Westpac Active Series - Investment Statement
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Westpac Active Series
Investment Statement
This is an Investment Statement for the purposes of the
Securities Act 1978 and is dated 18 September 2014
Important Information
(The information in this section is required under the Securities Act 1978.)
Investment decisions are very important. They often have long-term consequences.
Read all documents carefully. Ask questions. Seek advice before committing yourself.
Choosing an investment Financial advisers can help you make
When deciding whether to invest, consider carefully the answers to investment decisions
the following questions that can be found on the pages noted below:
Using a financial adviser cannot prevent you from losing money,
but it should be able to help you make better investment decisions.
What sort of investment is this? 10
Financial advisers are regulated by the Financial Markets Authority
Who is involved in providing it for me? 11
to varying levels, depending on the type of adviser and the nature of
How much do I pay? 12 the services they provide. Some financial advisers are only allowed to
13 provide advice on a limited range of products.
What are the charges?
15 When seeking or receiving financial advice, you should check -
What returns will I get?
18 – the type of adviser you are dealing with:
What are my risks?
20 – the services the adviser can provide you with:
Can the investment be altered?
21 – the products the adviser can advise you on.
How do I cash in my investment?
22 A financial adviser who provides you with personalised financial
Who do I contact with inquiries about my investment?
adviser services may be required to give you a disclosure statement
Is there anyone to whom I can complain if I have problems covering these and other matters. You should ask your adviser about
with the investment? 22 how he or she is paid and any conflicts of interest he or she may have.
What other information can I obtain about this investment? 23 Financial advisers must have a complaints process in place and
they, or the financial services provider they work for, must belong to
a dispute resolution scheme if they provide services to retail clients.
In addition to the information in this document, important information
So if there is a dispute over an investment, you can ask someone
can be found in the current registered prospectus for the investment.
independent to resolve it.
You are entitled to a copy of that prospectus on request.
Most financial advisers, or the financial services provider they work for,
must also be registered on the financial service providers register. You
The Financial Markets Authority can search for information about registered financial service providers
regulates conduct in financial markets at http://www.fspr.govt.nz
The Financial Markets Authority regulates conduct in New Zealand’s You can also complain to the Financial Markets Authority if you have
financial markets. The Financial Markets Authority’s main objective concerns about the behaviour of a financial adviser.
is to promote and facilitate the development of fair, efficient, and This is an Investment Statement for the purposes of Securities Act
transparent financial markets. 1978 and has been prepared as at 18 September 2014.
For more information about investing, go to http://www.fma.govt.nz
Investments made in the unit trusts within the Westpac Active Series (the Trusts) do not represent bank deposits or other liabilities of Westpac Banking Corporation
ABN 33 007 457 141, Westpac New Zealand Limited (Westpac NZ) or other members of the Westpac group of companies. They are subject to investment and
other risks, including possible delays in payment of withdrawal amounts in some circumstances, and loss of investment value, including principal invested. The
ultimate holding company of BT Funds Management (NZ) Limited (BT Funds Management) is Westpac Banking Corporation. None of BT Funds Management,
Westpac NZ, Westpac Banking Corporation, any member of the Westpac group of companies, The New Zealand Guardian Trust Company Limited (as Trustee),
or any director or nominee of any of those entities, or any other person guarantees any Trust’s performance, returns or repayment of capital. The Trusts are not
offered, and this Investment Statement does not constitute an offer, in any jurisdiction other than New Zealand. Disclosure statements under the Financial Advisers
Act 2008 are available on request and free of charge from any Westpac Financial Adviser.
3
Key information about the Westpac Active Series
This section answers the main questions you may have about the Westpac Active Series. You’ll find
more detail on the relevant pages of this Investment Statement. All of the information is subject to
change but is correct as at the date of this Investment Statement.
General
Throughout this Investment Statement, we use “we”, “our” or “us” to refer to the Manager (BT Funds Management).
Whenever we use the words “you” or “your”, this refers to an investor or investors in the Trusts.
Certain terms used in this Investment Statement are explained in the Glossary on page 24.
More information More information
What is the Page
10
How can I withdraw Page
21
Westpac Active Series? my money?
The Westpac Active Series is a range of unit trusts that Generally, you can withdraw any or all of your investment
invest across a number of asset classes. The Westpac in a Trust at any time.
Active Series comprises the following five Trusts:
You can make lump sum and regular withdrawals so
- Westpac Active Income Strategies Trust long as you meet the minimum withdrawal amounts and
- Westpac Active Conservative Trust generally maintain the minimum holding.
- Westpac Active Moderate Trust
- Westpac Active Balanced Trust
- Westpac Active Growth Trust How will my money Pages
8-9
The Trusts are New Zealand unit trusts, be invested?
set up under the Unit Trusts Act 1960. You can invest in any or all of the Trusts. Each Trust
offers a different mix of investments with various levels
of risk and potential return.
Who looks after the Page
11
Westpac Active Series?
What are the charges? Page
We (BT Funds Management) are the Manager of the 13
Trusts and the investment arm of Westpac in New The charges are:
Zealand. We are supervised by the Trustee, which is
- Management Fee
The New Zealand Guardian Trust Company Limited.
This is an annual fee calculated daily as a percentage
of the gross value of the assets of each Trust and
paid monthly:
How much do I need to invest? Page
12 Westpac Active Income Strategies Trust 0.80%
How much you invest is largely up to you. You can invest
Westpac Active Conservative Trust 1.10%
by way of lump sum investments or regular investments.
Westpac Active Moderate Trust 1.25%
You can invest in one or more Trusts.
Westpac Active Balanced Trust 1.40%
Lump sum investments Westpac Active Growth Trust 1.50%
The minimum initial investment in a Trust is $5,000. We currently pay the Trustee’s fee and any expenses
After that, you can invest lump sums of $500 or more. we incur on a normal day to day basis from the
management fee we receive, so these are not
Regular investments
deducted from the assets of the Trusts.
If you choose to make regular investments, you can do so
- GST
weekly, fortnightly, monthly or quarterly. You must invest
GST will be added to any fees where applicable.
a minimum of $1,200 per year. There is no minimum initial
investment if you make regular investments.
