Long-Short Credit Strategy

Targets daily liquidity returns in excess of the RBA cash rate plus 4% to 6% pa net of fees with near-zero interest rate duration risk and an average A rating

SMARTER MONEY LONG-SHORT CREDIT FUND (LSCF)

RBA CASH PLUS 4% TO 6% PA STRATEGY

About

The Smarter Money Long-Short Credit Fund (LSCF) harnesses CCI’s 25 person team (as at October 2020) to actively exploit mispricings in global cash and bond markets to generate daily liquidity returns that exceed a target of the RBA cash rate plus 4% to 6% pa after all fees with an average A credit rating and near-zero interest rate duration risk. 

Since inception LSCF has outperformed the HFRI Credit Hedge Fund and the Bloomberg Credit Hedge Fund Indices net of fees, and ranks as the No.1 strategy in Mercer’s short duration credit universe over the last 1, 2 and 3 years as at October 2020.

LSCF is a daily liquidity solution that invests in cash and fixed-income assets that are hedged to a floating-rate (ie, not fixed-rate) exposure that means it has near-zero interest rate (duration) risk. 

LSCF is typically placed in the “unconstrained fixed-income”, “high yield”, or “defensive alternative” universes.

LSCF is an absolute return fixed-income strategy focused on exploiting typically long and, more opportunistically, short mispricings in credit markets. It targets volatility of less than 5% pa, which it has historically delivered.

LSCF aims to generate alpha that has low-to-no correlation with equities, fixed-rate bonds and property markets, from relatively low-risk and liquid investments identified through the portfolio managers’ proven active asset-selection process. LSCF also targets reliably distributing strong quarterly income.

The ability to go long or short, either directly or through using derivatives, means LSCF can profit from bond price rises and price falls. Going long or short can also result in LSCF being leveraged.

Ratings

LSCF is listed on numerous investment platforms. It is also rated by many researchers, including Lonsec, Atchison and Australia Ratings. The strategy has daily redemption rights.

Investments

LSCF actively invests in a portfolio of Australian cash securities, bonds and hybrids with a target dollar-weighted average credit rating in the “A” band. LSCF does not invest in fixed-rate bonds (unless interest rate risk is hedged out). LSCF is permitted to use leverage to enhance alpha (or capital gains). 

Applying a diverse array of quantitative asset pricing techniques, LSCF’s portfolio managers add-value through very actively exploiting bond mispricings that seek to generate capital gains over and above the yield provided by the underlying fixed-income assets.

Risks

LSCF is not a bank deposit. It is a managed investment scheme registered and regulated by the Australian Securities and Investments Commission (ASIC). All investments carry risks, including that the value of investments may vary, future returns may differ from past returns, and that your capital is not guaranteed. The Fund can take long and short positions, borrow and use derivatives, meaning the Fund is geared (or leveraged). Leverage can amplify gains and also amplify losses. To understand LSCF’s risks better, please refer to the detailed “Risks” section in the PDS. 

Strategy: RBA cash plus 4.0% to 6.0% pa (unconstrained fixed-income, high yield, or defensive alternatives)
APIR: SLT2562AU
ARSN: 617 838 543

Inception Date: 31 Aug 2017
Target Returns: 4.0% to 6.0% over RBA cash rate net of fees

Responsible Entity: Equity Trustees
Registry: Mainstream Fund Services
Custodian: Mainstream Fund Services

Applications: Daily
Withdrawals: Daily (T+3)
Distributions: Quarterly
Minimum Investment: $1,000
Additional Investment: $1,000
Savings Plan: Monthly
Savings Plan Minimum: $100
Buy/Sell Spread*: 0.00%/0.05%

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Ratings

Qualitative

Long-Short Credit Fund: Very Strong | Australia Ratings
Smarter Money Fund: Recommended | Atchison Consultants

*The Buy Sell Spread may change depending on the transaction costs associated with buying and selling the assets within the Fund’s portfolio at that time. Any changes to the spreads after the date of the PDS will be published here.

SMARTER MONEY LONG-SHORT CREDIT FUND

Unconstrained

The Smarter Money Long-Short Credit Fund (LSCF) is an absolute return fixed-income strategy focused on exploiting long and short mispricings in credit markets.

The Fund targets returns above the Reserve Bank of Australia (RBA) cash rate plus 4% to 6% pa over rolling 3 year periods after Management Fees, Administration Fees and Performance Fees. The Fund targets volatility of less than 5% pa.

The Fund invests primarily in senior and subordinated bonds, hybrids and derivatives. The Fund targets holding the majority of its portfolio in investment-grade quality debt securities.

The Fund aims to generate absolute returns that have low-to-no correlation with equities, fixed-rate bonds and property markets, from relatively low risk and liquid investments identified through the portfolio managers’ proven active asset-selection process. The Fund aims to reliably distribute strong quarterly income.

The portfolio managers seek to generate these returns by taking “long” or “short” positions in relation to assets which they consider are trading below or above fair value. The goal is to generate significant risk-adjusted returns, or “alpha”. The ability to go long or short, either directly or through using derivatives, means the Fund can profit from bond price rises and price falls. Going long or short can also result in the Fund being leveraged.

LSCF has been independently reviewed and rated by several research houses, including Lonsec, Atchison Consultants (Very Strong) and Australia Ratings (Recommended). Please contact us to obtain copies of the available ratings reports. These ratings are only one factor to be taken into account when deciding whether to invest.

LSCF actively invests in a portfolio of cash securities and floating-rate notes with a target dollar-weighted average credit rating in the investment-grade band. LSCF does not invest in fixed-rate bonds (unless interest rate risk is swapped out) or equities. LSCF’s portfolio managers add value through active asset-selection.

LSCF is not a bank deposit. It is a managed investment scheme registered and regulated by the Australian Securities and Investments Commission (ASIC). All investments carry risks, including that the value of investments may vary, future returns may differ from past returns, and that your capital is not guaranteed. The Fund can take long and short positions, borrow and use derivatives, meaning the Fund is geared (or leveraged). Leverage can amplify gains and also amplify losses. To understand LSCF’s risks better, please refer to the detailed “Risks” section in the PDS. 

Strategy: Unconstrained Fixed Income; Defensive Alternatives
APIR: SLT2562AU
ARSN: 617 838 543

Inception Date: 31 Aug 2017
Target Returns: 4.0% to 6.0% over RBA Cash Rate net of fees

Responsible Entity: Equity Trustees
Registry: Mainstream Fund Services
Custodian: Mainstream Fund Services

Applications: Daily
Withdrawals: Daily (T+3)
Distributions: Quarterly
Minimum Investment: $1,000
Additional Investment: $1,000
Savings Plan: Monthly
Savings Plan Minimum: $100
Buy/Sell Spread*: 0.00%/0.05%

Download Centre

Ratings

Qualitative

Long-Short Credit Fund: Very Strong | Australia Ratings
Smarter Money Fund: Recommended | Atchison Consultants

*The Buy Sell Spread may change depending on the transaction costs associated with buying and selling the assets within the Fund’s portfolio at that time. Any changes to the spreads after the date of the PDS will be published here.