RAW Insight

Tortoise continues to beat the Hare!

Tortoise continues to beat the Hare! (RAW Mortgage Fund up 1.14% in Q1 2020)

When the world around us remains so uncertain, holding your capital in a fund with strong underlying capital protection and consistent returns can be reassuring.
 
The RAW Mortgage Fund is one such fund. It continues to provide consistent returns for investors with capital protected by first legal charge security held against a broad range of UK residential property at an average loan to valuation ratio of just 47%.
 
The Fund has delivered positive monthly returns to investors every month since launch nearly 5 years ago. Total returns to institutional investors since launch are now in excess of 20%. Steady, consistent monthly returns from the Fund have proved very reliable whilst listed investments in stock markets have been up and down.
 
For those seeking regular income, the Fund offers the option of an income share class with quarterly dividends. New this month the Fund also offers a USD $ share class.

Mortgage Fund Performance Comparison:

Comparison indices above: IShares Core FTSE 100 UCITS ETF; IShares FTSE 250 UCITS ETF; IShares £ Corporate Bond 0-5 year UCITS ETF; IShares UK Gilts 0-5yr UCITS ETF

Alternative, usually reliable sources of consistent income, such as government or corporate bonds, are currently looking less attractive with investor returns severely impacted by the external environment.
 
The Fund provides investors with capital protection via a first legal charge on the properties it takes security over and when combined with conservative lending (via low loan to valuation ratios), we are of the view that residential property values would have to fall very significantly before the Fund’s capital was impaired or its returns were impacted.
 
The April report from Savills, “How UK residential behaves in downturns”, looks at historic economic shocks on the UK property market - such as the Oil Crisis in the 1970s, the 1980s recession and the Global Financial Crisis. Based on these ‘economic shocks’, where property prices fell between 15% and 36%, it seems unlikely (given that interest rates are so low) that there will be such a significant impact on residential property prices in the UK to affect the RAW Mortgage Fund’s underlying capital protection.
 
We are very pleased to report that each and every loan within the Fund continue to perform positively and as expected. Since the Fund was launched nearly 5 years ago, we have not experienced any bad debts or write downs of loans and the current performance of the loan book continues to be very strong.
 
We have received positive inflows of new capital from investors over the last couple of months, including additional capital allocations from existing institutional investors.
 
The team at RAW Capital Partners have continued to work effectively and efficiently whilst operating remotely from our normal office location and have successfully completed new lending activity over the last few weeks working closely with our panel of solicitors and valuers.


Call us for more information on + 44 1481 708256 or email tim@rawcapitalpartners.com
 
Find out more about how we can help you achieve consistent returns on your investments with options to invest from as little as £10,000.

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