Investment guidelines & permitted investments

Investment guidelines

Guideline

Description

Objective

To provide an attractive level of total return over time, consisting of dividend income and capital appreciation, and diversification for investors consistent with prudent investment management.

Benchmark

The FTSE Global Core Infrastructure 50/50 Index (net total return AUD).

Number of securities

The portfolio is to be typically invested in 50 - 100 global listed infrastructure securities at any given time.

Maximum individual security limits

Maximum of 10% of the portfolio.

Global listed infrastructure securities limits

100% of the portfolio.

Cash

0% - 5% of the portfolio.

Currency Hedging

The portfolio is unhedged. Currency exposures may be hedged defensively where the Company’s Board sees significant risk of currency weakness, but no attempt is made to add value to the Portfolio by actively managing currency risk.

Short selling

Not permitted.

Derivatives

Permitted derivative instruments such as options and futures contracts may be used by the Portfolio Manager, including opportunistic sale of call options on up to 20% of the Portfolio and put options on up to 10% of the Portfolio.

Borrowings

Not permitted.

Voting rights

The Portfolio Manager has the right to exercise or not exercise any proxy voting rights attached to securities or units held within the Portfolio.

Permitted investments

An infrastructure company is one that derives at least 70% of its revenues from, or has at least 70% of its assets committed to, the construction, development or financing of infrastructure assets, or the management, ownership and/or operation of infrastructure assets such as pipelines, toll roads, airports, railroads or ports.

These companies’ businesses may include:

  • the generation, transmission, sale or distribution of electric energy;
  • production, transmission or distribution of natural resources used to produce energy;
  • distribution, purification and treatment of water;
  • provision of communications services, including cable television, satellites, towers, microwave, radio, telephone and other communications media; or
  • the provision of transportation services, including shipping or transport logistics.