INVESTMENT trust Peer-to-Peer Global Investments (P2PGI) will shift its focus towards UK loans following a disappointing year, Peer-to-Peer Finance News has learned.
The fund, which is managed by MW Eaglewood, has traditionally been weighted towards US consumer loans. However, Simon Champ, MW Eaglewood’s chief executive officer has suggested that these allocations could change in the coming months.
“We try to remain focused on prime lending and continuously monitor and adjust our portfolio composition for optimum risk-adjusted returns,” Champ told Peer-to-Peer Finance News. “Whereas at launch the fund was heavy invested in US consumer loans, it is now more diverse and that percentage has shrunk and could well continue to shrink.
“Other areas that we now invest in include UK consumer loans, loans to SMEs, trade finance and asset-backed loans and we expect to continue this diversification not only by sector but also by platform and by geography.”
The fund has produced a 12-month rolling NAV return of 4.45 per cent, under-performing against its target return of 6-8 per cent. The disappointing returns are believed to be due to rising rates in the US, FX costs, Brexit and the elevated cost of borrowing against some assets. As a result, the firm has recently been exercising its share buyback options as a way of capitalising on the fund’s discounted share price and creating value for shareholders.
Despite missing out on its target returns for 2016, the fund has consistently produced positive NAV returns since its launch in 2014.
“Looking ahead we will continue to diversify the portfolio to achieve the best returns for our shareholders, whilst being cognisant of the low-risk profile of the fund,” added Champ. “We are eager to remain a low risk investment proposition.”