loftus peak global disruption fund · loftus peak global disruption fund product disclosure...

Loftus Peak Global Disruption FundProduct Disclosure StatementmFund: LOF01ARSN 098 764 080APIR MMC0110AUIssue Date 3 December 2019

About this PDSThis Product Disclosure Statement (“PDS”) has been prepared and issued by EquityTrustees Limited (“Equity Trustees”, “we” or “Responsible Entity”) and is a summary ofthe significant information relating to an investment in the Loftus Peak Global DisruptionFund (the “Fund”). It contains a number of references to important information (includinga glossary of terms) contained in the Loftus Peak Reference Guide (“Reference Guide”),which forms part of this PDS. You should carefully read and consider both the informationin this PDS, and the information in the Reference Guide, before making a decision aboutinvesting in the Fund.

The information provided in this PDS is general information only and does not takeaccount of your personal objectives, financial situation or needs. You should obtainfinancial and taxation advice tailored to your personal circumstances and considerwhether investing in the Fund is appropriate for you in light of those circumstances.

The offer to which this PDS relates is only available to investors receiving this PDS inAustralia.

This PDS does not constitute a direct or indirect offer of securities in the US or to any USPerson as defined in Regulation S under the Securities Act of 1933 as amended (“USSecurities Act”). Equity Trustees may vary this position and offers may be accepted on meritat Equity Trustees’ discretion. The units in the Fund have not been, and will not be,registered under the US Securities Act unless otherwise approved by Equity Trustees andmay not be offered or sold in the US to, or for, the account of any US Person (as defined inthe Reference Guide) except in a transaction that is exempt from the registrationrequirements of the US Securities Act and applicable US state securities laws.

Contents1. About Equity Trustees Limited

2. How the Loftus Peak GlobalDisruption Fund works

3. Benefits of investing in theLoftus Peak Global DisruptionFund

4. Risks of managed investmentschemes

5. How we invest your money

6. Fees and costs

7. How managed investmentschemes are taxed

8. How to apply

9. Other information

The Reference GuideThroughout the PDS, there are references to additional information contained in the Reference Guide. You can obtain a copy of the PDS andthe Reference Guide, free of charge, by emailing the Investment Manager at [email protected], visiting www.loftuspeak.com.au orcalling +61 2 9163 3333 or by calling the Responsible Entity.

The information contained in the Reference Guide may change between the day you receive this PDS and the day you acquire the product. Youmust therefore ensure that you have read the Reference Guide current as at the date of your application.

Updated informationInformation in this PDS is subject to change. We will notify you of any changes that have a material adverse impact on you or othersignificant events that affect the information contained in this PDS. Any information that is not materially adverse information is subject tochange from time to time and may be obtained by emailing the Investment Manager at [email protected], visitingwww.loftuspeak.com.au or calling +61 2 9163 3333. A paper copy of the updated information will be provided free of charge on request.

Investment ManagerLoftus Peak Pty LimitedABN 84 167 859 332, AFSL 503571Ph: +61 2 9163 3333Web: www.loftuspeak.com.au

Administrator and CustodianMainstream Fund Services Pty LtdACN 118 902 891Lvl 1, 51-57 Pitt StreetSydney NSW 2000Phone: 1300 133 451Web: www.mainstreamgroup.com

Responsible EntityEquity Trustees LimitedABN 46 004 031 298, AFSL 240975GPO Box 2307Melbourne VIC 3001Ph: +61 3 8623 5000Web: www.eqt.com.au/insto

Loftus Peak Global Disruption Fund PDS 1

1. About Equity Trustees LimitedThe Responsible EntityEquity Trustees LimitedEquity Trustees Limited ABN 46 004 031 298 AFSL 240975, asubsidiary of EQT Holdings Limited ABN 22 607 797 615, which is apublic company listed on the Australian Securities Exchange (ASX:EQT), is the Fund’s responsible entity and issuer of this PDS.Established as a trustee and executorial service provider by a specialAct of the Victorian Parliament in 1888, today Equity Trustees is adynamic financial services institution which continues to grow thebreadth and quality of products and services on offer.

Equity Trustees’ responsibilities and obligations as the Fund’sresponsible entity are governed by the Fund’s constitution(“Constitution”), the Corporations Act and general trust law. EquityTrustees has appointed Loftus Peak Pty Ltd as the investmentmanager of the Fund. Equity Trustees has appointed a custodian tohold the assets of the Fund. The custodian has no supervisory role inrelation to the operation of the Fund and is not responsible forprotecting your interests.

