The Manning Credit Opportunities Fund delivered +1.10% in July 2026. To 31 July 2026, returns were 13.14% over 12 months, 14.62% per annum over three years and 14.54% per annum since inception in July 2022.
The Fund targets the RBA cash rate plus 10% per annum over rolling five years. Over three years the Fund exceeded the cash rate by 10.51% per annum, and by 9.25% over the past 12 months.
Returns are inclusive of distributions, net of fees and exclude tax. Past performance is not a reliable indicator of future performance.
Portfolio Activity
Two existing lenders drew on their facilities during July, with the portfolio continuing to perform in line with expectations.
As we noted last month, MCOF is a particularly active portfolio. New drawdowns are only one side of that activity. More than 90% of the underlying loans across the portfolio are either amortising or held within revolving structures, meaning principal is continually being repaid as underlying borrowers make scheduled repayments or refinance. Within revolving facilities, that capital can then be recycled by the non-bank lender into new eligible loans, subject to the credit and structural parameters of the facility. As a result, there is considerably more activity occurring within the portfolio than the headline level of Fund deployment might suggest.
This is an important characteristic of the strategy. Even where our commitment to a facility remains unchanged, the underlying collateral pool can continually evolve as loans repay and new eligible assets are funded. We monitor that activity closely, including underlying loan performance, collateral composition, concentration limits and compliance with the structural protections of each facility. At the Fund level, repayments and changes in facility utilisation also create opportunities to reassess where capital is best allocated across the portfolio.
Portfolio Construction
For MCOF, diversification is more nuanced than simply the number of lenders or facilities in the portfolio. We consider the underlying borrowers and collateral, repayment characteristics, concentration risks and the extent to which different exposures may behave similarly under changing economic conditions.
The Fund's broader mandate is particularly valuable in this context. It allows us to allocate across different forms of specialist lending and asset-backed finance rather than being required to maintain exposure to a particular segment of the market. This flexibility means the portfolio can evolve as relative value changes, while remaining focused on transactions that meet the Fund's higher risk adjusted return requirements.
Where Scale Is Not an Advantage
Some of the more interesting opportunities we assess for MCOF are attractive precisely because they are not particularly scalable. Smaller or finite transactions can be less suited to large pools of institutional capital, despite having strong underlying credit characteristics. This can reduce competition and create opportunities for more bespoke structuring and pricing.
For MCOF, the objective is not to find the largest transactions or maximise the amount of capital deployed with any one lender. The Fund's higher return target means each opportunity needs to justify its place in the portfolio. In some cases, that may be a larger facility capable of growing over time. In others, it may be a finite pool of assets or a highly structured transaction where the economics are attractive precisely because the opportunity cannot readily be scaled.
