Linear’s range of Wholesale Solutions include:

• Investment administration services
• Platform under white label
• Responsible Entity / Trustee services
• Fund accounting
• Unit registry

We provide these services to a range of financial intermediaries including boutique fund managers, dealer groups, financial planning firms and family offices.
Linear is an established provider with a very strong reputation earned through delivery of service, commitment to technology and a strong understanding of the market place.
For further information please contact our Business Development team on 1300 669 891.

View your portfolio online, run reports, read the latest financial news from around the globe and access a range of impressive investment opportunities by harnessing the power of the Linear Managed Account, investment platform.

Investment Choice

Through the Linear Managed Account investors can select from a range of professionally managed Model Portfolios, called Separately Managed Accounts (SMA’s) and Self-directed investments which include managed funds and ASX listed securities.

Each investor receives a central working cash account earning a competitive interest rate from which all dividends and interest income is deposited into and all purchases and sales are settled and fees deducted.

Administration Ease

As the Responsible Entity, Linear takes care of all your investment paperwork, deals with investment managers, processes and settles investment changes and keep your account information up to date.

Portfolio Reporting

As a part of the online account access you receive a selection of portfolio reports covering valuation, taxation, performance, fee analysis, purchases and sales, capital movements and investment allocations. Reports can be run over individual accounts and multiple accounts, where you have more than one account. This provides an accurate up to date analysis of your investments.

At year end Linear produces audited tax statements on your account with an annual tax summary that can be relied upon for the preparation of tax returns.

News and Research

Access the latest news from around the world covering all investment markets including equities, currencies, bonds and metals. In addition view local and international market data and read a range of research reports from a range of respected authorities including investment managers, banks, investment banks, brokers and research houses.

How to Invest

To invest in the Linear Managed Account you must read the Product Disclosure Statement (PDS) and complete the application form. In order to receive the PDS you must be an authorised financial adviser, registered with Linear.

To find out more contact our Business Development team on 1300 669 891

View Indexes – Australian Equities

The range of Index Model Portfolios available through the Linear Managed Accounts provide convenient and passive exposure to Australian Equities. As the Investment Manager, Linear rebalances all Index Model Portfolios quarterly, or as advised by Standard and Poor’s. Standard and Poor’s are the supplier of the Multi Sector and the Global Industry Classification Standard (GICS) Indices.

Index Replication

Index Model Portfolios available under this PDS will attempt to partially or fully replicate the underlying index. Index replication refers to the manner in which Index Model Portfolios are constructed and maintained. Full replication means that all securities in the index are purchased in line with the constituent weightings. Partial replication means that a sample of the securities from the index will be purchased. As an example, the S&P/ASx 200 Industrials (Sector) Index is comprised of over 32 securities, however in order to reduce transaction costs, only the 15 largest securities will be purchased. Linear offers complete replication on all indices including those listed as only partial. This is provided on request and subject to minimum investment sizes.

Customisations

All Index Model Portfolios can be customised to include or exclude certain securities or to ‘lock’ tax parcels.
Information is provided in this PDS – in particular the Transacting and Taxation sections starting on pages 10 and 31
respectively.

Tracking Error

The performance of the Index Model Portfolios may differ from the underlying benchmark due to partial replication, customisation, ‘locking’ of tax parcels, the charging of fees on the Model Portfolio(s) or the reinvestment of dividends.

About S&P/ASx Indices

The S&P/ASx Australian indices are closely aligned with Standard & Poor’s global suite of indices, and are recognised internationally as Australia’s principal investable equity indices. Standard & Poor’s global indices are liquid, tradable and easily replicable, allowing extensive use by institutional Investment Managers, mutual fund managers and professional advisers. With over A$200 billion managed and benchmarked to the S&P/ASx 200, the index is regarded as Australia’s equity benchmark.

