Newsletter

Spotlight (Kinsted Wealth – Strategic Income Pool)

… key amongst which is that Private lending has significantly grown since the Great Financial Crisis, as banks looked to exit lending activities, they no longer saw themselves fit to manage. Further – well, technology has both powered and empowered many new entrants in the lending space. 

Significant risk adjusted returns can clearly be generated when focusing on specific niches – as demonstrated by the returns produced by Kinsted’s pool. 

Here are the key “visuals” we’d like to point you to: 

• Performance – How well has it done, compared to the broad Canadian Bond Market? 

Answer – has delivered significant outperformance. Yes, one would expect some outperformance, otherwise why invest – but importantly, we all know the Fixed Income environment has been rather challenging in the past 2-3 years.

What does that look like, visually, when contrasted with the “reference index” as accessible via ETF XBB? 

Answer – rather impressive, wouldn’t you say? Steady, from the lower left to the top right of the chart, with notably, significantly less volatility than XBB (XBB being one of the largest ETFs providing exposure to the Aggregate Bond market in Canada).

What are you invested in? 

In other words, what is inside the pool that differentiates / distinguishes it from a broad Canadian Bond market exposure? 

Answer – The Broad Canadian Bond Index is significantly exposed to Canadian Debt, primarily Federal and Provincial, as well as Canadian Corporate debt – with a significant “Financials” industry component. 

In contrast, as shown below, specific exposures are part of the Kinsted pool: such as Direct lending; Mortgage Debt; and Music Royalties.