Each account must maintain the required minimum cash balance in the Self-Directed Portfolio. Note that the required minimum cash balance in an account may be higher than the product's minimum cash balance of $2,000.
If an account’s minimum cash balance falls below its required minimum in the Self Directed Portfolio, the account will be subject to Divestment, a system-generated sell-down of assets or cash transfer between portfolios that tops-up the cash balance to the minimum required balance.
Divestment occurs on or around the fifth business day of every month. Product thresholds for accounts are as follows.
Investment - If an account’s balance falls below the Auto Sell Trigger, (or the product minimum of $500 if no trigger has been set), divestment will top up the cash balance to the Cash Target (or the product minimum if not Cash Target has been set).
Super (Accumulation) - If an account’s balance falls below the Auto Sell Trigger (or 1.5% of total FUM if no Trigger has been set), divestment will top up the cash balance to the Percentage or Cash Target set (or up to 2% if no Target has been set).
TTR & Pension - If an account’s balance falls below Auto Sell Trigger (or 1.5% of total FUM, if no Trigger has been set) divestment will top up the cash balance to the Percentage or Cash Target set (or up to 2% if no Target has been set).
Please use the Cash Balances report to assist with cash management of your client’s accounts should you wish to avoid divestment.
On the first business day of each month you will be notified by an ‘Alert’ if your client’s account’s is subject to divestment. You can use the Cash Balances report to assist with cash management of your client’s accounts should you wish to avoid divestment (this is found in Business Management > Management Reports).
Divestment: Sell-down process
Step 1: Check for unsettled inflight AUD Equity sell trades from Self-Directed Portfolio (SDP). If this does not cover the gap, Step 2 occurs.
Step 2: Cash movements, conversions of foreign cash holdings or sell downs of your assets will occur in the following order:
- AUD cash from any Tailored Portfolio
- Foreign currency cash from the SDP
- Foreign currencies from any Tailored Portfolio
- AUD cash from Managed Portfolios
- Foreign currency cash from Managed Portfolios
- Proportional sell down across all Managed Portfolios
- Australian listed securities from the SDP
- International listed securities from the SDP
- Managed funds in the SDP
- Fixed income securities in the SDP
Please note: There is a grace period where accounts less than 90 days old are not subject to divestment.
Please note: This article is for information purposes only, where there are discrepancies between this article and the Disclosure documents, including but not limited to: the Global Investment Guide, or the PDS or the Super Additional Investment Guide, the disclosure documents prevail.