The S&P/ASx indices are real-time, market capitalisation-weighted indices that include the largest and most liquid stocks in the Australian market. The S&P/ASx 200 covers approximately 80% of the Australian equity market by capitalisation, with a constituency that is highly liquid and tradable. Such characteristics ensure that the S&P/ASx 200 is representative of the Australian market while maintaining a limited number of eligible securities.

About GICS

The (GICS) was developed by Morgan Stanley Capital International Inc. (MSCI), an independent provider of global indices and benchmark related products and services, and Standard & Poor’s® (S&P®), an independent international financial data and investment services company and a leading provider of global equity indices. The GICS classifications aim to enhance the investment research and asset management process for financial professionals worldwide. It is the result of numerous discussions with asset owners, portfolio managers, and investment analysts around the world and is designed to respond to the global financial community’s need for an accurate, complete, and standard industry definition.

The GICS structure consists of 10 sectors, 24 industry groups, 67 industries and 147 sub-industries. The GICS methodology has been widely accepted as an industry analysis framework for investment research, portfolio management and asset allocation. Its universal approach to industries worldwide has contributed to transparency and efficiency in the investment process. In addition, the current trend towards sector-based investing has also greatly benefited from.

Active Managers

The following pages provide details regarding the Investment Managers that provide actively managed Model Portfolios offered under this PDS. The Investment Managers either construct or provide advice to Linear Asset Management on the construction of the Model Portfolios using their experience and expertise and as such the exact makeup of any Model Portfolio is considered to be the Investment Manager’s intellectual property. By signing the Application Form for your investment in the Linear Managed Accounts, you hereby agree that the individual securities making up the Model Portfolios remains the intellectual property of the Investment Managers and that it will be kept confidential between you, your Representative (if applicable) and your financial adviser and will not be disclosed to any other person.

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View UBS Model Portfolios

UBS Global Asset Management in Australia provides investment products and services to institutional Investors, intermediaries and private clients. UBS Global Asset Management is a leading asset manager in Australia with offices in Sydney, Melbourne, Perth and Brisbane. Its clients include superannuation (pension) funds, financial institutions, corporates, financial intermediaries and private clients.

UBS offer a comprehensive range of investment fund products across all major asset classes. For some time, UBS Global Asset Management has made its extensive capabilities accessible to Australian retail Investors and offers sector specific funds in cash, fixed income and equities, both domestic and international as well as a variety of multi-sector balanced funds.

UBS Global Asset Management is committed to being a major player in wholesale investment funds across the globe. Australia is one of our key markets and, accordingly, we are delighted to offer a range of funds to suit the needs of individuals and financial advisers alike. UBS offer a broad range of equity strategies across the style spectrum and with varying return and risk objectives. Country, regional and global strategies are available to retail/wholesale and institutional clients worldwide.

UBS’ equity capabilities are grouped into three investment pillars:

• Core/Value;
• Growth Investors; and
• Structured Equities.

Each pillar offers distinctive strategies, a unique heritage and enduring style attributes. Every pillar offers dedicated teams of experts who are passionate about their distinctive investment approaches.

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View Ralton Model Portfolios

Boutique Management, Value Investing, SMA Specialists

Ralton Asset Management Limited (’Ralton’) is a successful boutique Australian fund manager, owned and operated by its directors and senior executives. As a pioneer in Australia’s managed accounts industry, Ralton has been offering its investment capabilities exclusively through separately managed accounts, or SMA’s, since 2001, and currently manages portfolios on behalf of a wide range of Investors, including charitable trusts, corporations, superannuation funds, family trusts and individuals.

Ralton specialises in the active management of Australian share portfolios, and its disciplined, value-oriented investment approach has delivered strong and tax-efficient returns since inception. From the very beginning, their objective has been to design and build high quality, value-adding Investment Portfolios, and they have achieved this by packaging the investment services in a managed account structure rather than a unit trust, offering Investors professional portfolio management with all the benefits of direct share ownership.