4More information More information
What are the risks? Page
18
Who can I ask for help? Page
22
Every investment has some level of risk and can go up or Call our team on 0800 738 641 or drop in to any Westpac
down in value. The main risk is investment risk – that you branch to make an appointment with a Westpac
may not get back the money you invest or that your returns Financial Adviser.
are less than you expect, due to changes in the value of
the assets in a chosen Trust or Trusts. The principal risks
that may produce this result are:
- Market risk
- Investment manager risk
- Credit risk
- Derivatives risk
- Concentration risk
- Liquidity risk
The Trusts are designed to provide different levels of risk
which depend on the asset classes in which they invest
and the proportion invested in each asset class.
Do we use related parties? Page
14
We may enter into transactions with, and use the services
of, parties related to us (such as Westpac NZ and
Westpac Banking Corporation) in respect of the Trusts.
These arrangements will be on arm’s length terms.
We may invest the Trusts’ assets directly or indirectly in
funds where we are (or a related company is) the trustee or
manager. The Trusts will not incur any additional entry or
management fees for these investments.
5Helping you make better financial decisions
Westpac has been helping New Zealanders with their money since 1861. Whether you’re looking to save
for retirement, a long-term goal or earn an income from your savings there are many financial decisions
you need to make that will have a direct impact on your quality of life.
Introducing the Income and growth assets
Westpac Active Series Income Assets
Cash and fixed interest are often referred to as income assets
The Westpac Active Series offers a series of investment solutions
because they generate income in the form of interest payments.
that make it easy for you to invest in your future. The Westpac Active
Generally Trusts that invest in a higher proportion of income assets
Series can help you achieve the things you’ve always dreamed of.
can be expected to deliver modest but more consistent returns.
You’ll discover that it’s easy to implement and just as easy to change They are less likely to go up and down, but will usually provide lower
should your situation change. You’ll always be in the driver’s seat. returns over the long term.
In the following pages you’ll find important information you need to Growth Assets
know before you make your decision. It includes the things we have Shares and property are often referred to as growth assets because
to tell you by law, and other information we think you’ll find useful. If (though they involve more risk) they have greater potential to achieve
you’ve got any questions once you’ve read this, you can talk with a capital growth over the medium to long term than income assets.
Westpac Financial Adviser or call 0800 738 641. Trusts with more exposure to growth assets have the potential for
higher long-term returns, but they are more likely to go up and down
The range of investment solutions in the short term and will experience periods of negative returns.
Each Trust in the Westpac Active Series has been constructed with Alternative investments tend to be a mixture of both growth and
a specific investment strategy and investment timeframe in mind, income assets, and are currently treated as growth assets for the
and as a result they each have a distinct mix of income assets, or purpose of portfolio construction.
income and growth assets.
This graph shows how different assets have different risk and
For example, the Westpac Active Income Strategies Trust has potential return profiles:
exposure to income assets only, while the majority of the Westpac
Active Growth Trust’s exposure is to growth assets. The Trusts may Higher Shares
also invest in alternative investments, a growing range of assets that Potential
Return
do not fall into the four main asset classes.
Property
Fixed Interest
Low Cash
Potential
Return
Low Risk Higher Risk
This is intended solely to illustrate concepts. It is not a prediction
of the future returns from, or the investment performance of,
any of the Trusts.
See pages 8-9 for an overview of the characteristics of each Trust,
and benchmark asset allocation at the date of this Investment
Statement.
6Risk and return
The chart below shows how, depending on risk levels, returns on an investment can go up and down quite differently over different
time periods.
- The lower risk investment mostly contains income assets.
- The medium risk investment is spread more evenly between income assets and growth assets.
- The higher risk investment mostly contains growth assets.
For each investment, potential return ranges are shown as concepts over two periods:
The red bar shows a range of potential returns over 1 year.
The grey bar shows a range of potential average annual returns over 10 years.
Higher risk
investment
Greater Medium risk
positive investment
returns
Lower risk
investment
Greater
negative
returns
1 year return range 10 year average annual return range
This is intended solely to illustrate concepts. It is not a prediction of the future
returns from, or the investment performance of, any of the Trusts.
The chart shows how, for each investment, the range of potential returns over 1 year is wider than the range of potential annual returns
averaged over 10 years. This is because extreme market events can occur which may have a major impact on short term returns. The
economy generally works in cycles, with periods of expansion followed by lower growth or recession, and then renewed expansion. The longer
the investment period, the more room there is for the effects of extreme events or market downturns to be smoothed out (this is why there is a
narrower range of potential returns over 10 years for each investment).
Growth assets are typically more sensitive to market events, so the more growth assets an investment contains the wider the range of potential
returns across both the 1 year and 10 year timeframes.
Selecting your investment option
An effective way to try and balance risk and return is to ensure the timeframe of your chosen investment reflects your investment timeframe,
and the profile of the investment reflects your appetite for risk.
Westpac’s financial advisers
A Westpac Financial Adviser can help you make better financial decisions by explaining your investment options and the potential risks
involved. They can also help you decide which Trust or Trusts are best for you, and help you to develop a financial plan to achieve your long-
term financial goals. Each plan is tailored to your goals, risk appetite and financial situation.
Westpac has a team of authorised financial advisers located around New Zealand. To find out how Westpac can help you, just call 0800 738
641 or visit your local branch and arrange an appointment with your local Westpac Financial Adviser.
7A closer look at the Trusts
The table below gives an overview of the characteristics of each Trust, and benchmark asset allocation at the
date of this investment statement.
