What is the difference between Wholesale & Retail Funds?

  • Retail managed funds

Designed to cater for individual investors, a broader marketplace, with minimum investment amounts ranging from A$1,000. Some even offer regular savings plan options.

Common types of retail funds includes mutual funds and exchange-traded funds (ETFs).

  • Wholesale managed funds

Designed to cater for professional investors with significantly higher minimum investment amounts, typically in excess of A$500,000 per fund.

KEY TAKEAWAYS

  • Different type of investors

Retail funds are intended for retail investors who are ordinary investors, while wholesale funds are intended to wholesale investors or institutional investors.

  • Different minimum balances

Retail funds are easier to access with its low minimum balances, while wholesale funds have hefty minimums.

  • ASIC registered or not

Wholesale funds are not required to be registered, while retail funds are required to be registered.

  • Different fee structure

The fees charged by a wholesale fund are usually lower then a retail fund. Generally, it is easier and cheaper to structure and promote a fund as an unregistered fund compared to a registered fund.

Tanggram Investment Fund, for instance, is a registered retail fund. It has a far more onerous undertaking with a multitude of compliance, governance, audit and reporting requirements which are not required for an unregistered wholesale fund. For more information please refer to the Tanggram website.

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