THE Honeycomb Investment Trust saw its net asset value (NAV) improve during June but its manager has admitted the time taken to deploy extra cash has weighed on returns.
The alternative finance-focused fund posted an NAV total return for June of 0.60 per cent, up from 0.56 per cent in May.
The investment company’s gross investment assets increased to £497m in the month, an increase of £47m on May driven by continued strong originations across consumer, property and business sectors, a monthly update from Honeycomb said.
“This growth has been a combination of the predictable flow of organic originations combined with the acquisition of a small seasoned portfolio and £14m of new structured facilities,” Honeycomb said.
“Growth in investment assets has been funded through the deployment of the remaining cash from the equity raise and an increase in debt drawings.
“Despite deploying the additional capital in the month, due to the timing of deployment the overall results were still impacted by the drag of carrying cash for part of the month and limited gearing.”
As of the end of June, the portfolio had a 60 per cent exposure to consumer loans, 33 per cent to property and seven per cent to small business finance.
Despite such as small weighting, Honeycomb said there was an “attractive opportunity” in small business lending and said it will grow its exposure having recently signed up a new partner.
Honeycomb raised £100m through a share sale in April following an oversubscribed £105m fundraising in May 2017.
The investment trust is currently trading on a premium to NAV of 11.4 per cent.