Developing a strategy and investing the funds  

One of the key responsibilities that SMSF trustees have is to manage the fund's investments.

Investment strategy

Every SMSF is required to have an investment strategy. The strategy must consider:

• returns
• risk
• diversification, and
• the ability of the fund to pay benefits to members as the reach retirement (i.e. liquidity).

A good strategy will set out the investment objectives of the fund and detail how the fund proposes to meet those objectives. It does not have to be a detailed document but it does need to be followed and reviewed regularly so it remains up-to-date.

For non-traditional assets like art or other collectibles, the trustees may have to rely on outside experts for valuations and advice.