Westpac Active Westpac Active
Income Strategies Trust Conservative Trust
Investment
Allocations
Income Assets RECOMMENDED
MINIMUM TIMEFRAME
RECOMMENDED
MINIMUM TIMEFRAME
Medium Term Medium Term
Growth Assets
Benchmark Cash 20% Cash 23%
Asset Allocation NZ and international NZ fixed interest1 24%
fixed interest1 and mortgages 80% International fixed interest 33%
Total Income Assets 100% Total Income Assets 80%
Property 3%
Australasian shares 7%
International shares 8%
Alternative investments2 2%
Total Growth Assets 20%
Cash
Investment NZ fixed interest
Ranges Cash
International fixed interest
This shows you the Property
NZ and international fixed interest and mortgages
permitted ranges for each Australasian shares
asset class. It also shows International shares
you the benchmark asset
Alternative investments
allocations
0 10 20 30 40 50 60 70 80 90 100 0 10 20 30 40 50 60 70 80 90 100
% %
Benchmark Benchmark
Investment • A ims to achieve stable returns with low • A ims to achieve stable returns with
Characteristics levels of capital growth with low levels of some capital growth over the medium term
risk over the medium term with low levels of risk
• Expected to provide the lowest levels • Volatility is likely to be higher than the
of volatility of the Trusts Westpac Active Income Strategies Trust but
• Long-term returns are likely to be lower lower than the Westpac Active Moderate
than for investments that include growth Trust
assets • Returns will vary and may at times be
• Returns will vary and may at times be low low or negative
or negative
Benchmark asset allocation We may alter the benchmark allocation and the ranges for each Trust
at any time. You may request copies of a Trust’s benchmark asset
Each Trust has a ‘benchmark’ asset allocation reflecting our intended allocation and ranges, and actual asset allocation, by contacting us or a
long-term allocation to each asset class. The actual asset allocation will Westpac Financial Adviser.
vary from this benchmark asset allocation as market prices change and Further information regarding the authorised investments for each Trust
when we pursue tactical investment opportunities or seek to protect is contained in the investment guidelines for the Trusts, a copy of which
asset values in volatile economic periods. These variations may be can be obtained from us on request.
significant but are restricted by permitted ranges above and below each
benchmark.
Fund descriptions
Benchmark and actual asset allocations take into account both direct
and indirect investments and the effects of derivative contracts. While Where we describe a Trust’s potential risk and return, the description used
derivatives may be used in each asset class, the use of derivatives may (i.e. “low’”, “high”) is our assessment of a Trust’s risk and return profile.
8 be more extensive in the International Fixed Interest and Alternative This assessment is based on the expected volatility and long term return in
Investments asset classes. normal market conditions for the asset classes the Trust invests in.Westpac Active Westpac Active Westpac Active
Moderate Trust Balanced Trust Growth Trust
RECOMMENDED RECOMMENDED RECOMMENDED
MINIMUM TIMEFRAME MINIMUM TIMEFRAME MINIMUM TIMEFRAME
Medium to Medium to Long Term
Long Term Long Term
Cash 10% Cash 5% Cash 4%
NZ fixed interest1 22% NZ fixed interest1 15% NZ fixed interest1 7%
International fixed interest 28% International fixed interest 20% International fixed interest 9%
Total Income Assets 60% Total Income Assets 40% Total Income Assets 20%
Property 5% Property 5% Property 10%
Australasian shares 13% Australasian shares 20% Australasian shares 25%
International shares 17% International shares 29% International shares 37%
Alternative investments2 5% Alternative investments2 6% Alternative investments2 8%
Total Growth Assets 40% Total Growth Assets 60% Total Growth Assets 80%
Cash Cash Cash
NZ fixed interest NZ fixed interest NZ fixed interest
International fixed interest International fixed interest International fixed interest
Property Property Property
Australasian shares Australasian shares Australasian shares
International shares International shares International shares
Alternative investments Alternative investments Alternative investments
0 10 20 30 40 50 60 70 80 90 100 0 10 20 30 40 50 60 70 80 90 100 0 10 20 30 40 50 60 70 80 90 100
% % %
Benchmark Benchmark Benchmark
• A ims to achieve moderate levels of • A ims to achieve capital growth over • A ims to achieve capital growth over
capital growth over the medium to the medium to long term with medium the long term with high levels of risk
long term with moderate levels of risk levels of risk • Expected to provide the highest
• Volatility is likely to be higher than • Volatility is likely to be higher than levels of volatility of the Trusts
the Westpac Active Conservative the Westpac Active Moderate Trust, • Returns will vary and may at times
Trust, but lower than the Westpac but lower than the Westpac Active be low or negative
Active Balanced Trust Growth Trust
• Returns will vary and may at times • Returns will vary and may at times be
be low or negative low or negative
Currency exposure
Foreign currency exposures in the Trusts (with the exception of the Westpac Active Income Strategies Trust) may be fully or partially hedged as
considered appropriate. Under normal circumstances currency exposure will be fully hedged in the Westpac Active Income Strategies Trust.
Details of the currency strategy by asset class are contained in the prospectus.
1
Z fixed interest securities will generally be issues denominated in New Zealand dollars, but may also include issues made by New Zealand or Australian entities
N
denominated in foreign currencies.
2
Alternative investments are investments that do not fall within the main asset classes. Alternative investments can include hedge funds, absolute return funds,
commodity investments, venture capital and private equity. Investment strategies that may be found in some alternative investments include the use of gearing
(obtaining greater exposure to markets than the net value of an underlying asset) and short selling (selling something you do not own with a view to buying it back later
at a lower price). 9What sort of investment is this?
The Westpac Active Series is a range of unit The Trusts are diversified
trusts that invest across a number of different The Trusts invest in a range of asset classes. Asset classes may
asset classes. You can invest by making lump include cash, fixed interest, shares, alternative investments, property
and for the Westpac Active Income Strategies Trust only, mortgages.
sum payments, regular payments, or both.
For the ‘benchmark’ asset allocation for each Trust see pages 8-9.
You’ll also have the flexibility to change your
The Trusts invest in these assets either directly (by buying the assets)
investment when it suits. or indirectly by investing in other funds. The exact make up of a Trust
will depend on the underlying investment strategy behind it.
Your choice of Trusts How the Trusts work
In the Westpac Active Series, there are five Trusts you can choose Your money buys units in the Trust or Trusts you choose. Each unit
from, each offering a different mix of investments with various levels represents a share of the Trust, so changes in the value of the assets
of risk and potential return. This means you can choose the Trust or in that Trust will affect the value of the units you own. In other words,
Trusts that suits your risk profile and investment goals. if the assets of the Trust go up in value, your units will be worth more
and if they go down in value, your units will be worth less.
The five Trusts are:
Any returns on your investment are generally reflected in the unit price
- the Westpac Active Income Strategies Trust of the Trust or Trusts you’ve chosen to invest in.
