Recommending the Gryphon Capital Income Trust

Simon Fletcher

The domestic Residential Mortgage-Backed Securities (RMBS), and broader securitisation market has historically been restricted to institutional investors. However, the Gryphon Capital Income Trust (GCIT) offers a unique investment opportunity in providing exposure to this market for retail investors.

Proven expertise is almost a requisite in this specialised area of the market. Gryphon Capital Investments (the manager) has existing successful strategies, which it will leverage.

The investment objective of the trust is to provide stable income with a target return of 5.00% p.a. (after fees), payable monthly within target risk parameters.

This product is best recommended for investors looking for diversified exposure to the RMBS asset class with returns that are not typically correlated to equity markets.

Our basis for recommendation on the GCIT is a blend of both subjective and objective analysis of the underlying portfolio and the managers’ background, experience, analytical capability and proven track record.

Based on our research, we believe this product offers investors a stable source of income with the margin being offered over the RBA cash rate considered fair and commensurate with its risk.

Although GCI has a relatively short history of fund performance for the two strategies (2015 and 2016) which form the basis of GCIT, the management and analyst team have proven themselves for at least eight years in managing significant Australian Fixed Income investments and for even longer overseas.

They comprise a highly effective and specialised team and possess all key traits of a successful asset manager. We believe this is unlikely to materially change.

For the above reasons, BondAdviser recommend investors Subscribe to the Gryphon Capital Investment Trust.

The trust is expected to list and commence trading on the 18th of May 2018 at an indicative Net Asset Value (NAV) of $2.00 (issue price of $2.00 per unit). One Managed Investment Funds Limited will serve as the Responsible Entity and Custodian.

You can access our full research below.


About this contributor

Simon Fletcher

Simon Fletcher

Head of Research, BondAdviser

As the Head of Research at BondAdviser, Simon is responsible for managing the research team, delivering the valuation methodology and overseeing the quality and accuracy of all data and research produced.

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