Unity Target Income Fund I
Our first fixed income fund, “Unity target income fund I” private investment fund LLC, has started its operations on July 26th, 2021. The fund operations will continue until September 20th, 2023.
The fund’s investment objective is " To preserve the initial value of the investments and provide an additional annualized target return of at least 1.5% or higher above the benchmark return, which will be calculated as an average time deposit rate of the largest 4 systemically important local banks ".
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The fund will invest primarily in fixed income instruments issued publicly or privately by medium and large institutions with sufficient operational track record and credit strength and relatively a stable operating environment. Whenever it is possible, the fund manager will take an active part in the structuring of the investments.
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As of the 3rd quarter of 2021, the fund’s investment portfolio was comprised of 3 privately placed bonds with an average annual interest rate of 16.7% and average maturity of 8.2 months.
Investment Objectve & Criteria
The fund's objective is a competitive current income linked to the target return while preserving value of the investment capital.
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The fund's investments will be selected but not limited to the following criteria:
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Macroeconomic and sector view will be formulated for the period of the investment period plus up to 12 months, considering key economic indicators, monetary and fiscal policies, growth expectations for an economy and a respective industry if necessary;
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Each investment will be assessed in terms of the issuer's operational sustainability, competitive positioning, cash flow capacity, and availability of the credit enhancements.
Benchmark and Target Return
The fund will use the average annualized 12-month deposit rate of the largest 3 domestic banks as the "Benchmark rate" in the calculation of the "Target return" for its investors.
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The fund's target rate/return will be set as the benchmark rate plus a margin of at least 1.5%.
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At the end of fund life, an extra return above the target will be shared between the fund manager and the investors with a 35/65 split.
Fund Custodian
The Khan bank custodian services department provides custodial services for the Fund.