Ausbil Investment Trusts Australian Active Equity Fund

Transcription

1 ausbil.com.au Ausbil Investment Trusts Australian Active Equity Fund Product Disclosure Statement 18 December 2014 ARSN APIR AAP 010 3AU mfund AXW01 Commenced April 1997 Issue Number 3 Contents 1. About Ausbil Investment Management Limited How the Fund works Benefits of investing in the Fund Risks of managed investment schemes How we invest your money Fees and costs How managed investment schemes are taxed How to apply Other information...7 Important information This PDS provides a summary of the key information relating to the Ausbil Investment Trusts Australian Active Equity Fund ( Fund, Australian Active Equity Fund ). It summarises significant information and contains a number of references to important information, each of which forms part of this PDS. The PDS and Incorporated Material contains important information you should consider before making a decision to invest in this Fund. The information may change between the time of reading this PDS and the day when you acquire the product. You can access the information incorporated into this PDS ( Incorporated Material ) on our website, download a copy or request a copy free of charge by calling us. The information in this PDS is general information only and does not take into account your personal financial situation or needs. You should consult a licensed financial adviser to obtain financial advice that is tailored to suit your personal circumstances. Contact details If you have any questions or would like to request a hard copy of the Product Disclosure Statement ( PDS ) and Incorporated Material ( IM ) please contact us at: Toll Free Phone Fax Mail Ausbil Investment Management Limited GPO Box 2525 Sydney NSW contactus@ausbil.com.au Website Updated information Information in this PDS is subject to change from time to time. Information that is not materially adverse information may be updated by us by placing such information on our website. Updated information can be obtained by contacting your master trust or wrap account operator (for indirect investors), your financial advisor, going to our website or calling us. You may request a paper copy of any updated information at any time, free of charge. The offer made in this PDS is issued in this juristiction (electronically or otherwise). Ausbil authorises the use of the PDS as disclosure to indirect investors who are investors and prospective investors accessing the Fund through an investor directed portfolio service ( IDPS ) or IDPS-like service (commonly known as a master trust or wrap account). Indirect investors should also read the information contained in Section 9 of the Incorporated Material under the heading Indirect Investors. Ausbil does not guarantee the performance of the Fund, the repayment of capital or any particular rate of return. Investment in the Fund is not a bank deposit or an investment in or other liability of Ausbil. No assurance is given in respect of the Fund that the projected asset allocations or stated objectives will be achieved or maintained at the levels disclosed in this PDS. Ausbil Investment Trusts Australian Active Equity Fund 1

2 1. About Ausbil Investment Management Limited Ausbil Investment Management Limited AFS Licence , ABN ( Ausbil, responsible entity, we, us, our ) is the responsible entity of, and issuer of units in, the Fund offered in this PDS. As the responsible entity, Ausbil is responsible for the administration and management of the Fund, and setting the Fund s investment policy and objectives. Ausbil is a specialist investment manager with approximately $10 billion in funds under management as at 30/9/2014. Established in April 1997, we are now a strategic partnership between senior members of the investment/management team of Ausbil and New York Life Investment Management ( NYLIM ), a wholly-owned subsidiary of New York Life Insurance Company. You should read the important information about Ausbil contained in the Incorporated Material before making a decision to invest in the Fund. The material relating to About Ausbil Investment Management Limited may change between the time when you read this PDS and the day when you acquire the product. 2. How the Fund works When you invest your money in the Fund, your money is pooled together with other investors money. We use this pool to buy investments and manage them on behalf of all the investors in the Fund. By investing this way, you may have access to investment opportunities you may not otherwise be able to access on your own. When you acquire an interest in the Fund, we will issue you units in the Fund representing your investment but you do not have an interest in any particular asset of the Fund. The total value of the assets in the Fund is divided into units and a unit price is generally calculated for each Business Day. The unit price will generally change daily as the market value of assets in the Fund rises or falls. Unit prices are calculated using asset values at the close of markets on a Business Day. The application price is calculated by dividing the Net Asset Value of the Fund by the number of units on issue and then adding a buy spread. The redemption price is