Trust frequently asked questions
Definitions
What is a managed fund or investment trust?
When you invest into a managed fund your money is ‘pooled’ together with other investors’ money to buy assets. Managed funds are also called managed investment schemes, unit trusts, managed trusts, pooled funds, mutual funds, collective investments and investment funds.
A managed fund is an arrangement between a group of investors and a fund manager (the responsible entity), governed by a constitution. In exchange for the money you invest, the trust issues units in the managed fund which have certain rights attached (such as the right to a share of any income and on certain occasions, the right to vote). The number of units you receive depends on how much you invest in the fund and the unit price on the day.
Australian Ethical invests the pooled money into various assets according to the Australian Ethical Charter.
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The responsible entity provides investment and administrative expertise and is responsible for overall investment performance of the investment trusts. Australian Ethical Investment Limited is the responsible entity for the five public retail investment trusts offered in our PDS.
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What is a withdrawal (redemption)?
Withdrawing some or all of your investment from an investment trust is called a withdrawal or a redemption. This is because your investment is converted to cash by ‘redeeming’ units in the trust.
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General
What are the benefits of investing with Australian Ethical?
- professional experience
- diversification
- simplicity
- transparency
- investment choice
- investment information
- account information
- potential investment returns
- income distribution
- low initial investment for regular savers
- capital growth.
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What are the risks associated with investing in a managed fund or investment trust?
Generally managed funds are a less risky investment as your money is diversified (spread across different types of assets and securities) and is managed by investment professionals.
However like all investments, managed funds are subject to varying risks and their value can go up as well as down. Some types of investments perform differently at times and have varying risk characteristics and volatility.
Refer to the How do we manage your money? section in the trust PDS for a detailed explanation of particular investment risks.
Further information
- What is your investor profile?
- Product Disclosure Statements
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Which investment trust should I invest in?
The best mix of investments for you will depend on your personal financial circumstances, your investment goals and timetable, and how you balance risks and rewards.
Our trust PDS provides information to help make your investment decision. However after reading it in full, if you are still uncertain about which product is most suitable, you should see an accredited financial adviser. Australian Ethical can offer general advice on the financial products it offers, but will not provide individually tailored advice to you on which investment trust you should invest in.
Further information
- Your investor profile
- Product Disclosure Statements
- List of financial advisers and helpful contacts
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What individual investments are in the portfolios?
The portfolio list for each investment trust are available and updated regularly.
See the portfolio list for:
- Australian Ethical Balanced Trust
- Australian Ethical Equities Trust
- Australian Ethical Large Companies Share Trust
- Australian Ethical World Trust
- Austrailan Ethical Income Trust
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What is the minimum amount I need to invest in a trust?
At Australian Ethical you can invest as little as $100 per month by starting a regular savings plan.
If you’d like to make a single contribution the minimum initial investment is $2000. Additional one-off investments are required to be at least $500.
- Minimum initial investment: $2000
- Minimum additional investment: $500
- Minimum balance in any trust: $500
- Minimum initial investment for regular savings plan: $100
- Minimum monthly investment for regular savings plan: $100
Further information
- Australian Ethical Trusts
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What if I am investing as a joint unitholder?
When you invest as a joint unitholder you will be required to supply us with details of individuals holding the account.
Joint accounts are allocated one investor number. You will need to supply signatures for each holder on every transaction, any changes to your details, or any withdrawals (redemptions) you wish to make.
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What if I want to invest for my child or grandchild?
We do not accept investments in the name of children (someone under 18 years of age).
You can designate on an account a child’s name which will be noted, but you will remain the legal owner of the investment. In normal circumstances, you will be the only party able to transact on the account. This will be the case regardless of the child’s age or legal status.
If you do not wish for the account to be taxed at the highest marginal rate then your tax file number should be provided.
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Performance
What investment returns can an investor in Australian Ethical's trusts expect?
While future performance can never be guaranteed, Australian Ethical's investment trusts have historically achieved competitive long-term performance.
Past returns shouldn’t be used to calculate your future returns but are a useful guide to the overall performance of the fund manager and financial product. By referring to them, in conjunction with other information (such as fees and risk), you can compare our returns with other managers/products of a similar type when deciding where to invest.
