Australia Ratings is an independent research firm that provides information, research and ratings to the Australian investment community.
It is licensed by the Australian Securities and Investments Commission, and is the only Australian research firm to hold two retail Australian Financial Services Licences.
It is widely recognised as a highly credible source of independent information for both retail and wholesale investors on the credit and investment risk of financial products offered in the Australian market, including managed funds and ASX-listed debt securities (Source: Australia Ratings).
Managing Director of Australia Ratings Chris Dalton said, “after several years of covering Trilogy’s investment offerings, the agency has developed increasing confidence in the investment grade of the funds.
“Over that time we’ve been able to see the consistency of Trilogy’s processes and strategies,’’ said Chris. “Based on the quality of the underlying investments, their performance over that period as well as the Philiposophy that Trilogy employs, we felt that it was justified to improve their ratings.’’
Trilogy Managing Director Philip Ryan said the news was testament to the professionalism of the Trilogy team.
“We are delighted to have the robustness of our funds validated by independent external experts,’’ said Philip.
In their detailed assessment of the Trilogy Monthly Income Trust, a pooled mortgage trust providing investors with exposure to returns available through loans secured by registered first mortgages, Australia Ratings’ investment team concluded that “the team at Trilogy is very experienced, with multiple checks and balances contributing to the ability of the Trust to achieve its objectives’’.
The Trust deserves a ‘Very Strong’ rating, says Australia Ratings, which indicates “a very strong level of confidence that the Trust can deliver a risk-adjusted return in line with its investment objectives”.
“With management having been in this sector before and throughout the GFC, they have built a diversified, risk-averse portfolio of mortgages which continues to drive strong, stable returns,’’ the report says.
“In March 2020, in response to the COVID crisis, the Trust put several additional risk measures in place in relation to loans written during that time.
“The Trust has maintained monthly returns at a level above 6.50% (annualised) throughout the COVID period. Since inception in 2007, the Trilogy Monthly Income Trust has paid a distribution every month, has honoured all withdrawal requests, and maintained a unit price of $1.00.’’
In their detailed report on the Trilogy Enhanced Income Fund, Australia Ratings noted that it aims to provide investors with regular monthly income and returns in excess of the returns of traditional cash products.
The Fund targets a 65% allocation to cash, cash-style investments, and other financial assets and a 35% allocation to the Trilogy Monthly Income Trust.
The Fund’s benchmark is the official cash rate +1.50% and it has substantially exceeded this. Whereas the official cash rate has been below 2% since 2016, the Fund has returned an average of 3.86% per annum since inception in 2017, 3.06% per annum over the past three months and 3.45% per annum for November 2020, when the official cash was just 0.1%.
“The underlying investments of the Fund have performed well over this period,’’ Australia Ratings noted, and it’s ‘Very Strong’ rating indicated their very high degree of confidence that this would continue, as their ratings are forward-looking opinions designed to help investors identify and understand the features and quality of investment products.
This article is issued by Trilogy Funds Management Limited ACN 080 383 679 AFSL 261425 (Trilogy) as responsible entity for the Trilogy Monthly Income Trust (Trust) ARSN 121 846 722 and the Trilogy Enhanced Income Fund (Fund) ARSN 614 682 469. Application for investment can only be made on the application form accompanying the Product Disclosure Statement (PDS) dated 17 December 2018 for the Trilogy Monthly Income Trust ARSN 121 846 722 and 28 July 2020 for the Trilogy Enhanced Income Fund ARSN 614 682 469 available at www.trilogyfunds.com.au. The PDS contains full details of the terms and conditions of investment and should be read in full, particularly the risk section, prior to lodging any application or making a further investment. All investments, including those with Trilogy, involve risk which can lead to loss of part or all of your capital or diminished returns. Trilogy is licensed to provide only general financial product advice about its products and therefore recommends you seek personal advice on the suitability of this investment to your objectives, financial situation and needs from a licensed financial adviser. Investments with Trilogy are not bank deposits and are not government guaranteed.
The information contained in the Australia Ratings Analytics report and encapsulated in the investment rating is of a general nature only. The report and rating reflect the opinion of Australia Ratings Analytics Pty Limited (AFSL 494552). It does not take into account an individual’s objectives, financial situation, or needs. Professional advice should be sought before making an investment decision. A fee has been paid by the fund manager for the production of the report and investment rating.