Security Measures - IPO Wealth

Security Measures

Measures in place to manage the Fund’s liquidity and security arrangements


Measures in place to manage the Fund’s liquidity:

Capital Protection Reserve

The Fund’s investment manager (IPO Wealth Pty Ltd) is entitled to receive a performance fee, which is the excess of the interest payments received from the borrower over the target return for the relevant investment period.

The investment manager is required to set aside up to 10% of the gross asset value of the Fund (Capital Protection Reserve) from its performance fees as follows:

  • 10% of the Fund’s gross asset value below $20 million; plus
  • 7.5% of the Fund’s gross asset value above $20 million and below $50 million; plus
  • 5% of the Fund’s gross asset value above $50 million.

The purpose of the Capital Protection Reserve is to top up the Fund’s asset pool in the event of any capital losses. There is no certainty that the Capital Protection Reserve will be sufficient to cover any capital losses incurred by investors and repayment of investors’ capital is not guaranteed.

The balance of the Capital Protection Reserve as at 30 June 2018 was $526,802.74. There is also a provision of $651,358.89 for performance fees which will be added to the Capital Protection Reserve at 30 June 2019.

Please request a copy of the Fund’s disclosure document for more information.

Cash Reserve

The Fund’s investment manager (IPO Wealth Pty Ltd) aims to keep 10% of the Fund’s capital invested in cash and cash equivalent assets (such as term deposits offered by ADIs) or such similar credit worthy and liquid investments for liquidity purposes as determined by the investment manager from time to time. Any funds awaiting distribution to investors may be similarly invested at the discretion of the investment manager. However, in spite of the cash reserve, any failure or delay by Mayfair 101 Holdings in meeting its loan repayment obligations could cause significant delays in the Fund satisfying withdrawal notices and therefore you may not be able to access your money in the Fund in a timely fashion.

General Security Agreement

The loan between the Fund’s trustee, Vasco Trustees Limited and the borrower IPO Wealth Holdings Pty Ltd t/a Mayfair 101 Holdings includes a General Security Agreement (GSA). Generally speaking, a GSA provides security over all of the presently acquired and future property acquired by the borrower. The trustee can enforce its security interest if there is a default by Mayfair 101 Holdings under the loan agreement in certain circumstances.

Purchase Money Security Interest

The loan between the trustee and the borrower (Mayfair 101 Holdings) includes a Purchase Money Security Interest (PMSI). Generally speaking, a PMSI provides specific security over any assets purchased by the borrower using the borrowed funds. The trustee can enforce its security interest if there is a default by Mayfair 101 Holdings under the loan agreement in certain circumstances.

Financial Services Licence

IPO Wealth Pty Ltd is a Corporate Authorised Representative of DH Flinders Pty Ltd, holder of Australian Financial Services Licence No 353001.

Legal Adviser Engagement

The Fund’s Loan Agreement with IPO Wealth Holdings Pty Ltd, General Security Agreement and Purchase Money Security Interest were prepared and reviewed by qualified Australian legal practitioners.

» Learn more about the risks you should consider before investing

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*The IPO Wealth Fund (Fund) is a managed investment scheme, available to wholesale investors only, and not available to retail investors. Vasco Trustees Limited (ACN 138 715 009, AFSL 344486) (Vasco) is the trustee of the Fund, and IPO Wealth Pty Ltd (ACN 617 039 255) (IPO Wealth) is the investment manager of the Fund.

IPO Wealth is a Corporate Authorised Representative (No.1253092) of D H Flinders Pty Ltd (ACN 149 601 596, AFSL 353001) for the purposes of providing general advice relating to the IPO Wealth Fund only, and in no other capacity.

IPO Wealth is a wholly owned subsidiary of Online Investments Pty Ltd trading as Mayfair 101. The sole investment activity of the Fund is to lend money to IPO Wealth Holdings Pty Ltd, trading as Mayfair 101 Holdings, a related party of IPO Wealth. Mayfair 101 Holdings may use the borrowed funds to make investments which carry a significant level of associated risk and may not be liquid, including private equity transactions. If Mayfair 101 Holdings does not make interest and principal repayments to the Fund on time, this could adversely impact the Fund’s investors. A failure or delay by Mayfair 101 Holdings in meeting its loan repayment obligations could cause significant delays in the Fund satisfying withdrawal notices and therefore you may not be able to access your money in the Fund in a timely fashion.

An investment in the Fund is not a bank deposit and is subject to a greater risk than cash investment products, including loss of income and part or all of the capital invested. It may therefore not be appropriate for investors who require liquidity or certainty of income and/or capital return. None of Vasco, IPO Wealth, nor D H Flinders Pty Ltd guarantees any income or capital return from the Fund or that withdrawals will be paid on time. Returns (if any) paid to investors from the Fund will not exceed the target return for the relevant investment period.

You should consider this information, together with the Fund’s Information Memorandum, and seek your own independent financial advice before investing in the Fund. IPO Wealth provides only general advice which does not consider an individual investor’s objectives, financial situation or needs.