The Investment ManagerLoftus Peak Pty LimitedLoftus Peak is a global fund manager with a focus on investing inlisted disruptive businesses. Loftus Peak’s principals each have closeto three decades of experience in company valuation, and bringsignificant discipline to the investment process.

2. How the Loftus Peak GlobalDisruption Fund works

The Fund is a registered managed investment scheme governed bythe Constitution. The Fund comprises assets which are acquired inaccordance with the Fund’s investment strategy. Direct investorsreceive units in the Fund when they invest. In general, each unitrepresents an equal interest in the assets of the Fund subject toliabilities; however, it does not give investors an interest in anyparticular asset of the Fund.

If you invest in the Fund through an IDPS (as defined in the ReferenceGuide) you will not become an investor in the Fund. The operator orcustodian of the IDPS will be the investor entered in the Fund’sregister and will be the only person who is able to exercise the rightsand receive the benefits of a direct investor. Your investment in theFund through the IDPS will be governed by the terms of yourIDPS. Please direct any queries and requests relating to yourinvestment to your IDPS Operator. Unless otherwise stated, theinformation in the PDS applies to direct investors.

Applying for unitsYou can acquire units by completing the Application Form thataccompanies this PDS or by making an application through themFund settlement service (“mFund”) by placing a buy order for unitswith your licensed broker. The minimum initial investment amount forthe Fund is $5,000.

Completed Application Forms should be sent along with youridentification documents (if applicable) to:

Mainstream Fund Services Pty LtdClient Services Registry TeamGPO Box 4968Sydney, NSW, 2001

Please note that cash and cheques cannot be accepted.

If applying via mFund you will need to provide the application moneydirectly to your licensed broker.

We reserve the right to accept or reject applications in whole or inpart at our discretion. We have the discretion to delay processingapplications where we believe this to be in the best interest of theFund’s investors.

The price at which units are acquired is determined in accordancewith the Constitution (“Application Price”). The Application Price ona Business Day is, in general terms, equal to the Net Asset Value(“NAV”) of the Fund, divided by the number of units on issue andadjusted for transaction costs (“Buy Spread”). At the date of thisPDS, the Buy Spread is 0.25%.

The Application Price will vary as the market value of assets in theFund rises or falls.

Making additional investmentsYou can make additional investments into the Fund at any time bysending us your additional investment amount together with acompleted Application Form. The minimum additional investmentinto the Fund is $5,000.

DistributionsAn investor’s share of any distributable income is calculated inaccordance with the Constitution and is generally based on thenumber of units held by the investor at the end of the distributionperiod.

The Fund usually distributes income annually at the end of June,however, Equity Trustees may change the distribution frequencywithout notice. Distributions are calculated effective the last day ofeach distribution period and are normally paid to investors as soonas practicable after the distribution calculation date.

Investors in the Fund can indicate a preference to have theirdistribution:

• reinvested back into the Fund; or• directly credited to their AUD Australian domiciled bank

account.

Investors who do not indicate a preference will have theirdistributions automatically reinvested. Applications for reinvestmentwill be taken to be received immediately prior to the next BusinessDay after the relevant distribution period. There is no Buy Spread ondistributions that are reinvested.

In some circumstances, the Constitution may allow for an investor’swithdrawal proceeds to be taken to include a component ofdistributable income.

Indirect Investors should review their IDPS Guide for information onhow and when they receive any income distribution.

Access to your moneyInvestors in the Fund can generally withdraw their investment bycompleting a written request to withdraw from the Fund and mailingit to:


Or sending it by fax to +612 9251 3525

Or by making a withdrawal request through mFund by placing a sellorder for units with your licensed broker.

The minimum withdrawal amount is $5,000. Once we receive andaccept your withdrawal request, we may act on your instructionwithout further enquiry if the instruction bears your account numberor investor details and your (apparent) signature(s), or yourauthorised signatory’s (apparent) signature(s) or if the withdrawal isreceived via mFund.

Equity Trustees will generally allow an investor to access theirinvestment within 14 days of acceptance of a withdrawal request bytransferring the withdrawal proceeds to such investor’s nominatedbank account or where the request is received via mFund, to theinvestor’s licensed broker. However, Equity Trustees is allowed toreject withdrawal requests, and also to make payment up to 180 daysafter acceptance of a request (which may be extended in certaincircumstances) as outlined in the Constitution and Reference Guide.

We reserve the right to accept or reject withdrawal requests in wholeor in part at our discretion.