- the Westpac Active Conservative Trust
Making an investment
- the Westpac Active Moderate Trust
If you’d like to invest, you’ll need to complete the application form at
- the Westpac Active Balanced Trust the back of this Investment Statement.
- the Westpac Active Growth Trust.
Who can invest?
This offer is only open to you if you are in New Zealand. You need
to let us know if you change your address or leave New Zealand
permanently.
The Trusts are managed funds
When you invest, your money will be combined with others in the
Trust you choose. This means you have access to a wider range of
investment choices and greater buying power than you would usually
have if investing alone.
It also means that your investment will be managed and overseen
by an experienced team of investment professionals.
Each Trust is a portfolio investment entity (PIE) for tax purposes.
10Who is involved in providing it for me?
The Trusts have a Manager, Promoters and a The Trustee’s principal place of business is Level 15, 191 Queen Street,
Auckland 1010.
Trustee who all play different roles.
Administration Managers
Trustees Executors Limited, MMC Limited and The Hongkong and
Manager - BT Funds Management
Shanghai Banking Corporation Limited provide certain administrative
(NZ) Limited
functions for the Trusts.
We (BT Funds Management) are the Manager and issuer of the Trusts.
Trustees Executors Limited’s principal place of business is Level 5,
We are responsible for the implementation of the Trusts’ investment
10 Customhouse Quay, Wellington 6011.
strategies and their administration.
MMC Limited’s principal place of business is Level 13, Citigroup Centre,
We are the investment arm of Westpac in New Zealand and one of
23 Customs Street East, Auckland 1010.
New Zealand’s leading fund managers, with over $6 billion of funds
under management. We provide a broad range of managed funds The Hongkong and Shanghai Banking Corporation Limited’s principal
offering access to different asset classes, securities and investing place of business is Level 9, HSBC House, 1 Queen Street,
styles with the objective of helping our customers achieve their Auckland 1010.
investment goals.
Please note: the addresses of the Manager, Promoters, Trustee and
Our principal place of business is Westpac on Takutai Square, Administration Managers (and the directors of us and Westpac NZ)
16 Takutai Square, Auckland 1010. may change at any time without us notifying you. You can always find
company address details and lists of directors online at
Our contact address is Westpac on Takutai Square, 53 Galway Street,
www.business.govt.nz/companies.
Auckland 1010.
Our directors are: Trusts
- Leigh James Bartlett of Auckland
The Trusts are New Zealand unit trusts, set up under the Unit Trusts Act
- Patrick Keble Farrell of Sydney, Australia
1960. This Investment Statement covers the five different Trusts that
- Ian Nicholas New of Wellington
make up the Westpac Active Series. They are:
- Simon James Power of Auckland.
- Westpac Active Balanced Trust (established 31 July 1992)
See the prospectus for director biographies. Information on the roles
- Westpac Active Conservative Trust (established 31 July 1992)
that are key to the management of our business is available in the
- Westpac Active Growth Trust (established 30 November 1994)
prospectus, by calling us on 0800 738 641, or by visiting
- Westpac Active Moderate Trust (established 4 January 2012)
www.westpac.co.nz and searching for the document
- Westpac Active Income Strategies Trust (established 4 January 2012).
“Key roles within BT Funds Management”.
You can read more about how the Trusts work under “What sort of
Promoters investment is this?”.
Promoter is a special term used in the Securities Act 1978. Essentially it
describes any people or companies involved in planning or developing Investment management
the Trusts. BT Funds Management, and Westpac NZ and its directors We utilise the skills and expertise of specialist investment managers for
(except anyone who is a director of both companies) are all Promoters certain asset classes. We currently do this by buying units in other funds
of the Trusts. (Specialist Funds).
Westpac NZ’s principal place of business is Westpac on Takutai Square, We consider a number of factors when selecting Specialist Funds,
16 Takutai Square, Auckland 1010. including the investment managers of those Specialist Funds. When
Westpac NZ’s contact address is Westpac on Takutai Square, assessing those investment managers we look for specialists who
53 Galway Street, Auckland 1010. have a well defined and robust investment philosophy and process,
and who possess above average research skills. We regularly monitor
Westpac NZ’s directors who are Promoters are: investment performance, portfolio holdings, compliance, changes to
- Malcolm Guy Bailey of Feilding key investment personnel and business factors (among other matters).
- Philip Matthew Coffey of Sydney, Australia
- Janice Amelia Dawson of Auckland The investment managers of the Specialist Funds may include us or
- Christopher John David Moller of Lower Hutt our related companies and may change at any time without us notifying
you. The Trusts currently have no directly appointed investment
- Peter David Wilson of Otaki.
managers.
Trustee You can find out more about the Specialist Funds and their investment
managers in the prospectus, by calling us on 0800 738 641 or by
The New Zealand Guardian Trust Company Limited is the Trustee.
searching for a document called “Westpac Active Series Investment
It is responsible for supervising the performance of our duties and for
Managers” that you’ll find at www.westpac.co.nz.
holding (itself or through its nominees or custodians) all of the assets
of the Trusts. The Trustee is licensed to act as a trustee under the
Securities Trustees and Statutory Supervisors Act 2011.
11How much do I pay?
How much you invest is largely up to you. Investing by automatic payment
You can make lump sum or regular investments. or direct credit
Every investment you make buys units in your You can make regular automatic payments or direct credits directly
into Guardian Nominees Limited’s bank account: 03 0584 0026000 84.
chosen Trust.
If you choose to make a payment in this way, we will need:
- your unitholder number
Lump sum investments
- the short name for the Trust you are investing into
You can make lump sum payments to any Trust at any time. You must (eg “Moderate” or “Growth”)
make the minimum initial investment of $5,000 for each Trust. Once
- your last name
you’ve met that, you can make lump sum investments of $500
or more. We may change the payment methods from time to time.
Your initial lump sum investment can be paid at any Westpac branch,
How much is a unit worth?
by contacting a Westpac Financial Adviser or by cheque.
Any further lump sums can be paid by direct credit or cheque. When you invest in a Trust your money is used to buy units.
These units change in price depending on the value of that Trust’s
Regular investments assets and the fees and expenses payable by the Trust.