The Ralton investment team is well resourced and consists of experienced professionals with diverse backgrounds, all sharing a talent and passion for investing. This unique blend of experience and ability promotes insightful analysis and debate and brings a high degree of rigour to Ralton’s fundamental research-driven investment process.

Investment Philosophy

Ralton’s proven investment approach has been designed to identify quality businesses that are trading at a considerable discount to valuation, and is guided by the following fundamental beliefs:

• Markets are not perfectly efficient and the true value of a business is not always reflected in its share price.
• Undervalued companies can be identified through detailed and intensive research; and
• Capital preservation is critical to wealth creation.

The companies that Ralton typically invests in are those with strong and reliable management, good profit and dividend growth expectations, reasonably predictable future profits and cash flows, and a very clear business model. In contrast, Ralton tends to avoid investing in businesses that 1) lack pricing power in their relevant market, or 2) are higher risk, early-stage research & development or exploration based companies.

A Three Stage Investment Process

Intensive bottom-up research is the cornerstone of the entire process, supplemented by top-down economic and thematic views. The process is disciplined and consistently applied, using a number of proprietary qualitative and quantitative techniques to ensure that targeted companies have been thoroughly scrutinised.

Stage 1: Defining the Investment Universe

The first stage of the process is to narrow the number of stocks in the investment universe by applying a number of screens. This approach systematically eliminates companies that do not meet certain minimum standards, allowing the investment team to focus more intensely on companies of potential interest.,/p>

Stage 2: Bottom-up Fundamental Company Research

Ralton’s research programme is focused on understanding the key drivers of business performance and returns, namely people, operations, products and services, and market dynamics. For companies remaining in the investment universe, Ralton undertakes a detailed assessment of executive management, interviews competitors and suppliers, reviews financials, and forms a clear view on the outlook for the company’s industry.

Stage 3: Portfolio Construction

Risk management and capital preservation are key themes underlying the portfolio construction framework. With a focus on actively managing down-side portfolio risk for Investors, Ralton constructs an efficiently diversified portfolio of high quality, undervalued companies, and invests for the long term (typically at least 3 to 5 years) in an effort to maximise after-tax returns.

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View Platypus Model Portfolios

At Australian Unity Investments we focus on improving the financial wellbeing of our investors and creating investments that are genuinely different to the rest of the market. Platypus Asset Management was established in 1998 and became joint venture partners with Australian Unity in February 2006.

The Model Portfolio is designed for investors who:

• Are looking to enhance the performance of their existing Australian equities portfolio;
• Seek an opportunity for capital growth from the sharemarket over the medium to long-term;
• Feel comfortable with the potential volatility of the sharemarket; and
• Have at least a five year investment outlook.

The investment strategy of the AUI Platypus Australian Equities SMA portfolio is to invest in quality ASx listed companies that are assessed as likely to provide investors with attractive long-term returns (capital growth plus above average yield and franking).

There is a 4 step investment process:

Identify opportunities and investment themes

The starting point of Platypus’ investment process is to complete a screening of investable stocks to identify those that indicate strong earnings potential. The health or otherwise of the economy, individual industries and sectors is also assessed, and any identified themes are then applied to the following detailed quantitative analysis.

Analyse earnings potential

This produces a list of about 100 – 150 stocks. Platypus conducts detailed quantitative analysis on the industry outlook, the company’s position within its industry, historic profit growth, earnings forecasts and balance sheet strength Critical to this process is the use of independent sources such as brokers and specialist economics forecasting groups, combined with in-house research and expertise. Platypus assesses each stock’s capability of delivering strong returns typically around 20% pa over the following three year period before the stock is included or removed from the portfolio.

Assess durability and risk

In assessing the durability of a company’s earnings, the company’s growth profile, and the likelihood of any earning surprises, Platypus uses quantitative and qualitative screening techniques and uses a variety of information sources and may conduct company visits where appropriate. Platypus assesses the ability of the company’s management to deliver its forecast earnings, the source of funding for the expected growth in the share price, and any potential catalysts or external factors that may contribute to over or under performance.
The output of this process typically leaves around 30-40 investable stocks.

