Benefits of Listed Managed Investments

Managed Investments are used by investors for a variety of reasons, including:

Diversification

Through Managed Investments it is possible to participate in a portfolio that includes many securities. This diversification limits your exposure to any one security, so that under performance by any one security should not necessarily have a severe impact on your overall investment.

Managed Investments can also be used to diversify across different asset classes, such as Australian shares, real estate, and fixed interest. Different asset classes may perform differently during any given period, so by holding investments in multiple asset classes you can reduce your exposure to a particular class. You may need to invest in several Managed Investments to achieve exposure across multiple asset classes. 

Professional management

When you invest in a Managed Investment you are engaging a professional portfolio manager to implement investment decisions and administer the fund. There is an array of management styles and philosophies the manager may adopt in running the investment portfolio. Investors pay the administration costs of the fund, and where the fund manager is external, a management fee may also apply. Any fees or expenses are automatically deducted from the value of the investment portfolio.

Convenience

Investors in Managed Investments access a portfolio of securities through one investment. This may be an easier way to build and manage your investment portfolio than investing in each of the underlying securities. Because the assets of many investors are combined, the cost of transactions is less than if you were to create a similar portfolio.

Access

Managed Investments allow you to access investment opportunities that may otherwise be unavailable to you. Through Managed Investments, retail investors can gain exposure to assets such as office buildings or toll roads. Some of the other types of investment that are available through Managed Investments include private equity, agriculture assets, commercial real estate and transport infrastructure.

Periodic distributions

Managed Investment pass-through or declare distributions (dividends) based on the performance of the underlying investments. The frequency and size of these dividends depends on the individual product. Managers may elect to distribute on a monthly, quarterly, or annual basis. Franking credits are also passed through or created by the Managed Investment for utilisation by investors. Dividends and imputation