Mandatory investment of at least $1.5 million at the time of investment in an eligible fund(s):
- Investment in securities of companies that have a market capitalization (“mkt cap”) of less than A$500 million at the time of first purchase by the fund. Investments are to be ASX-listed or Australian unlisted companies, but unlisted are to be no more than 20% of the fund’s net asset. Up to 20% of the fund’s net assets may be in other Australian exchange-listed companies.
- Up to 10% of the fund’s net assets may be invested in foreign exchange listed companies (e.g. New Zealand) with a mkt cap of less than A$500 million at the time of first purchase by the fund.
- Up to 30% of the fund’s net assets can be previously held assets whose companies have grown their mkt cap above A$500 million.
- Must maintain a minimum of 20 investee companies from three months post fund’s inception date.
- No further purchase can be made of any individual asset that exceed 10% of the fund’s net assets.
A complying fund must have the following:
- Cash is to be no more than 20% of a fund’s net assets.
– Derivatives are to be used for risk management purposes only.
– Managed funds (open or closed-end) or Listed Investment Companies (LICs) are eligible.
- Fund Managers are to have and maintain a minimum of $100m in firm-wide FUM to offer a 5 0% complying fund(s) to applicants.
The investment must not be made in:
- Securities issued or proposed to be issued by a government; or
- Debentures; or
- Securities that otherwise meet the requirements under this section but where the issuer of those securities invests the proceeds of the issue of those securities in securities that do not meet the market capitalisation requirements.
Note: for example, a small exchange traded fund which invests in the securities of large capitalization companies is excluded under this paragraph
Pindari Emerging Companies Funds:
- Pindari Capital SIV Emerging Companies Fund