2 Loftus Peak Global Disruption Fund PDS

The price at which units are withdrawn is determined in accordancewith the Constitution (“Withdrawal Price”). The Withdrawal Price ona Business Day is, in general terms, equal to the NAV of the Fund,divided by the number of units on issue and adjusted for transactioncosts (“Sell Spread”). At the date of this PDS, the Sell Spread is0.25%.

The Withdrawal Price will vary as the market value of assets in theFund rises or falls.

Equity Trustees reserves the right to fully redeem your investment ifyour investment balance in the Fund falls below $5,000 as a result ofprocessing your withdrawal request. In certain circumstances, forexample, when there is a freeze on withdrawals, where accepting awithdrawal is not in the best interests of investors in the Fundincluding due to one or more circumstances outside its control orwhere the Fund is not liquid (as defined in the Corporations Act),Equity Trustees can deny or suspend a withdrawal request and youmay not be able to withdraw your funds in the usual processing timesor at all. When the Fund is not liquid, an investor can only withdrawwhen Equity Trustees makes a withdrawal offer to investors inaccordance with the Corporations Act. Equity Trustees is not obligedto make such offers.

If you are an Indirect Investor, you need to provide your withdrawalrequest directly to your IDPS Operator. The time to process awithdrawal request will depend on the particular IDPS Operator andthe terms of the IDPS.

Unit pricing discretions policyEquity Trustees has developed a formal written policy in relation tothe guidelines and relevant factors taken into account whenexercising any discretion in calculating unit prices (includingdetermining the value of the assets and liabilities). A copy of thepolicy and, where applicable and to the extent required, any otherrelevant documents in relation to the policy will be made availablefree of charge on request.

Additional informationIf and when the Fund has 100 or more direct investors, it will beclassified by the Corporations Act as a ‘disclosing entity’. As adisclosing entity, the Fund will be subject to regular reporting anddisclosure obligations. Investors would then have a right to obtain acopy, free of charge, of any of the following documents:

• the most recent annual financial report lodged with ASIC(“Annual Report”);

• any subsequent half yearly financial report lodged with ASICafter the lodgement of the Annual Report; and

• any continuous disclosure notices lodged with ASIC after theAnnual Report but before the date of this PDS.

Equity Trustees will comply with any continuous disclosure obligationby lodging documents with ASIC as and when required.

Copies of these documents lodged with ASIC in relation to the Fundmay be obtained from ASIC through ASIC’s website.

Further readingYou should read the important information in the ReferenceGuide about:

• Application cut-off times;

• Application terms;

• Authorised signatories;

• Reports;

• Withdrawal cut-off times;

• Withdrawal terms; and

• Withdrawal restrictions,

under the “Investing in the Loftus Peak Global DisruptionFund”, “Managing your investment” and “Withdrawing yourinvestment” sections before making a decision. Go to theReference Guide which is available at www.loftuspeak.com.au.The material relating to these matters may change between thetime when you read this PDS and the day when you acquire theproduct.

3. Benefits of investing in the LoftusPeak Global Disruption Fund

3.1 Features of Loftus PeakLoftus Peak is a global fund manager with a focus on investing inlisted disruptive businesses. Loftus Peak’s principals each have closeto three decades of experience in company valuation, andbring significant discipline to the process. The Fund’s portfolio,which includes large capitalisation names like Apple, Google andAlibaba, is constructed on the basis of strict criteria, giving itexposure to some of the best and fastest-growing companies in theworld, at carefully selected valuations.

3.2 Significant benefits of investing in Loftus PeakTraditional business models are being disrupted as connectivity,networks and the sharing economy impact all industries – retail,transport, communications, energy and banking to name a few.Loftus Peak invests to generate returns from these major secularshifts. The Portfolio’s geographical and sectoral diversification lowersthe concentration risk inherent in the typical Australian portfolio withits heavy skew toward banks, resources and the Australian dollar.

4. Risks of managed investmentschemes

All investments carry risks. Different investment strategies may carrydifferent levels of risk, depending on the assets acquired under thestrategy. Assets with the highest long-term returns may also carry thehighest level of short-term risk. The significant risks below should beconsidered in light of your risk profile when deciding whether toinvest in the Fund. Your risk profile will vary depending on a range offactors, including your age, the investment time frame (how long youwish to invest for), your other investments or assets and your risktolerance.

