Alpha Generating strategies
Coolabah Capital Investments (CCI) offers a rich range of active credit alpha solutions under the Smarter Money Investments (SMI), BetaShares and CCI umbrellas. All utilise our unique intellectual edge furnished by one of the largest teams in investment-grade fixed-income.
The Strategies
Coolabah has a wide range of actively managed fixed income strategies for retail, wholesale and institutional investors.
Publicly available strategies are offered through Coolabah’s wholly owned subsidiary Coolabah Capital Investments (Retail), previously known as retail fund manager, Smarter Money Investments (SMI). These include:
- the Smarter Money Fund (SMF), which targets liquid, zero-duration returns of 1.0% to 2.0% p.a. above the RBA cash rate after all fees with a target average A credit rating (with no leverage);
- the Coolabah Short Term Income Fund, which targets liquid, zero-duration returns of 1.5% to 3.0% p.a. above the RBA cash rate after all fees with a target average A credit rating (with no leverage);
- the Coolabah Floating-Rate High Yield Fund (Managed Fund) (YLD), which provides exposure to a portfolio of investment-grade Australian floating-rate notes with enhanced yields;
- the Smarter Money Long Short Credit Fund (LSCF), which targets liquid, zero-duration returns of 4.0% to 6.0% p.a. above the RBA cash rate after all fees with a target average A credit rating;
- the Coolabah Long-Short Opportunities Fund (LSOP), which targets liquid, zero-duration returns of 8.0% p.a. above the RBA cash rate after all fees with a target average A credit rating;
- the Coolabah Active Composite Bond Fund (Hedge Fund) (FIXD), which targets liquid, long-duration returns of 1.0% to 2.0% p.a. above AusBond Composite 0+Yr Index after all fees with a target average A credit rating;
- the Coolabah Active Global Bond Fund, which targets liquid, long-duration returns of 1.0% to 2.0% p.a. above Global Aggregate Corporate Index after all fees with a target average A credit rating;
- the Coolabah Active Sovereign Bond Fund (ABSF), a liquid AAA rated government bond strategy which offers both zero-duration and long-duration exposure that targets returns of 3% to 5% p.a. above their Benchmarks; and
- two foreign currency strategies, including a US Dollar Short Term Income and a Long-Short Credit strategy.
These strategies are available to institutional investors in a customisable mandate or fund format to suit any risk and return profile.
Public Strategies
SMARTER MONEY FUND
The Smarter Money Fund (SMF) aims to actively exploit mispricings in cash and bond markets to generate daily liquidity returns that exceed a target of the RBA cash rate plus 1.0% to 2.0% pa after all fees with an average A credit rating and near-zero interest rate duration risk.
The SMF is a daily liquidity solution that invests in cash and investment-grade fixed-income assets that are hedged to a floating-rate (ie, not fixed-rate) exposure, which means it has near-zero interest rate (duration) risk.
SMF cannot invest in hybrids or use leverage. It is typically placed in the “short duration fixed-interest” (credit) or “cash-enhanced” universes.
SMF is listed on numerous investment platforms. It is also rated by many researchers, including Mercer, Lonsec, Atchison and Foresight Analytics. The strategy has daily redemption rights.
COOLABAH SHORT TERM INCOME FUND
The Coolabah Short Term Income Fund aims to actively exploit mispricings in cash and bond markets to generate daily liquidity returns that exceed a target of the RBA cash rate plus 1.5% to 3.0% pa after all fees with an average A credit rating and near-zero interest rate duration risk.
The Fund is a daily liquidity solution that invests in cash and fixed-income assets that are hedged to a floating-rate (ie, not fixed-rate) exposure, which means it has near-zero interest rate (duration) risk.
It cannot use leverage. It is typically placed in the “short duration fixed-interest” (credit) or “cash-enhanced” universes.
It’s listed on numerous investment platforms. It is also rated by many researchers, including Foresight Analytics. Lonsec, Mercer and Zenith. The strategy has daily redemption rights.
COOLABAH FLOATING-RATE HIGH YIELD FUND (MANAGED FUND)
The Coolabah Floating-Rate High Yield Fund (Managed Fund) focuses on generating higher income than other traditional fixed income investments by investing in a portfolio of investment-grade Australian Floating-Rate Notes (FRNs) with enhanced yields.