Portfolio construction

From here Platypus selects stocks to be included or removed from the portfolio. The relative weightings of each stock within the portfolio is set with due consideration given to (but not limited to) the stock’s market capitalisation, liquidity, expected return profile and risk controls. Consistency with Platypus’ investment process and with its views on industry or sector trends, is also a key factor when selecting stocks.

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Back to Model Portfolios

View Bennelong Model Portfolios

Bennelong Funds Management is a thriving, boutique fund manager nurturing a growing suite of asset management teams. We are a wholly owned subsidiary of the Bennelong Group, a privately owned funds management and private equity business.

Philanthropic objectives

While the Bennelong Group owns and manages significant businesses globally, it also measures its success through contributing to positive and lasting change in the wider community via the Bennelong Foundation.

Investment Process

Bennelong’s investment process aims to consistently deliver above-benchmark returns over the long term, while controlling risk within appropriate parameters. Bennelong seeks to identify stocks that are likely to deliver above-average earnings growth in the foreseeable future and are also attractively priced relative to the market. The Fund is suitable to investors who:

• Are primarily seeking capital growth from a portfolio of Australian stocks;
• Are seeking some income via dividends and franking credits; and
• Have a high tolerance to risk.

Bennelong’s team of highly experienced analysts undertakes comprehensive ongoing research to assess the earnings prospects and relative valuations of the stocks in their investment universe. Bennelong’s analysts assess each company’s competitive position and the relative attractiveness of the industry in which it operates. Quantitative and qualitative assessments for each company are combined in an overall company score, which is a primary input into Bennelong’s portfolio construction process. Other inputs to this process include stock liquidity constraints, constraints on the size of individual stock positions, market sentiment and corporate/market activity considerations.

The companies within the portfolio will be selected primarily from, but not limited to, the S&P/ASx 300 Index ex the S&P ASx 20 Leaders Index. The Fund may invest in securities listed on other exchanges where such securities relate to ASx listed securities. The first formal stage of the investment process applies a series of simple but important tests which must be satisfied before a stock is considered as part of the investment universe. The investment criteria that BAEP applies to the opportunity set is summarised below;

• Market capitalisation typically above $250m;
• The stock must have an earnings history;
• The stock must have reasonable liquidity in the trading of its shares.

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The Linear Continuously Protected SMA is now available, providing investors with exposure to a portfolio of direct Australian equities overlaid with a Capital Protection strategy that aims to protect 80% of the portfolio’s highest ever value.

Capital Protection is applied by rebalancing between equities and cash and through the use of a Swap Contract. Unlike other Capital Protected products, there is no minimum investment term and investors are the beneficial owners of the investment portfolio. The Linear Continuously Protected SMA provides a cost effective, easy to understand and completely transparent professionally managed and administered portfolio. All dividends, franking credits and income payments are credited directly to the portfolio.

Some of the fantastic features of this new product include:

• Capital Protection equal to 80% of the highest ever value of the portfolio.
• No minimum investment term – investors can redeem their investment at any time.
• A competitive total annual fee for Capital Protection, administration and investment management ranging from 1.49% to 2.26%pa, inclusive of GST.
• Investors retain beneficial ownership of the shares in their portfolio, with dividends paid into the investor’s cash Account within the Scheme.
• Choice of four Model Portfolios – Ralton Leaders Continuously Protected, UBS HALO (High Alpha Long Only) Continuously Protected, AUI Platypus Australian Equities SMA Portfolio Continuously Protected.
• No cash locking of the portfolio.
• The ability to transfer between Capital Protected and non-protected Model Portfolios.
• Secure online access to view Account details, portfolio valuations and investment performance.
• Margin lending possibilities – the product has been approved by two margin lenders.