The Responsible Entity does not guarantee the liquidity of the Fund’sinvestments, repayment of capital or any rate of return or the Fund’sinvestment performance. The value of the Fund’s investments willvary. Returns are not guaranteed and you may lose money byinvesting in the Fund. The level of returns will vary and future returnsmay differ from past returns. Laws affecting managed investmentschemes may change in the future. The structure and administrationof the Fund is also subject to change.

In addition, we do not offer advice that takes into account yourpersonal financial situation, including advice about whether the Fundis suitable for your circumstances. If you require personal financial ortaxation advice, you should contact a licensed financial adviserand/or taxation adviser.


Individual investment riskInvestments to which the Fund is exposed, like shares on a stockexchange, can (and do) fall in value for many reasons, such aschanges in a company’s internal operations or management, or in itsbusiness environment. The Investment Manager aims to reducethese risks with careful analysis and by talking to those people whorun companies and are responsible for changes which may impact onthe Fund’s investments.

Market riskEconomic, technological, political or legal conditions, interest ratesand even market sentiment, can (and do) change, and changes in thevalue of investment markets can affect the value of the investments inthe Fund.

Investment manager riskInvestment managers can be wound up or liquidated, they can ceaseto manage the relevant fund and be replaced, their investmentmethodology can change, they can poorly manage operational risksand their funds can perform poorly. If any of these occurred, EquityTrustees would do all things reasonably practicable to recover thevalue of the Fund’s investments and seek a new investment manageror program, with a similar investment profile, if thought appropriate.If the investment program changed significantly, you would be givenat least 30 days’ notice. Further, only a small number of investmentprofessionals are responsible for managing the Fund and theirpersonal circumstances can change. We aim to reduce this risk byhaving additional resources available through Equity Trustees.

Fund riskRisks particular to the Fund include that it could terminate (forexample, at a date we decide), the fees and expenses could change(although we would always give you at least 30 days’ notice if feeswere to increase), we could be replaced as responsible entity and ourmanagement and staff could change. There is also a risk thatinvesting in the Fund may give different results than investingindividually because of income or capital gains accrued in the Fundand the consequences of investment and withdrawal by otherinvestors.

Currency riskFor investments in offshore shares, a rise in the Australian dollarrelative to a particular currency in which the share is purchased maynegatively impact investment values and returns. As such, anappreciation of the Australian dollar versus a given offshore currencywould have a negative impact on the value of your investment whilea depreciation would likely have a positive effect, as measured inAustralian dollars. Loftus Peak may use some currency hedging forrisk management purposes that hedges US investments back toAustralian dollars. Where the risk is hedged, the hedge may notprovide complete protection from currency movements.

Derivative riskThe Fund may make use of exchange-traded derivatives, including,but not limited to, futures, options and contracts for differences, aspart of its investment policy. Derivatives may be used to manageequity and foreign exchange risk. Derivatives are highly specialisedinstruments that require investment techniques and risk analysisdifferent from those associated with equities and debt securities. Theuse of a derivative requires an understanding not only of theunderlying instrument but also of the derivative itself. In particular,the use and complexity of derivatives require the maintenance ofadequate controls to monitor the transactions entered into and theability to assess the risk that a derivative transaction adds to aportfolio. As such there can be no guarantee or assurance that theuse of derivatives will meet or assist in meeting the investmentobjectives of the Fund.

Derivatives can be highly volatile and expose investors to a high riskof loss. The low initial margin deposits normally required to establisha position in such instruments permit a high degree of leverage. As aresult, depending on the type of instrument, a relatively smallmovement in the price of a contract may result in a profit or a losswhich is high in proportion to the amount of funds actually placed asinitial margin and may result in unquantifiable further loss exceedingany margin deposited. In addition, daily limits on price fluctuationsand speculative position limits on exchanges may prevent promptliquidation of positions resulting in potentially greater losses.

Liquidity riskThere are circumstances under which access to your money may bedelayed. Further, the level of overall market liquidity is an importantfactor that may contribute to the profitability of the Fund and accessto your money. Illiquid markets can make it difficult to tradeprofitably and to realise assets in a timely fashion to meet withdrawalrequests. Also, note that units in the Fund are not quoted on anystock exchange so for example you cannot sell them through astockbroker.

Interest rate riskThis is the risk that the capital value or income of a security may beadversely affected when interest rates rise or fall.

Regulatory riskThis is the risk that the value or tax treatment of either the Fund itselfor investments of the Fund, or the effectiveness of a Fund’s trading orinvestment strategy, may be adversely affected by changes ingovernment (including taxation) policies, regulations and laws, orchanges in generally accepted accounting policies or valuationmethods.