Note that:
- all investments can rise and fall in value
- past performance is not necessarily indicative of future performance
- returns are affected by variations in market forces and there will be changes in the distributed income we pay you according to how investments are performing
- the risk characteristics of each trust should be considered along with the potential returns.
Further information
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How is the unit price calculated?
The unit price is calculated by dividing the net assets by the total number of units on issue for that trust.
For example, if a trust had a total of $1 000 000 net assets and there were 1 000 000 units on issue, then the unit price for that trust for that day would be $1.00.
Further information
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Your investment
Is there a cooling-off period?
Yes, there is. The cooling-off period is outlined on page 23 of the trust PDS. If you invest, you will receive a confirmation letter which includes the final date that you may use this option. This is typically within 14 days of receiving a confirmation letter, before which you can exercise your cooling-off right.
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What happens if I invest just before or just after a distribution?
Subject to the terms of the Trust Constitution, if you hold units in the investment trusts at close of business on the last business day of the six month period ending 31 December or 30 June of any year then you will be entitled to be paid a distribution for the six-month period ending on those dates.
The first unit price after these dates will be reduced by the distribution amount, which will be paid to investors holding units in the trust on the last business day.
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You can change your investment or its mix at any time.
If you wish to switch investment trusts, you need to use the Switching form in the trust PDS or write to us requesting the changes.
Remember, you may need to consider any tax implications and whether a switching fee is applicable (see Fees and costs). If you are unsure, you may wish to contact an accredited financial adviser.
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The trust’s taxable income is passed on to you as the investor and tax payable will be your responsibility.
You do not need to give us your tax file number but be aware that if you do not, tax on your distributions will be withheld at the highest marginal rate and remitted to the Australian Taxation Office. For more information see page 42 of the Product Disclosure Statement.
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How do I withdraw my investment, when will I get the money and does it cost me to do this?
Normally, you can withdraw your investment at any time. You can do this by filling out the Withdrawal form on the Forms for unitholders page. Alternatively you can make a written request, dated and signed by all authorised signatories to the unitholding. Refer to the trust PDS for further details.
Withdrawals are normally paid within seven business days of receiving a request. Withdrawals can be delayed in January and July because of the distribution processes.
In some circumstances, the responsible entity may be required to delay withdrawals.
We do not charge a withdrawal fee on the amount you take out of your investment.
Further information
- See How to invest (page 22) in the trust PDS
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Fees and discounts
Where do I find information on fees and costs?
Refer to the fees and costs section for trusts.
It is very important that you understand the fees that will be charged on your investment because it will affect your returns. If, after reading the fees and costs section on the website or in the PDS, you are in doubt about the fees you will be charged, please contact us or see an accredited financial adviser before investing.
Further information
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Can I obtain a contribution fee discount?
We offer fee discounts for certain investments made directly into the trusts. See Table 2: Important additional disclosure items under fees and costs.
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What is the impact of the contribution fee on your investment?
When you invest your money, a contribution fee is deducted from it. For example, when you invest $1000, and if the contribution fee is 4%, your net investment would be $960 ($1000 investment less $40 contribution fee). If the unit price is $1.00 you would receive 960 units.
Further information
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Keeping you informed
Can I access my information online?
Yes you can. If you want to use this facility, you will need to register by filling in the Online access application form. If you have an adviser, they will be able to access your unitholding information with their own password.
You can find your current unit balance, latest transactions and the Online access application form at the Client Log-in for Trusts. The application form can also be found under the forms for unitholders page.
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How often will I receive statements and information?
You will receive:
- a statement following an application, withdrawal or detail alteration
- confirmation of each completed transaction (except for regular savings plan investments and trail commission redemption payments)
- two distribution statements per year detailing your balance and a transaction summary, with the end of financial year statement including your tax information
- an annual report on the financial position and performance of the trusts
- two newsletters per year
- if you are a regular saver, you will receive a quarterly statement.
These will be sent as long as we have your current address details (postal and email).
You may elect to receive all statements by email.
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Where do I find…
Forms to change my trust investment?
Forms for unitholders are available in the trusts section, or may be accessed directly from the homepage from Client forms. Forms are also available at the end of the trust PDS.
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BPAY instructions and biller codes to make trust investments?
BPAY codes are available on the Making trust payments page.
See the Checklist – Trusts for instructions on using BPAY.