APPROVED
PRODUCT LIST
Approved Product List - Effective 29 September 2015
Libertas at its option, may change, delete, suspend, or discontinue parts of or all of this document in its entirety, at any time without prior notice.
Approved Product List
Any financial product which is detailed below is approved for use. Advisors must read each relevant section of the APL to ensure they understand any other relevant conditions associated with recommending particular classes of products.
However, because a product is approved does not mean it is necessarily appropriate for a client. An approved product means you are allowed to use the product - it does not mean you should.
The product structure and the tax consequences of the product are not part of the approved product list. You must ensure the product chosen matches the client’s risk profile and is suitable having regard to the client’s goals, objectives and financial situation.
You must have sufficient knowledge of the product and competency in advising in the product before recommending it.
Libertas believes that its Advisors have the necessary skills to construct well balanced portfolios having regard to the client’s goals, objectives and financial situation. Therefore it is not deemed necessary for it to make rules around limits and concentration of holdings.
This APL is the standard APL for all advisors within the Libertas Group. There are a wide range of advisors within the group with varying degrees of authorisations, e.g., some advisors are risk only advisors, some have authorisation to advice on self-managed super funds, and others may have authority to advice on margin loans, etc.
Your FSG will be the guiding document as you what you can provide advice on. If the authorisation is not listed in your FSG then you cannot provide in that category of financial product. You should therefore read this APL in light of the areas you can provide advice on.
Life Office and Friendly Society Products
Any pure life risk insurance product issued by an APRA regulated entity.
Any insurance or funeral bond product issued by an APRA regulated.
Investor directed portfolio services (IDPS)
Any Investor Directed Portfolio Service managed by:
An APRA regulated entity, an ASX listed company or a subsidiary of either. .
Unit trusts/managed funds
1. Superannuation funds
Any APRA regulated complying superannuation fund where the underlying investments are approved.
2. Multi-manager portfolios
These are defined as premixed portfolios which are a blend of a number of different fund managers. A multi-manager portfolio where one of the following consultants is pro-actively involved in the decision making process can be used:
Advance, Asgard, BT, Colonial First State, Lonsec, Mercer, MLC, OnePath, Russell
They are selected on the basis that the manager/asset consultant has expertise in this field. The portfolio is not dependent on the product/platform, e.g., the Mercer series may be available on a number of products/platforms.
3. Index products
The following index products are approved:
Any index fund that is not based on derivatives and is listed or traded on the ASX.
4. Single-manager funds
All investment grade funds as determined by Mercer.
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5. Exchange Traded Funds (ETFs) & Listed Investment Companies (LICs)
ETFs and LICs are a listed security and are permitted for use under Libertas’s licence. However, Advisors are to use a “look through” approach when recommending ETFs. This means Advisors are to allocate ETFs in a specific asset class according to the underlying investments of the ETF.
6. Listed Australian Securities
The following listed securities are approved:
You may recommend any share listed on the ASX 300, or any Listed Investment Company (LIC) which is recommended by the broker.
Any company option, convertible note, fixed interest type security, preference share or warrant issued by or over any share in the ASX 200 which is broker recommended.
Any Initial Public Offering (IPO) which is recommended by a broker/research provider where the IPO will most likely be included the ASX 300 upon S & P’s next review of the ASX 300.
Securities listed on other country’s exchanges are not approved, e.g., securities listed on any USA exchange are not approved.
7. Listed fixed interest securities
Fixed interest securities which have either appropriate research from a broker/research house or have a credit rating are approved:
8. Trade execution
You may use any stockbroker to execute transactions that does not require Libertas to guarantee the trade.
9. Income products
Any cash account, cash management trust/account, fixed interest or term deposit issued by an APRA registered entity or a controlled subsidiary.
The cash account in any platform or administration service on the APL.
10. Mortgage Funds
Only those investment grade as approved by Mercer
11. Foreign currency accounts
Any cash account underwritten by an Australian Bank provided the appropriate risk disclosure accompanies the recommendation.
12. Structured products
No structured products are approved.
13. Agribusiness products
No agribusiness products are approved
14. Margin Lending
Margin lending products are not approved unless issued by any APRA registered entity or a controlled subsidiary. No product may be margin-loaned higher than 50%.
15. Property
Advisors can refer to investment properties within their SOA as part of a client’s asset allocation, but the selection of the property is to be outsourced to professionals in this field
16. Derivatives
No derivatives except instalment warrants
17. Other products
Advisors may use the following services:-
Australian Money Market and FIIGS
18. Managed Discretionary Accounts (MDAs)
Subject to the terms of the MDA agreement with the client, Advisors with this authorisation can manage the client’s investments with discretion. However, at all times Advisors must comply with the APL.
These Advisors may recommend any security listed on the ASX provided there is appropriate research from an approved provider.
Life Risk Insurance Philosophy
Libertas uses a prudential standard for pure life risk products offered therefore all are approved. However, Advisors should carefully choose which product they recommend. Advisors have the responsibility to match client needs with relevant products and must recommend a product which is appropriate for that particular client. Having the widest range of available product provides the best opportunity for that to occur.
The reason for the life risk APL being broad is that all insurance firms which offer financial products in Australia are regulated by APRA which sets minimum capital standards.
Special Approvals
Libertas does not give special approvals – there is one APL for all Advisors who choose to be licensed with a Libertas AFSL.
Note: Should research not be available, then Advisors may submit a request to Libertas’s Investment Committee for the product to be approved. The submission must include reasons plus adequate documentation in support of the request.