ASIC lifts on managed investment products for mFund
Retail investors previously limited to redeeming interests in simple managed investment schemes with a shorter PDS through mFund are now able to apply and redeem in a broader range of options, following the amendment of a Class Order (CO 13/1621) to expand product offerings.
The Australian Securities and Investments Commission (ASIC) has granted the expansion and revision to the Class Order in response to an application from the Australian Securities Exchange (ASX); jointly operated by ASX and ASX Settlement, mFund would allow investors to electronically apply for, or redeem units in simple managed investment schemes.
Commissioner John Price said broadening options for investors would see an increase in efficiency and productivity for the industry.
"This expansion can help make the process of applying for and redeeming interests in managed investment schemes more efficient for a greater range of products and can help lower operating costs for the investment management industry," he said.
The expanded products which would also include hedge funds in the mFund settlement service must comply with the ASX Operating and Settlement Rules criteria, which would include rules related to liquidity of scheme property and redemption of the units.
The key aspects of the Class Order are:
- It would exempt responsible entities of managed investment schemes available through the mFund settlement service from just issuing interests in response to an application form that was included in or accompanied a PDS; and
- Responsible entities would generally be allowed to issue on the basis of an electronic message through the mFund settlement service indicating that the investor has been given the current version of the PDS and any supplementary PDS that apply to the particular fund.
"By extending the range of products that are available through the mFund settlement service, the relief will facilitate the potential for greater efficiency in the industry without compromising the requirement for an investor to receive disclosure needed, before investing," Price said.
"ASIC supports innovation that has the potential to provide benefits to consumers and efficiencies to industry."
AUTHOR
Hope William-Smith
Recommended for you
Clime Investment Management has welcomed an independent director to its board, which follows a series of recent appointments at the company.
Ethical investment manager Australian Ethical has cited the ongoing challenging market environment for its modest decrease in assets over the latest quarter.
Commentators have said Australian fund managers are less knowledgeable compared with overseas peers when it comes to expanding their range with ETFs and underestimating the competition from passive strategies.
VanEck is to list two ETFs on the ASX next week, one investing in residential mortgage-backed securities and the other in Indian companies.
