United Funds Management

News

Update Cash Management Fund and the Bank Guarantee

28th November 2008

United Cash Management Fund - update on the Federal Government guarantee

As previously communicated in our Adviser Bulletin dated 20 October 2008, the United Cash Management Fund (Fund) is currently 100% invested in securities eligible for the Federal Government's guarantee program. 

Subsequent to our last correspondence, the Government has announced that from 28 November 2008, a fee schedule will apply to the guarantee of deposits, and selected money market securities from approved Australian Deposit taking institutions, with a value of over $1 million.

At this time, the Fund will not be subject to the fee and will therefore not be guaranteed, however:

  • we will continue to invest only in the highest rated money market securities
  • we will invest only in securities that are eligible for the Federal Government's guarantee and that are suitable for investment under Standard and Poor's AAAm Cash Management Fund rating criteria.

Subject to market conditions, we may choose to have a portion of the Fund, or the entire Fund, guaranteed. We will continue to keep you informed of our decisions regarding this.

The underlying assets of the Fund are 100% invested in bank instruments from ANZ, Commonwealth Bank, National Australia Bank, St George, Suncorp Metway and Westpac. 

Standard and Poor's AAAm Rating

We are pleased to confirm that, in September 2008, Standard & Poor's reaffirmed its 'AAAm' rating on the Fund - the highest credit rating available to a cash management trust. The 'AAAm' rating on the Fund indicates that the safety of the Fund is excellent and that it has an extremely strong capacity to maintain principal value and limit exposure to loss.

What does the Standard & Poor's AAAm rating mean?

  • At least 75% of the portfolio must be invested in A1+ rated securities - the highest short term money market security rating available.
  • At least 10% of the portfolio must be maturing within 7 days at all times.
  • At least 50% of the portfolio should be held in the form of highly liquid assets; defined as bank issued securities rated A-1+ and A-1.
  • The average maturity of the portfolio should be maintained within a relatively short time frame, with a maximum weighted average maturity of 70 days.
  • A maximum of 33% of the portfolio be exposed to a single A1+ rated counterparty.
  • A maximum of 25% of the portfolio be exposed to a single A1 rated counterparty.

Current and future investment strategy of the Fund

The key considerations for the suitability of assets within the Fund's portfolio will continue to be as follows:

  • The Fund will continue to invest in the highest quality securities in the market that are eligible for the Government guarantee.
  • The Fund will continue to invest 100% of its funds in assets defined as highly liquid by Standard and Poor's.
  • The Fund will continue to provide investors with ready access to their funds.
  • The Fund will continue to provide investors with a steady competitive yield.

We will continue to adopt this approach in order to provide security on your investment while delivering competitive returns and ready access to your funds.

If you have any queries about the Fund or the underlying assets, please contact Charles Kneale on 0417386467.

The information on this site is general information only and does not constitute personal financial product advice, including a recommendation to invest in any financial product referred to on this site. The information on this site does not take into account any investor's particular investment objectives, circumstances or needs. Before making any investment decision based on the information or products referred to on this site, investors should consider whether they are appropriate to their needs or consult a financial planner for professional advice.

United Funds receive positive rating from Lonsec

5th June 2008

Lonsec have completed their initial review of seven of our United Funds and have assigned each of them a rating of Investment Grade.

The funds that have been rated by Lonsec are:

  • United Sector Leaders Capital Stable Fund
  • United Sector Leaders Capital Balanced Fund
  • United Sector Leaders Capital Growth Fund
  • United Sector Leaders Diversified Aggressive Fund
  • United Sector Leaders Capital High Growth Fund
  • United Australian Equities Fund
  • United International Equities Fund

Lonsec says the 'Investment Grade' rating means the funds can achieve their objectives and, if applicable, outperform some of their peers over an appropriate timeframe.

This means that United has been externally and independently researched and rated. This rating will support United's expansion onto other platforms, increasing its availability to clients and planners across Australia.

Some of the feedback Lonsec gave in its report includes:

  • "Overall, Lonsec is impressed with the level of attention and detail applied to the portfolio construction process for the diversified (and single sector) funds and believes it to be a key strength for United."
  • "United has been one of only a few multi-managers assessed by Lonsec to have successfully added value through manager selection in the multi-sector products over the medium-term (3 years)."
  • "Lonsec views positively United's focus on high conviction strategies and the hands on approach to mandate tailoring."

This rating is further recognition of United's robust investment process and assists AWM in its endeavour to strengthen its position as a growing provider in the wealth management industry.

The Lonsec Limited ("Lonsec") ABN 56 061 751 102 rating (assigned May 2008) presented in this document is limited to "General Advice" and based solely on consideration of the investment merits of the financial product(s). It is not a recommendation to purchase, sell or hold the relevant product(s), and you should seek independent financial advice before investing in this product(s). The rating is subject to change without notice and Lonsec assumes no obligation to update this document following publication. Lonsec receives a fee from the fund manager for rating the product(s) using comprehensive and objective criteria.