Account Level Cash Management

Managing your client’s cash balance

You can manage the amount of cash held in your client’s account by using automatic cash management facilities available online. A minimum balance must be maintained in the cash held in your client’s Self-Directed Portfolio (SDP) to meet adviser fees, administration fees, transaction fees and various payments. The product’s required minimum cash balance is as follows:

• Investment Service: $2,000
• Super and Pension: the higher of $2,000 and 2% of the total account balance.

You can set up the following on your client’s behalf at the time of opening an account or after the account has been activated:

• Cash Target and Auto Sell Trigger for the cash held in the SDP.
• Automatic cash or income transfer between your SDP and Managed Portfolios.
• Automatic investment plan to allocate excess cash across your Managed Portfolios.

Setting a Cash Target and Auto Sell Trigger

You can set up a “Cash Target” for an account as a specific dollar amount or as a percentage of the total account balance. The Cash Target must be higher than $2,000 for the Investment Service, and must be higher than $2,000 and 2% of the total account balance for Super and Pension.

You can also nominate an “Auto Sell Trigger” amount on the account so that if the SDP cash balance falls below this amount, holdings in the account are automatically sold down, after taking into account any income received, to replenish the cash holding back to the Cash Target. If you nominate a dollar amount for the Cash Target, the Auto Sell Trigger amount must be at least $1,500 below the Cash Target.

In the example below, the account is set up with a Cash Target of $5,000 where the Auto Sell Trigger must be $3,500 or less.

You can set up the automatic cash management facility during the application process and you can also adjust the levels after the account is opened. Sell down of holdings will not be triggered within the first 90 days of an account being activated. If you do not set up a specific minimum cash target on a client’s account, the abovementioned product minimum cash balance and sell trigger will apply.

Automatic sell down of account holdings

If a client’s cash balance falls below the Auto Sell Trigger and you do not take action to top up the cash balance and if the account does not have any sell transactions awaiting settlement, conversion of any foreign cash holdings and sell down of the account’s holdings in order of the priority listed below will take place on or around the fifth of the following month, to bring the cash holding back to the Cash Target.

1. AUD cash from any Tailored Portfolio
2. Foreign currency cash from the SDP
3. Foreign currencies from any Tailored Portfolio
4. AUD cash from Managed Portfolios
5. Foreign currency cash from Managed Portfolios
6. Proportional sell down across all Managed Portfolios
7. Australian listed securities from the SDP
8. International listed securities from the SDP
9. Managed funds in the SDP
10. Fixed income securities in the SDP

Setting up a direct debit facility

A direct debit facility can be set up on an Investment account to top up the cash balance to the Cash Target if it falls below the Auto Sell Trigger. The direct debit occurs on or around the 25^th of each month and can be set up online or by completing the Direct Debit Request form.

Automatic investment plan

You can set up an automatic investment plan on your client’s account so that when funds are deposited into the Self-Directed Portfolio, the amount is automatically invested across selected Managed Portfolios according to the proportions determined by you and your client. The automatic investment plan will run each business day where new deposits are made into the Self-Directed Portfolio provided that the amounts to be invested meet the minimum investment requirement of the Managed Portfolios.