The Fund delivered +0.72% in October, 9.17% over 12 months and 9.39% annualised over three years continuing to deliver over 5% net return above the RBA cash rate.
Preparing For Upcoming Transactions
Over the coming months we expect several large transactions to complete. In preparation, the Fund will be carrying higher cash balances so we can fund those drawdowns on schedule. In this asset class, timing is driven by documentation, multiparty negotiations and securitisation mechanics that can take months to finalise. While we aim to align applications and deployments closely, monthly returns typically move around more due to cash levels rather than any change in credit performance. Our focus remains on allocating into facilities with the structural depth we require, not on compressing timelines at the expense of quality.
Inflation Risks and Portfolio Resilience
Recent data has reinforced what we have long believed - that inflation in Australia remains structurally stickier than in many developed markets. Core measures remain above the RBA target, while forward indicators of growth and employment are softening. This combination has renewed discussion around the risk of stagflation, slow growth coupled with persistent inflation. For credit investors, the practical consideration is how portfolios perform when rates remain higher for longer while economic momentum slows. In our view, the resilience of our Fund depends not on forecasting macro conditions but on ensuring every exposure can withstand them.
Structural Strength Over Market Cycles
The portfolio is targeting performance across a range of rate and growth environments, with exposures typically secured against diversified, self-amortising loan pools supported by enforceable collateral, hard eligibility criteria and transparent performance data. Income is generated from cashflow, not revaluation, and structural features such as arrears triggers and early amortisation mechanisms operate to preserve capital should conditions deteriorate. These mechanics are designed to function regardless of whether inflation, growth or policy rates surprise in either direction. Periods of slower growth or policy uncertainty often expose the difference between structural and cyclical returns. For us, the emphasis remains on stability - ensuring each exposure performs on its own merit, without dependence on market momentum or yield compression.
Consistent Process, Proven Track Record
As a team we remain fully engaged in the market with a consistently broad pipeline across both strategies each week. We deploy where the risk, structure and counterparty quality meet the Fund’s return target. Approaching 10 years, the track record reflects a repeatable process rather than mark-to-market gains or tactical calls. Through liquidity shocks, credit repricing and policy tightening, the objective has been unchanged: capital preservation and a high level of income, delivered with transparency and discipline.
