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Managed funds must improve marketing materials

Friday 9 September 2022


The Australian Securities and Investments Commission (ASIC) has found that the marketing materials have did not have enough information about past and future performance, product comparisons and downplaying risks in fund benefit promotions.

ASIC’s Deputy Chair Karen Chester said in an official statement  this week, “ASIC’s surveillance into marketing of fund performance and risk is ongoing. Where we find poor conduct, we will take prompt action to protect consumers and hold responsible entities, trustees and investment managers to account. We will deploy a range of regulatory interventions, from our recent use of stop orders through to court action where warranted.”

This comes after what the regulator calls long surveillance of 18 funds.

In their official statement the regulator listed some expectations of their responsible entities:

  • Marketing must give balanced messages about returns, features, benefits and significant risks.
  • Risk disclosure needs to be clear and prominent. 
  • The safety, reliability or security of an investment should not be overstated.
  • Comparisons with other products or benchmarks must be appropriate and reasonable.
  • Any reliance on past performance must explain that it is not indicative of future performance.
  • Care must be taken with the use of images, graphs and tables to ensure they are not confusing.

The Deputy Chair added, “In conveying our concerns to these responsible entities and trustees, we have secured timely and voluntary amendments to the funds’ marketing materials.”