NEW YORK, Nov. 2, 2021 /PRNewswire/ -- The Alternative Credit Income Fund ("the Fund") (tickers: RCIIX, RCIAX, RCIWX, RXICX, RCILX) announced the sixth anniversary of its initial investment on October 27, 2015. Since inception, the Fund has distributed 22 consecutive quarterly dividends, representing $4.14 per share1, providing its investors a consistent, stable income stream.
With a cumulative return of 64.1%, the Fund2 has outpaced its most relevant fixed income benchmarks, including the S&P/LSTA Leverage Loan Index (+32.4%) and U.S. High Yield Index (+49.3%)3.
"Six years ago, the Fund's team recognized the value of providing investors with access to professionally managed, private credit solutions," says portfolio manager Mike Terwilliger. "As predicted, today we are pleased to report that the Credit Income Fund has delivered above–market yields and returns for its investors."
The Fund will also celebrate its one–year anniversary with its new Investment Advisor, Sierra Crest Investment Management LLC, a subsidiary of the global private equity fund, BC Partners Advisor, which acquired the Fund on November 1, 2020.
"We are proud of what the Alternative Credit Income Fund has achieved thus far," said Ted Goldthorpe, CEO of BC Partners Credit. "And, I am even more excited about what the Fund is going to do for its investors going forward. Through the BC Partners platform, the Fund has significant access to directly originated private credit deals, which will help boost returns and lower volatility going forward."
As of September 30, 2021, the Fund (RCIIX) provided a dividend yield of 6.6%4 versus the U.S. High Yield Index yield of 4.1%.
"With yields near historical lows and public market multiples near historic highs," continued Mr. Terwilliger, "the need for private credit solutions like the Alternative Credit Income Fund has never been greater."
As highlighted in the following chart, the Fund has outperformed relevant fixed income benchmarks on a YTD, 1-, 3-, and 5-Year basis:
Since First Investment*
Credit Income Fund (RCIIX)
Bloomberg Barclays US Agg Index
S&P/LSTA Leverage Loan Index
* 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.
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.
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.
Represents dividends paid to Alternative Credit Income Fund I share (RCIIX) investors since inception
Source: Bloomberg. Returns from 10/27/2015 through 10/27/2021; The Fund represents Alternative Credit Income Fund I Share (RCIIX); 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 for RCIIX is 4.38%. 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% (RCIIX) of the average daily net assets of the funds through October 31, 2022.
Source: Bloomberg. Returns from 10/27/2015 through 10/27/2021; U.S. High Yield Index represents the Bank of America U.S. High Yield Index (H0A0)
To calculate the annualized distribution, the Fund's management will annualize the most recent quarterly distribution made to shareholders and divide by the NAV per share as of quarter–end. The annualized distribution represents a single distribution from the Fund and does not represent the total returns of the Fund. Distribution includes a return of capital. Distributions are not guaranteed.