Counterparty riskCounterparty risk is the risk that the counterparty to a transaction orcontract (such as a broker or other agent of Equity Trustees) maydefault on their obligations and that the Fund may, as a result,experience an adverse investment outcome or liability.

General risksOther significant risks relevant to many managed funds include:

• The value of investments will vary• The level of returns will vary, and future returns may differ from

past returns and• Returns are not guaranteed, and you may lose some of your

money

The level of risk for each person will vary depending on a range offactors, including age, investment time frames, where other parts ofyour wealth are invested and your risk tolerance. These risks can bemanaged, but cannot be completely eliminated. You can ad

5. How we invest your money

Warning: Before choosing to invest in the Fund you shouldconsider the likely investment returns, the risks of investing andyour investment time frame.

Investment objectiveThe Fund aims to deliver a return over the benchmark (below) overthe medium to long term by bringing a disciplined investmentprocess to listed global companies impacted by disruption. Thescheme aims to achieve its objective by investing in equities,comprising listed shares, exchange traded funds, and exchangetraded derivatives.

BenchmarkMSCI All Countries World Index (net dividends reinvested) in AUD

Minimum suggested time frameThe minimum suggested investment time frame for the Fund is 3-5years.


Risk level of the FundVery High

Investor suitabilityThe Fund is generally suited for persons seeking exposure in globalequities with a focus on disruptive themes

Investment style and approachThe investment process combines top down fundamental qualitativeand quantitative research with company valuations based on ananalysis of forecast future cash flows. Stock weightings typicallyrange from 2% to 10% depending on risk weights applied. Thatresults in a diversified portfolio with holdings in the range 15 – 35.Investment risk is primarily managed through close analyticalattention. Capital preservation can be managed by holding up to50% cash. Index and currency options and futures may also be usedto manage risk, within the limits.

Asset allocationThe portfolio allocation will generally be:

• Global Equities - Minimum of 15 securities, Maximum of 35securities

• CASH - Minimum 1%, Maximum 50%

The Investment Manager actively adjusts the investment mix withinthe ranges above. Remember the investment mix can change withinthe ranges and sometimes quickly. Ask your adviser or contact us forthe latest investment mix and size of the Fund. Assets are helddirectly.

Changing the investment strategyThe investment strategy and asset allocation parameters may bechanged. If a change is to be made, investors in the Fund will benotified in accordance with the Corporations Act.

Labour, environmental, social and ethicalconsiderationsEquity Trustees and the Investment Manager do not generally takeinto account labour standards or environmental, social or ethicalconsiderations for the purposes of selecting, retaining or realisinginvestments.

Fund performanceUp to date information on the performance of the Fund can beobtained from www.loftuspeak.com.au. A free of charge paper copyof the information will also be available on request.

6. Fees and costs

DID YOU KNOW?Small differences in both investment performance and feesand costs can have a substantial impact on your long-termreturns.

For example, total annual fees and costs of 2% of your accountbalance rather than 1% could reduce your final return by up to20% over a 30 year period (for example, reduce it from$100,000 to $80,000).

You should consider whether features such as superiorinvestment performance or the provision of better memberservices justify higher fees and costs.

You may be able to negotiate to pay lower contribution feesand management costs where applicable. Ask the fund or yourfinancial adviser.

TO FIND OUT MOREIf you would like to find out more, or see the impact of the feesbased on your own circumstances, the Australian Securities andInvestments Commission (ASIC) website(www.moneysmart.gov.au) has a managed funds fee calculatorto help you check out different fee options.

The information in the following template can be used to comparecosts between different simple managed investment schemes. Feesand costs can be paid directly from an investor’s account ordeducted from investment returns. For information on tax please seeSection 7 of this PDS.

TYPE OF FEE ORCOST Amount

Fees when your money moves in or out of the Fund

Establishment fee Nil

Contribution fee Nil

Withdrawal fee Nil

Termination fee Nil

Management costs

The fees and costs formanaging yourinvestment1

Management fees: 1.20% p.a. of the NAV ofthe Fund2

Performance fees: 15% of the amount bywhich the Fund’s performance exceeds theMSCI All Countries World Index (netdividends reinvested) in AUD. Anyunderperformance from a prior period mustbe recouped before a fee can be taken (wecall this the high-watermark)3

1 All fees quoted above are inclusive of Goods and Services Tax(GST) and net of any Reduced Input Tax Credits (RITC). See below formore details as to how management costs are calculated.2 Management fees can be negotiated. See “Differential fees”below.3 This represents the performance fees which are payable as anexpense of the Fund to the Investment Manager. See “Performancefees” below for more information.

