FundTap Luxembourg Finance Fund
Investment Objective
The FundTap Luxembourg Finance Fund invests on a managed basis into
debt securities to achieve, in the medium to long term, a good overall
investment return with relative security of capital in comparison to other
income generating investments.
Investment Policy
The FundTap Luxembourg Finance Fund primarily invests into a substantial number of unsecured personal loan debt securities with attractive credit characteristics and interest rates.
It is important to note that the Sub-Fund A only invests in individual loans and not a basket of loans that may have been repackaged, re-graded and sold at a premium. Each loan is carefully assessed and individually selected by the General Partner with the assistance of the proprietary risk analysis software of the Investment Research and Analysis Company.
The General Partner will manage the acquisition and potential sale of loans in order to maximise returns whilst minimising defaults.
The key characteristics to successful investment in the unsecured personal loan market are:
- accurate analysis of the risk
- appropriate reward versus risk (interest rate)
- careful maintenance of the risk (ie the borrowers)
- strict monitoring of the risk
- wide spread of risk using a large pool of borrowers
- sufficient liquidity (the ability to trade risk)
The FundTap Luxembourg Finance Fund seeks to capitalise on these positive characteristics whilst limiting exposure to any negatives. Sub-Fund A may trade these securities on a secondary market for proper risk management and/or financial gain.
Loan Statistics
As of Jan 11th 2012: the average borrower earns approximately 70,000 USD per annum and is in the top 10% of US population*......with 14.9 years of credit history; 13.3% debt to income ratio; a 715 FICO Score and an average loan size of 10,878 USD.
We employ FundTap Analytics Ltd’s proprietary Trend Analysis Program (TAP) to target improved investment returns through highly effective debt management.
It is this combination of individual selection and management that allows us to conservatively target a net income of 8.5%+ pa.
It is essential that an income generating product has low fees and this also fits with our investment philosophy and background, hence management fees are just 1.25% pa with no performance fees.
We will publish weekly online statistics for all debt securities.