It invests in a portfolio of cash securities and floating-rate, Australian bank-issued senior and Tier 2 bonds with an average rating of “A-”. It has the capacity to invest in government bonds and corporate bonds.
SMARTER MONEY LONG-SHORT CREDIT FUND
The Smarter Money Long-Short Credit Fund (LSCF) aims to actively exploit mispricings in global cash and bond markets to generate daily liquidity returns that exceed a target of the RBA cash rate plus 4% to 6% pa after all fees with an average A credit rating and near-zero interest rate duration risk.
LSCF is a daily liquidity solution that invests in cash and fixed-income assets that are hedged to a floating-rate (ie, not fixed-rate) exposure, which means it has near-zero interest rate (duration) risk.
LSCF is typically placed in the “unconstrained fixed-income”, “high yield”, or “defensive alternative” universes.
LSCF is listed on numerous investment platforms. It is also rated by many researchers, including Lonsec, Atchison and Foresight Analytics. The strategy has daily redemption rights.
COOLABAH LONG-SHORT OPPORTUNITIES FUND
The Coolabah Long-Short Opportunities Fund (LSOP) aims to actively exploit mispricings in global cash, bond and bank equity markets to generate daily liquidity returns that exceed a target of the RBA cash rate plus 8% pa after all fees with an average A credit rating and near-zero interest rate duration risk.
LSOP is a daily liquidity solution that invests in cash, fixed-income securities and listed equity providing investors with exposure to the full capital structure of Australian and overseas banking groups. All fixed-rate assets are hedged to a floating-rate (ie, not fixed-rate) exposure that means it has near-zero interest rate (duration) risk.
COOLABAH ACTIVE COMPOSITE BOND FUND (HEDGE FUND)
The Coolabah Active Composite Bond Fund (Hedge Fund) is our market-leading, daily liquidity, long duration, active composite bond strategy. This was previously an institutional strategy for super funds that was not available to the public, which we are now excited to bring to you as an exchange quoted managed fund on Cboe Australia under the ticker FIXD. The Fund can also be accessed by applying directly with the Fund Administrator, Apex Fund Services, under the APIR Code ETL2716AU.
The Coolabah Active Composite Bond Fund (Hedge Fund) seeks to deliver superior risk-adjusted returns to the Bloomberg AusBond Composite Bond Index through harnessing Coolabah’s active credit alpha style that focusses on systematically exploiting mispricings to generate capital gains in addition to yield.
COOLABAH ACTIVE GLOBAL BOND FUND
The Coolabah Active Global Bond Fund targets returns in excess of the Bloomberg Global Aggregate Corporate Index (hedged to AUD) after management costs, by 1.0% to 2.0% per annum over rolling 3 year periods.
The Fund offers an active fixed-income strategy focused on mispricing in corporate bond markets with the aim of delivering superior risk-adjusted returns.
The Fund offers fixed-rate bond exposure by matching its interest rate duration to that of the Index.
COOLABAH ACTIVE SOVEREIGN BOND FUND
The Coolabah Active Sovereign Bond Fund (ASBF) aims to generate excess returns of 3% to 5% p.a. above its benchmark through exploiting relative value mis-pricings in high quality government bonds and related derivatives that have a low correlation to equity markets, credit markets and the level of interest rates.
The Zero Duration Class (ETL9561AU) aims to deliver the Fund’s investment strategy over its Benchmark, the RBA Overnight Cash Rate. It offers a floating interest rate exposure resulting in low or near-zero interest rate risk.
The Long Duration Class (ETL5578AU) aims to deliver the Fund’s investment strategy over its Benchmark, the Bloomberg AusBond Treasury 0+ Yr Index. It offers fixed-rate bond exposure by matching its interest rate duration to that of the Index.
Floating-Rate or Fixed-Rate Exposures Available
Foreign Currency Strategies
USD Strategies
CCI offers Australian based investors with US dollars access to the Australian fixed income market through the Short Term Income and Long-Short strategies. These solutions target returns between 1.5% to 3%, and 4% to 6% above the US Federal Funds Target Range.
