NEWS


ACORN CAPITAL EXPANSION PLATFORM ASSIGNED A 'VERY STRONG' INVESTMENT RATING BY AUSTRALIA RATINGS
Friday, May 04, 2018


Melbourne, 4 May 2018 -  Australia Ratings has assigned a ‘VERY STRONG’ investment rating to Acorn Capital Expansion Platform - the Platform comprising Acorn Capital Expansion Fund (ACEF) and Acorn Capital Expansion Trust (ACET).

A VERY STRONG investment rating indicates a very strong conviction that the Platform can deliver a risk adjusted return in line with the Funds’ investment objective - based on our investment rating scale to indicate how well we believe a fund will perform against a range of risks.

Acorn Capital Expansion Platform is managed by Acorn Capital Limited; and ACEF and ACET are to launch in May 2018. 

The Platform will primarily invest in innovative emerging Australian unlisted companies that are at early/expansion stage of development and with an objective for each fund to generate 20% in returns.  The Manager is looking to invest all the committed capital for both funds within 4 years, to return all committed capital within 5 years, and to exit any remaining investments in an orderly manner thereafter. The maximum term of each of ACEF and ACET will be 10 years.

Australian Ratings believes that ACEP (and either of its constituents, ACEF and ACET) represents a good access point for exposure in innovative and emerging Australian private companies.

The lack of research coverage of unlisted innovative Australian companies can be a potential source of enhanced returns and the upside can be large. However, for all of this potential, a disciplined approach by industry specialists is undoubtedly required.

Australia Ratings believes that investments in ACEF or ACET will be appropriate for high net worth individuals, substantial self-directed superannuation funds and established family offices, to form part of a balanced, diversified portfolio. Investment in the securities of these entities should, however, be considered as a long-term investment.

As new investment structures, both ACEF and ACET do not have any past performance. However, the Manager has significant experience and track record in investing in unlisted assets.

Australia Ratings has also assigned its Product Complexity Indicator (PCI) of ‘YELLOW’ indicating the fund as a complex financial product, with investment managers seeking to outperform their chosen mainstream market sector.

A full rating report is available from www.australiaratings.com/.

FOR MORE INFORMATION CONTACT:

Daniel Liptak, Director
daniel.liptak@australiaratings.com
03 8080 6684

ABOUT AUSTRALIA RATINGS

Australia Ratings is a local, independent rating agency that provides timely and credible ratings information and research to the broader investment community.As an ASIC-licensed rating agency, we provide general advice by issuing credit ratings on debt securities and companies; and fund ratings on Australian managed funds.We are Australia’s only agency that holds a retail Australian Financial Services Licence (AFSL). This enables both retail and wholesale investors to use our credit ratings to help them gauge credit risk and complexity of financial products sold in the Australian market.

Rating opinions of Australia Ratings are determined by its analytical team in accordance with its rating methodology. The Board of Australia Ratings whose members include Jarrod Brown, Chris Dalton and Mike Dontschuk oversee the application of Australia ratings rating methodology and the integrity of the rating process.

About Australia Ratings’ Investment Rating

Our investment rating reflects Australia Ratings’ current opinion of a fund’s or an investment’s ability to achieve its stated investment objectives in the near term.The rating expresses a view on the expected consistency of the fund’s or investment’s performance within its peer or style group and on the fund manager’s ability to produce superior performance amongst its peers in the near term with due regard to the medium-term consensus view of the asset class to which the product is benchmarked.

A five-point scale is used to differentiate our opinion on how well we believe a fund will perform against a range of risks.


About the Product Complexity Indicator

Our proprietary colour-coded product complexity indicator (PCI) highlights the complexity level of an investment by its terms and conditions’ structure and transparency that may affect an investor’s return.

 

 


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