The importance of diversification

Some surprises are good: perhaps a surprise birthday party, or finding a $20 note in your coat pocket. Others are not so good: stock market crashes, or being caught out by a failing investment.

There are things you can do with your investment portfolio to help minimise the impact of any bad surprises. To ensure that the surprise of one investment’s sudden underperformance does not negatively affect the entirety of your investment portfolio. And that is diversification.

Not putting all your eggs in one basket is an adage as old as time. In investment terms, this means placing your investments across a range of assets and asset classes to protect against market movements. Diversification need not be complex, but it can help you avoid those ‘bad’ surprises.

Most investors will already know to hold targeted exposures across a range of sectors such as shares, property, cash, and fixed income products like bonds or property credit. But how many actually practice this? Given the volatility in markets, now might be the perfect time to reflect on your investment holdings and make strategic allocations towards a fully diversified portfolio.

At La Trobe Financial, we hold a deep conviction in the performance of highly diversified portfolios of granular exposures across Australian property credit. As you saw in our recent update, our Credit Fund of $9.3 billion (February 2023) comprises 12,640 loans with an average loan amount of $694,542 and an average loan-to-value ratio of 64.8%. With assets spread geographically around Australia, and across a range of asset classes, our commitment to diversification has seen our flagship 12 Month Term Account referred to by one ratings agency as the most diversified in its sector.

Investment rates on the move again

Through our careful selection of high-quality, highly-diversified assets, we are able to announce a further increase in our portfolio investment rates.

Effective 1 April 2023, changes to our portfolio accounts will be updated as follows:

At La Trobe Financial, our 500 fully trained staff are led by a team of professionals who are immensely proud of our impeccable performance across three decades of the Fund. No investor has ever lost a cent of capital in our portfolio accounts and we remain driven to ensuring that experience is repeated for decades to come.

*The rates of return on your investment will be effective from 1 April 2023. The rates of return are reviewed and determined monthly and may increase or decrease each month. The applicable distribution for any given month is paid at the start of the following month. The rates of return are not guaranteed and are determined by the future revenue of the Credit Fund and may be lower than expected.

An investment in the Credit Fund is not a bank deposit, and investors risk losing some or all of their principal investments. Past performance is not a reliable indicator of future performance. Withdrawal rights are subject to liquidity and may be delayed or suspended. Visit our website for further information.

La Trobe Financial Asset Management Limited ACN 007 332 363 Australian Financial Services Licence 222213 Australian Credit Licence 222213 is the responsible entity of the La Trobe Australian Credit Fund ARSN 088 178 321. It is important for you to consider the Product Disclosure Statement for the Credit Fund in deciding whether to invest, or to continue to invest, in the Credit Fund. You can read the PDS and Target Market Determinations on our website www.latrobefinancial.com, or ask for a copy by calling us on 1800 818 818.

#We will make every endeavour to release your funds 2 business days for the Classic Notice Account, 90 days for the 90 Day Notice Account and 180 days for the 6 Month Notice Account, after receiving your redemption request. We however have 12 months under the Fund’s Constitution to honour that request. In determining whether to honour your redemption request within 2 business days for the Classic Notice Account, 90 days for the 90 Day Notice Account or 180 days for the 6 Month Notice Account we have to have regard to the Fund’s cash position and the best interests of all investors. There is a risk that a redemption request will not be honoured within 2 business days, 90 days or 180 days. However, there has never been a case in the history of the Fund when we have not honoured a redemption request on time due to a lack of liquidity.

To view our awards and ratings, please visit the Awards and Ratings page on our website.

La Trobe Financial Services Pty Limited ACN 006 479 527 Australian Credit Licence 392385.

To the extent that any statement in this email constitutes financial product advice, that advice is general advice only and has been prepared without considering your objectives, financial situation or needs. You should, before deciding to acquire or to continue to hold an interest in the La Trobe Australian Credit Fund, consider the appropriateness of the advice having regard to your objectives, financial situation or needs and obtain and consider the Product Disclosure Statement for the Fund.

© Copyright 2023 La Trobe Financial Services Pty Limited ACN 006 479 527. All rights reserved. No portion of this may be reproduced, copied, or in any way reused without written permission from La Trobe Financial.

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