calculated the same way, except that the sell spread is deducted from the Net Asset Value per unit. For additional information on the buy/sell spread, refer to Section 6, Fees and other costs. Entry and exit prices for each Business Day will be posted on our website, on the following Business Day. Transacting via mfunds Ausbil is a foundation member of the mfund Settlement Service ( mfund ), which is operated by ASX. We expect the Fund to be admitted as an mfund product under the ASX Operating Rules on or around 1 December When and while the Fund is admitted as an mfund product under the ASX Operating Rules, investors will be able to buy and sell units in the Fund through mfund. mfund uses CHESS, ASX s electronic settlement system, allowing automated application and redemption of units in the Fund through your ASX broker (or your financial adviser who uses a stockbroking service on your behalf). Minimum initial investment The minimum initial investment is $20,000, or such lower amounts as we may determine from time to time in accordance with the Constitution. Refer to Section 8 on How to Apply. Additional investments You can increase your investment by making additional investments (subject to the minimum amount), which will increase your units, at any time. Refer to Section 8 on How to Apply. How to redeem You can decrease your investment by redeeming some or all of your units in the Fund at any time by either mailing or faxing us a completed redemption form or a written instruction requesting a redemption. The minimum redemption amount is $5,000. Your instruction should be faxed to Attention: Registry Services or mailed to National Australia Bank Limited, Registry Services, PO Box 1406, Melbourne Vic Redemptions will generally be paid to your nominated bank account within 5 Business Days. When and while the Fund is admitted as an mfund product, investors invested through mfund will be able to make a redemption from the Fund using mfund. 2 Ausbil Investment Trusts Australian Active Equity Fund

3 Processing application and redemption requests If we receive an application or redemption request by 2.30pm (Sydney time) on a Business Day, you will receive the unit price for that Business Day. Application and redemption requests received after 2.30pm (Sydney time) on a Business Day will be processed using the unit price calculated for the following Business Day. Indirect investors may be subject to different conditions from those referred to in this PDS, particularly with regard to cut-off times for transacting, processing and redemptions. As well as reading this PDS, indirect investors should read their IDPS operator s offer document. If we receive an incomplete application or redemption request, the transaction request will be processed using the unit price applying on the Business Day we receive the correct documentation. Restrictions on redemptions There may be instances where your ability to redeem from the Fund is restricted and you may be subject to a waiting period before your investment can be redeemed. Pursuant to the terms of the Constitution, we must refuse to sell assets held in the Fund to process redemptions where we have received a redemption request and consider that it is not in the interests of members to sell assets of the Fund or that the assets cannot be sold at an appropriate price or on adequate terms. Distributions The Fund generally determines distributions semi-annually (as at June 30 and December 31). Distributions are usually paid within 14 days after the end of the period. In some situations distributions may be paid at other times. 3. Benefits of investing in the Fund Significant features of the Fund include: Exposure to an actively managed portfolio predominantly made up of listed large cap Australian equities; An investment rationale that combines company level research with top down economic analysis resulting in a disciplined approach to portfolio construction; and Regular reporting provision of financial reports, unit holding, distribution and tax statements, along with investment reports; Investing in the Fund offers a number of benefits, including: Provision of daily liquidity to investors via daily pricing, daily transactions and half yearly distributions; A disciplined risk management process that manages risk relative to anticipated investment returns; Access to the investment expertise of Ausbil; and Access to our secure client website on: to keep track of your investments. You should read the important information about the features and benefits of investing in the Fund contained in the Incorporated Material before making a decision to invest in the Fund. The material relating to the Benefits of investing in the Fund may change between the time when you read this PDS and the day when you acquire the product. The distributions you receive are generally assessable income and can be made up of both income and realised capital gains. Distributions are generally calculated based on the Fund s net income at the end of the distribution period divided by the number of units on issue. This gives a distributable income amount per unit. Your distribution entitlement is then determined by multiplying the number of units held