You can make regular investments weekly, fortnightly, monthly We generally calculate a unit price for each Trust on each business
or quarterly. If you choose to make regular investments in a Trust, day. There may be some times when we are not able to calculate
you do not need to make the minimum initial investment for that Trust. a unit price. You can read more about the pricing of units in the
However, you must make a minimum annual investment of $1,200. prospectus.
You are free to change the amount whenever you like. You can make
Currently, you can buy or sell units at the same unit price. We can,
regular investments by direct debit or automatic payment.
however, set different prices for buying and selling units after taking
If you miss any regular investments you won’t be issued any units for into consideration any transaction costs. Read more about this under
the investments you miss. “What are the charges?”.
Making your investments What unit price applies?
You can make payments at any Westpac branch or by contacting a When you invest, you will buy units at the unit price that we determine
Westpac Financial Adviser. All payments are made to the Trustee’s applies to the day and time we accept your complete application and
nominee, Guardian Nominees Limited. receive payment. This may be different from the unit price on the day
you posted or lodged your form or made payment. We currently have
Investing by cheque a daily cut off time of 4pm. If we accept your application after 4pm,
the unit price for the next business day will apply.
Any payment you make by cheque should be made out to Guardian
Nominees Limited and crossed “Not Transferable”.
Investing by direct debit
You can set up a direct debit by simply completing the direct debit
authority at the back of this Investment Statement and giving it to a
Westpac Financial Adviser or taking it to any Westpac branch.
12What are the charges?
There are various charges that may apply when Trustee fee
you invest in a Trust in the Westpac Active Series. The Trustee receives an annual fee for the services it provides. This fee
These include management and trustee fees, is currently up to 0.04% per annum of the gross value of the assets of
each Trust. We currently pay the Trustee’s fee from the management
and expenses. While all fees are subject to change,
fee we receive so it isn’t deducted from the Trusts. However, the
we work hard to ensure that they are competitive. Trustee may charge its fee to the relevant Trust if we do not pay it.
You can find out more about fees at any time by
Expenses
calling us on 0800 738 641.
We and the Trustee are each entitled to be reimbursed for any
expenses incurred in performing our respective roles. These expenses
will vary from time to time and the exact amount won’t usually be
Management fee
known in advance. All expenses paid by a Trust are shown in its
Each Trust has an annual management fee that is calculated daily financial statements.
as a percentage of the gross value of the assets of each Trust.
We may choose (at our discretion) not to be reimbursed for any
This management fee is deducted monthly from each Trust and paid
expenses. Currently we have chosen not to be reimbursed for all
to us. Below are details of each Trust’s current management fee.
expenses we incur on a normal day to day basis in the operation
and administration of the Trusts. We meet these expenses from the
Trust Management fee
management fee we receive. Any other expenses incurred will be paid
from the Trusts. Read more about this in the prospectus.
Westpac Active Income Strategies Trust 0.80% p.a.
GST
Westpac Active Conservative Trust 1.10% p.a.
GST is not included in any of the stated fees. GST will be added to
Westpac Active Moderate Trust 1.25% p.a. any fees where applicable.
Westpac Active Balanced Trust 1.40% p.a.
Fees and expenses affect your returns
Westpac Active Growth Trust 1.50% p.a.
Where any fees and expenses are paid out of the assets of your
chosen Trust, they will affect the return of that Trust. How much these
We may invest the Trusts in other Specialist Funds that will in most
affect your returns will depend on their size.
cases also charge management fees. Investment in Specialist Funds
can be direct or through other funds which we manage. Our current
Financial advisers
policy means that you do not bear the cost of management fees
charged by the Specialist Funds which we choose. We ensure this by We may at our discretion pay amounts (including non-monetary
adjusting either the management fees applied by the Specialist Funds benefits) from the fees we receive to financial advisers or other
or our own fees. Read more about related party arrangements on the persons we have approved. These payments are not an additional
following page. cost to you. We are not responsible for the advice given to you by
these advisers.
Specialist Funds may also charge other fees (such as performance
fees) and incur expenses (such as transaction costs). Where these
fees and expenses are paid, they will affect the value of the Trusts
and consequently have an impact on returns. Other than in relation
to the Westpac Active Income Strategies Trust, we do not expect the
combined total of these other fees charged and expenses incurred
by the Specialist Funds to exceed 0.05% of the gross value of the
assets of any Trust. For the Westpac Active Income Strategies Trust
we do not expect the combined total of these other fees charged and
expenses incurred by the Specialist Funds to exceed 0.10% of the
gross value of the assets of the Trust. You can obtain details of any
fees charged by Specialist Funds by calling us on 0800 738 641.
13Transaction costs Fees may vary
Some managed funds maintain a difference between the buying price We may agree with the Trustee to vary the fees from time to time.
and the selling price of units. This difference is commonly known as Fees not currently charged, may also be introduced at any time as
a “spread”. A spread occurs when the cost of buying or selling the permitted by the trust deed. You can check the fees at any time by
assets of a Trust are included in the buying or selling price of units. calling 0800 738 641.
It is not paid to anyone as a fee. We don’t currently apply a spread
to any Trust, although we could choose to do so in the future. Related party arrangements
A spread may be used in some of the Specialist Funds in which Any Trust may invest (directly or indirectly) in Specialist Funds where
the Trusts invest. we are (or one of our related companies is) the trustee, manager or
responsible entity. If a Trust invests in such a Specialist Fund, it will
Read more about unit pricing in “How much do I pay?”.
not pay any entry fee or the management fee for that Specialist Fund
You can switch your investment between the Trusts at any time and (or the amount of the fee will be refunded). If the trustee of such a
there is no charge for switching. However, a switch is treated as Specialist Fund is the Trustee (or a related company), then it will not
buying and selling units in the Trusts you’re switching between so, charge the trustee fee for that Specialist Fund to the relevant Trust
although they don’t currently do so, spreads may apply. The same (or will refund that fee). Other fees or expenses for the Specialist Fund
investment minimums also apply as outlined under “How much do will still be payable and will affect the value of the relevant Trust.
I pay?”.
We may enter into transactions with, and use the services of, parties
There are tax related consequences of buying, selling and switching. related to us in respect of the Trusts. These arrangements will be on
Read “General information about taxes” for more about that. arm’s length terms.
