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SIGNIFICANT
EVENT NOTICE
Frequently Asked Questions

19 June 2023

If you have any questions about the changes that we have outlined in the 19 June 2023 Self-Managed Invest Significant Event Notice (SEN), please read below: 

Introduction of switching windows for the SMI Infrastructure and Property investment options

Hostplus has an obligation to always act in the best financial interests of our members and investors. While we believe it’s important for members and investors to have flexible access to their investments, we must also protect the longer-term interests of other members and investors. In certain circumstances frequent investment switches may be detrimental to other members or investors. This may particularly be the case when the switches relate to unlisted assets. That’s because these assets aren’t listed on the stock exchange, or other market, which means they aren’t valued daily in the same way as listed assets. 

Hostplus is required to set and routinely review the design, distribution and use of our financial products. Additionally, the superannuation industry regulator (APRA) recently issued its updated Prudential Standard SPS 530 (Investment Governance) which provides guidance and requires all superannuation funds to review and as appropriate increase, extend and strengthen their investment governance frameworks and practices. This includes valuation practices, liquidity management and investment switching, to ensure member equity considerations are well managed and protected.  

In response, we’ve recently updated our investment governance policies and processes. One particular area where we have enhanced our controls is around investment switching. This includes introducing new switching windows for our SMI Infrastructure and Property options.

Switching windows are periods in which SMI investors can switch in and out of the Property and Infrastructure investment options. There will be four switching windows available – one each quarter. 

The switching windows for the Infrastructure and Property investment options will commence on the second Monday of the second month of each quarter. The switching window lasts approximately two business weeks. 

For example, for the quarter commencing 1 October 2023, the switching window will open at 12:01am AEST/AEDT on Monday 13 November 2023. It’ll then close at 2.00pm AEST/AEDT on Friday 24 November 2023. Any request received after the 2pm cut off on the last Friday of the switching window won’t be processed. 

We’ll publish the exact date and timings of the switching windows on our website annually. 

There are no restrictions on making any new investments into (contributing) or redeeming your investments from the Property and Infrastructure option in SMI. These transactions can continue to occur at any time. 

No – at this stage they’ll only apply to the Property and Infrastructure options. You can continue to switch between your other SMI investment options at any time. 

No. Investments into the Property and/or Infrastructure options aren’t affected. This means you can continue to contribute into these options (either through BPAY or Electronic Funds Transfer) at any time. The switching windows only apply when you want to switch into or out of these investment options within SMI.

Yes. The switching windows don’t apply if you want to make a withdrawal from your investments. Withdrawing from an investment option is different to switching between options. You’ll still be free to make a partial or full withdrawal from either the Property and/or Infrastructure options. These withdrawals can be made at any time. 

Introduction of new investment options

We’re committed to delivering products and services that meet our investors' best financial interests. We know that not all investors are the same. So, following a review of our investment strategy, we wanted to offer investors a broader range of investment options to suit their individual investment objectives and risk appetites.

Our SMI Product Disclosure Statement (PDS) available on our website has the most up-to-date information. We recommend reading the PDS if you're considering investing in one or more of the new options. 

Strengthened investment governance

Hostplus is required to set and routinely review the design, distribution and use of our financial products. Additionally, the superannuation industry regulator (APRA) requires all superannuation funds to review and as appropriate increase, extend and strengthen their investment governance frameworks and practices. This includes valuation practices and liquidity management, to ensure member and investor equity considerations are well managed and protected.  

In response, we’ve recently updated our investment governance policies and processes. One particular area where we have enhanced our controls is around investment switching. This includes enhanced monitoring of members’ and investors’ investment switches to identify any switching activity that is unreasonable, and which may be detrimental to other members’ or investor’s interests.  

Unreasonable switching means any switching activity used by members or investors to gain an unfair advantage on investment returns. This could mean activities such as switching in and out of investment options during valuation cycles.  

If we identify switching activity we consider to be unreasonable, we may:  

  • provide education and guidance to any members or investors engaging in the activity 
  • issue more formal cautions to discourage the activity, or  
  • restrict or remove a member’s or investor’s ability to switch investment options. 

If we need to put any of these or other controls in place, we’ll let you know.

Changes to asset rebalancing practices

Each Hostplus investment option has its own target asset mix and allocation. You can view those here or in our Product Disclosure Statement (PDS).  

When markets move up and down, and when members or investors move their money in and out of our investment options, the asset allocation can drift away from our target. We then need to adjust the option’s underlying investments to match the target asset mix again. This is called rebalancing.  

The Balanced option, being our largest investment option, has played a central role in rebalancing other Hostplus investment options.  

From 1 July 2023, rebalancing will be proportionately applied across all pre-mixed investment options, rather than just the Balanced option.  

This new process aligns with best practice investment governance.