Additional Explanation of fees and costsWhat do the management costs pay for?Management costs comprise the additional fees or costs that aninvestor incurs by investing in the Fund rather than by investingdirectly in the underlying assets of the Fund. Management costsinclude management fees and performance fees.

In addition, management costs do not include transactional andoperational costs (i.e. costs associated with investing the underlyingassets, some of which may be met by Buy/Sell Spreads).


Management feesThe management fees of 1.20% p.a. of the NAV of the Fund arepayable to the Responsible Entity of the Fund for managing theassets and overseeing the operations of the Fund. The managementfees are accrued daily and paid from the Fund monthly in arrears andreflected in the unit price. As at the date of this PDS, ordinaryexpenses such as investment management fees, custodian fees,administration and audit fees, and other ordinary expenses ofoperating the Fund are covered by the management fees at noadditional charge to you.

The management fees shown above do not include extraordinaryexpenses (if they are incurred in future), such as litigation costs andthe costs of convening investor meetings.

Performance feesPerformance fees are payable to the Investment Manager where theinvestment performance of the Fund exceeds the performance ofthe MSCI All Countries World Index (net dividends reinvested) inAUD (“Benchmark”). The performance fees are 15% of this excess,calculated daily and paid for each six month period ending 30 Juneand 31 December in arrears from the Fund and calculated based onthe beginning NAV of the Fund, adjusted for applications andredemptions, over the relevant period.

No performance fees are payable until any accruedunderperformance (in dollar terms) from prior periods has beenmade up (this feature is sometimes referred to as a high-watermark).

Based on the current calculation methodology for the performancefee, the Responsible Entity has estimated that the typical ongoingperformance fee payable per annum may be $138 assuming anaverage account balance of $50,000 during the year. Prior periodshave been taken into account in calculating this estimate However,this is not a forecast as the actual performance fee for the current andfuture financial years may differ. The Responsible Entity cannotguarantee that performance fees will remain at their previous level orthat the performance of the Fund will outperform the Benchmark.

It is not possible to estimate the actual performance fee payable inany given period, as we cannot forecast what the performance of theFund will be, but it will be reflected in the management costs for theFund for the relevant year. Information on current performance feeswill be updated from time to time and available atwww.eqt.com.au/insto.

Transactional and operational costsIn managing the assets of the Fund, the Fund may incur transactionaland operational costs such as brokerage, settlement costs, clearingcosts and applicable stamp duty when assets are bought and sold,and the costs of derivatives used for hedging purposes (ifapplicable). This generally happens when the assets of a fund arechanged in connection with day-to-day trading or when there areapplications or withdrawals which cause net cash flows into or out ofa fund.

The Buy/Sell Spread reflects the estimated transaction costs incurredin buying or selling assets of the Fund when investors invest in orwithdraw from the Fund. The Buy/Sell Spread is an additional cost tothe investor but is incorporated into the unit price and incurred whenan investor invests in or withdraws from the Fund and is notseparately charged to the investor. The Buy Spread is paid into theFund as part of an application and the Sell Spread is left in the Fundas part of a redemption and not paid to Equity Trustees or theInvestment Manager. The estimated Buy/Sell Spread is 0.25% uponentry and 0.25% upon exit. The dollar value of these costs based onan application or a withdrawal of $5,000 is $12.50 for each individualtransaction. The Buy/Sell Spread can be altered by the ResponsibleEntity at any time. The Responsible Entity may also waive theBuy/Sell Spread in part or in full at its discretion.

Transactional costs which are incurred other than in connection withapplications and withdrawals arise through the day-to-day trading ofthe Fund’s assets and are reflected in the Fund’s unit price. As thesecosts are factored into the NAV of the Fund and reflected in the unitprice, they are an additional implicit cost to the investor and are not afee paid to the Responsible Entity. These costs can arise as a result ofbid-offer spreads (the difference between an asset’s bid/buy priceand offer/ask price) being applied to securities traded by the Fund.Liquid securities generally have a lower bid-offer spread while lessliquid assets have a higher bid-offer spread reflecting thecompensation taken by market makers in providing liquidity for thatasset.

During the financial year ended 30 June 2019, the total transactioncosts for the Fund were estimated to be 0.06% of the NAV of theFund, of which 100% of these transaction costs were recouped viathe Buy/Sell Spread, resulting in a net transactional cost to the Fundof 0% p.a.