14What returns will I get?
Your returns are reflected in the amount you Payment of withdrawals
receive when you make a withdrawal from a Trust. We are legally responsible for paying any withdrawals. However, in
The investment performance of a Trust, any fees certain exceptional circumstances we can decide to suspend or delay
payment of withdrawal amounts. For example, we may determine
and expenses and tax will influence the returns
in good faith that it is in the interests of all investors in the relevant
you receive. Trust to delay payments. We may also delay payments if withdrawal
requests are received for a significant proportion of a Trust in a short
period of time. We may also refuse to allow a withdrawal where
Three key factors to consider necessary to protect a Trust’s PIE status.
Three key factors that influence returns are:
Payment of distributions
- Investment performance – this will depend on which Trust or Trusts
you invest in and how those Trusts perform over time. This is On our direction, the Trustee is legally responsible for paying any
explained in more detail below. distributions. We do not currently intend to pay regular distributions
to you. Instead, any returns to you will be by way of an increase in the
- Fees and expenses – these are explained in more detail under
unit price. We reserve the right to pay distributions, however, and may
“What are the charges?”.
vary the distribution policy from time to time.
- Taxation - this will depend on your prescribed investor rate (PIR)
If we decide to pay a distribution from a Trust, the amount to be
and the current tax treatment of a Trust and its assets. Read more
distributed to you will be based on the number of units you hold at the
about tax on the following pages.
relevant time.
What is investment performance? We may adjust any distribution we pay you or your unit holding to
Your returns will depend on the investment performance of the Trust account for any PIE tax that is attributable to you. See “General
or Trusts you invest in. Investment performance includes both capital information about taxes” for more details on PIE tax.
growth (and losses) and income earned from interest and dividends. If we decide to pay a distribution from a Trust, we may offer a
The unit price of a Trust depends on the value of the Trust’s assets distribution reinvestment option. If you choose this option, we will
(reflecting its investment performance). issue units in your name at the unit price applicable to the first
business day following the date we pay the distribution.
The investment performance of a Trust is related to the type of assets
it invests in. Generally speaking, the more growth assets you have in For any distribution reinvestment the minimum levels of investment
an investment, the more likely you are to have negative returns in the will not apply.
short term, but also the more likely you are to achieve higher returns
Any distribution reinvestment plan (if offered) will comply with the
over the long term.
requirements of, and contain the terms and conditions required under,
There is no guarantee on returns and no amount of returns is the Securities Act (Dividend Reinvestment) Exemption Notice 1998,
promised. as amended or substituted from time to time.
15General information about taxes Your investment will be taxed at your PIR
Different investors may be taxed at different rates and all tax Each Trust is a PIE for tax purposes. This means that:
legislation is subject to change.
- Every day, we will calculate the amount of taxable income (or loss)
and any tax credits or other amounts attributable to you; and
If you have questions about how tax affects your personal
circumstances we recommend you talk to an independent - We will pay tax (if any) on the taxable income attributable to you
tax adviser. at your PIR. You must provide your IRD number and PIR otherwise
the highest PIR will apply.
The current PIRs that may apply to you are as follows:
Your PIR will be one of: New Zealand tax resident individual investors
10.5% If in either of one of the last two income years:
- Your taxable income (excluding income from PIEs) was $14,000 or less; and
- Your total income (including PIE income after subtracting PIE losses) was $48,000 or less.
If you don’t qualify for the 10.5% rate but in either of the last two income years:
17.5% - Your taxable income (excluding income from PIEs) was $48,000 or less; and
- Your total income (including PIE income after subtracting PIE losses) was $70,000 or less.
28% If you don’t meet the requirements for the 10.5% or 17.5% rates, or fail to notify a PIR or
your IRD number.
Other investors
Your PIR If you are a New Zealand tax resident and are a:
will be 0% - Company
- Registered charity
- PIE Investor Proxy
- Unit trust
- Group investment fund (other than a designated group investment fund)
- PIE
- Superannuation fund or trustee of a trust (that has not elected another PIR)
You can select If you are a New Zealand tax resident trustee of a trust (including a family trust and a superannuation fund
but not a unit trust or charitable trust).
a PIR of 0%,
17.5% or 28% Trustees of certain testamentary trusts can also select the 10.5% PIR.
Your PIR If you are not a New Zealand tax resident, or fail to notify a PIR or your IRD number.
will be 28%
Income years generally run from 1 April in any year to 31 March the following year.
16Non-New Zealand income counts when calculating your PIR Investment through a portfolio service
When you work out your PIR, you must include non-New Zealand Where the units are held through an investor directed portfolio
income in calculating your taxable income for any particular income service or nominee or custody service which is a proxy for an
year – even if you weren’t tax resident in New Zealand when that investor in a PIE (PIE Investor Proxy), the PIE Investor Proxy will
income was earned. This is especially important for new residents be responsible for looking after the tax of that investor. This means
to consider. it will pay tax, and attribute income, losses, tax credits and refunds
for tax purposes, in respect of the units. Neither we, nor the Trustee,
In some cases, new residents can elect out of this treatment. Just go
will be liable for the attribution of income, losses or refunds nor the
to the Inland Revenue’s website www.ird.govt.nz to find out more.
payment of tax in respect of units held by the PIE Investor Proxy.
It’s important to let us know your correct PIR and IRD number
How Trust assets are taxed
It’s very important to let us know your correct PIR and IRD number
As a PIE any gains made by a Trust from selling shares:
when you apply. If your notified PIR is too low, you may need to
pay any tax shortfall at your income tax rate (plus any interest and - in companies or unit trusts resident in New Zealand; or
penalties) and file a tax return. If your notified PIR is too high, you can’t
- in certain companies that are resident in Australia, listed on an
claim back any excess tax we pay on your behalf because PIE tax is a
approved Australian Securities Exchange index (which currently
final tax in this situation. If you don’t provide your PIR and your correct
includes the All Ordinaries Index) and maintain a franking credit
IRD number, then all taxable income attributed to you will be taxed at
account,
28%. Finally, it is important to let us know if your PIR changes (unless
the change is due to a change in the statutory tax rates rather than a will not be taxed. Dividends on these shares are taxable, but the tax
change in your income). liability may be offset by any imputation credits or foreign withholding
tax credits received, subject to certains limits.
