La Trobe fund hits $2b

La Trobe Financial’s retail Credit Fund has hit $2 billion in funds under management (FUM) milestone while total Group FUM has reached $5 billion.

La Trobe Financial’s chief investment officer, Chris Andrews said that the fund saw a higher proportion of self-managed superannuation funds (SMSF) investors.

“Our peer-to-peer offerings have enabled investors to select their investment risk and duration and take more control over their portfolio construction,” he added.

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According to the company, its growth in FUM was helped in part by its disciplined investment process as well as its experienced distribution team with a strong client service focused on building relations with financial advisers and investors.

“We’ve seen growing product demand as both investors and their advisers look for ways to achieve return objectives during periods of ongoing uncertainty and volatility across markets,” Andrews said.

Additionally, SQM Research’s Louis Christopher said about the fund’s flagship investment term, the 12 Month Term Account: “The Fund [12 Month Term account] has consistently outperformed the benchmark and the peer average and managed to maintain a consistent return at 5.2 per cent per annum since 2015 while the peer group and the benchmark index have fallen over the year, which has been driven by all-time low cash rates and increased competition from the banks resulting in the tightening of margins.”

The La Trobe Financial Credit Fund is available on over ten platforms including Colonial First Wrap, Macquarie Wrap and Netwealth and it was approved for distribution by over 200 approved product lists across Australia.

“Following Blackstone’s entry to our share register as an 80 per cent owner, we are well placed to embark on our next phase of growth,” Andrews added.

“We will continue to broaden and evolve our product offering to suit investors’ needs.”

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It is only a matter of time before La Trobe becomes the next scandal. Any adviser recommending this type of product for income purposes is playing with fire. Tick Tock!

You have been warned!

Really, Walker?? La Trobe was one of the very few mortgage fund managers to sail through the GFC. Investors actually had a postive return on their funds for that year and thereafter. Why do you so wish to try and tarnish a manager when no such scandal exists? Views like your own only make investors question the relevancy of the adviser industry.

Mr Dragon, you only have to look at the returns on offer and the glossy advertisements targeting the elderly in the Australian to know that trouble is brewing. Those returns can only be achieved through lending to individuals/corporations who are higher risk. My research has confirmed La Trobe is a lender of choice for property developers focusing on the unit development space. I recommend you do some research into the current oversupply of units in Melbourne, Sydney and in particular, Brisbane. Then overlay the number of developments approved by desperate councils (who need the fees associated with approving said developments) but which have not even commenced and you will understand where I am coming from. There are many off the plan units due to settle this year, many of which will be valued at lower levels than contract price. Some recent statistics indicate end valuations as much as 25% lower. Many buyers will be unable to secure finance due to the resulting LVR and will forfeit their 10% deposits, resulting in the developers being required to sell stock at firesale prices which will only add fuel to the fire.

Just because a product weathered the GFC storm doesn't make them a safe investment, particularly where mortgage funds are concerned. Financial Advisers are required by law to know their product and if you are an adviser, I would encourage you to ensure the product is 'low risk' as you intimate.

I'm not saying there isn't a place for mortgage income funds in a client's portfolio. However, such an allocation could not in good conscience form part of a defensive portion of a client's portfolio.

I hope I am wrong.

Good points Walker Texas ranger : ) and Dragon. Nice reading different opinions. Personally I think there is a time and place but would like to see further improvements in the health of the economy before jumping back in.

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