We pool investors' funds into high value commercial loans using mortgages as security
OTG Asset Backed Loan Fund
Quick facts
7.28% pa compounding*
7.05% pa paid monthly*
*Quoted, after fees, total return from 1 Nov 21, not guaranteed.
September 2018
Fixed income, secured commercial debt
Security properties - east coast Australia city markets only
Investment objective
OTG's Asset Backed Investment fund aims to provide investors with high returns matched with commensurate risk tolerance.
Fund overview
The actively managed fund provides exposure to east coast Australian city markets through a diversified portfolio of 1st and 2nd mortgages secured loans. OTG Capital places loans with leading lenders who offer commercial borrowers competitive conditions where the larger banks usually cannot.
Diversification
Our active Investment Committee utilises multiple city locations, varying loan sizes, 6-18 month loan maturity dates and commensurate investment yields to diversify and protect our investors' funds. Loan are used in residential and commercial settings and range between full service and interest only loans. These loans are typically used in order to bridge other loans or provide funding for development.
Risks
Investment returns are not guaranteed. You should read and understand the risks outlined in our Information Memorandum. OTG Capital loans are always secured against popular residential mortgages with LVRs usually between 60-70%. This risk mitigation provides comfort while minimising possibilities of loan impairments ever compromising our Fund's yield. We have a faultless track record, and have always returned our promised yield and all our investor's initial capital outlay.
Fees
There are no admin fees, no entry or exit fees, and no administrative change fees.
The yield we promise is the yield we pay. See the Information Memorandum for more info on assets under management fees. This is paid before the yield calculated for investors.
Restrictions
- Wholesale and sophisticated investors only
- Minimum investment of $AU 25,000
- Liquidity - fund redemptions are subject to liquidity (see above)
Details
LVR (loan to value ratio)
between 60% - 70%
Minimum investment
$AU 25,000
Management style
Active
Distributions (if selected)
Monthly
Liquidity status
iliquid fund - usually 30 days
Public Trustee
AMAL - over $AU 16Bn under management
Documents
Past performance does not guarantee future performance. Future yields are not guaranteed.
Yield changes
| Yield Change | Date | Monthly Income Yield | Effective Annual Yield |
| 0 | September 2018 | 6% p.a | 6.27% p.a |
| 1 | November 2019 | 6.75% p.a | 6.96% p.a |
| 2 | June 2020 | 5.85% p.a | 6.01% p.a |
| 3 | March 2021 | 6.9% p.a | 7.12% p.a |
| 4 | November 2021 | 7.05% p.a | 7.28% p.a |
Past performance as at 30/11/2021
| Start | 1 month | 3 months | 6 months | 1 year | 3 years | Inception |
| Effective Annual Yield Income | 7.05% p.a | 6.61% p.a | 6.93% p.a | 6.65% p.a | 6.34% p.a | 6.31% p.a |
| Effective Annual Yield compounded | 7.28% p.a | 7.18% p.a | 7.15% p.a | 6.86% p.a | 6.52% p.a | 6.50% p.a |
| Total Return Income | 0.59% | 1.74% | 3.46% | 6.75% | 19.10% | 21.10% |
| Total Return Compounded | 0.59% | 1.75% | 3.51% | 6.86% | 20.28% | 22.70% |
$AU 25,000 with OTG's Fund at Inception vs S&P/ASX 200
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OTG's Fund vs Economic Indicators
Other Notes
Distributions / Redemptions
We ensure monthly distributions are made within 7-10 working days after the end of the calendar month. As we are not an "at call" bank deposit facility (illiquid), we aim to provide funds redemption within 30-45 business days.
Rate of Return & Interest Rates
Whilst past performance doesn't reflect future returns, as Fund Managers, we aim to perform in a range consistent with a margin above the RBA cash rate providing performance that gives investors comfort their returns are doing better than the underlying cash rate and potentially beating inflation as well. The prevailing lending interest rates will always have an impact on the Trust's returns.
Trust Unit Price
It is intended the Trust's Unit Price will remain $1.00 at all times, with income (after management fees and expenses) being disbursed to investors.
Trust Cash Reserve and Capital Protection
The Trust's cash reserve has not been required at this time. Capital Protection is reviewed on a monthly basis in line with evaluation of the Loan-to-Value-Ratio of all our commercial loan instruments in the market at the time. The Trust's Constitution and Trustee ensures the Trust's Fund Manager never exceed these parameters to safeguard our investors funds and their returns.
