A financial services institution has helped to address a gap in the investment products available to Australian investors with the launch of its new 90 Day Notice Account.
The addition to La Trobe Financial’s investment product suite offers short to medium duration investments at an initial investment rate of 3.10% per annum paid monthly, providing investors with regular income, and allowing them access to their funds with 90 days’ notice.
The offering fits between La Trobe’s existing 48 Hour (2.6%) and 12 Month Term (5.20%) products in terms of yield and duration.
“For the past several years, we have been aware of the challenges that investors face in generating a reasonable income in a hyper-low rate environment. The pain is particularly acute for investors who remember paying record high interest rates on their home loans, only to have savings rates plunge as they enter into retirement,” explained chief investment officer, Chris Andrews.
“As we have stated repeatedly over the last five years, we believe that this current low interest rate environment will persist for years to come and it is critical that investors take steps to identify alternative income sources.”
According to Andrews, the new offering has been built upon the process and disciplines on which each of its investment products rely.
“By investing in carefully selected, highly diversified portfolios of low LVR, mortgage-secured loans, history shows that we can deliver highly robust and resilient portfolios that deliver capital-stability and stable monthly income,” he said.
“Our 67-year track record across many business cycles has taught us that a return of capital is just as critical as a return on capital; we have taken that lesson very seriously in designing this 90 Day Term Account.”
La Trobe CEO, Greg O’Neill OAM, noted the difference in the financial environment from when its retail offering first launched in the early 1990s with the official cash rate sitting at 17%, as compared to today’s 1.0%.
“We are delighted to produce this timely product addition to further benefit investors in our Credit Fund,” he said.