About the Capital Protection Strategy

The aim of the Capital Protection strategy is to ensure that 80% of the highest ever value of your portfolio is protected. This means not just 80% of the value of your initial investment, but also 80% of any subsequent increases in the value of your investment portfolio.

The Capital Protection strategy is a two-part process

To ensure the value of an investor’s portfolio does not fall below the Lock-in Level, a Target Exposure is calculated daily that determines the preferred allocation between the Model Portfolio and cash. In simple terms, the Target Exposure aims to increase the allocation to the Model Portfolio when it is increasing in value and similarly, to decrease the allocation to the Model Portfolio when it is decreasing in value.

Where appropriate, Linear (as the Responsible Entity) rebalances your portfolio’s allocation between the Model Portfolio and cash to keep it in line with the Target Exposure.
In addition, Linear enters into a SPP Swap Contract in order to protect the investor’s portfolio against a significant decline in value. If the portfolio value falls below the Lock-in level, the SPP Swap will be exercised and the proceeds will be credited to the investor’s cash account. This will restore the portfolio value to the Lock-in level.

Features in more detail

No minimum investment term. Redeem your investment at any time. Unlike many other Capital Protected products on the market, the LCPSMA is a continuously open product and applications can be made any time. Importantly, once invested, there is no minimum investment term that applies to investors. Investors can redeem all or part of their portfolio at any time. Another great feature of the LCPSMA is that it is possible to remove the Capital Protection strategy while remaining invested in the underlying securities.

Beneficial Ownership

One of the great advantages of the LCPSMA is that investors maintain beneficial ownership of the shares in their portfolio. The shares are held by a third part custodian, streamlining the administrative tasks associated with direct ownership including managing direct communication material and corporate action requirements. Any dividends generated by the portfolio are paid directly into the investor’s cash Account within the Scheme. Also, investors have the flexibility of managing the capital gain implications of their portfolio by choosing their preferred tax parcel accounting method. Options include first in first out (FIFO), maximise capital gains or maximise capital losses.

Cost Effective Investment

The LCPSMA offers fantastic value for a full service administration platform.
The total annual fee for Capital Protection, administration and investment management ranges from 1.49%pa to 2.26%pa, inclusive of GST. Institutional brokerage arrangements have also been arranged to keep investor’s transaction costs to a minimum and where possible, ‘trade netting’ will take place to further reduce the cost to investors.

No Cash Locking

At times, in order to maintain the value of the investor’s portfolio, the Target Exposure may result in a 100% allocation to cash. If this occurs, the portfolio will not be locked into cash for the remaining period of investment. On an ongoing basis, the Target Exposure will always look to increase the allocation to the Model Portfolio where this would result in an increase in the portfolio value. This ensures that investors always have the possibility of experiencing upside improvement in the value of their investment portfolio.

Online Access

Linear has developed a new secure Online Client Access portal for investors. Once logged in, investors can view their Account details, portfolio valuations and investment performance. Investors also have access to a wide range of up-to-date consolidated reports that allow accurate management of tax positions. Importantly, audited year-end taxation reports are provided online to assist in the preparation of tax returns.

Margin Lending Approved

Margin lending is a great way to increase your exposure to the share market. The LCPSMA has already been approved by two margin lenders. For investors that choose to use a margin lending facility, all or part of their holdings in the LCPSMA will be used as security. These holdings, held by the custodian, will be held separately from other LCPSMA investor’s assets.
By maintaining a margin loan LVR of 75% or less, the Capital Protected nature of the LCPSMA greatly reduces the likelihood that an investor will be subject to a margin call.

How to invest

To invest in the Linear Continuously Protected SMA you must read the Product Disclosure Statement (PDS) and complete the application form. In order to receive the PDS must be an authorised financial adviser, registered with Linear.

To find out more contact our Business Development team on 1300 669 891