- Ground-breaking corporate credit fund continues to outpace
competitors and benchmarks, highlights "Reverse T.I.N.A"
market
NEW
YORK, Nov. 18, 2022 /PRNewswire/ -- The
Alternative Credit Income (the "Fund") (tickers: RCIIX, RCIAX,
RCIWX, RCICX, RCILX), a closed-end interval fund, marked the second
anniversary with its Investment Advisor, BC Partners. Leveraging BC
Partner's proprietary access to institutional-level private deals,
the Fund has outpaced fixed income indices and competing
funds.
As of November 1, 2022, the Fund
generated a cumulative return of 19.65% under BC Partners.
Cumulative returns for fixed income benchmarks over that timeframe
include the Barclay's U.S. Aggregate Total Return Value Index
(-15.98%), the Morningstar LSTA Leveraged Loan Total Return Index
(+6.68%) and the Bank of America High Yield Index
(-2.15%).1
"Shifting monetary policy and changes in market structure,
though challenging for traditional fixed income in recent years,
have acted as tailwinds for alternative credit investors," said
portfolio manager Mike Terwilliger.
"By navigating this market context, our Fund is the top performing
corporate credit interval fund amongst our peers and has outpaced
all relevant fixed income benchmarks since joining BC Partners in
2020."2
Ted Goldthorpe, CEO of BC
Partners Credit added, "We continue to capitalize on our
proprietary pipeline of directly originated deals, and as public
markets have sold-off we are now also seeing opportunities that
would have been inconceivable just twelve months ago. Few times in
my career have provided such an attractive backdrop for credit
investing."
The Fund's focus on delivering competitive returns to investors
as well as reducing volatility, has helped generate a 3.53% Sharpe
ratio under BC Partners.3
"People may recall the adage T.I.N.A. or There is No Alternative
to describe investors plowing money in stocks over the previous
decade when rates were at rock bottom levels. Now, with equity
market valuations remaining lofty, traditional fixed income
un-investable as interest rates marching higher, we would
characterize the current market as 'T.I.N.A in Reverse.' Investors
must expand their use of non-traditional credit and private
credit in their portfolio—There Is No Alternative."
The Fund has outperformed relevant fixed income benchmarks on a
1-, 3- and 5-Year basis as of date:
Identifier
|
Name
|
1
Year
|
3
Year
|
5
Year
|
Since First
Investment
|
Since
Inception
|
RCIIX
|
Credit Income
Fund
|
-1.64 %
|
5.58 %
|
5.32 %
|
7.02 %
|
6.48 %
|
LBUSTRUU
|
Barclays US Aggregate
Index
|
-15.68 %
|
-3.77 %
|
-0.54 %
|
0.27 %
|
0.20 %
|
SPBDAL
|
Morningstar /LSTA
Leveraged Loan Index
|
-1.78 %
|
2.71 %
|
3.07 %
|
3.82 %
|
3.35 %
|
*YTD through 10/31/2022
**Data represents performance as of the date the Fund
started actively investing as of 10/27/2015.
***Inception date of the Fund is 4/17/2015.
The Bloomberg Barclays U.S. Aggregate Index is a broad-based
flagship benchmark that measures the investment grade, U.S.
dollar-denominated, fixed-rate taxable bond market. The index
includes Treasuries, government-related and corporate securities,
MBS (agency fixed-rate and hybrid ARM pass-throughs), ABS, and CMBS
(agency and non-agency).
The S&P/LSTA Levered Loan Total Return Index is a
market-value-weighted index designed to measure the performance of
the U.S. leveraged loan market based upon market weightings,
spreads, and interest payments.
About the Advisor
Sierra Crest is an affiliate of
BC Partners Advisors L.P. ("BC Partners"), which has an over
30-year history investing across Europe and North
America and has approximately $60
billion in assets under management in private equity,
private credit and real estate strategies. BC Partners operates a
private equity investment platform, a credit investment platform
("BCP Credit") and a real estate investment platform as fully
integrated businesses. Sierra
Crest's investment activity takes place within the BCP
Credit platform. Integration with the broader BC Partners platform
allows BCP Credit to leverage a team of investment professionals
across its private equity platform including its operations team.
BC Partners has remained an independent partnership since its early
days as a pan European private equity manager. Its entrepreneurial
spirit is ingrained in the culture of its organization and evident
across its three complementary and integrated businesses.
Media Inquiries
Simren Priestly, Head of Communications
E: simren.priestley@bcpartners.com
T: +44 20 7009 4722
Appendix
You cannot invest directly in an index. Performance data quoted
represents past performance. Past performance does not guarantee
future results and investment returns and principal value of the
Fund will fluctuate so that shares, when redeemed, may be worth
more or less than their original cost. Current performance may be
higher or lower than the performance data quoted above. For
performance information current to the most recent month-end,
please call toll-free (833) 404-4103 or visit www.AltCIF.com.
