What are they? What LIT’s have Helm invested in, why do we like them and what risks are involved?
Over the next 3 posts we will be answering these questions to help you get informed and up to speed on LIT’s
With investors clamouring for better income returns than the paltry interest paid on bank cash deposits and TD’s, the world’s top debt managers have obliged with an expanding cluster of ASX-listed funds to give retail ASX investors exposure to a $US2 trillion global fixed interest sector that was the exclusive preserve of institutions (Banks, AMP etc.) and sophisticated investors.
The task was to find quality alternatives to term deposits and cash deposits has just become more acute with the Reserve Bank of Australia’s decision to cut rates by a further 0.25%.
Above: 20 Year Chart of the 90-day bank Bill Rate
Investors have value to gain with higher yields and an avenue of getting exposure to a broader range of assets in a single transaction. There are many benefits to LIT’s which will be discussed further.