Document ID: chunk:federal_register_of_legislation:F2021C00656:body:0:p5
Version: federal_register_of_legislation:F2021C00656
Segment Type: other
Provision Reference: 
Character Range: 10988–13947

Permitted investments
       (3)The investment may be made only in one or more of the following:
(a) securities quoted on ASX Limited;
(b) securities (Australian non‑ASX quoted securities) quoted on an Australian securities exchange other than ASX Limited.
(c) securities (unquoted Australian securities) not quoted on an Australian securities exchange that are covered by subsection (4) (but see section 11 for investments in Australian residential real estate;
(d) securities (foreign quoted securities) quoted on a securities exchange operated in a foreign country;
(e) cash held by Australian ADIs, including certificates of deposit, bank bills and other cash like instruments (but see section 11);
(f) derivatives (but see section 11).
       (4) For paragraph (3)(c), unquoted Australian securities are covered by this subsection if:
(a) they are issued by:
 (i) a company incorporated in Australia; or
 (ii) a trustee or responsible entity of a managed investment scheme that invests in Australian real property or Australian infrastructure assets.
(b) the central management and control of the company or managed investment scheme mentioned in paragraph (a) is in Australia.
       (5)The investment must not be made in:
(a) securities issued or proposed to be issued by a government; and
(b) debentures.
(c) securities that otherwise comply with this section but the issuer of the securities invests the proceeds of the issue of those securities in securities that do not meet the market capitalisation requirements under subsection (6).
Example A small exchange traded fund that invests in the securities of large capitalised companies is excluded under this paragraph.
       Market capitalisation
       (6) For an investment in securities of a company or managed investment scheme:
(a) at the time of the first investment in those securities, the company or the managed investment scheme must have a market capitalisation of less than AUD 500 000 000;
(b) at any time, the proportion of the value of the managed investment fund's net assets held in securities of companies and managed investment schemes whose market capitalisation has grown to AUD 500 000 000 or more (since their securities were first invested in) must not exceed 30%.
       Australian non ASX quoted securities.
       (7)The total value of investments in Australian non ASX quoted securities must comprise no more than 20% of the value of the managed investment fund's net assets at any time.
       Unquoted Australian securities
       (8) An investment in unquoted Australian securities must result in no more than 20% of the value of the managed investment fund's net assets being held in such securities immediately after the time of investment.
       Foreign quoted securities
       (9) The total value of investments in foreign quoted securities must comprise no more than 10% of the value of the managed investment fund's net assets at any time.
       Investments