Alternativeasset manager Absolute Capital has moved swiftly to allay fears over one of its funds having an interim stop order placed on it by theAustralian Securities and Investments Commission(ASIC).
ASIC has yet to release a public statement regarding the Yield Strategies Fund, but Absolute Capital managing director Deon Joubert says ASIC has placed the order on the fund due to disclosure issues regarding the prospectus and not the strategy or management of the fund.
“I am surprised that ASIC has yet to release anything but it has shown in recent months that it takes a keen interest in the detail of how products are described,” Joubert says.
“ASIC has asked we cover more information for retail investors given the strategies we take. The Yield Strategies Fund is unique in Australia and the complex underlying investments and strategies make disclosure in plain English challenging,” he says.
The chief areas of concern for the regulator were the clarification of the meaning and interpretation of charts in the prospectus, the clarification of the relationship Absolute Capital has with a related company Absolute Capital Markets and more details regarding the disclosure of valuation of assets.
Absolute Capital will release a supplementary prospectus as soon as ASIC is satisfied with the additional information.
Joubert says the stop order does not impact current investors in the fund, which remains solid in terms of structure and its investment strategy. However, the fund will not be able to accept any applications until the stop order has been lifted.