New Zealand PIE strategies
CCI offers New Zealand based investors access to the Australian and global fixed income market through the following strategies:
- the Coolabah Short Term Income PIE Fund, which targets liquid, zero-duration returns of 1.5% to 3.0% p.a. above the RBNZ cash rate after all fees with an average A credit rating (with no leverage);
- the Coolabah Floating-Rate High Yield PIE Fund, which provides exposure to a portfolio of investment-grade Australian floating-rate notes with enhanced yields;
- the Coolabah Long-Short Credit PIE Fund, which targets liquid, zero-duration returns of 4.0% to 6.0% p.a. above the RBNZ cash rate after all fees with an average A credit rating; and
- the Coolabah Active Composite Bond PIE Fund, which targets liquid, long-duration returns of 1.0% to 2.0% p.a. above AusBond Composite 0+Yr Index (NZD Hedged) after all fees with an average A credit rating.
All strategies are portfolio investment entities (PIE). This is a New Zealand managed fund that offers investors special tax rules that apply to the income earned by the Fund. The PIE rules mean that investors pay tax on their own tax rate (the Prescribed Investor Rate or PIR), which is usually slightly lower than their income tax rate. Refer to the Product Disclosure Statement for more information.
Institutional Strategies
Coolabah Capital Institutional Investments (CCII) manages a wide range of customised, active credit alpha strategies exclusively for wholesale and institutional investors in mandate or fund format.
CUSTOM INSTITUTIONAL MANDATES
CCI specialises in building bespoke direct portfolios of investment grade and/or sub-investment grade credit alpha strategies with risk and return preferences tailored to client needs, including long and long-short strategies that are unlevered or levered.
BETASHARES ACTIVE AUSTRALIAN HYBRIDS FUND
HBRD is the first “active” fixed-income ETF in Australia that provides access to a diversified portfolio of cash, bonds and hybrid securities. HBRD aims to outperform the RBA cash rate plus 2.5% pa, which it has done since inception, while seeking to reduce the volatility and downside risk that may otherwise be experienced by direct holders of hybrids.
Fund Comparison
< Scroll left to reveal table.
Long Only Strategies
| Smarter Money Strategy | Short Term Income Strategy | Betashares HBRD ETF | |
|---|---|---|---|
| Strategy | Smarter Money Income | Short-Term Income | Hybrid Securities |
| Domicile | Australia | Australia | Australia |
| Currency | AUD | AUD | AUD |
| APIR Code | CRE0014AU | SLT0052AU | ASX: HBRD |
| Investment Objective | RBA + 1%-2% p.a. after fees | RBA + 1.5%-3% p.a. after fees | RBA + 2.5% p.a. after fees |
| Target Volatility | < 1% p.a. | < 2% p.a. | 3%-4% p.a. |
| Inception Date | 17-Feb-2012 | 8-Oct-2014 | 13-Nov-2017 |
| Responsible Entity | Equity Trustees | Equity Trustees | BetaShares Capital |
| Registry | Apex Fund Services | Apex Fund Services | Link Market Services |
| Custodian | Citigroup | Citigroup | RBC Investor Services |
| Applications | Daily | Daily | Daily |
| Withdrawals | Daily (T+3) | Daily (T+3) | Daily (T+2) |
| Distributions | Quarterly | Quarterly | Monthly |
| Minimum Investment | $1,000 | $1,000 | None |
| Additional Investment | $1,000 | $1,000 | None |
| Savings Plan | Monthly | Monthly | N/A |
| Savings Plan Minimum | $100 | $100 | N/A |
| Buy/Sell Spread* | 0.00%/0.025% | 0.00%/0.025% | On Market |
| Gearing | No | No | No |
| Shorting | No | No | No |
Geared & Alternative Strategies - Zero Duration
| Floating-Rate High Yield Strategy | Long-Short Credit Strategy | Long-Short Opportunities Strategy | Coolabah Active Sovereign Bond Fund - Zero Duration Class | |
|---|---|---|---|---|
| Strategy | High Yield | Unconstrained Fixed Income | Unconstrained Fixed Income | Government Bond |
| Interest Rate Exposure Target | Floating-Rate (< 3mths) | Floating-Rate (< 3mths) | Floating-Rate (< 3mths) | Floating-Rate (< 3mths) |
| Domicile | Australia | Australia | Australia | Australia |
| Currency | AUD | AUD | AUD | AUD |
| APIR Code | ETL5010AU | SLT2562AU | ETL9059AU | ETL9561AU |