Customer Service
Put us to the test, we have an excellent track record with our investors in responding quickly and efficiently to their questions and requests for further information. Call us on 1300 OTG CAP (684 227) any time to talk to our team.
All forms of investment have risk, even bank deposits. Some investments have greater risk than others, and in saying this, OTG Capital manages and mitigates its risk by;
- ensuring all loans are secured with mortgages over real property assets
- loans are secured with LVRs usually between 60% - 70%
- our loans are generally short term in nature, safeguarding potential risk against interest rate movements, and delivering liquidity to the fund
Please ensure you read our supporting Information Memorandum and Supplementary Terms that clearly outline all the risks associated with our Investment Trust.
And if you're still not sure, please be sure to call us at anytime, we'd be happy to discuss any concerns you have. We also recommend you seek personal advice from a licensed qualified financial planner if you are still not sure.
OTG Capital's fund by the nature of how we invest your money, is illiquid. This means that we are not an "at call" bank deposit facility.
While we don't lock your money in, should you need to redeem your investment with us, we usually provide your funds within 30-45 business days depending on the fund's liquidity and cash reserves available at the time of your redemption request.
We also ask a minimum of 30 days’ notice for redemption of part or all of your funds.
AMAL is a major Australian trustee company with over $16Bn under management.
All aspects of our operation works under the normal Australian Financial Services Licenses (AFSL) and ASICs (Australian Securities and Investment Commission) rules and regulations. The Trusts are wholesale and only open to wholesale investors.
Please refer to our Information Memorandum (IM) and Supplementary Terms and Application Pack for further details.
Wholesale & Sophisticated investors are accepted only, we are not a retail fund. In accordance with the Australian Corporations Act, to be eligible to invest with OTG Capital you are at least one of the following;
- Classified as a sophisticated investor, or;
- You have net assets of $2.5million, or;
- You have a gross income of the last 2 financial years of at least $250,000 per annum.
- Intending on investing $500,000 or more, or;
- Operating a self managed superannuation fund within certain criteria.
- We accept minimum investments of $25,000 and additional amounts in $10,000 increments should you wish to increase your sum later.
- The maximum investment amount we accept is $10 million.
- We have no fixed terms and you can keep your investment with us for as long (or short) as you like.
- Fund redemptions are always subject to the Trust's liquidity (view liquidity tab).
Why would you choose to invest in OTG Capital's fund?
To make better returns than cash term deposit interest rates. If you're satisfied continuing to earn bank interest on fixed deposits that involve meagre returns and long term commitments, then the answer is simple.
We understand everyone's need to hold a certain amount of cash reserves in "at call" accounts for cash flow and liquidity. We also believe that additional cash reserves that don't need at call immediacy should therefore work far harder for you.
OTG Capital's Investment Trust doesn't lock your money in, while still providing solid returns, above term deposit rates. The Fund Managers at OTG Capital have extensive finance industry experience, and OTG Capital's Fund Management have been involved in Asset Backed Investments using mortgages for more than 21 years.
So while OTG Capital as an Investment Trust is 3 years old now, this form of investing has provided solid returns even during the GFC years. And while past performance is no guarantee of future returns, using mortgages over real property assets to secure commercial loans is a proven formula that provides a lower risk profile for investors and their funds.
Our offer:
- Diversified short term loan portfolio sourced from a range of lenders
- Secured by real property from Australia's popular east coast city markets
- LVR's usually between 60% - 70%
- No lock-in periods, no hassle
- No entry or exit fees, no set up fees and no admin fees if you wish to switch from income to compounding or vice versa
OTG Capital is not a financial planning organisation, we only provide general advice.
General Advice is an ASIC legal definition that relates to information we provide to You. It means the information is general in nature and does not take into account your personal circumstances or your financial background.
If you are in any doubt, we strongly recommend you seek financial advice from a suitably qualified professional.
OTG Capital is licensed as a Corporate Authorised Representative (CAR#001250963) by Dirigere Advisory Pty Limited under their Australian Financial Services License (AFSL#524371) to provide General Advice only in relation to the OTG Capital Asset Backed Investment Trust.
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