, in van Eyk s opinion, that Underlying Manager may benefit from the investment environment or to manage portfolio turnover. Underlying Funds Turquoise Australian Equity Fund BlackRock Australian Equity Opportunities Fund BlackRock Australian Equity Absolute Return Fund van Eyk Blueprint Volatility Buffer Fund Selected because? The fund provides an indexed exposure to the Australian share market with enhanced franking credits. This fund aims to provide an absolute total return from Australian shares, regardless of whether or not there is a rising equity market. This fund aims to provide an absolute total return from Australian shares, regardless of whether or not there is a rising equity market. The fund aims to provide investors with the potential to benefit from market volatility and share market falls. How it fits in with the Fund s investment objective Expected to provide returns in line with the Australian share market a directional market trading strategy. Expected to provide both long and short market exposure with a focus on absolute returns and some equity exposure a directional trading strategy. Expected to provide access to returns derived from the Australian share market via a nondirectional trading strategy. Expected to contribute positively to performance in weaker equity market conditions via exposure to volatility strategies. Macquarie Cash To provide liquidity to the portfolio Provides an absolute return, regardless of market conditions.

17 2.4 Key assumptions and dependencies of the investment strategy The strategies the Fund will have exposure to will vary from time to time in accordance with van Eyk s investment research. These strategies each have their own dependencies, with some strategies dependent on changes in market variables in order to generate returns, while other strategies may be dependent on either positive or negative movements in market variables in order to generate returns. As each strategy may be dependent on different market conditions, the ability of the Fund to generate positive returns will be dependent on the ability of: > > van Eyk to select an appropriate mix of underlying investments for particular market conditions; and > > the Underlying Managers selected by van Eyk to effectively execute their own investment strategies. There is no guarantee that the Fund will achieve its performance objectives, or produce returns that are positive or compare favourably against its peers. 2.6 Ethical investments van Eyk s investment decisions are primarily based on economic factors and do not specifically take into account labour standards or environmental, social or ethical considerations. These considerations may be taken into account if they have the potential to materially affect the value of the investment. 2.7 Changes to the Fund We may make changes to the Fund from time to time, including to the investment strategy of the Fund. Where we do so, we will provide such notice as required by the Corporations Act or constitution of the Fund. 2.5 Calculating the performance of the Fund To calculate the performance of the Funds, we comply with the standards set by the Financial Services Council. Performance figures are calculated before tax and after deducting fees and expenses, using net asset value prices, assuming that income is reinvested and that the investment is held for the full performance calculation period. Past performance figures can be obtained from van Eyk s website at blueprint.vaneyk.com.au or by calling Macquarie Investment Management Client Service. Past performance is not a reliable indicator of future performance, which can differ materially. Returns can be volatile, reflecting rises and falls in the value of the underlying investments. 15

18 16 Section 3: Risks you should consider All investments carry risk. Different investments carry different levels of risk, depending on the investment strategy and the underlying investments. Generally, the higher the potential return of an investment, the greater the risk (including the potential for loss and unit price variability over the short term). Financial markets can, and have been, volatile, and higher levels of market volatility may result in greater risk for investors than an investment in less volatile markets. When you make an investment, you are accepting the risks of that investment. It is therefore important to understand these risks before deciding to invest. The level of risk that you are willing to accept will depend on a range of factors including your financial objectives, risk tolerance, age, investment timeframe, where other parts of your wealth are invested and whether your investment portfolio will be appropriately diversified after making the investment. The value of your investment and the returns from your investment will vary over time. Future returns may differ from past returns. We do not guarantee the performance or returns of the Fund and you may lose some or all of the money that you invest in the Fund. This section highlights some of the significant risks of the Fund (including in relation to its investment strategy and structure), but there could be other risks that adversely affect the Fund. You should seek your own professional advice on the appropriateness of an investment in the Fund for you, having regard to your particular circumstances and financial objectives. Manager risk: Refers to the risk that this Fund will not achieve its performance objectives or not produce returns