Investment Strategy
Jessbyte Foundation — current investment strategy document
Investment Strategy
Jessbyte Pty Ltd as trustee for the Jessbyte Foundation
228 Tooronga Rd, Terrey Hills NSW 2084 foundation@jessbyte.com ABN 59 608 104 479
Version 1.1, March 2026
Background
This document is the Investment Strategy of the Jessbyte Foundation, adopted by the Board as at the date of signing below. It takes effect immediately upon signing. The asset allocation targets are set with reference to the 2026-27 financial year and will be reviewed at least annually. Version 1.1 incorporates a comprehensive professional review of the prior version, adding compliance provisions required by the PAF Guidelines 2019 (arm's length requirements, borrowing restrictions, and collectibles prohibition), updated asset allocation targets including new categories for commodities and cryptocurrencies, and improved governance language throughout. The investment objectives and overall approach remain consistent with prior versions.
Objectives
The objectives of the fund are to:
- Provide support to Australian charities via grants and donations
- Ensure that the fund has sufficient liquidity at all times to meet its commitments
- Maximise long-term growth through investment choice and the benefits of the fund's tax-free status
The investment objective of the trustees is to achieve real medium to longer-term growth with a view to generate long-term average growth in excess of the annual grants and donations expected to be made from the fund. The fund currently distributes at or modestly above the legislated PAF minimum of 5% of prior year net assets, noting that this minimum may be increased to 6% under future legislative changes.
It is the trustees' intention that the fund continue indefinitely, including in the event of zero or minimal ongoing donations being received into Jessbyte, though this remains subject to the long-term circumstances of the fund. In recognition of the long investment time frame, the fund will have a high proportion of growth assets in the portfolio.
Investment Choice
The Trustees have determined the fund's investments may include but not be limited to all or one of the following:
- Direct equities, stocks and derivatives including participation in dividend reinvestment programs and rights issues
- Property trusts and associated investments
- Managed investments and associated products
- Direct residential, industrial and commercial property investment
- Deposits and investments with banks and other financial institution securities including Term Deposits, Debentures, Secured and Unsecured Notes and Bonds
- Commodities, including gold and commodity-linked securities
- Cryptocurrencies and cryptocurrency-linked exchange traded products
- Any other investment that the trustees may feel prudent to achieve the objective of the fund
All investments must be entered into and maintained on an arm's length basis in accordance with the Private Ancillary Fund Guidelines. The fund will not invest in collectibles as defined by the PAF Guidelines.
The Trustee may from time to time decide to seek professional advice from Accountants, Solicitors or Financial Planners in the formulation or implementation of this or any future investment strategy.
In formulating this strategy the trustees have taken into consideration relevant features of the various investments in accordance with both the fund's objectives and appropriate legislation, including the Taxation Administration (Private Ancillary Fund) Guidelines 2019.
In drafting this investment strategy, the trustees have taken into account all of the circumstances of the fund, including:
- the risks and likely return associated with each investment
- the range and diversity of investments held by the fund
- any risks coming from limited diversification
- the liquidity of the fund's investments
- cash flow needs for the minimum donations required to be paid out from the fund each year
- other operating cash flow requirements
Policies
The policies adopted by the trustees in order to achieve these objectives are:
- Regular monitoring of the performance of the fund's investments, the overall investment mix and the expected cash flow requirements of the fund
- Re-balancing the fund's investment portfolio due to changes in market conditions through asset sales and new investments as appropriate
- Reviewing this investment strategy at least annually and updating it as required to reflect changes in market conditions, legislation, or the fund's circumstances
The fund will not borrow money except where permitted under the PAF Guidelines (i.e. to cover settlement of a transaction for the acquisition of a financial instrument, where the borrowing was not expected to be needed at the time of the investment decision, the period does not exceed 14 days, and total borrowings do not exceed 10% of the market value of the fund's assets).
The trustees will aim to follow the investment strategy, however, they will at all times reserve the right to change the investment mix depending on market conditions and opportunities available to better meet the objectives of the fund.
Risk Profile and Risk Tolerance
The fund has a long time horizon. Further the trustees are prepared to endure a reasonable level of volatility of returns in expectation of long term growth in order to meet our financial sustainability objectives.
Trustees understand the trade-off between investment risk and long term capital and income growth and have indicated asset growth is a priority.
Insurance
The trustees have considered whether the fund should hold a contract of insurance for its board members and concluded that our risks are low and that insurance would be of negligible expected value.