by the distributable income amount per unit. An investor who invests during a distribution period may get back some of their capital as income. Unless you instruct otherwise, your distribution entitlement will be reinvested. Reinvestment of distributions will normally be effective the first day following the end of the distribution period at an application price calculated by dividing the Net Asset Value of the Fund at the end of the distribution period (excluding the distribution amount) by the number of units on issue. No buy spread will apply in this circumstance. You should read the important information about how the Fund works contained in the Incorporated Material before making a decision to invest in the Fund. The material relating to How the Fund works may change between the time when you read this PDS and the day when you acquire the product. Ausbil Investment Trusts Australian Active Equity Fund 3

4 4. Risks of managed investment schemes All investments carry risk. The likely investment return and the risk of losing money are different for each managed investment scheme. Different strategies may carry different levels of risk, depending on assets that make up the strategy. Assets with the highest longterm returns may also have the highest risk of losing money in the shorter term. The significant risks associated with this Fund are: Market risk: The risk that the market price of an asset will fluctuate as a result of factors such as economic conditions, government regulations, market sentiment, local and international political events and environmental and technological issues. Market risk may have a different impact on each type of asset, investment style and investor. Specific security risk: Investments in shares in a company can fall in value for many reasons such as changes in internal operations or management of the company or changes in the business environment in which the company operates. Fund risk: Fund risks include potential termination of the Fund, a change in a Fund s characteristics (such as distribution frequency, change in fees and expenses etc.), replacement of the Responsible Entity or when laws that affect managed investment schemes change. There is also a risk that investing in a Fund may give different results than investing directly because of the income or capital gains or losses accrued in the Fund and the consequences of applications and redemptions by other investors. Risk can be managed but it cannot be completely eliminated. When considering investing in the Fund or other managed investment schemes, it is important to understand that: the value of your investments will go up and down; the level of returns will vary, and future returns may differ from past returns; returns are not guaranteed and you may lose some of your money on any investment you make; and the appropriate level of risk for you will depend on a range of factors including your age, investment time frame, where other parts of your wealth are invested and your risk tolerance. For more information about risk and returns refer to the Australian Securities and Investments Comission (ASIC) website. You should read the important information about the general and Fund specific risks contained in the Incorporated Material before making a decision to invest in the Fund. The material relating to the Risks of investing in the Fund may change between the time when you read this PDS and the day when you acquire the product. 5. How we invest your money Warning: You should consider the likely investment return, risk and your investment time frame when choosing whether to invest in the Fund. Australian Active Equity Fund Description of Fund Investment return objective Benchmark Asset classes and asset allocation ranges Minimum suggested holding period Standard risk measure Fund performance Labour standards, environmental, social and ethical considerations Changes to Fund details The Fund predominantly invests in a portfolio of listed large cap Australian equities which are primarily chosen from the S&P/ASX 300 Index. The Fund is designed for investors who wish to benefit from the long-term capital gains available from share investments and who are comfortable with fluctuations in capital value in the short to medium term. To achieve returns (before fees and taxes) in excess of the benchmark over the medium to long term with moderate tax effective income. There is no guarantee that this objective will be achieved. S&P/ASX 300 Accumulation Index. Australian Equities 90% - 100% Cash 0% - 10% 5+ years Risk Band: 7 Risk Level: Very high risk of losing money in any year. Likely to produce higher returns over the long term. Please visit and click on Performance. Past performance is not indicative of future performance. Environmental, social and governance factors can impact performance. As a result we include an assessment of environmental, social and governance factors in our investment process. We do not have a predetermined view on these factors. Instead we consider these factors, as we become aware of them in our investment decisions. We have the right to close or terminate the Fund and change the Fund s investment return objective (including benchmark), asset classes and asset allocation ranges without prior notice in some cases. We will inform investors of any material change to the Fund s details in their next regular communication or as otherwise required by law. You should read the important information about how we invest your money, including the Fund s Standard Risk Measure, contained in the Incorporated Material before making a decision to invest in the Fund. The material relating to How we invest your money may change between the time when you read this PDS and the day when you acquire the product. 4 Ausbil Investment Trusts Australian Active Equity Fund

