Aura Core Income Fund

The Fund is aimed at retail and wholesale investors and participation is available to individuals, companies and trusts including superannuation trusts so long as they are ordinarily resident in Australia and aged 18 years or over.

This product is likely to be appropriate for a consumer seeking capital preservation or income distribution, to be used as a core component or satellite/small allocation within a portfolio where the consumer:

• Has a short, medium, or long-term investment timeframe.
• Has a low, medium, high, or very high risk/return profile.
• Does not require monthly access to capital.

The Fund is open-ended and an Australian Registered Managed Investment Scheme offered under a Product Disclosure Statement and registered with ASIC. 

The Fund aims to achieve a target return of 3.5%–5.5% per annum above the Reserve Bank of Australia (RBA) Cash Rate distributed as stable monthly income from a diversified portfolio of Australian private debt assets, predominantly made up of small to medium enterprise loans.

The Fund aims to invest in a diversified pool of Australian private debt investments. Investments will be made via warehouse securitisation deals, notes or other instruments for business and consumer loans, as well as direct lending to businesses. The Fund will target private debt investments sourced from multiple channels, including:

• Investing in funding vehicles of loan originators who target well-secured loans with low probability of default and aim to achieve higher returns on a risk-adjusted basis, than publicly traded notes of similar portfolio default and loss given default levels;
• Direct business lending opportunities; and
• Consumer lending via warehouse securitisation vehicles.

The Fund provides an opportunity for investors to benefit from the Investment Manager’s experience and extensive research and proprietary due diligence processes to target high-quality Australian non-bank lenders.

The Fund’s investment strategy is to provide stable monthly cash income and portfolio diversification by gaining exposure to the private debt asset class. The following portfolio parameters have been set for the Fund:

• 0–90% invested into private debt.
• 5% maximum loan concentration to a single underlying loan once the funds under management within the Fund reaches $100 million.
• 10–100% cash holdings.

The Fund is able to use derivatives to hedge interest rate risk.

The Fund invests across the Australian private debt universe, primarily in ​pools of both Australian SME business and consumer loans, originated by non-bank lenders. The criteria are as follows:

1. The underlying exposures are Australian loans.
2. There are processes for robust credit assessments of the underlying borrowers.
3. The lender has a scalable business model with a robust medium-term outlook to ensure the debts will be ​originated and serviced to a high standard on an ongoing basis.
4. The lender’s management team has a proven track record.

The minimum investment is $25,000 and the minimum client balance is $5,000. 

Additional applications (top-ups) of $5,000 or more can be made into the Fund. The minimum additional investment amount does not apply to reinvestment of distributions, which may be lower than this minimum. Additional investments are accepted every month and will be processed on the first business day of each month (provided your additional application is received before 12 noon Sydney time on the second last Business Day of the preceding month.)

The net asset value of the Fund will be determined monthly, and the Fund intends to distribute net income to investors each month. It is intended that all net income at the end of each month will be distributed to investors by the 10^th business day of the following month and may be slightly delayed after 30 June each year.

Yes, you can elect to take distributions as follows:

• Direct deposit to a bank account in the name of the entity investing; or
• Reinvestment in the Distribution Reinvestment Plan 'DRP'. If no election is made on your application form when you invest, then distributions will automatically be reinvested in the DRP.

The Fund intends to offer monthly redemptions, known as a Limited Withdrawal Offer.

However, please note the Fund is defined as illiquid under the Corporations Act, and regular Limited Withdrawal Offers are not guaranteed and will be subject to the Fund having available liquid assets. The Fund will aim to hold some cash to meet monthly redemptions but there may be situations where limits to redemptions may apply. 

Each month, the Responsible Entity intends to offer investors a Limited Withdrawal Offer. During the withdrawal period, the Responsible Entity will accept withdrawal requests.

Investors will be required to submit the Withdrawal Request Form and have it signed by the authorised signatories on the account. The Withdrawal Request Form will be included in each Limited Withdrawal Offer.

Each Limited Withdrawal Offer will be available for acceptance for at least 21 days. You can find details of the withdrawal period on the Responsible Entity One Managed Investment Funds website.

If total redemption requests received are in excess of the amount of the Limited Withdrawal Offer, the requests will to be satisfied proportionately.

Any requests for withdrawal in response to a Limited Withdrawal Offer that are not wholly satisfied due to a scale back will remain valid for withdrawal in the next Limited Withdrawal Offer.

Withdrawal proceeds will be paid to your nominated bank account and generally by the 10th Business Day of the following month. However, the Responsible Entity has up to 21 days to pay withdrawal proceeds.

Please refer to Section 7 of the PDS for more information regarding Limited Withdrawal Offers. You can access the PDS here: Download the Aura Core Income PDS.