Fair Oaks Income Investors - FAIR

Fair Oaks Income Investors - FAIR

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Stock Name Stock Symbol Market Stock Type
Fair Oaks Income Limited FAIR London Ordinary Share
  Price Change Price Change % Stock Price Last Trade
0.00 0.0% 0.67 08:00:02
Open Price Low Price High Price Close Price Previous Close
0.67 0.665 0.67 0.67 0.67
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Top Investor Posts

scrwal: FA17 are the default realisation shares - they should be converted to FAIR 2021 shares very soon. Interactive Investor changed mine last Friday. The only problem now is that you can't buy any shares until the new KID is issued - you can sell.
cerrito: Did anyone take the realizatioin share option? I did not. The point that they made in the prospectus about illiquidity of these shares was correct. I went for the realization shares the last time this happened and with all the part realizations it was rather cumbersome. We should learn later today if indeed there was enough demand for the realization shares. I pondered in rather a vague way about buying more but as a £ investor decided I had enough US$ exposure,
davebowler: Liberum; Event Fair Oaks Income Fund's NAV per share at 31 January 2021 was $0.664, representing a 5.3% NAV total return in the month. January's NAV performance benefited from upward revaluations in certain investments with short reinvestment periods. Rising loan prices have increased the liquidation NAV for the equity tranche holders. There is further potential upside for these positions from refi/reset activity. Loan markets were broadly positive in January, with returns of 1.2% in the US and 1.0% in Europe. Loan prices have benefited from rising demand from retail inflows into US loans funds as investors seek floating rate exposure due to a steepening yield curve. 12-month trailing default rates have continued to decline and are now 3.4% in the US (previously 3.8%) and 2.1% in Europe (previously 2.6%). CLO spreads on new issues have compressed further in January. AAA US and EU new issue spreads fell to 1.15% and 0.87% at the end of January compared to 1.32% and 1.06% in the prior month. The positive environment should create opportunities for CLO equity holders to refinance or reset the CLO liabilities at more attractive levels. Master Fund II is nearing the end of its investment period. As previously indicated, FAIR will offer shareholders the opportunity to participate in a new share class that will invest in a new Master Fund, similar to the approach taken by the fund in 2017. The new Master Fund will reinvest principal receipts received from the current Master Fund in a new pool of assets, with a fixed investment period and maturity. Liberum view The tightening of CLO liability spreads is set to continue as investment demand strengthens. In combination with improving fundamentals (lower default rates, rising OC test cushions), the environment for CLO equity and mezzanine returns remains very favourable. Significant refinancing activity is expected in 2021. Equity tranches should benefit from a lower cost of capital, resulting in higher expected IRRs. Debt tranches also offer upside through repayment at par and we note several of FAIR's CLO debt tranches experienced large price increases during January. FAIR's flexible mandate leaves it well-placed to capitalise on relative value opportunities across CLO structures.
cerrito: Davebowler, I have just seen your 478 on the VTA thread covering Liberum on Fair.. A forecast for a 26pc NAV increase caught my eye noting the decent December 20 NAV performance although that the buy price today at 65 is higher than the 311220 NAV. My question to myself is as a £ investor at these exchange rates do I want more US$ assets.
grahamg8: Dividend, yesssss. See post #126. In fact 2.2c in the quarter is higher than the historic 0.7c per month. Another jump in NAV bodes well for an share price rise when the markets open. Although down on capital over my 5 year holding, when the dividends are added back I am in the black, wow. Plus traded out at the end of 2016 and bought back in early 2018 for a little extra return. Overall not too unhappy with the way things have gone. Still disgruntled with the new share issue as I can't help feeling there was a bit of sculduggery in crashing the share price and then almost immediately bringing in new investors at a rock bottom price.
grahamg8: The new investors got a good deal. The existing investors were shafted.