5 6. Fees and costs Consumer Advisory Warning Did you know? Small differences in both investment performance and fees and costs can have a substantial impact on your long-term returns. For example, total annual fees and costs of 2% of your fund 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 us or your financial adviser. The following table shows fees and other costs that you may be charged. These fees and costs may be deducted from your money, from the returns on your investment or from the assets of the Fund as a whole. Type of fee or cost Amount Fees when your money moves in or out of the Fund Establishment fee: Contribution fee: Withdrawal fee: Termination fee: Management costs: The fees and costs for managing your investment. Management fee: Expenses: costs we incur in managing and administering the Fund. Nil Nil Nil Nil Ausbil Investment Trusts Australian Active Equity Fund 0.82%p.a. These costs are accrued daily and paid monthly in arrears. plus %pa These costs are accrued daily and paid quarterly in arrears based on end of quarter Gross Asset Value Estimated at %p.a. of the Gross Asset Value of the Fund. Accrued daily in the unit price and paid out of the Fund on a monthly basis. To find out more If you would like to find out more, or see the impact of fees based on your own circumstances, the ASIC website has a managed investment fee calculator to help you check out different fee options. The calculator can also be used to calculate the effect of fees and costs on your investment. Fees and other costs Unless otherwise stated, all fees quoted in this PDS are inclusive of any Goods and Services Tax ( GST ) after allowing for an estimate for Reduced Input Tax Credits ( RITCs ) and Input Tax Credits ( ITCs ). 1. The $180 assumes the additional $5,000 was invested at the end of the year. If it is assumed the additional $5,000 was invested at the beginning of the year, the management fee would be $225 (0.90% x $25,000). Please note that this is just an example and the actual investment balance of your holding will vary on a daily basis. Worked example This table provides an example of how the fees and costs charged by the Fund can affect your investment over a one-year period. You should use this table to compare this product with other managed investment products. Example Amount Balance of $20,000 with a contribution of $5,000 during the year Contribution fee 0% Nil PLUS Management costs EQUALS cost of the Fund 0.90%pa And, or every $20,000 you have in the Fund, you will be charged $180 (0.90% x $20,000) each year. If you have an investment of $20,000 at the beginning of the year and put in an additional $5,000 at the end of the year, you would be charged fees estimated to be $180 1 Warning: Additional fees may be paid to a financial advisor if a financial advisor is consulted - refer to the Statement of Advice which will be provided by your financial advisor, which sets out the details of the fees. Additional explanation of fees and costs Management costs Management costs represent the costs associated with investment management of the portfolio and Fund administration. For the duration of this PDS, Ausbil has determined that these costs will not exceed 0.90%p.a. In the event that actual recoverable expenses are lower than the estimated costs accrued in the Fund s unit price, management costs may be less than 0.90% p.a. Expenses Under the Constitution, Ausbil may recover certain expenses from the Fund reasonably and properly incurred in performing its obligations as the responsible entity, including: Expenses for the sale, purchase and valuation of the assets of the Fund; Auditors fees; Fees in connection with agents, solicitors and advisers; Fees payable to ASIC or any other regulatory authority; Fees payable to the custodian that holds the assets of the Fund; Expenses relating to the maintenance of the register of unitholders and accounting records. The estimated level of recoverable expenses is accrued in the daily unit price and Ausbil will be reimbursed monthly for the actual costs incurred during the period. Indirect Cost Ratio (ICR) The ICR of a Fund is the ratio of the Fund s management costs, which are not deducted directly from an investor s account, to the Fund s total average assets and is expressed as a percentage. The ICR does not include establishment, contribution, redemption or termination fees, buy/sell spreads, transactional and operational costs, but does include administration and management fees. The ICR for the Fund was 0.90% for the year ending 30 June By way of a dollar example, assuming a constant balance of $20,000 invested in the Fund throughout the 12 month period and ignoring any market movement in the Fund s investment value, based on an ICR of 0.90%, $180 would have been charged in management costs. The above ICR does not represent any promise that the ICR for future periods will remain at this level. 5