that compare favourably against its peers as a result of van Eyk s investment decisions. This may occur in situations where prevailing market conditions are not conducive to the investment style(s) of the selected Underlying Managers, or where van Eyk s allocations across Underlying Managers do not provide the returns expected. Underlying investment risk: The underlying investments chosen by van Eyk may fail to achieve the Fund s investment objectives, and may experience loss. Any individual underlying investment may be exposed to a range of factors that affect its performance and which may cause that investment s return to underperform relative to the market and/or its peers. Volatility strategies risk: Volatility strategies are complex and involve a higher degree of risk than traditional asset classes such as fixed interest and equities. Volatility strategies may fail to provide a buffer against downward market moves and may suffer losses in falling markets. In addition, volatility strategies may fail to participate in upward trending markets, and may even suffer losses in such markets. Strategy specific risk: Unlike managers of more traditional asset classes, managers of absolute equity strategies and volatility strategies tend to employ a range of methods and techniques, and have greater flexibility, in managing their portfolios. Such strategies may include using leverage, complex derivatives and other speculative investment practices that may increase the risk of investment loss. These strategies may not perform as expected in any or all market conditions, and may not deliver the investment objectives of the Fund. Leverage risk: The Underlying Funds in which the Fund invests may either borrow, or use derivatives, in order to obtain leveraged exposure to a particular asset or market. The use of leverage, whether through borrowing to invest or derivatives, may have the effect of magnifying both investments gains and losses and therefore increasing the risk of the Fund s unit price being sensitive to changes in underlying market variables. Currency risk: The Fund is denominated in Australia dollars. Some of the Fund s investments may be exposed to foreign currencies on a limited basis. The Underlying Manager or van Eyk may or may not hedge such foreign currency exposure. Their value will therefore be exposed to foreign exchange rate movements. Should the Underlying Manager or van Eyk make an active decision to hedge currency exposure, there is no guarantee that hedging will provide the expected protection against loss. Hedging may also reduce the opportunity for profit should currency movements prove favourable for the Fund s investments. Investment risk: The Fund has exposure to the Australian share market, volatility strategies, derivatives and other unlisted managed funds. The risk of an investment in the Fund is therefore higher than an investment in a typical bank account. Amounts distributed to unitholders may fluctuate, as may the Fund s unit price. The unit price may vary by material amounts, even over short periods of time, including during the period between a redemption request being made and the time the redemption unit price is calculated. Market risk: The markets for financial assets can be and have been volatile, and have the potential to fall by large amounts over short periods of time. Poor performance, losses or volatility in the Australian and international markets may potentially impact the overall performance of the Fund.

19 Default risk: Issuers or entities upon which the Fund s investments depend may default on their obligations, for instance by failing to make a payment when due. Such parties can include Underlying Managers of the Underlying Funds, derivatives counterparties, brokers (including clearing brokers of exchange traded instruments), foreign exchange counterparties, deposit taking banks, as well as the Fund s (or an Underlying Fund s) custodian. Default on the part of an issuer or counterparty could result in a financial loss to the Fund. Derivatives risk: Derivatives may be used by the Fund, or an Underlying Fund, to hedge existing exposures or to gain economic exposure. The use of derivatives by the Fund or an Underlying Fund may expose the Fund to risks including counterparty default, legal and documentation risk. Liquidity risk: Investments may be difficult or impossible to sell, either due to factors specific to that investment, or to prevailing market conditions. Liquidity risk may mean that an asset is unable to be sold or the Fund s exposure is unable to be rebalanced within a timely period and at a fair price, potentially resulting in delays in redemption processing, or even the suspension of redemptions. If we are required to process a large redemption or application, the exposure of the Fund to particular investments, sectors or asset classes may be altered significantly, as determined by van Eyk. Regulatory and legal risk: Governments or regulators may pass laws, create policy, or implement regulation that affects the Fund or its underlying investments or the ability of van Eyk or an Underlying Manager to execute its investment strategies. Such initiatives impact either a specific transaction type or market, and may be either country specific or global. Such changes may result in the Fund failing to achieve its investment objectives. Similarly laws affecting registered managed investment schemes (including taxation and corporate and regulatory laws) may change