Please note: the Inland Revenue can require us to disregard your
notified PIR if it considers the rate is incorrect. If this is the case, The Trusts have Foreign Investment Fund (FIF) international share
we must apply whichever rate the Inland Revenue considers interests, which include shares in overseas companies (other than
appropriate. the Australian companies described above) and units in overseas
unit trusts. The Trusts will generally be treated as deriving taxable
Joint investors income equal to 5% of the average daily market value of FIF interests
for each income year.
Joint investors will be treated as a single investor with a PIR equal to
the highest PIR of the joint investors. If you are a joint investor then Dividends or profits from selling most FIF international share interests
each of you needs to provide us with your PIR and IRD number or are not taxed. Tax credits received for any withholding tax paid on
tax will be deducted at the highest PIR (currently 28%). dividends may be offset against the Trusts’ tax liability, subject to certain
limits. Generally, the Trusts may not claim a tax deduction for any losses
Trustees in respect of a FIF international share interest.
Trustees that elect a PIR that is lower than 28% must include the PIE The Trusts are taxed under the ordinary tax rules in respect of their
income in their tax return and pay any applicable tax themselves (with other assets not covered above.
a credit for tax paid by the Trust in respect of the PIE income).
You can read more about how the Trusts are taxed in the prospectus.
How we pay tax on your behalf
Other tax information
We work out the PIE tax that is attributable to you and then cancel
You should not be subject to tax on any distributions from the Trusts
units equal in value to that amount. Similarly, if you are due a
or sale of your units. You may be subject to tax on transfers in certain
refundable PIE tax credit, we’ll issue additional units equal in value
circumstances. See the prospectus for more details.
to the amount of the refund. We’ll usually make these adjustments
for PIE tax after the end of the relevant Trust’s income year. You can read more about PIEs and on tax generally in the prospectus or
at www.ird.govt.nz. If you have any questions about tax, we recommend
However, if you withdraw, switch, or transfer units during the year,
talking to an independent tax adviser.
then we’ll make tax adjustments at that time.
17What are my risks?
Every investment has some level of risk. Before you Market risk: many factors affect market performance generally and,
therefore, the value of assets in which the Trusts invest. These can
invest it’s important to understand what those
include the state of the economy (both domestic and overseas);
risks are and how comfortable you feel about them. the performance of individual entities; tax laws and other regulatory
This section explains the principal risks associated conditions; political events; inflation; market sentiment; movements
in interest rates and currency and broader events like changes in
with the Westpac Active Series and how they might
technology or environmental events. We seek to reduce market risk to
impact on returns. some extent by diversifying across asset classes, investment sectors,
countries, investment managers and/or investment styles. The Trusts
that invest in international markets are exposed to movements in
foreign currencies, which may have an adverse effect on the domestic
What is risk?
value of their international investments.
Risk is the likelihood that you may not get back the money you invest
We set out the extent to which we may manage currency movements
or that your returns are less than you expected. The level of return
for each Trust at page 9.
from your investment is usually related to the level of risk in the
Trust you invest in and the length of time you are invested. Investment manager risk: the allocation of a Trust’s investment
between asset classes, investment sectors and individual investments
As a general guide, the Trusts with a greater exposure to income
will affect returns, as will the performance of the businesses
assets usually offer more stable but lower potential returns over a
underlying the investments. Even though investment managers
longer timeframe. The Trusts with a greater exposure to growth
make the investment decisions, the outcomes cannot be predicted
assets have the potential for greater long-term returns but are usually
with certainty and results will vary accordingly. To manage this risk
more volatile.
we seek to utilise professional investment managers whom we
regularly monitor. We select any Specialist Funds and their investment
What is volatility?
managers according to specific criteria (which involves considering
Volatility describes how much the value of an investment or asset a number of factors).
varies over time. Generally speaking, growth assets are more volatile
Credit risk: if a Trust invests in fixed interest assets, money
than income assets and are more likely to produce negative returns in
market securities, mortgages, or derivatives there is always a
the short term. Levels of volatility are likely to increase when there is
risk that a borrower or other counterparty’s creditworthiness
heightened uncertainty in financial markets.
may decline or they may default and not make the required
payments. The investment strategy incorporates appropriate
What are the main risks when investing? diversification and/or assessment of creditworthiness in
The main risk is investment risk – the risk of negative or lower than order to reduce any significant credit risk for the Trust.
expected returns on your investment. All investments have investment
Derivatives risk: derivatives are financial contracts whose value
risk. If market conditions are volatile or you invest for a short time it
depends on the future value of underlying assets such as shares, fixed
is reasonably foreseeable that your overall returns from the Trust or
interest, commodities, currency or cash. Derivatives may be used
Trusts may be less than you expect or may be negative for a period
by the Trusts as an alternative to investing in a physical asset or as a
of time. If returns are less than charges paid and you withdraw your
risk management tool. They provide exposure to an underlying asset
money at this time, it is possible that you could receive back less without the need to buy or sell that asset. The potential gains and
money than you put in. losses from derivative transactions can be substantial and can increase
Below are the principal risks that may produce this result. We also the volatility of a Trust’s returns. To manage this risk we operate a
describe how we seek to manage these risks (where possible). Derivative Risk policy (available from us on request) which sets out the
It is important to note that we cannot manage the relevant risks guidelines around the use of derivatives in the Trusts. The Specialist
completely. There are other risks including regulation risk, contractor Funds in which the Trusts invest may use derivatives more extensively
risk, product risk, operational risk and tax-related risk. You can read than the Trusts themselves. As part of our Derivative Risk policy the
more about these in the prospectus. derivatives policies of the Specialist Funds are reviewed periodically
by us to confirm their appropriateness for the Trusts. It is our policy
not to invest directly in derivatives to gear the Trusts (that is, to obtain
greater exposure to markets than the net asset value of a Trust). If for
any reason (through market movements or cash flows) a Trust becomes
geared through its direct investments, we will realign the Trust as soon
as practicable to remove any gearing.
