Benefits of investing in a Navigator Integrated SMA

Individual accounts

When you invest in the SMA through a platform, a separate interest will be issued to the platform operator in relation to each Model Portfolio you choose, and any assets we hold in relation to that separate interest will be accounted for separately. Asset holdings that relate to a Managed Portfolio that you select are referred to in this PDS as "your account or "your Managed Portfolio.

You (or the trustee in the case of a superannuation investment) retain beneficial ownership of the assets held in your account.

Transparency

You can view the assets that you hold within your chosen Model Portfolio through your platform reports and facilities.

Portability

You can transfer Australian securities and units in managed funds that are held by (or for) you into the Wrap platform before transfer into the SMA and still retain the beneficial interest in those assets. You can also transfer your securities and units in managed funds between your Model Portfolios within the SMA. Please see page 27 for more details.

No inherited capital gains

When you transfer assets into your account, or assets are acquired by us and held as part of your account, an individual cost base is established in relation to that Model Portfolio. For securities this means there are no tax consequences for you as a result of other investors' transactions.

Professional investment management

You can benefit from the services provided to NAL by investment professionals who monitor and manage Model Portfolios on our behalf.

NAL, as responsible entity for the SMA, has appointed a number of investment managers to provide NAL with a range of investment and advisory services in connection with the Model Portfolios that you can select when investing in the SMA. Information about these investment managers is detailed in the PDS.

Consolidated reporting

Because the SMA is fully integrated with the technology systems of the platform through which you access the SMA, you will be able to have a comprehensive view of your Model Portfolio. This means you can:

1. view the breakdown of securities, managed funds and cash investments in your Model Portfolio;
2. keep track of your investments; and
3. transact between the SMA and other investments on your platform easily.

Investor suitability

The model portfolio is appropriate for an investor seeking medium to long term capital growth with some income from a diversified portfolio of Australian shares. Investors should be prepared to accept some fluctuations in short term returns. 

About the Fund

The Navigator integrated SMA ('the iSMA'), available on MLC Wrap and MLC Navigator (including Series 2 and associated badges), offers portfolios that enable your clients to invest in a range of assets according to a defined investment strategy and objective. 

The iSMA offers two main types of portfolios - single sector portfolios, which include listed securities, and multi-asset portfolios, which may include listed securities, managed funds and cash investments.  The iSMA provides a range of client benefits including beneficial ownership (non-Superannuation only), transparency of underlying assets, portability, and professional investment management.

Investment income

The frequency and amount of income that you receive will depend on the Model Portfolio/s that you have selected to invest in.

Investment income is initially deposited into the cash component of the Model Portfolio.

Where a Model Portfolio has automatic payment of investment income, dividend and interest income are automatically paid to your platform cash account after the initial deposit into the cash component of the Model Portfolio. For all other model portfolios your dividend and interest income will be paid into the cash allocation of your Model Portfolio and will be re-invested when the Model Portfolio is rebalanced.

Any income received after you have closed your Model Portfolio, will be automatically transferred to your platform Cash Account.

How we invest your money

Ausbil's broad investment philosophy is that active management of portfolios facilitates consistent and risk controlled outperformance. Rather than focusing only on growth or value investing, our investment processes allow us to exploit the inefficiencies across the entire market, at all stages of the cycle and across all market conditions.

We believe that the Australian equity market is relatively efficient, but not perfect. The basic premise of our philosophy is that stock prices ultimately follow earnings and earnings revisions. We believe that the market places excessive emphasis on the current situation and does not sufficiently take into account the likelihood of future changes to the earnings profile of individual companies and sectors.

Investment approach

Ausbil employs a four-stage process to provide the framework for portfolio construction consistent with its investment philosophy:

1. Macroeconomic analysis: Assess current economic and market conditions
2. Sectorial analysis: Identify attractive sectors and portfolio themes
3. Stock selection: Fundamental stock analysis backed by quantitative ranking
4. Portfolio construction: Robust, appropriate and risk aware portfolio

These conclusions are constantly retested.

The focus of the approach is to identify attractive sectors and stocks which are likely to be subjected to a relatively strong earnings environment and positive earnings revisions over the coming twelve months.

• Indicative cash holding: 1-10%

• Investment universe: S&P/ASX 300