What is an mFund?

Canstar award winner CMC Markets explains the mFund investment process.

  • Are you weighted too heavily toward a particular sector or stock, and want to get smart about diversifying your investment portfolio?
  • Do you want to expand your reach into the local Australian or global markets?
  • Would you like a percentage of your portfolio to be managed by a professional fund manager?
  • Do you want to trade online through a CANSTAR award winning broker, to gain visibility and keep track of your entire investment portfolio in one consolidated view?

 If you answered yes to some or all of these questions, read on to find out more about how you can gain access to mFunds through a broker such as CMC Markets Stockbroking, the winner of the CANSTAR national award for ‘Outstanding Value Online Share Trading’ for five consecutive years; and the CANSTAR five-star rating for each investor category (casual investor, active investor and trader), for the second year.

What is an mFund?

An mFund is an unlisted managed fund admitted for settlement under the ASX Operating Rules and available to investors through the mFund Settlement Service.

Since the launch of ASX mFund Settlement Service, Australian investors have begun to recognise the powerful mix of benefits that the inclusion of mFunds into portfolios can provide.

From instant diversification, professional management and exposure to assets not easily reached using traditional investment vehicles such as listed companies, mFunds offer investors access to international and emerging markets, property funds and bond markets, which can ultimately lead to better investment returns.

The mFund settlement service uses the ASX CHESS service to automate the buying and selling of units in unlisted managed funds via select brokers. It’s a growing service with over 125 mFunds available from a broad range of leading managed fund issuers across multiple asset classes and sectors. Units purchased through mFunds are delivered directly back into your CHESS sponsored HIN Holding.

mFunds offer Australian investors wide exposure to a range of asset classes and investment themes not easily reached in the local market. For example, some of the most successful mFunds are returning 27.63% per annum by giving Australian investors access to different asset classes.  They are also an effective means of diversifying investor’s portfolios, reducing sector or asset class risk.

 

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Quick and Easy

mFunds are purchased online through your broker, such as CMC Markets Stockbroking who have been a part of the service since it launched in May 2014.

The CMC Markets Stockbroking mFund service is completely online and fully integrated with the company’s online trading platform, enabling investors to buy and sell funds by the click of a mouse.

The brokerage cost of entering an mFund is $29.95 or 0.11% of the investment amount and there are no ongoing fees. A range of mFund FAQs can be seen here. 

SMSFs

More than ever, trustees of SMSFs need access to investment product structures and decision-making tools, so they can get the best return on their capital, without the headaches and costs associated with traditional means of accessing these products via paper applications or through a bank-owned wrap platform.

Within the $574Bn SMSF segment, most investors tend to use an ‘income strategy’ to gain the benefits of dividends, franking credits, etc. However, many want to build a portfolio that ensures growth.

Australian SMSF trustees are especially attracted to the benefits of mFunds, which are seeking to add another hard-working element to their share portfolios, which has tended to be made up of big blue chip stocks such as the big four banks and Telstra.

The automation and convenience mFund provides gives investors a consolidated view so they can keep track of their portfolio’s total value on the CMC Markets Stockbroking share trading platform.

The future of funds

Currently there are over 125 mFunds from a large selection of fund managers such as AMP, Pimco and Aberdeen; and the number of managed funds operating within the mFund offering is expected to grow significantly in 2016.

According to independent research house Investment Trends, Australian equities investors are seeking access to this innovative product from their broker, to gain access to international shares.

CMC Markets Stockbroking has been offering investors access to mFunds since ASX launched this innovative product. For more information on mFunds visit cmcmarkets.com.au/mfunds or contact us on 1300 360 071 or brokingservice@cmcmarkets.com.au.

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