| Investment Objective | A portfolio of floating-rate notes with enhanced yields | RBA + 4%-6% p.a. after fees | RBA + 8% p.a. after fees | RBA Overnight Cash Rate + 3%-5% p.a. after fees |
| Target Volatility | None | < 5% p.a. | < All Ords Index | < 4% p.a. |
| Inception Date | 5-Dec-2022 | 31-Aug-2017 | 1-May-2020 | 13-Dec-2023 |
| Responsible Entity | Equity Trustees | Equity Trustees | Equity Trustees | Equity Trustees |
| Registry | Apex Fund Services | Apex Fund Services | Apex Fund Services | Apex Fund Services |
| Custodian | Citigroup | Citigroup | Citigroup | Citigroup |
| Applications | Daily | Daily | Daily | Daily |
| Withdrawals | Daily (T+3) | Daily (T+3) | Daily (T+3) | Daily (T+3) |
| Distributions | Quarterly | Quarterly | Quarterly | Quarterly |
| Minimum Investment | $1,000 | $1,000 | $1,000 | None |
| Additional Investment | $1,000 | $1,000 | $1,000 | None |
| Savings Plan | Monthly | Monthly | N/A | N/A |
| Savings Plan Minimum | $100 | $100 | N/A | N/A |
| Buy/Sell Spread* | 0.00%/0.05% | 0.00%/0.05% | 0.00%/0.05% | 0.00%/0.01% |
| Gearing | Yes | Yes | Yes | Yes |
| Shorting | No | Yes | Yes | Yes |
Geared & Alternative Strategies - Long Duration
| Coolabah Active Composite Bond Fund (Hedge Fund) | Coolabah Active Global Bond Fund | Coolabah Active Sovereign Bond Fund | |
|---|---|---|---|
| Strategy | Composite Bond | Global Corporate Bond | Government Bond |
| Interest Rate Exposure Target | Matched to the Composite Bond Index (Fixed-Rate Bond Exposure) | Matched to the Global Aggregate Corporate Index (Fixed-Rate Bond Exposure) | Matched to the Treasury Bond Index (Fixed-Rate Bond Exposure) |
| Domicile | Australia | Australia | Australia |
| Currency | AUD | AUD | AUD |
| APIR Code | CXA: FIXD | ETL2586AU | ETL5578AU |
| Investment Objective | AusBond Composite 0+Yr Index + 1%-2% p.a. after fees | Global Aggregate Corporate Index + 1%-2% p.a. after fees | AusBond Treasury 0+Yr Index + 3%-5% p.a. after fees |
| Target Volatility | None | None | 4% p.a. |
| Inception Date | 7-Mar-2017 | 23-Sep-2024 | 13-Dec-2023 |
| Responsible Entity | Equity Trustees | Equity Trustees | Equity Trustees |
| Registry | Apex Fund Services | Apex Fund Services | Apex Fund Services |
| Custodian | Citigroup | Citigroup | Citigroup |
| Applications | Daily | Daily | Daily |
| Withdrawals | Daily (T+2) | Daily (T+3) | Daily (T+4) |
| Distributions | Quarterly | Quarterly | Quarterly |
| Minimum Investment | None | $1,000 | $1,000 |
| Additional Investment | None | $1,000 | $1,000 |
| Savings Plan | N/A | N/A | N/A |
| Savings Plan Minimum | N/A | N/A | N/A |
| Buy/Sell Spread* | On Market | 0.00%/0.025% | 0.00%/0.01% |
| Gearing | Yes | Yes | Yes |
| Shorting | Yes | Yes | Yes |
Foreign Currency Strategies
| USD Short Term Income Strategy | USD Long-Short Credit Strategy | |
|---|---|---|
| Strategy | Short-Term Income | Unconstrained Fixed Income |
| Domicile | Australia | Australia |
| Currency | USD | USD |
| Investment Objective | US Fed Fund Target Range + 1.5%-3% p.a. after fees | US Fed Fund Target Range + 4%-6% p.a. after fees |
| Target Volatility | < 2% p.a. | < 5% p.a. |
| Inception Date | 8-Oct-2014 | 31-Aug-2017 |
| Responsible Entity | Equity Trustees | Equity Trustees |
| Registry | Apex Fund Services | Apex Fund Services |
| Custodian | Citigroup | Citigroup |
| Applications | Daily | Daily |
| Withdrawals | Daily (T+5) | Daily (T+5) |
| Distributions | Quarterly | Quarterly |
| Minimum Investment | $1,000 USD | $1,000 USD |
| Additional Investment | $1,000 USD | $1,000 USD |
| Buy/Sell Spread* | 0.00%/0.025% | 0.00%/0.05% |
| Gearing | No | Yes |
| Shorting | No | Yes |
From 5 October 2021, a Target Market Determination (TMD) is required to be made available under the Design & Distribution Obligations. It describes who this financial product is likely to be appropriate for (i.e. the target market), and any conditions around how the product can be distributed to investors. It also describes the events or circumstances where the Target Market Determination for this financial product may need to be reviewed.