However, actual transactional and operational costs for future yearsmay differ.

Can the fees change?Yes, all fees can change without investor consent, subject to themaximum fee amounts specified in the Constitution. Equity Trusteeshas the right to recover all reasonable expenses incurred in relationto the proper performance of its duties in managing the Fund and assuch these expenses may increase or decrease accordingly. We willgenerally provide investors with at least 30 days’ notice of anyproposed change to the management costs. In most circumstances,the Constitution defines the maximum level that can be charged forfees described in this PDS. Expense recoveries may change withoutnotice, for example, when it is necessary to protect the interests ofexisting members and if permitted by law.

Payments to IDPS OperatorsSubject to the law, annual payments may be paid to some IDPSOperators because they offer the Trust on their investment menus.Product access is paid by the Investment Manager out of itsmanagement fees and is not an additional cost to the investor. If thepayment of annual fees to IDPS Operators is limited or prohibited bylaw, Equity Trustees will ensure the payment of such fees is reducedor ceased.

Differential feesThe Responsible Entity or Investment Manager may from time totime negotiate a different fee arrangement (by way of a rebate orwaiver of fees) with certain investors who are Australian WholesaleClients.

mFundWarning: if you are transacting through mFund your stockbroker oraccredited intermediary may charge you additional fees (see theirFinancial Services Guide).

Example of annual fees and costs for the FundThis table gives an example of how the fees and costs for thismanaged investment product can affect your investment over a 1year period. You should use this table to compare this product withother managed investment products.


EXAMPLE – Loftus Peak Global Disruption Fund

BALANCE OF $50,000 WITH A CONTRIBUTION OF $5,000DURING THE YEAR

Contribution Fees Nil For every additional $5,000you put in, you will becharged $0

Plus

ManagementcostsComprising:

Management fees:

Performance fees:

1.48% p.a.

1.20% p.a.

0.28% p.a.

And, for every $50,000 youhave in the Fund you will becharged $740 each yearcomprising:

$600

$140

EqualsCost of Fund

If you had an investment of$50,000 at the beginning ofthe year and you put in anadditional $5,000 during thatyear, you would be chargedfees of:$740*What it costs you willdepend on the fees younegotiate.

This example assumes the $5,000 contribution occurs at the end ofthe first year, therefore management costs are calculated using the$50,000 balance only.

* Additional fees may apply. Please note that this example does notcapture all the fees and costs that may apply to you such as theBuy/Sell Spread.

The performance fees stated in this table shows the actualperformance fees for the financial year ended 30 June 2019 as apercentage of the Fund’s average NAV. The performance of theFund, and the performance fees, may be higher or lower or notpayable in the future. As a result, the management costs may differfrom the figure shown in the table. It is not a forecast of theperformance of the Fund or the amount of the performance fees inthe future. See also above (next to the heading “Performance fees”)our estimated typical ongoing performance fees fee payable perannum. The actual indirect costs and performance fees for thecurrent financial year and for future financial years may differ. Formore information on the performance history of the Fund, visit EquityTrustees’ website at www.eqt.com.au/insto. Past performance is nota reliable indicator of future performance.

Warning: If you have consulted a financial adviser, you may payadditional fees. You should refer to the Statement of Advice orFinancial Services Guide provided by your financial adviser in whichdetails of the fees are set out.

ASIC provides a fee calculator on www.moneysmart.gov.au, whichyou may use to calculate the effects of fees and costs on accountbalances.

Further reading�

You should read the important information in the ReferenceGuide about:

• Performance fee example

under the “Additional information on fees and costs” sectionbefore making a decision. Go to the Reference Guide which isavailable at www.loftuspeak.com.au. The material relating tothese matters may change between the time when you read thisPDS and the day when you acquire the product.

7. How managed investment schemesare taxed

Warning: Investing in a registered managed investmentscheme (such as the Fund) is likely to have tax consequences.You are strongly advised to seek your own professional taxadvice about the applicable Australian tax (including incometax, GST and duty) consequences and, if appropriate, foreigntax consequences which may apply to you based on yourparticular circumstances before investing in the Fund.

The Fund is an Australian resident for tax purposes and does notgenerally pay tax on behalf of its investors. Australian residentinvestors are assessed for tax on any income and capital gainsgenerated by the Fund to which they become presently entitled or,where the Fund has made a choice to be an Attribution ManagedInvestment Trust (“AMIT”) and the choice is effective for the incomeyear, are attributed to them.