At small and medium-sized PAFs with good compliance-orientated trustees, directors and officers insurance is often not taken out as risks are primarily limited to PAF Guideline breaches. While some policies may cover defence costs for regulatory investigations, the trustees consider the likelihood and magnitude of such events to be low relative to the cost of coverage. This assessment will be reviewed periodically as the fund grows.
Liquidity
The main ongoing liquidity requirement for the fund is the donations and grants it will make each financial year, plus ongoing administrative fees such as accounting fees and ASIC annual return fee for the corporate trustee.
Cash in excess of anticipated liquidity requirements will be invested in accordance with the fund's investment strategy. When expenses, grants or donations are expected to be paid, funds will preferably be held in highly liquid investments until shortly before needed to be converted into cash, in order to maximise long-term returns of the fund assets.
The trustees note that projected dividend and distribution income may not fully cover the fund's annual grant obligations in all years. Where a shortfall arises, the fund's predominantly equity-based holdings provide sufficient liquidity to meet obligations through the orderly sale of listed securities. The trustees will aim to maintain awareness of upcoming cash flow needs to avoid being forced to sell at unfavourable times.
Asset Allocation
The targeted asset allocation recognises the need to have a diversified asset mix. However, given the long term investment horizon of the fund, the allocation will have a strong growth asset bias and be focused on maximising capital growth.
The trustees recognise the higher risk and volatility associated with investing predominantly in growth assets. This volatility will be compensated by the prospect of achieving higher returns and growth in the longer term. In order to minimise this risk, trustees will consider investing across different asset classes, industries, and sectors where possible.
There are also tax benefits to the Foundation from receiving Australian franked dividends. As the fund has a 0% tax rate, franking credits received with dividends are fully refundable by the ATO, effectively recovering corporate tax already paid on those earnings. These refunds are then available for reinvestment or distribution.
The final targeted asset allocation will be in the following ranges:
| Asset | Long term range | Current target |
|---|---|---|
| Australian listed equities & ETFs | 30–99% | 55% |
| International listed equities & ETFs | 20–60% | 30% |
| Derivatives on listed equities | 0–15% | 0% |
| Commodities & commodity-linked securities | 0–15% | 5% |
| Australian listed property | 0–33% | 2% |
| Direct property | 0–33% | 0% |
| Cash and term deposits | 0–5% | 1% |
| Cryptocurrencies & crypto-linked ETPs | 0–10% | 5% |
| Australian cash and bond funds | 0–10% | 2% |
| International cash and bond funds | 0–10% | 0% |
The "Long term range" allows for normal market fluctuations and periods when the fund may have limited exposure to a particular asset class. The "Current target" provides an indication of the fund's planned investment allocation over the next 6–12 month period.
Delegation and Execution Authority
The Jessbyte Foundation Board delegates day-to-day investment management responsibilities to a designated investment decision-maker, as appointed by the Board from time to time and recorded in Board minutes. This includes executing trades, rebalancing portfolios, maintaining appropriate liquidity, and ensuring compliance with the strategic asset allocation and investment guidelines outlined in this document. All such actions must align with the Foundation's objectives and reporting obligations, and material changes to strategy or asset allocation must be communicated to the Board in a timely manner.
Environmental, Social, and Governance (ESG) Considerations
The Jessbyte Foundation acknowledges that investment decisions can carry significant environmental, social, and governance (ESG) impacts. While long-term growth and capital preservation are primary objectives, preference will be given to investments that align with the Foundation's values of equity, justice, sustainability, and transparency. Where practical, the Foundation aims to avoid direct investment in companies whose core business activities conflict with these values (e.g. fossil fuels, tobacco, arms manufacturing, or companies with poor human rights records), and may seek to positively weight investments in companies demonstrating strong ESG practices or thematic alignment with the Foundation's charitable purposes.
Signatures
All Directors of the Trustee Company to sign:
Jess Justyn Emika Sullivan
Director of Jessbyte Pty Ltd as trustee for the Jessbyte Foundation
Date: _________
Nathan Scott Westwood
Director of Jessbyte Pty Ltd as trustee for the Jessbyte Foundation
Date: _________
Junko Nichols
Director of Jessbyte Pty Ltd as trustee for the Jessbyte Foundation
Date: _________
Rosston Garry Wellings
Director of Jessbyte Pty Ltd as trustee for the Jessbyte Foundation
Date: _________