The Aegis service holds, administers and reports on a wide range
of investments, including cash, fixed interest, equities, managed
funds, specialty assets and currencies.
Cash includes your portfolio Cash Account, which is held with ASB
Bank Limited, and selected bank term deposits.
Fixed interest includes NZ Government and corporate bonds listed
on the NZX, and unlisted domestic fixed interest securities.
Equities include listed domestic and international ordinary and
preference shares, rights issues, options and notes and some
unlisted domestic shares.
Listed investments are transacted through the NZX broker nominated
by your investment professional.
Managed funds include unlisted New Zealand domiciled unit trusts -
including Portfolio Investment Entity (PIE) funds, unlisted foreign
domiciled managed funds such as Australian unit trusts and exchange
traded funds. Investors in unlisted managed funds held via the
Aegis service generally enjoy a substantial discount on fees to
retail managed funds. Additionally, a number of managed funds
available via Aegis are either not accessible direct to retail
investors, or if they are they have substantial minimum investment
requirements.
Speciality assets are predominantly managed funds or exchange
traded funds specialising in a specific investment area.
Investments via the Aegis service are held in New Zealand dollars,
Australian dollars, US dollars or British pounds.
Your investment professional will discuss your investment requirements with you and may recommend changes from time to time. They will also instruct Aegis to buy and sell investments in your portfolio.
Your investment professional is able to instruct Aegis to withdraw funds from your portfolio, including regular withdrawals. Aegis will pay these to the nominated bank account loaded against your portfolio records. You can choose to have more than one nominated bank account for withdrawals. For security reasons, Aegis will not pay withdrawals to bank accounts that are not loaded against your portfolio.
The Aegis service uses a custodian, ICSL, to hold investments on
your behalf. This is an efficient way of administering investments
as it enables Aegis to aggregate (i.e. combine) the purchase or
sale of an investment on behalf of a large number of investors and
transact this in the market as a single instruction. It also
enables Aegis to receive consolidated interest and dividend
payments, which it then allocates to individual investors'
portfolios.
In other words, aggregation enables Aegis to undertake less
investment transactions with fund providers and brokers. This
aggregation ability is one of the reasons why fees for managed
funds purchased through Aegis are often cheaper than if purchased
directly. Through aggregation, Aegis can often avoid investors
being charged minimum brokerage fees for listed investments that
might otherwise be charged for small transactions.
ICSL acts as a bare trustee and has no discretionary powers in
relation to your investments, so it cannot undertake investment
transactions without instructions from you or your authorised
representatives. Although ICSL is the registered holder of
investments, you retain the beneficial ownership of your
investments.
To add cash into your portfolio, you simply deposit the amount
directly into the trust account held by ICSL. Aegis then ensures
the cash is added to your portfolio. Any cash withdrawals you
require from your portfolio are paid directly into your nominated
bank account.
You can transfer existing investments into your Aegis portfolio by
transferring their ownership to ICSL. This enables Aegis to
administer these investments for you, while you retain beneficial
ownership of your investments.
Interest and dividend payments from your investments are
automatically added to your Aegis Cash Account and retained in your
portfolio. Purchases of investments and proceeds from your
investment sales are deducted or added to your Aegis Cash
Account.
By having your investments held via Aegis, you do not have to worry
about the significant ongoing paperwork and administration that is
associated with investing.
It is important to note that none of your investment professional, Aegis, or ICSL, guarantees the performance of the investments in your portfolio. Investments are subject to investment risk including loss of income and capital invested.
For many investments, Aegis calculates and deducts tax on your
behalf and pays this tax to the Inland Revenue, where
required.
Resident Withholding Tax (RWT) will generally be deducted from
gross interest income you earn for both New Zealand and offshore
investments. Aegis may also be required to deduct RWT from
dividends you receive from New Zealand and Australian shares. This
will be dependent on the level of imputation credits recorded
against the dividend. Aegis will generally deduct RWT at the rate
recorded against your portfolio. If you are not a New Zealand tax
resident, Aegis may need to deduct Non-Resident Withholding Tax
(NRWT) from interest and dividends you receive from New Zealand
investments.
If you invest in Portfolio Investment Entities (PIEs), Aegis will
calculate and deduct the required PIE tax using the Prescribed
Investor Rate (PIR), tax rate specific for PIE funds, recorded
against your portfolio.
There are some investments such as overseas shares which are
taxed under the foreign investment funds rules (generally this will
be the fair dividend rate method) where Aegis is not required to
deduct tax. For these investments, you will be required to include
this income in an annual tax return and pay the appropriate tax
directly to the Inland Revenue.
Aegis provides comprehensive tax reports to assist in the
preparation of annual tax returns and financial statements for your
portfolio. This includes details of fees charged to your portfolio,
which may be deductible against taxable income, all investment
income received by way of interest, dividends and other cash
distributions, PIE funds taxable income and taxable income
calculated under the foreign investment fund rules. Aegis is
ideally placed to undertake the complex calculations required under
the foreign investment funds rules because of the up to date
pricing and exchange rate information maintained as an integral
part of the Aegis service.
As the taxation of investment income can be complex, we recommend
you seek advice from a tax professional.
Because Aegis holds your portfolio investments, records all transactions that take place within your portfolio and has up to date pricing and exchange rate information, Aegis is the source of truth when it comes to portfolio reporting. Your investment professional can provide you with a comprehensive range of reports including:
Your investment professional will agree with you how often they will provide portfolio reports to you. They can also offer you a range of portfolio reports to view online as and when you require. You can choose to have these online reports made available to other people that may be associated with or provide portfolio related services to you, for example trustees, accountants and solicitors.
Aegis' fees are based on the value of your portfolio held on the
Aegis service. Each day, Aegis calculates fees based on the end of
day value of your portfolio, and accrues this amount until it's
deducted from your Aegis Cash Account. This deduction is usually
monthly but may be on another frequency as agreed with your
investment professional.
Your investment professional's fees are usually calculated the same
way as the Aegis fee and may be presented as a combined fee or
shown separately. Your investment professional will agree these
fees with you at the time of establishing your portfolio on Aegis.
The fees deducted are shown on cash transaction reports available
to you.
If there is insufficient cash in your Aegis Cash Account to pay
the fee, it will continue to accrue until sufficient cash is
available to pay the fee. In some instances, your investment
professional may need to sell some of your investments to make cash
available to pay fees.
Your investment professional may undertake ad hoc work for you and
either invoice you directly for this work or agree with you to have
the amount deducted from your Aegis Cash Account.
In the first instance, contact your investment professional. Most portfolio investments can be transferred into your own name, though others may need to be sold if they are not available to be held by you directly. The contract you have with your investment professional will also specify termination terms and conditions.
Under the Privacy Act 1993, you have rights of access to and
correction of any personal information that Aegis or ICSL hold
about you. When appropriate and for the purposes of ongoing
administration of your investments, Aegis and ICSL may need to
provide your details to parties associated with providing
investment services to Aegis.
If you have any concerns about how your personal information is
used in connection with the Aegis service, please contact Aegis on
0800 800 638.