You can access Weinberg Private Managed Portfolios via your account in a relevant Platform.

When you make an investment into the scheme, we will establish your Portfolio, and purchase the underlying assets that form part of the managed portfolios you have selected. Your interest in the scheme is held for you by the Platform Operator, under the terms and conditions that apply to the Platform through which you access Weinberg Private Managed Portfolios.

All underlying assets held in your Portfolio are held for us by the custodian that we appoint. Each managed portfolio has a stated investment objective that will guide its management. Each managed portfolio will be monitored, and its asset allocation adjusted with a view to achieving its investment objective.

We exercise our discretion in making the management decisions relating to your Portfolio. Generally, we will purchase, sell, subscribe for, apply for, transfer or redeem assets in order to align your Portfolio, as closely as is practicable, to the composition of the relevant managed portfolio to which your Portfolio relates.

The Weinberg Private series of managed portfolios are invested in a range of asset classes. This will allow you to select a managed portfolio based on what you determine to be your financial goals and tolerance to risk. Speak to your financial adviser about selecting managed portfolios that may be suitable to your needs.

Once an appropriate investment strategy has been determined, there are usually a number of possible implementation options. Generally speaking, it comes down to a choice of either managed funds, ETFs or direct investment such as equities listed on the stock market and listed property. While either of these approaches could have a place in a portfolio, we feel direct investment suits your current profile and desire for transparency and control over income and tax outcomes.

The level of risk and your expected return will be similar whether you invest directly into the asset on the share market, or whether you invest indirectly via managed fund (which is just a trust in which investor’s pool money together for investment). Which one you should have is a personal decision based on the level of control, tax efficiency and transparency you prefer.

Managed funds are most useful for those investors that lack sufficient capital to invest directly and/or are not comfortable with direct involvement. We recommend investing directly where practical as you have a large enough capital base to directly hold a diversified portfolio and have stated you are comfortable with the transparency.

Managed funds are less appropriate as you defer control over a crucial part of your investment and tax planning to a fund manager. Fund managers utilise a unit trust structure which is less effective in managing tax outcomes for investors due to the nature of embedded CGT. When you invest in a managed fund, there is already accumulated capital gains/losses in that fund that you will potentially receive despite not having invested in the fund when they were incurred. By investing through direct assets via a managed account, you maintain the ownership of the underlying assets being managed and the tax parcels associated with your investments.

Although the majority of your portfolio will be held through direct assets, to enable us to get adequate diversification Elston do use managed funds and ETFs where investing directly would prove too costly or impractical e.g. fixed income investments and international equities investments.

ASX listed fixed interest exposure is largely dominated by Hybrids and Preference Shares. Hybrids and Preference Shares have equity like characteristics which mean that the Hybrids share similar downside risks to equities without the potential capital upside that equities provide. We therefore think that the risk does not justify the return. Secondly, Weinberg Private portfolios will look at fixed incomes exposure outside of those listed on the ASX in order to access specialist investment management expertise.

The investment universe is quite limited, which impedes our ability to get exposure to sectors/economies that we feel offer the greatest value for our clients. In addition, managing direct international equities can create additional transactional, currency and taxation risk within the portfolios. Last, it allows us to access specialist investment management expertise in target sectors/economies.

The primary benefit is that where practical, your monies will be invested directly into listed securities, rather than unitised trusts. This provides you with a number of advantages such as;

• Certainty of cash flow – The unit trust structure of managed funds is a problem for cash flow. It is possible for managed funds to earn good income but be unable to pay it out to you due to the fact they have realised capital losses. The distributions paid can also be highly variable due to capital profits. Direct investments overcome this, as they ensure you can always bank all income that is paid.

• Ensure you receive all franking credits – You will always receive the tax benefit from franking credits on the investments you own.

• Manage capital gains tax – Unlike a managed fund where you may inherit capital gains at the time you invest, a direct portfolio will only attract tax on your actual profits.

• Get greater comfort – By owning a direct portfolio you will always know exactly where your money is invested. This can provide some comfort in tough times as you can better appreciate the risks you are taking on.

• Proactive portfolio management including regular rebalancing and investment communication by our team of experienced, professional authorised fund managers.

• A disciplined, conservative investment philosophy focused on actively managing quality investments for after tax returns.

• Potential savings by reducing exposure to more costly unitised investments.

• Disciplined and efficient rebalancing of your portfolio through the managed account structure on a more regular basis.

• You will have full visibility to your portfolio holdings and can view the underlying investments that have been selected by logging on to the product provider’s website.

• You will have access to comprehensive reports that include information on economic outlook, performance of the managed portfolio vs its benchmark, and a summary of changes made during the period.

• The Weinberg Group of practices will continue to play a role of investment governance, which allows us to monitor, provide our clients feedback and investment preferences for consideration.