*The Buy Sell Spread may change depending on the transaction costs associated with buying and selling the assets within the Fund’s portfolio at that time. Any changes to the spreads after the date of the PDS will be published here.
Disclaimer: Past performance does not assure future returns. Returns are shown after all fund fees, unless otherwise stated. Retail product fees can vary depending on the unit class selected and/or whether the financial advisory firm has negotiated access to lower cost unit classes.
Equity Trustees Limited (Equity Trustees) ABN 46 004 031 298 AFSL 240975, is the responsible entity for the Smarter Money Fund (SMF), the Coolabah Short Term Income Fund (STIF), Smarter Money Long-Short Credit Fund (LSCF), Coolabah Long-Short Opportunities Fund (LSOP), the Coolabah Floating-Rate High Yield Fund (Managed Fund) (YLD), the Coolabah Active Composite Bond Fund (Hedge Fund) (Ticker: FIXD), and the Coolabah Active Sovereign Bond Fund (ASBF). Equity Trustees is a subsidiary of EQT Holdings Limited ABN 22 607 797 615, a publicly listed company on the Australian Securities Exchange (ASX: EQT).
Public Trust is the Supervisor and FundRock NZ Limited (FundRock) is the issuer and manager of the Coolabah Investment Funds (Scheme), including the Coolabah Short Term Income PIE Fund, the Coolabah Floating-Rate High Yield PIE Fund, the Coolabah Long-Short Credit PIE Fund and the Coolabah Active Composite Bond PIE Fund. Coolabah Capital Investments (Retail) Pty Ltd ACN 153 555 867 is the Investment Manager.
This has been prepared by Coolabah Capital Investments (Retail) Pty Ltd ACN 153 555 867 (Coolabah), an authorised representative (#000414337) of Coolabah Capital Institutional Investments Pty Ltd ABN 85 605 806 059 AFSL 482238, to provide you with general information only. In preparing this publication, we did not take into account the investment objectives, financial situation or particular needs of any particular person. It is not intended to take the place of professional advice and you should not take action on specific issues in reliance on this information. The Product Disclosure Statement (PDS) for the Fund should be considered before deciding whether to acquire or hold units in it. A PDS for the Fund can be obtained by visiting www.stag.coolabahcapital.com. Neither Coolabah, Equity Trustees nor any of their related parties, their employees or directors, provide any warranty of accuracy or reliability in relation to such information or accepts any liability to any person who relies on it. Past performance should not be taken as an indicator of future performance. The Fund is subject to investment risks, which could include delays in repayment and/or loss of income and capital invested.
AUSTRALIA
SYDNEY
Level 3, 1 Bligh Street, Sydney NSW 2000
MELBOURNE
Level 38, South Tower, 80 Collins Street, Melbourne VIC 3000
UNITED KINGDOM
LONDON
Second Floor, 28 Austin Friars, London EC2N 2QQ
NEW ZEALAND
AUCKLAND
Level 17, 1 Albert Street
Auckland CBD, Auckland 1010