Fixed Income, Investments

La Trobe fund gets recommended rating

La Trobe fixed income

The La Trobe 12 Month Term Account, which offers fixed income investments, has earned a recommended rating from Zenith Investment Partners.

Research house Zenith Investment Partners has awarded a recommended rating to the La Trobe 12 Month Term Account.

The La Trobe offering operates in the fixed income asset class and gives investors access to its underlying portfolio consisting of a pool of direct low-doc mortgages primarily backed by residential, commercial and industrial properties.

In addition, the fund also has the capability to make allocations to rural and vacant land and aims to deliver a yearly return of 1.5 per cent above the Bloomberg AusBond Bank Bill Index.

Over a one-year, three-year and five-year time horizon, the 12 Month Term Account has generated annual returns of 5.14 per cent, 5.26 per cent and 5.3 per cent respectively. This compares favourably to the median returns for the asset class of 2.04 per cent, 3.91 per cent and 4.18 per cent over the same respective time frames.

The ratings agency expressed satisfaction over the risk management of the low-doc nature of the fund’s mortgage pool, noting the manager “has sufficient risk and control measures in place to mitigate impacts to investor capital while providing competitive returns through the credit cycle”.

“In Zenith’s opinion, risks pertinent to the fund are effectively managed through adherence to stringent lending criteria, full credit and risk assessments and proactive arrears management,” it said.

Zenith suggested the offering is suitable for individuals looking for capital stability and an income return above the cash rate.

“However, investors should only consider the fund if they have a higher risk tolerance (relative to cash),” it warned.

“Investors should also be comfortable with the inherent risks of liquidity mismatches to which most mortgage funds are prone, however, Zenith acknowledges that the 12-month term structure helps mitigate this.”

La Trobe chief investment officer Chris Andrews said: We welcome the research team’s results and findings. Zenith has been a mainstay of property and funds management assessment for many years and has an outstanding reputation for accuracy and reliability.”

The recommended rating indicates the La Trobe 12 Month Term Account has a high probably of meeting its stated investment objectives.


Our Story

selfmanagedsuper is the definitive publication covering Australia’s SMSF sector. It uniquely offers online content tailored separately for SMSF professionals and individual trustees participating in the fastest growing and largest sector of the superannuation industry. As such, it is a must read for those wanting to stay informed about the latest news, regulatory developments, technical strategies, investments, compliance, legal and administration issues concerning SMSFs.

Copyright © SMS Trustee News 2024

ABN 43 564 725 109

Benchmark Media

Site design Red Cloud Digital