6 Buy/sell spread The buy/sell spread is an additional cost to you and is generally incurred whenever you invest in or redeem from the Fund. The buy/ sell spread is retained by the Fund (it is not a fee paid to us) and represents a contribution to the transaction costs incurred by the Fund, such as brokerage, when the Fund is purchasing and selling assets. There is no buy spread incurred on distributions which are reinvested. The current buy/sell spread is 0.30% of the amount that you invest or redeem. For example, if you invested $20,000 in the Fund the cost of your buy/sell spread would be $60. Other fees and costs These may include additional fees and costs such as transactional and operational costs. We may change the amount of fees and costs without your consent. Should there be a decision to increase fees and costs, you will be given 30 days prior notice. Indirect investors accessing the Fund through an IDPS may incur additional fees and costs. As well as reading this PDS, indirect investors should read their IDPS operator s offer document, which explains the fees payable by the indirect investor to the IDPS operator. Additional fees may be paid to a financial advisor if a financial advisor is consulted - refer to the Statement of Advice which will be provided by your financial advisor which sets out the details of fees. In the case of applications made via mfund, additional fees may be charged by your broker - refer to the Financial Services Guide which will be provided by your broker. 7. How managed investment schemes are taxed Warning: Investing in a registered managed investment scheme is likely to have tax consequences. Because the Australian taxation system is complex and different investors have different circumstances, you are strongly advised to seek professional tax advice. Managed funds generally distribute all of their taxable income each year so that the Fund is not subject to tax. You will be assessed for tax on distributions received by you, which may include franked and unfranked dividends, capital gains and interest income. A taxable capital gain or loss may be realised when redeeming units in the Fund. You should read the important information about taxation contained in the Incorporated Material before making a decision to invest in the Fund. The material relating to How managed investment schemes are taxed may change between the time when you read this PDS and the day when you acquire the product. You should read the important information about the fees and costs, charged by the Fund, contained in the Incorporated Material before making a decision to invest in the Fund. The material relating to Fees and costs of the Fund may change between the time when you read this PDS and the day when you acquire the product. 6 Ausbil Investment Trusts Australian Active Equity Fund

7 8. How to apply How to invest in the Fund 1. Read this PDS together with the Incorporated Material. 2. Complete the: Application Form Client Identification Forms Hard copies of the Application Form and Client Identification Forms are available by calling (toll free). 3. Make payment of monies via electronic funds transfer or cheque. Payment details are provided on the Application Form. 4. Send the Application Form, relevant Client Identification Forms and cheque (if payment by cheque) to: National Australia Bank Limited, Registry Services, PO Box 1406, Melbourne VIC Upon receipt of confirmation of your initial investment in the Fund you can then start to make additional investments into the Fund. Additional investments A written instruction is required, however, there is no need to complete another form. Your instruction should be faxed to Registry Services on or mailed to the address noted in point 4 above. The written instruction must be signed by you as the investor (or the authorised signatories) and should specify your name, account number, Fund name and the amount to be invested. How to invest via mfund When and while the Fund is admitted as an mfund product, investors will be able to make an initial and/or additional investment in the Fund through mfund using your ASX broker (or your financial adviser who uses a stockbroking service on your behalf). Cooling-off If you are a retail investor (as defined in the Corporations Act) you have a cooling-off period to reconsider your initial investment in the Fund. If you want to exercise your cooling-off right, we must receive your written request within 14 days from the earliest of: the date you receive your initial application confirmation; or five business days after the issue of units in the Fund. The amount returned to you will be adjusted for any change in the unit price since the investment was made, which means that you may get back less money than you invested and there may be tax implications for you. A cooling-off right does not apply to additional investments, reinvested distributions and switches between Funds. Complaints If you feel we are not dealing with you as you would like, as a first step please contact us and we will do our best to resolve your concern quickly and fairly. Our contact details are on the front cover of this PDS. If you are not satisfied with our handling of your complaint, you can contact the Financial Ombudsman Service at: Financial Ombudsman Service Limited GPO Box 3 Melbourne VIC 3001 Phone: info@fos.org.au Website: You should read the important information about how to apply, cooling-off periods and complaints contained in the Incorporated Material before making a decision to invest in the Fund. The material relating to How to apply may change between the time when you read this PDS and the day when you acquire the product. 