What is an mFund

mFundAn mFund product is an unlisted managed fund admitted for settlement under the ASX Operating Rules and available to investors through the mFund Settlement Service. The ASX rule framework supports the mFund Settlement Service by ensuring all parties, including stockbrokers, fund issuers and unit registrars, are accountable for their roles and responsibilities. This rule framework underpins the high level of standards expected of services delivered by ASX.

Managed funds are a popular and relatively easy way for individuals to invest. One transaction can allow you to access a range of underlying investments, diversify across different asset classes and market sectors, and enter into investments that may otherwise be out of reach.

Diversification
Managed fund products allow you to access a diversified portfolio made up of different asset classes and industry sectors. This can reduce your level of investment risk by minimising the impact of poor performance by a particular industry or industry sector.

Potential wealth generation
A well-chosen managed fund, used individually or in conjunction with other investments, can create a portfolio to assist your efforts to generate wealth.

Cost-effective investment
Investing in a managed fund is as affordable as investing in shares. You can start investing with a relatively small amount, adding to it cost effectively over time.

Access to a range of assets
Managed fund products can provide access to assets that can assist with portfolio diversification but which you may not otherwise be able to invest in due to factors such as:

  • financial limitations (eg shopping centres),
  • market access (eg international shares) or
  • where it is difficult for individual investors to gain research, information or insight to performance (eg small or micro-cap stock or those within emerging markets).

You should keep the following risks in mind when considering investing in mFund products. These risks are no different to risks associated with managed funds in general. You should carefully examine the investment strategy, asset allocation and the manager’s track record before investing.

Underperformance
While investing in managed funds provides access to different asset classes and industry sectors, there is always a risk that the managed funds investments may underperform or decline in value. This will affect your return.

Asset class risks
Certain asset classes that managed funds hold may carry their own risks. For example, if a fund invests in international shares, its value may be affected by currency fluctuations.

Specialised funds
Some managed funds invest in specialised areas in an attempt to exploit potential high-growth opportunities. You may be taking on extra risk if you invest in a fund focused on a narrow section of the market.

Whilst ASX facilitates access to mFunds through the mFund Settlement Service, it is not the provider of mFund products and offers no guarantee over their performance. You must be given the PDS associated with each mFund product and make their own investment decisions. You should also seek professional financial advice.

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Next steps

View the available mFunds

Learn how to buy and sell mFunds