Montgomery Investment Management launches retail credit fund

By Penny Pryor

Montgomery Investment Management has launched a retail income strategy via its partnership with Aura Group.

The Aura Core Income Fund is an open-ended fund which invests in a pool of Australian private debt assets including asset backed SME loans.

As banks have focused their lending on large business customers, SMEs have struggled to find credit and look to alternative sources of funding.

It has a minimum investment of $25,000 and it aims to achieve a target return of the RBA cash rate plus 3.5 per cent to 5.5 per cent per annum net of fees and costs.

"The low yields that we have experienced over the last decade from fixed interest and term deposit products have seen many investors seek superior risk-adjusted returns that can be found from non-bank lenders. I am delighted that the Aura Core Income Fund provides our retail clients with a fund that aims to provide stable income from the credit asset class and the investment expertise behind the highly successful wholesale-only Aura High Yield SME Fund," Montgomery Investment Management chairman, Roger Montgomery, said