Support for Elstree hybrid fund

hybrids/evergreen/

1 June 2021
| By Laura Dew |
image
image
expand image

The Elstree Hybrid fund has received a rating from Evergreen Ratings as it offers a higher yield than term deposits.

Issued by financial institutions, hybrids had less risk than equities, discretionary distributions and could be converted into equity by the issuer or regulator.

The Elstree Hybrid fund was actively managed and received a ‘satisfactory’ rating from Evergreen Ratings as the ratings house said it offered a “well-considered, carefully-crafted portfolio of equity hybrids, while enjoying the yield experience of this market segment”.

It aimed to deliver returns greater than short-term interest rates from a portfolio of hybrid securities. 

Founder, Angela Ashton, said: “We believe that hybrid portfolios require ongoing active management because hybrids come in many flavours of debt, equity and embedded options.

 

“As hybrids are sold into the market, retail investors tend to sell older hybrids (where some of the optionality creates additional uncertainty) in order to buy the newer issues. The result is that the market can oversell, creating opportunities for informed investors.”

 

Campbell Dawson, Elstree Hybrid management director, said: “We believe the hybrid market offers opportunities for active investors as it is inherently inefficient. It is dominated by retail investors who have a limited understanding of bank and insurer capital issues, and who under and overreact to issuer specific risks and equity market movements.  We construct portfolios which seek to benefit from market opportunities and inefficiencies and pass these returns on to our investors”.

 

Read more about:

AUTHOR

Recommended for you

sub-bgsidebar subscription

Never miss the latest news and developments in wealth management industry

MARKET INSIGHTS

So we are now underwriting criminal scams?...

2 months ago

Glad to see the back of you Steve. You made financial more expensive, not more affordable as you claim, and presided ...

2 months ago

Completely agree Peter. The definition of 'significant change is circumstances relevant to the scope of the advice' is s...

4 months 1 week ago

A Sydney financial adviser has been permanently banned from providing any financial services, with the regulator deriding his “lack of integrity, trustworthiness and prof...

3 weeks 1 day ago

Minister for Financial Services, Stephen Jones, has provided further information about the second tranche of the Delivering Better Financial Outcomes (DBFO) reforms....

2 weeks ago

One licensee has lost 27 advisers in the past week, now sitting at zero, according to the latest Wealth Data figures....

3 weeks 1 day ago

TOP PERFORMING FUNDS