Further readingYou should read the important information about Taxationunder the “Other important information” section before makinga decision. Go to the Reference Guide which is available atwww.loftuspeak.com.au. The material relating to these mattersmay change between the time when you read this PDS and theday when you acquire the product.

8. How to applyTo invest please complete the Application Form accompanying thisPDS, send funds (see details in the Application Form) and yourcompleted Application Form to:


If applying via mFund you will need to provide the application moneydirectly to your licensed broker.

Please note that cash and cheques cannot be accepted and allapplications must be made in Australian dollars.

Who can invest?Eligible persons (as detailed in the ‘About this PDS’ section) caninvest, however individual investors must be 18 years of age or over.

Investors investing through an IDPS should use the application formprovided by their IDPS Operator.

Cooling off periodIf you are a Retail Client who has invested directly in the Fund, youmay have a right to a ‘cooling off’ period in relation to yourinvestment in the Fund for 14 days from the earlier of:

• confirmation of the investment being received; and• the end of the fifth business day after the units are issued.

A Retail Client may exercise this right by notifying Equity Trustees inwriting. A Retail Client is entitled to a refund of their investmentadjusted for any increase or decrease in the relevant ApplicationPrice between the time we process your application and the time wereceive the notification from you, as well as any other tax and otherreasonable administrative expenses and transaction costs associatedwith the acquisition and termination of the investment.


The right of a Retail Client to cool off does not apply in certainlimited situations, such as if the issue is made under a distributionreinvestment plan, switching facility or represents additionalcontributions required under an existing agreement. Also, the rightto cool off does not apply to you if you choose to exercise your rightsor powers as a unit holder in the Fund during the 14 day period. Thiscould include selling part of your investment or switching it toanother product.

Indirect Investors should seek advice from their IDPS Operator as towhether cooling off rights apply to an investment in the Fund by theIDPS. The right to cool off in relation to the Fund is not directlyavailable to an Indirect Investor. This is because an Indirect Investordoes not acquire the rights of a unit holder in the Fund. Rather, anIndirect Investor directs the IDPS Operator to arrange for theirmonies to be invested in the Fund on their behalf. The terms andconditions of the IDPS Guide or similar type document will govern anIndirect Investor’s investment in relation to the Fund and any rightsan Indirect Investor may have in this regard.

Complaints resolutionEquity Trustees has an established complaints handling process andis committed to properly considering and resolving all complaints. Ifyou have a complaint about your investment, please contact us on:

Phone: 1300 133 472Post: Equity Trustees LimitedGPO Box 2307, Melbourne VIC 3001Email: [email protected]

We will acknowledge receipt of the complaint as soon as possibleand in any case within 3 days of receiving the complaint. We will seekto resolve your complaint as soon as practicable but not more than45 days after receiving the complaint.

If you are not satisfied with our response to your complaint, you maybe able to lodge a complaint with the Australian FinancialComplaints Authority (“AFCA”).

Contact details are:Online: www.afca.org.auPhone: 1800 931 678Email: [email protected]: GPO Box 3, Melbourne VIC 3001.

The external dispute resolution body is established to assist you inresolving your complaint where you have been unable to do so withus. However, it’s important that you contact us first.

9. Other informationConsentThe Investment Manager has given and, as at the date of this PDS,has not withdrawn:

• its written consent to be named in this PDS as the investmentmanager of the Fund; and

• its written consent to the inclusion of the statements made aboutit which are specifically attributed to it, in the form and context inwhich they appear.

The Investment Manager has not otherwise been involved in thepreparation of this PDS or caused or otherwise authorised the issueof this PDS. None of the Investment Manager nor their employees orofficers accept any responsibility arising in any way for errors oromissions, other than those statements for which they have providedtheir written consent to Equity Trustees for inclusion in this PDS.

mFund Settlement ServiceYou must use a mFund accredited and licensed broker to facilitateyour transactions on mFund. Your chosen broker may charge youadditional fees which are not outlined in Section 6 of this PDS.

Further readingYou should read the important information in the ReferenceGuide about:

• Your privacy;

• The Constitution;

• Anti-Money Laundering and Counter Terrorism Financing(“AML/CTF”);

• Indirect Investors;

• Information on underlying investments;

• Foreign Account Tax Compliance Act (“FATCA”); and

• Common Reporting Standard (“CRS”),

under the “Other important information” section before makinga decision. Go to the Reference Guide which is available atwww.loftuspeak.com.au. The material relating to these mattersmay change between the time when you read this PDS and theday when you acquire the product.


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