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    ECOR April 2022 Monthly Report & Update

    • eInvest Core Income Fund performance was negatively impacted by wider credit spreads. Coupon income as well as positive contributions from overlay and hedging strategies were partial offsets.
    • Fund duration has been reduced to zero and we note that when market conditions normalise, this period will give rise to a portfolio with a much higher yield that will benefit investors over time.
    Month (%)Quarter (%)1 Year (%)2 Years (%)Since Inception* (% p.a.)
    eInvest Core Income Fund (ECOR)-0.08-1.46-1.371.490.65
    Daintree Core Income Trust-0.08-1.47-1.391.432.05
    RBA Cash Rate0.
    Excess Return-0.09-1.48-1.471.350.43

    ^ Inception date for ECOR was 22 November 2019 and inception date for the underlying Daintree Core Income Trust was 1 July 2017. Excess Return since inception is measured on the Daintree Trust. Performance shown above are net of fees. To give a long-term view of the fund performance in the asset class, we have shown the returns of the Daintree Core Income Trust. The Trust has identical investments. Fund returns are calculated using net asset value per unit of the underlying fund at the start and end of the specified period and do not reflect the brokerage or the bid/ask spread that investors incur when buying and selling units on the exchange. Past performance is not a reliable indicator of future performance

    ECOR Fund and Investment Objective 

    ECOR is an absolute return, cash plus, investment-grade bond strategy. ECOR is not constrained by any traditional fixed income index, which provides us the flexibility to seek out the best risk-adjusted returns available across regions, sectors and securities.

    The aim of ECOR is to provide a steady stream of income and capital stability over the medium term by investing in a diversified portfolio of fixed income securities and cash. ECOR seeks to produce a return (net of fees) that exceeds the RBA Cash Rate by 1.50-2.00% p.a. within a cycle.

    Key Statistics  
    • Modified duration: 0.00 years
    • Portfolio Yield: 1.92%
    • Average Credit Quality: A
    • Portfolio ESG Score: A
    • Management Cost: 0.45% (incl. of GST and RITC)
    • Inception Date: 22 November 2019
    • ECOR paid a distribution of $0.035 dollars per unit in April 2022

    Fund Review

    eInvest Core Income returned -0.08% for the month net of fees. The fund’s performance was negatively impacted by wider credit spreads which offset coupon income as well as positive contributions from overlay and hedging strategies. On average spreads were approximately 6 basis points wider on the month with weakness seen across corporates, financials and structured credit. However, local A$ cash spreads outperformed both US and EUR investment grade spreads. We have further reduced our interest rate duration to zero from a neutral position of 0.20 years last month, which helped the fund materially given the additional 29 basis point correction seen in Australian 10-year bonds during the month.

    Given our defensive positioning, we did not participate in many new issues during the month, but we did purchase an NBN 2027 green bond as well as a CBA 2027 subordinated deal. We sat out of deals from Toronto Dominion, Volkswagen, OCBC and Bank of Queensland among others. In the structured credit space, we saw new deals from Ruby 2022-1 and Think Tank 2022-1. Goodman and CSL priced deals in the US market.


    After a consolidation in late March, April saw a resumption of the trends apparent since late 2021. Rates markets globally saw yield curves flatten, with the focus on how much and how quickly central banks will act to normalise interest rates. Meanwhile, credit markets are working through the impacts of inflation and spreads moved modestly wider again during the month. In addition, outsized moves in major currencies such as the yen created an additional dynamic that kept investors on edge.

    With the decision of the RBA to increase interest rates for the first time in 10 years, and offering a strong signal that further increases are imminent, Australia has joined much of the world in a concerted push to bring interest rates back to a neutral setting as swiftly as possible. Subject to the evolution of the inflation picture in coming months, we should expect rates to rise at most meetings of the RBA this year, toward an estimated neutral rate around 2.5%. With up to 40% of local borrowers having at least some part of their borrowings fixed, the flow through to the real economy will be gradual.

    In the US, we expect quantitative tightening (ie: the reduction in the Fed’s holdings of Treasuries) to begin in coming weeks in addition to rate increases, which we have held for some time to be the “x-factor”, particularly for financial markets. This will have the effect of removing excess liquidity from the system which given the prominence of the US dollar in global trade and commerce, could have unintended consequences well beyond America’s shores.

    COVID-related disruptions in China and the conflict in Ukraine show us that ongoing supply chain concerns will linger for the foreseeable future. Part of the inflation story can be attributed to these factors, on which tighter monetary policy can have limited impact. In the real economy, employment indicators have positively exceeded expectations, creating upward pressure on wages. This is creating challenges for businesses that are seeing raw material input costs and wage costs rise more quickly than they have for some time, risking margin contraction if these cannot be passed through to consumers.

    Thus, overall we expect volatility to continue and maintain a defensive posture as a result.

    Investment Manager

    Daintree Capital, the investment manager of ECOR, is a boutique investment manager specialising in the construction of absolute return, income generating portfolios. The firm was nominated as a Finalist for the Money Management Fund Manager of the Year Award in the Emerging Manager category for 2019, and ECOR has a ‘Recommended’ rating from Lonsec and Zenith. Daintree Capital is also a signatory to the United Nations Principles for Responsible Investment.

    To read more about eInvest Core Income Fund (Managed Fund) Code: ECOR, click here.

    Interested in purchasing units in the fund? Contact your financial adviser or simply purchase via your online broker, and as always read the PDS for more information. This can be found here. 

    Keen to learn more? Read why Active managers tend to outperform passive fixed income managers.

    Past performance is not a reliable indicator of future performance. Please read the PDS prior to investing. This information is general in nature and is subject to the terms and conditions outlined here.

    The rating issued 02/2022 published by Lonsec Research Pty Ltd ABN 11 151 658 561 AFSL 421 445 (Lonsec).  Ratings are general advice only and have been prepared without taking account of your objectives, financial situation or needs. Consider your personal circumstances, read the product disclosure statement and seek independent financial advice before investing. The rating is not a recommendation to purchase, sell or hold any product. Past performance information is not indicative of future performance.  Ratings are subject to change without notice and Lonsec assumes no obligation to update.  Lonsec uses objective criteria and receives a fee from the Fund Manager. Visit for ratings information and to access the full report. ©2022 Lonsec. All rights reserved.

    The Zenith Investment Partners (ABN 27 103 132 672, AFS Licence 226872) (“Zenith”) rating (assigned 09/2020) referred to in this document is limited to “General Advice” (s766B Corporations Act 2001) for Wholesale clients only.  This advice has been prepared without taking into account the objectives, financial situation or needs of any individual and is subject to change at any time without prior notice.  It is not a specific recommendation to purchase, sell or hold the relevant product(s).  Investors should seek independent financial advice before making an investment decision and should consider the appropriateness of this advice in light of their own objectives, financial situation and needs. Investors should obtain a copy of, and consider the PDS or offer document before making any decision and refer to the full Zenith Product Assessment available on the Zenith website. Past performance is not an indication of future performance. Zenith usually charges the product issuer, fund manager or related party to conduct Product Assessments.  Full details regarding Zenith’s methodology, ratings definitions and regulatory compliance are available on our Product Assessments and at