The Wholesale Fund Advantage

Australia has a robust and liquid investment industry that reflects the country’s growth, productivity and stability within the Asia-Pacific region. Australia’s investment industry capitalises on the strength of its financial markets and sound corporate governance, allowing investors to access innovative and world-class investment products.

The Investment Management industry in Australia greatly benefits from the Government mandated Superannuation (Pension) Scheme which was introduced in 1991. The Superannuation industry provides a liquid, stable and continuous inflow of assets for management by Investment professionals and is a key driver in the sophistication and growth of Australia’s Investment management industry.


Private residents of Australia can gain access to the expertise developed by Investment professionals through a commercial Managed Fund. A Managed Fund, or Investment Fund, is an investment vehicle in which assets are pooled and jointly managed for investors by investing in securities (shares), real estate, government bonds, cash or other financial instruments. Each Fund varies according to its performance target, the type of assets managed and the investment process used by the manager.


Despite the broad range of choice available, one type of Fund provides distinct advantages for the investor with larger amounts of money to invest.


Wholesale Funds provide investment services for large blocks of capital at a discount. The Australian Corporations Act (2001, Cth) provides for Wholesale Fund structures by dividing the type of people that financial services may be provided to into two classes, “Retail” and “Wholesale” (761G).


The Act defines Wholesale investors as persons that meet at least one of the following criteria:

<  Initial investment amount of A$500,000

<    Net assets of A$2,500,000

<    Gross income of at least A$250,000 per year in each of the previous 2 years

<    Are a Professional Investor (ie. investors who control more than A$10m)


These requirements are set by the Government to ensure that access to Wholesale Funds is restricted to those individuals who can demonstrate an understanding of financial markets through accumulating and managing private or commercial wealth.



So what is the Wholesale Advantage?


Private investors who satisfy Wholesale client criteria are able to access sophisticated investment strategies otherwise reserved for the Superannuation market alone. In addition, lower fees for Wholesale Investors are made possible because the regulatory regime imposes a less severe compliance and reporting load on Wholesale Investment Managers due to the financial expertise of Wholesale Investors.


As an example, the average Investment Management fee charged by Retail Funds is around 2% according to industry surveys, compared to 0.7-0.8% charged by Wholesale Funds.


Reduced regulatory compliance and communication expenses permit Investment Managers to charge a fee based on what they do best; building wealth through superior investment returns.


Bellwether Partners Limited is a Wholesale Investment Manager specialising in Australian Equities.

Information Supplied by:
Bellwether Partners Limited
Phone: +613 9661 0888
Website: www.bellwether.com.au