SMSF trustees should remember an investment strategy does not have any legal backing that places restrictions on them holding an asset within their fund, which provides more options when choosing investments.
Smarter SMSF chief executive Aaron Dunn said there were no “hard and fast rules” about how an investment strategy was developed, but it did need to be created by the trustees themselves making reference to a number of external controls.
“An important thing to recognise is there are no specific provisions that prohibit a type of investment in a super fund,” Dunn said during his firm’s recent SMSF Virtual Day.
He noted this was important for trustees looking to include newer types of assets, such as cryptocurrency, and that trustees were only restricted by the limits of legislation, regulation and any specific details added into a trust deed.
“There is nothing specific [related to the investment strategy] that prevents a particular investment, but you do need to go through each part of the legislation and regulations to determine where there is any restrictions and caveats,” he said.
“Trust deeds can also be amended to clearly create a reference to the type of investments that the fund is allowed to invest in.”
He said it was these factors that were currently reshaping investment strategies as trustees gave greater consideration to the general and retirement objectives that were being set for the fund’s members.
“This is why we are seeing so much alignment around what those objectives are and looking at each of the elements in Superannuation Industry (Supervision) Regulation 4.09 to try and match them to ensure we have a compliant strategy that is consistent with trying to reach those retirement outcomes,” he said.
