Investors turning to ‘sturdy’ mortgage trusts

By Reporter
 — 1 minute read

Investor confidence in mortgage trusts is on the rise, with most funds reporting an average increase of 37.5 per cent in funds under management (FUM) for the 12 months to December 2015, says SQM Research.

According to SQM Research’s Annual Australian Mortgage Trusts Sector Review, FUM increased by an average of 37.5 per cent for the year to December 2015.

“Overall, the mortgage trusts on offer to investors have been moulded into sturdy investment products that match the liquidity profile of the underlying loans,” SQM Research managing director Louis Christopher said.


“As a consequence, we have observed that investor confidence in the sector is improving with a net increase in reported funds under management.”

SQM Research's review covered funds from La Trobe, Australian unity and EQT. 

The review found that contributory mortgage structures or mortgage peer-to-peer lenders are increasing their prevalence in the market. Many new products from fund managers such as Australian Unity were released in the market in 2015.

For each of the funds reviewed, returns were reflective of the underlying risks inherit of their mortgage portfolios, the review found. 

While investor confidence was increasing, Mr Christopher said investors needed to be cautious when investing with “less recognised operators”.

“There are still some issues with regard to certain financial products offered by investment product providers on the fringe which have not been properly tested or even researched by a third party.”

Read more:

RBA continues to 'jawbone' Aussie dollar

APRA boss rejects ‘culture police’ tag

Revive superannuation council, says Labor

Telstra Super names new CIO

Japanese equities set to rebound strongly

The ifa Excellence Awards are back in 2021 and nominations are now open!

This prestigious accolade recognises exceptional professionals within the financial advice industry, shining a light on the outstanding achievements from the nation's best and brightest. If this sounds like you or someone you know, then nominate today for the ifa Excellence Awards 2021! ifa.com.au/excellence-awards


Investors turning to ‘sturdy’ mortgage trusts
investordaily image
ID logo


related articles

Website Notifications

Get notifications in real-time for staying up to date with content that matters to you.