9. Other information Keeping you informed As an investor in the Fund you will receive: A semi-annual distribution statement; and An annual tax statement containing a summary of your distributions for the financial year to assist you in completing your tax return. Continuous disclosure This Fund is subject to regular reporting and disclosure obligations under the Corporations Act. Copies of the following documents lodged with ASIC may be obtained from, or inspected at, an ASIC office. You can also call us to obtain copies of these documents free of charge. The latest annual financial report lodged with ASIC; Any half-yearly report for the Fund lodged with ASIC after the lodgement of the annual report and before the date of this PDS; or Any continuous disclosure notices given by the Fund after lodgement of the annual report and before the date of this PDS. We may also publish material information about the Fund on our website in accordance with ASIC policy. Indirect investors should contact your IDPS operator. New Zealand Investors This PDS and Incorporated Material is governed by Australian law as opposed to New Zealand law. 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. New Zealand investors should read Section 9 of the Incorporated Material which contains important information for New Zealand investors. The material relating to Important Information for New Zealand Investors may change between the time when you read this PDS and the day when you acquire the product. Indirect Investors The Fund offered in this PDS is a registered managed investment scheme for the purposes of the Corporations Act. The offer of units in the Fund falls under Australian jurisdiction. If you invest in the Fund through an IDPS, you may be subject to different conditions from those referred to in this PDS, particularly with regard to cut-off times for transacting, timing of distributions and processing, as well as investment minimums, Fund reporting and investor notices. As well as reading this PDS and the IM, indirect investors should read their IDPS operator s offer document, which explains the service and the fees payable by the indirect investor to the IDPS operator. Indirect investors should follow the instructions of the IDPS operator to apply to buy or sell units in the Fund. Indirect investors should read Section 9 of the Incorporated Material, which contains important information for Indirect Investors, before making a decision to invest in the Fund. The material relating to Indirect Investors may change between the time when you read this PDS and the day when you apply through your IDPS operator to acquire the product. Ausbil Investment Trusts Australian Active Equity Fund 7

8 mfund Investors Investors through mfund should read this PDS, which is available on our website and can be viewed or downloaded at Your ASX broker will process a buy order for units through CHESS. CHESS will confirm the order with your ASX broker once received and accepted by us. Applications for units received and accepted by us will be forwarded by CHESS to your ASX broker for your payment to be passed through the CHESS daily batch settlement process. We will price and allot new units in the Fund to your CHESS Holder Identification Number (HIN). CHESS will notify your ASX broker of the unit price and units allotted. Applications received through mfund will be subject to the same cut-off times as applications received via other distribution channels. For further information regarding cut-off times refer to section 2 How the Fund works of this PDS or the Incorporated Material. Terms used in this PDS Business Day means a day (other than a Saturday, Sunday or public holiday) on which banks are open for general banking business in Sydney. Corporations Act means the Corporations Act 2001 (Cth). Fund means Ausbil Investment Trusts - Australian Active Equity Fund. Gross Asset Value means the value of Fund assets, determined in accordance with the Fund s Constitution. IDPS means Investor Directed Portfolio Service, IDPS-like scheme, or a nominee or custody service (collectively known as master trusts or wrap accounts). mfund means the mfund Settlement Service operated by the ASX. Net Asset Value means the Gross Asset Value less charges and/or expenses accrued or unpaid. Responsible Entity means Ausbil Investment Management Limited. we us our or Ausbil means the Responsible Entity of the Fund. 8 Ausbil Investment Trusts Australian Active Equity Fund