Would you invest in credit for an 11 per cent annual return?
That sounds like a risky proposition but Pieter Staelens, portfolio manager of CVC Income and Growth, argues that his investment trust can be a defensive option that spreads risk.
In fact, he says that despite investors anchoring on the rollercoaster ride of the credit crunch and financial crisis, done right investing in credit can be dull and predictable.
And the fund manager adds that ‘when it comes to investing in credit, boring is good’.
On this episode of the Investing Show, Pieter joins Simon Lambert to explain more about the little-known world of credit investing and how the trust allows ordinary investors to profit from backing corporate loans.
He explains the investing strategy that means CVC Income and Growth has delivered an average annualised 11 per cent return over the past five years to investors and currently pays a dividend yield of 7.8 per cent.
Pieter also answers Simon's questions on how risky this is for investors and whether interest rate expectations could dramatically shift returns.
The trust’s share price total return is 25 per cent over the past year and 109.5 per cent over ten years. Ongoing charges were 0.56 per cent in 2024.
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