What is an Investment Strategy?
It is a strategy which is aimed at the investments of the Self Managed Super Fund (“SMSF”) to achieve a desired outcome and a minimum level of performance. It is a plan for making, holding and realising the Fund’s assets consistent with the Investment Objective of the Fund.
Why does my Fund need an Investment Strategy?
Under the Superannuation Industry (Supervision) Act 1993 (“SIS Act”) the Trustee of the SMSF is solely responsible and directly accountable for the management of the members’ benefits.
The trustee has a duty to make, carry out and document decisions about investing the assets of the fund and to carefully monitor their performance. This duty involves formulating and implementing an investment strategy. This important duty is prescribed in the SIS Act as a covenant (an obligation of the trustee).
The purpose of this obligation is:
- to protect the members’ retirement benefits;
- to minimise the risk of irresponsible or incompetent investments; and
- to ensure investments are made in accordance with the