18Concentration risk: a Trust’s assets may be concentrated in any capital or experiencing undue delays or both. In some cases,
particular securities, types of securities, geographical areas or assets may not be so easily converted into cash for various reasons
industries. Where the assets of a Trust are concentrated, there may such as a lack of demand for the asset or disruptions in the market,
be increased volatility which will impact on that Trust’s returns. The or large withdrawals. This risk may increase where a Trust invests
Trust’s assets may also be concentrated in particular Specialist Funds. through Specialist Funds, which may suspend or restrict withdrawals
The Trusts and Specialist Funds may adopt concentration limits to or otherwise become illiquid. A Trust itself may also suspend or
manage this risk. restrict withdrawals in certain circumstances. We seek to manage
liquidity risk by investing primarily in liquid markets and securities. We
Liquidity risk: a Trust may be limited in its ability to meet your
monitor each Trust’s liquidity levels in order to meet any liabilities and
withdrawal request if it cannot sell or accurately value assets to fund
withdrawals during normal market conditions.
your withdrawal. This may occur because some assets are less liquid
than others. This means it’s harder to sell the assets without losing
Each asset class in which a Trust invests also has specific risks. The specific risks for each asset class that are most likely to affect the value of
your investment in a Trust are:
Income assets
Cash Specific risks: market risk and credit risk
The value of a Trust’s cash assets may not keep pace with inflation (market risk). This could mean that even though your savings are
steadily growing, your money may not have the same buying power as you would expect in ‘today’s money’.
The value of cash assets can also be impacted by the ability of an issuer to pay interest or repay a loan or an issuer’s
creditworthiness may decline (credit risk).
Fixed interest Specific risks: market risk and credit risk
& mortgages The value of a Trust’s fixed interest or mortgage assets may not keep pace with inflation and will be affected by changes to interest
rates (market risk) and the ability of a borrower to repay the loan or pay interest or the ability of a counterparty to meet payments. An
issuer’s creditworthiness can also decline (credit risk).
Growth assets
Property Specific risk: market risk
The value of a Trust’s property assets will be affected by factors such as the demand for property generally, demand for the location,
the quality of the specific properties, the performance of individual property securities, the general economy, market sentiment and
movements in interest rates.
Shares Specific risk: market risk
The value of a Trust’s share assets will be affected by factors such as the performance of individual companies, market sentiment
and the economic performance of the country or sector.
In the case of international shares there is also the market risk of currency movements impacting on returns.
Alternative Specific risks: market risk, liquidity risk and derivatives risk
Alternative investments are complex and less liquid than traditional assets, particularly in times of significant market volatility. They
Investments can also involve extensive use of derivatives.
Refer to pages 8-9 for the asset mix of each Trust.
Choosing your investment option What happens if a Trust is insolvent
or wound up?
When you choose a Trust, you should consider how you feel about
risk and think about your investment timeframe. If, for any reason, we or a Trust become insolvent, you won’t be liable
to pay any money to anyone. If we or a Trust are liquidated or wound
up, any creditor’s claims will rank ahead of your claims. Your claims
will rank equally with all other investors in the relevant Trust.
19Can the investment be altered?
Yes, you can make various changes to your Making changes to the trust deed
investment in a Trust at any time. There are also some Together with the Trustee, we may amend the provisions of the trust
circumstances where we may make changes to your deed (including any establishment deed). Any such changes can be
made under certain circumstances outlined in the trust deed. Changes
investment. These are outlined below.
may include, without limitation, a Trust’s investment policy or limits on
any fees.
Together with the Trustee, we may also set guidelines regarding
Changes you can make
the investment management of the Trusts, including benchmark
- you can change your regular investments at any time as long as asset allocations and ranges. These may be changed without us
you pay the minimum annual investment. notifying you.
- you can pay in extra lump sums of $500 or more at any time.
Changes for tax purposes
- you can withdraw or transfer all or part of your investment
While each Trust is a PIE, we may adjust any distribution entitlement
(see “How do I cash in my investment?”).
or your unit holding (including on withdrawals, transfers or switches)
- you can switch your investment between Trusts by following the to reflect any PIE tax liability arising with respect to your units in
process below. a Trust. We may take all steps necessary to ensure that a Trust
is eligible, or continues to be eligible, for PIE status or otherwise
- if you’re a regular investor you can stop your investments for a
complies with the requirements of tax legislation relating to PIEs
time, as long as you maintain the minimum holding.
(including rejecting applications, switches and transfers, and
- you can change any details relating to your account. Just call withdrawing your units, at our discretion).
0800 738 641 and we’ll let you know what to do, depending on
what you need to change. Changes to specialist managers
- you can also change your PIR just by letting us know. Specialist investment managers and Administration Managers will be
regularly monitored and reviewed. These managers may be removed
Switching trusts or added without us notifying you. This means the identity and number
of specialist investment managers or Administration Managers
You can switch your investment between Trusts by completing a switch
for a Trust may vary from time to time. You can get details of the
request. We’ll then sell your units in the Trust you’re switching from and
specialist investment managers by calling us on 0800 738 641 or by
use that money to buy units in the Trust you’re switching into.
visiting www.westpac.co.nz and searching for the document entitled
The minimum amount of any switch is usually 500 units or $500 “Westpac Active Series Investment Managers”.
(whichever is less). You also need to maintain a minimum balance of
$5,000 or 5,000 units in each Trust (whichever is less). Other changes
You can get a switch request form from any Westpac branch, When we use the word “current” or “currently”, in relation to
a Westpac Financial Adviser or by calling 0800 738 641. legislation, policy, activity or practice we refer to these as at the
date of this Investment Statement. Any legislation, policy, activity
There is no charge for switching, but “spreads” may apply to unit
or practice may be reviewed or changed without us notifying you.
prices (see “What are the charges?”). A switch is a disposal of units
for tax purposes. See “General information about taxes” for the tax Your rights may also be varied by changes to relevant law, accounting
related consequences of a switch. and other regulatory requirements.
Switches are subject to our ability to suspend or delay withdrawals
as set out in “What returns will I get?”.
Our ability to make changes
With the consent of the Trustee, we can change any fees without
notice. If we make a change, you (or a Trust as the case may be)
will need to pay the new fees.
We may also alter the minimum investment and withdrawal amounts
and any notice periods. We can also close or wind up a Trust.
20You can also read
