The future for Montgomery Global

8 Comments

1. 

   Ming
   September 28, 2017 at 2:25 pm:

   Hi David,

   This is an interesting product, hopefully it strikes a good balance between growth and income.

   However, surely, there must be some T&Cs with the minimum annual distribution yield of 4.5%?

   What if the returns for a period is insufficient or negative?

   Is not forced selling of assets and distribution of capital to meet distributions against everything that Montgomery is about?

   • 

     David Buckland
     September 28, 2017 at 3:14 pm:

     Thanks Ming.
     That’s is right, however all our Funds are holding relatively large amounts of cash at present and so there shouldn’t be any forced selling.

2. 

   Prospective ETMF Investor.
   September 12, 2017 at 8:53 am:

   Hi David

   Good news about the new listed ETMF. Whilst I prefer the LIC closed end company structure over the open ended ETMF Unit Trust it’s a step in the right direction as far as simplicity for buying and selling of units goes.

   The new Fund has a minimum target yield of 4.5% paid semi annually. Considering that Global shares are generally low yield dividend payers can you explain how the Fund proposes to achieve such a yield if the income generated from the Unit Trust falls short of 4.5% ? My understanding is that Unit Trusts must distribute income generated to Unitholders to avoid tax penalties so if earnings cannot be retained to smooth distributions where will any shortfall come from? I’m a bit confused about that as I’ve never heard of any Unit Trusts being able to top up distributions if they have not been earned and are available for distribution. If a top up is required is it above board and legal? What are the implications and tax consequences for an investor of a top up?

   • 

     David Buckland
     September 12, 2017 at 5:07 pm:

     Hi Max, the distributable income from a Trust structure includes interest on the cash component of the portfolio plus dividends from the equities component of the portfolio plus/minus any net realised gains/losses (or realised profits minus realised losses) less any expenses associated with The Fund. This must be fully distributed. The Active Exchange Traded Managed Fund structure allows for a “top up” if the distributable income is inadequate relative to the targeted minimum annualised 4.5 per cent, and this would come out of capital. The specifics will be detailed in the Montgomery Global Equities Fund PDS.

3. 

   jeff nelson
   September 7, 2017 at 10:03 am:

   HI David
   My Super fund Australian Super has ETFs as an option.
   Could you see this as being an option that would be available through Australian Super.
   Also are you guys looking at doing ETFs with any of your other funds
   Regards
   Jeff

   • 

     David Buckland
     September 7, 2017 at 10:55 am:

     Hi Jeff, I suspect Australian Super would be unlikely to endorse the proposed Montgomery Global Equities Fund. This is our only proposed Active ETF, at this stage.

4. 

   Tony
   September 6, 2017 at 9:36 am:

   Hi David,

   Out of interest I’m currently have an investment in the Montgomery Global Fund. Apart from the ability of being able to trade Equities Fund, what is the advantage of this fund over the Global Fund?
   This question is taken in the context that the Equities Fund should mirror the Global Funds returns.

   Tony

   • 

     David Buckland
     September 6, 2017 at 9:42 am:

     There is no other obvious advantage Tony, except the “distribution component” within the total annual return may be a bit less volatile.