rambutan2: This from SMIF's march commentary: Portfolio Commentary The portfolio looks to take advantage of liquidity premium in credit markets. The managers were not expecting a viral pandemic that would result in the complete evaporation of liquidity across all fixed income sectors. In addition, the gap lower across all bond sectors, in an indiscriminate fashion, had a material effect on the underlying NAV. The forced selling from ETF accounts and margin calls being breached from levered accounts created an unprecedented period as the ‘dash for cash’ left quality assets at depressed valuations. The managers did not capitulate but saw pockets of the market as being oversold, despite appreciating the high level of uncertainty that the pandemic had created. The managers presumed that the velocity and ferocity of the market decline could not continue for too long, and that it created a medium to long term opportunity to replenish the Fund. This was in complete contrast to earlier in the year when the managers were growing concerned about re- investment risk. As a result of this opportunity, and to satisfy investor demand, the Fund issued just over 20m new shares. Market sentiment gradually improved toward the end of the month as medium term buyers emerged to add credit at new enhanced values, although liquidity remains low as many market participants work from home. The managers very selectively added risk, though offers at the quoted levels were difficult to source, indicating an underlying supportive technical backdrop, despite the ongoing uncertainty. As would be expected credit indices posted negative returns across the board in March with the Coco index at -15.13%, Euro HY -13.21%, STG HY -13.19% and US HY -11.76%; CLO markets declines surpassed the vanilla markets as liquidity disappeared. The Fund returned -20.93% during the month. CLO was the biggest detractor from performance contributing -11.05%. Market Outlook and Strategy The managers continue to add selective credit at credit spread levels that could represent the best entry point in years, thereby adding quality yield that will benefit the Fund over the medium to longer term. The managers recognize the global economy is very much in the very early stages of recession, hence the focus will be on high quality credit from the most robust sectors. Default rates are likely to spike and downgrades will be frequent, so the more speculative end of the credit spectrum is likely to perform poorly and will be avoided, despite the high yields on offer.
cerrito: Thanks rambutan2 for your detective work here. I have just caught up with the Dryden webinar which I thought was very good and reccomend people listen to it. Interested in the comment that until last Friday at least there had been no forced sellers; not surprised that they commented more than once that the market had bifurcated between high and low grade;were bracing themselves for an increase in their CCC exposure due to downgrades. The way I heard it was that they went into this with 15%CCC and reckon this will peak at 25/37%; also increase in defaults which for the European book started out at zero and will peak they estimate at 6/7%...although not clear if this was a payment default or a technical one; bid/offer trading spreads on high quality was between 2 to 3 and low quality between 5 and 10-no surprise for me there. There will be a time to get back into FAIR-though as a sterling investor I need to be aware of cable. I think it will fall further,
rambutan2: Hunting for any info/insights, so signed up for this with no hassle: FAO all European Dryden CLO investors: PGIM will be recording and uploading a market update that all current Dryden CLO investors are invited to download and listen too. The webinar will be available Friday 3rd April at 10am. Please find attached the webinar registration link below. https://investegate.co.uk/dryden-48-euro-clo--irsh-/rns/european-dryden-clos---investor-update/202004011635424752I/
rambutan2: SMIF today: Company Update The credit market has endured significant volatility over the past month as market participants have reacted to the economic uncertainty brought about by the effects of the Covid-19 pandemic. Forced and indiscriminate selling has resulted in unprecedented volatility that in turn has created the opportunity to source assets that have been otherwise unavailable to investors for almost a decade. The higher yields available for selective credits in the current market have enabled the Board of Directors of the TwentyFour Select Monthly Income Fund to approve the issue of 20.9m new shares to meet specific investor demand. The estimated mark-to-market yield of the portfolio as at Close of Business 25th March 2020 is 13.01% based on NAV (gross, GBP hedged, current yield-to-worst). https://investegate.co.uk/twtyfr-selmth-inc-fd--smif-/prn/company-update/20200330155554PCB4D/
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