Total Return measures net investment income and capital gain or
loss from portfolio investments. All performance shown assumes
reinvestment of dividends and capital gains distributions. The
Total Annual Fund Operating Expense as disclosed in the prospectus
dated December 16, 2020: RCIAX
(4.64%), RCICX (5.39%), RCIIX (4.38%), RCIWX (4.38%), RCILX
(4.90%). The Advisers have contractually agreed to defer the
collection of fees and/or reimburse expenses, but only to the
extent necessary to limit Total Annual Fund Operating Expenses
(excluding interest, dividend expense, amortization/accretion on
securities sold short, brokerage commissions, acquired fund fees
and expenses and extraordinary expenses) to 2.59% (RCIAX), 3.34%
(RCICX), 2.34% (RCIIX), 2.59% (RCIWX), and 2.84% (RCILX) of the
average daily net assets of the funds through October 31, 2022.
The Fund is distributed by ALPS Distributors, Inc. (ALPS
Distributors, Inc. 1290 Broadway, Suite 1000, Denver, CO 80203). Sierra Crest Investment
Management LLC (the Fund's investment adviser), its affiliates,
ALPS Distributors, Inc., and U.S. Bank, N.A. are not
affiliated.
Investing involves risk. Investment return and principal
value of an investment will fluctuate, and an investor's shares,
when redeemed, may be worth more or less than their original cost.
Alternative investment funds, ETFs, interval funds, and closed-end
funds are subject to management and other expenses, which will be
indirectly paid by the Fund. Debt instruments are subject to credit
risk and interest rate risk and may be subordinated to more senior
debt instruments. BDCs often use leverage to enhance returns and
are subject to interest rate risk, credit risk, and liquidity risk.
CLOs are debt instruments but also carry additional risks related
to the complexity and leverage inherent in the CLO structure. The
use of leverage, such as borrowing money to purchase securities,
will cause the Fund to incur additional expenses and magnify the
Fund's gains or losses.
There currently is no secondary market for the Fund's shares
and the Fund expects that no secondary market will develop. Shares
of the Fund will not be listed on any securities exchange, which
makes them inherently illiquid. An investment in the Fund's shares
is not suitable for investors who cannot tolerate risk of loss or
who require liquidity, other than the liquidity provided through
the Fund's repurchase policy. Limited liquidity is provided to
shareholders only through the Fund's quarterly repurchase offers,
regardless of how the Fund performs. The Fund's distributions
policy may, under certain circumstances, have certain adverse
consequences to the Fund and its shareholders because it may result
in a return of capital, resulting in less of a shareholder's assets
being invested in the Fund, and, over time, increase the Fund's
expense ratio. Any invested capital that is returned to the
shareholder will be reduced by the Fund's fees and expenses, as
well as the applicable sales load. Investments in lesser-known,
small and medium capitalization companies may be more vulnerable
than larger, more established organizations. The sales of
securities to fund repurchases could reduce the market price of
those securities, which in turn would reduce the Fund's
NAV.
1 Source: Bloomberg returns 1/2/2020 through 1/1/2022; Alternative Credit
Income Fund (RCIIX), total return +19.65%; U.S. Aggregate Bond
Index (LBUSTRUU), total return -15.98%; Morningstar/LSTA Levered
Loan Total Return Index, total return +6.68% (SPBDAL); U.S. High
Yield Returns as measured by Bank of America U.S. High Yield Index
(H0A0), total return -2.51%;
2 Source: Morningstar 11/1/2020
through 10/31/2022 Cumulative Return as follows: Alternative
Credit Income I (+19.78%); PIMCO Flexible Credit Income Inst
(+2.99%) Cliffwater Corporate Lending I (+19.12%); CION Ares
Diversified Credit I (+13.11%); PIMCO Flexible Municipal Income Ins
(-10.73%); First Eagle Credit Opportunities I (+10.70%); Lord
Abbett Credit Opportunities Instl (+14.70%); Apollo Diversified
Credit I (+2.90%); Carlyle Tactical Private Credit I
(+13.99%); Invesco Senior Loan Y (+9.86%); FS Credit Income I
(+4.93%); Blackstone Floating Rate Enhanced Inc I (+2.60%);
KKR Credit Opportunities I (-3.02%); BlackRock Credit Strategies
Instl (-2.55%); Palmer Square Opportunistic Income (+5.62%) and
Ecofin Tax-Advantaged Scl Impct Instl (+5.42%).
3 Source: Morningstar 11/2/2020
through 10/31/2022, arithmetic Sharpe Ratio of 3.53
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SOURCE BC Partners