Even the AMFS name will likely disappear in a further rebrand between now and an anticipated first quarter of 2014 launch, AMFS manager Chan Arambewela told last week’s 13th annual Wraps, Platforms & Masterfunds conference.
Contrary to some opinions, the service is simply about allowing fund managers to put their products up and have them listed as ASX products, Mr Arambewela said.
“So they remain unlisted, they’re not listed through the normal listing framework. It’s about getting them on ASX so as a result of that managers can have access to the ASX distribution channel through the ASX broker network,” he said.
“It’s not about providing a secondary market for trading managed funds; it’s still a service where price discovery occurs at the manager level. What we’re really doing is facilitating the flow of information around applications and redemptions in an electronic way.”
ASX has completed necessary technological upgrades to its CHESS platform so it can transact in managed funds and allow transactions to settle within a timeframe set by managers, Mr Arambewela added.
“If you’re a daily-priced fund, generally you get your cash up front and you might be able to strike the price and deliver those units the next day. It’s about replicating that and allowing information to flow electronically through our CHESS system [and] removing the paper application forms out of the equation,” he said.
“It’s allowing you then to hold those fractional units alongside your equities and shares. Importantly, at an investor level you’ll now be able to hold these managed funds with [exchanged traded funds], with shares.”
ASX is also seeking, through Austrac, to have anti-money laundering provisions met at the broker level to be recognised so there’s no need for that to be recognised by managers, thereby streamlining the process.
The benefits favour managers, platforms, distributors and investors, Mr Arambewela said.
“The technology’s been completed, that’s all the changes we had to make to our CHESS system. The testing environment’s been established, it’s being used at the moment by some participants. We’ve got 65-plus foundation members signed up; they’re made up of [responsible entities], fund managers, brokers and unit registries, [who are] there to support the managers.
“The service is subject to regulatory clearance and we’re going through that with [the Australian Securities and Investments Commission]… and we’re dealing with Austrac on that AML [anti-money laundering] issue.
“On the back of that, we’re confident in targeting a readiness date of the first quarter 2014.”