in the future, affecting investors rights and investment returns. Collateral risk: If the Fund or an Underlying Fund enters into derivatives arrangement that require it to deliver collateral or other credit support to the counterparty, the Fund, or Underlying Fund, will be exposed to the following additional risks in respect of that collateral. The Fund or Underlying Fund: > > may be required to post upfront margin/collateral with the lender (whether cash or other securities) and will need to have sufficient liquid assets to satisfy this obligation > > may, from time to time if the value of the derivatives arrangements moves against it, be required to post additional margin/collateral with the derivatives counterparty on an on-going basis. The Fund or Underlying Fund (as the case may be) will need to have sufficient liquid assets to satisfy such calls, and in the event it fails to do so, the counterparty may have the right to terminate such derivatives arrangement, and > > will be subject to credit risk on the counterparty. In the event the counterparty becomes insolvent at a time it holds margin/collateral posted with it by the Fund or Underlying Fund, the Fund or Underlying Fund (as the case may be) will ordinarily be an unsecured creditor of the counterparty, and will ordinarily rank behind other preferred creditors such as secured creditors and other creditors mandatorily preferred by law (for example, employees). Short-selling risk: While the Fund itself will not engage in short-selling, the Underlying Funds in which the Fund is invested may. Some of the specific risks associated with short-selling include: > > asset prices may rise, or remain constant, meaning the Underlying Fund may be unable to make a gain on their investment (and may make a loss), and > > the Underlying Fund may have entered into securities lending agreements as a borrower in order to facilitate their short-selling activities. Under such an agreement, the Underlying Fund: may be required to post upfront margin/collateral with the lender (whether cash or other securities) which the Underlying Fund will need to have sufficient liquid assets to satisfy, and may, if the value of the borrowed securities rises instead of falls, be required to post additional margin/collateral with the lender on an on-going basis, and will be subject to counterparty risk on the lender, in the event the lender becomes insolvent at a time it holds margin/collateral posted with it by the Underlying Fund. In these circumstances, the Underlying Fund will ordinarily be an unsecured creditor of the counterparty, and will ordinarily rank behind other preferred creditors such as secured creditors and other creditors mandatorily preferred by law (for example, employees). 17

20 Section 4: Fees and other costs Did you know? Small differences in both investment performance and fees and costs can have a substantial impact on your longterm returns. For example, total annual fees and costs of 2% of your account balance rather than 1% could reduce your final return by up to 20% over a 30-year period (for example, reduce it from $100,000 to $80,000). You should consider whether features such as superior investment performance or the provision of better member services justify higher fees and costs. You may be able to negotiate to pay lower contribution fees and management costs where applicable. Ask Macquarie or your financial adviser. To find out more If you would like to find out more, or see the impact of the fees based on your own circumstances, the Australian Securities and Investments Commission (ASIC) website ( has a managed investment fee calculator to help you check out different fee options. 4.1 Fees and other costs This table shows fees and other costs that you may be charged. These fees and costs may be deducted from your money, the returns on your investment or from the Fund s assets as a whole. Information on how managed investment schemes are taxed is set out in Section 5 of this PDS. You should read all of the information about fees and costs because it is important to understand their impact on your investment. Type of fee or cost Amount How and when paid Fees when your money moves in or out of the Fund 1 Establishment fee The fee to open your investment. Nil Not applicable 18 Contribution fee The fee on each amount contributed to your investment. Nil Not applicable Withdrawal fee The fee on each amount you take out of your investment. Nil Not applicable Exit fee The fee to close your investment. Nil Not applicable Management costs The fees and costs for managing your investment The management costs of the Fund consist of: Management fee 1.35% to 1.65% pa of the net asset value of the Fund. This is intended to reflect the management fees payable to each of Macquarie, van Eyk and any Underlying Manager in aggregate (the Underlying Manager management fees are not at an additional cost to you). The current estimate of the management fee is 1.50% pa. Performance fee 10% of the outperformance of the Fund over the hurdle, subject to a high watermark. The hurdle is a composite benchmark (50% of the S&P/ASX 300 Accumulation Index and 50% of the UBS Bank Bill Index) (Hurdle) The management fee: > > accrues daily and is payable monthly, and > > is deducted from the Fund s assets and reflected in the Fund s unit price. The performance fee: > > accrues daily and is payable semi-annually, and > > is deducted from the Fund s assets and reflected in the Fund s unit price.